The 6^th edition of the world’s largest benchmark report on digital maturity in retail banking, including the banks in Luxembourg, highlights leading digital banking trends, with a strong emphasis on user experience, fully digitalized processes, and the evolution of banking as a platform for auxiliary services.
 

Digital Banking Maturity (DBM) identifies champions and leading practices worldwide

Since its inception back in 2016, each edition of the report has expanded to include a greater number of banks surveyed and a wider range of geographies. In this edition, 349 banks across 44 countries on six continents were surveyed.

We have analyzed 1,005 functionalities for the retail banking in Luxembourg covering three channels – public website, internet banking and mobile banking –  structured into six stages of the customer journey:

• Availability of Information
• Account opening
• Customer onboarding
• Day-to-day banking
• Non-banking services
• Account closing
  

While the previous edition, DBM 2022, highlighted substantial growth in the number of functionalities offered by banks in digital channels, driven largely by the pandemic, the Digital Banking Maturity 2024 report reveals a significant shift among digital leaders. These banks are now focusing on optimizing core processes and functionalities, with a much stronger emphasis on hyper-personalization and the redesign of digital channels to deliver the best possible customer experience. Rather than continuously adding more features to their apps, banks are prioritizing the quality of the user experience over the quantity.

Key conclusions from DBM 2024:

1. The digital maturity of retail banking in Luxembourg still has a long journey ahead
   The DBM 2024 indicates that Luxembourg has been downgraded to the lowest group, “Digital latecomers”. Currently, Luxembourg ranks 30^th out of 44 geographies, with a DBM Index of 34% – significantly below the worldwide average (41%) and far behind the digital champions (60%). Furthermore, the digital maturity gap in Luxembourg’s retail banking sector has widened compared to neighboring countries, as France, Germany, and the Netherlands.
2. Shift from feature overload to streamlined experiences
   Banks have shifted their focus from developing new functionalities in digital channels to investing in personalized customer experiences. The COVID-19 pandemic, with its frequent lockdowns, significantly boosted banks' motivation to offer full services through digital channels. However, this trend has now slowed. The current emphasis is on refining interfaces, simplifying processes, and making digital banking more intuitive to enhance customer engagement. As a result, less-used or obsolete features are being removed.
3. Greater proactivity in supporting, developing, and educating customers
   By using Personal Finance Management (PFM) solutions, banks are increasingly offering a wider range of investment options, automating investment advisory and portfolio management, while also providing financial management tools to assist customers in organizing and monitoring their finances and behaviors on a daily basis.
4. Banks are no longer just banks
   There is a clear investment in solutions that integrate marketplaces, car rentals, ticket purchases for transportation and events, hotel and travel bookings, and personal income tax submissions—all embedded within banks' digital channels.
5. Use of AI is steadily increasing
   Several banks are declaring the use of Artificial Intelligence to enhance efficiency, namely in areas as credit scoring, risk assessment, fraud detection, cybersecurity, customer service, customer behavior analysis, personalized recommendations and process automation.