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The Paradox of Plenty

Part 1: The Long & Winding Road

After decades of transformation, what issues are UK banking technology leaders currently facing?

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This is the first in a series of articles looking at UK banking and capital markets technology. In this series we look at the budgets available to technology leaders in these institutions, their goals and the factors influencing their strategies. We also dig into where these leaders are placing their bets, the obstacles they face in achieving their goals and the actions that leading professionals can take to maximise their success. However, before diving into the detail, we begin by setting the scene and answering the important question of why we decided to investigate this topic in the first place.

The roots of digital transformation in banking and capital markets can be traced back almost six decades, to the opening of the first ATM in Enfield, North London, in June 1967 . This marvel of modern convenience, part of a wider revolution in payments that saw the first electronic interbank fund transfers and card transactions, fired the starting gun on a process of change that accelerated dramatically in the 1990s with the invention of the Internet.

Since then, the pace of transformative change for banks has continued to increase, driven by customers’ demands for greater speed, convenience and personalisation. In the 2000s we saw the first wave of FinTech challengers seeking to dislodge entrenched incumbents with canny, data-driven services and slick interfaces. And, as the technology landscape matured, some of these competitors would become collaborators supporting the ongoing transformation of incumbent banks. This complexity has only been amplified by the more recent entry of the so-called “BigTechs” – like Google, Amazon and Apple – into profitable markets such as payments and lending.

Most recently, as the pandemic forced the world into lockdown, social distancing measures saw offices and branches shuttered. Banks responded with a further rapid swing into digitisation, as they moved at speed to maintain essential day-to-day services for customers. This rapid adaptation demonstrated the resilience of the banking sector in the face of an unprecedented global challenge. It also laid bare areas where providers would need to invest further if they were going to be fit to compete in the world that emerged after COVID-19.

Today then, if you are a technology decision-maker at a banking or capital markets institution, your job has likely never seemed more complex or pressurised as you deal with the competitive pressure to innovate, the growing risk of cybercrime and the changing demands of customers and regulators, all while managing your costs and the resilience of your estate. Indeed, as we move into yet another year of fast evolving regulatory, technological and competitive change, and against a backdrop of crushed valuations for the banking sector globally, pressure on technology leaders to help address the strategic challenges faced by their boards through smart investment and innovation has never been greater.

Recognising the unique and intensifying pressures faced by many of our banking clients right now, we decided to run a survey (see methodology boxout) to find out more about how technology leaders in UK banking and capital markets are responding to these challenges. This article – the first in a series of five in our new “Paradox of Plenty” series – sets the scene for a broader discussion around technology investment trends in UK banking and capital markets.

Taking the temperature – introducing our latest UK banking and capital markets technology survey

In the end, our survey reached more than 150 technology leaders at almost 70 UK organisations covering the full gamut of banking and capital markets activity.

We asked this group of senior decision-makers a series of questions concerning their technology strategies and investments, taking in a wide sweep of critical themes.

This included their engagement with sustainability and new technologies, the ways in which they staff, manage and deliver change, as well as their favoured approaches to innovation and implementation.

With a better understanding of the resources, influences and choices available to them, we have a unique view of how this specialised cohort of industry professionals are thinking about the outcomes they are targeting, as well as the impact they are achieving for their firms as they position for future success.

And what emerges from our study might best be described as a paradox of plenty.

Our survey was run in September 2023 with the assistance of an external B2B survey company called Coleman Parkes. The survey itself was anonymous, reaching 151 senior technology decision-makers at 68 individual banking and capital markets organisations across the UK satisfying a discrete set of industry criteria.

Figure 1 below show the constituency we reached in different dimensions, while Figure 2 beneath highlights the roles and responsibilities of the respondents who answered our survey – 80% of whom held CxO technology titles.

Our respondents represent firms across UK retail, digital and SME banking as well as mutuals and wholesale and capital markets institutions. This includes the UK operations of various US and International investment banks. All were asked a series of questions concerning their technology investments, of which a cross-section of results is presented here.

Figure 1: A wide range of decision-makers from firms across the UK banking and capital markets spectrum.

Source: Deloitte UK Banking & Capital Markets Technology Study 2023 (n=151 respondents from 68 UK BCM firms)

Figure 2: A representative cross-section of senior technology leaders.

Source: Deloitte UK Banking & Capital Markets Technology Study, 2023

As we’ll see, our survey respondents told us their budgets were set to rise with a stronger focus on delivering change, which is great news for those looking to address urgent technology challenges and make their mark. And yet, in many cases, we also found the lion’s share of enlarged budgets going to familiar foundational areas of technology, such as cloud and analytics, where change has been underway for some years now. An over-riding objective for shareholders and, therefore, boards and the C-suite, is to deliver superior customer service at a structurally lower cost base. This is a key driver of investment in the enabling technology areas of data management, cloud, analytics and, increasingly, AI with the advent of the current Generative AI revolution.

The challenge for CIOs and their teams then is how best to manage this complex investment process. Yet “spend more to spend less” can be a precarious balancing act for those making the big decisions. And this is especially true in the absence of a standardised approach to measuring the outcomes of transformation, and in light of the many other internal and external obstacles that tech leaders must navigate along the path to success.

Herein then lies the paradox, since rising investment can be both a blessing and a curse, bringing a wealth of new options and a range of difficult choices.

In deploying their war chests, decision-makers may also find the balance between ‘run’ and ‘change’ harder to strike as they are required to invest both in the foundational elements needed to deliver flexibility and resilience and the wide scale transformational innovation needed to fully exploit the next wave of change. And, of course, the dots must all be joined in a cost-sensitive way that can be tracked and evidenced consistently.

Hence, having established some context, as well as the stakes for the decision-makers who answered our survey, Part 2 of this series will look in deeper detail at the resources available to banking and capital markets tech leaders. In addition to the external factors driving their strategies, we will look at the outcomes they are targeting in response to these myriad challenges.

There is a lot here to consider, but if tech leaders can balance these competing requirements effectively and use their resources to create meaningful impact across their organisations, they can begin to solve the paradox, helping their firms to emerge from the fray better positioned to navigate the path forward with confidence.


  1. Further details on this important first step along the path of banking digital transformation can be found in this article: (Guinness World Records, 19th Aug 2015. Downloaded: 8th Feb 2024)
  2. Survey respondents self-selected the sub-sectors best reflecting the core business of their respective firms. In some cases, these definitions are self-evident. However, in the case of Universal Banks we stipulated firms that blend retail, commercial and wholesale or investment banking services. This sets certain brands apart from the wholesale and investment banking pure players as well as the major UK high street retail players who, following the global financial crisis, largely downscaled or closed their capital markets activities.

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