[jack_riminton]

Having worked in a fintech D2C app, the distinction I drew was that there were 2 'products' - the financial product i.e getting 4% return on your money - the digital product i.e the app

The 1st was the real product, the 2nd the nice-to-have

Obviously core tech in banking is infinitely more critical than an app but the point is the same; the tech in banks, unless its 'quant', HFT or ML is not the money maker and therefore won't be paid as such

[mcv]

The app that people use to access their money is absolutely core tech. If the payment infrastructure goes down (or worse: is buggy), that's a massive problem. Banks that don't consider this core aren't keeping up.

[PeterisP]

The thing is, while reliability of payment infrastructure matters, the UX and convenience of it does not as much - "everyday services" are not the core business of the banks (for ordinary individuals, mortgages and consumer loans is, for high net value, investments), they are pretty much a loss-leader that needs to exist but it's neither a major revenue maker nor a determining factor for customers - e.g. they will shop around for the mortagage, and if they get a good deal, they'll switch to another bank without even looking at how convenient their apps are.

Yes, there are some consumers for whom those everyday services are everything and they'll go to some 'app only' bank that does that well and without excessive fees. From the point of a traditional bank, that's not a problem, good riddance - if they don't use other products and aren't willing to pay excessive fees for everyday things, there's no money in having them as customers, and when they'll want to do something profitable (e.g. take a mortgage) they'll come back from that app-only bank as that product (the financial product, not the tech product) is actually competitive.

Note: this is from an EU viewpoint. USA may have a bit different perspective as the regulations there allow quite a lot revenue streams (e.g. bounced check fees) from people with no money and no other products, in EU much of exploitative payment practices have become restricted, so these customers simply become unprofitable and not really desired, the main value of "having them" is that this might help you sell profitable products to them later when they have more money and/or more plans for credit.

[jack_riminton]

Many of our customers didn’t even use the app. They could phone up and get someone to do every action for them. If your product can operate without the app then the app is secondary

[mcv]

Financial transactions by phone? To me, that sounds inefficient, expensive, error prone and insecure. All banks I know provide an app and a website to their users. Having to talk to a person to handle your money is something from the 1980s.

Of course for very specific high-value transactions, it may be useful to talk to someone, especially when it's something that also involves advice, but most people only do that kind of thing two times in their life: for mortgage and pension.

Modern banking does not function without the app (be it web or mobile).

[jack_riminton]

Lol, if you say so!

[Bootvis]

He’s right. If customers are not able to do this themselves through an app, the required headcount would boom and no retail bank would be profitable.

[jack_riminton]

You might want to look at the profitability of the 'app only' banks vs the traditional ones

[mavhc]

What kind of customers are you talking about, investors or normal people?