Australia’s retail and commercial lending leaders are under pressure to show returns on their technology investments and deliver meaningful improvements to customers.

Australian lenders and banks have invested billions in improving their platforms and processes over the past decade – with limited success to date to the underlying cost base. Despite the promises of new technology in financial services embedded in tech-enabled business models, lending costs have remained stubbornly high, while customers continue to demand better, faster service at a more competitive price.

The most successful lending modernisation projects to date have been those designed to release value at key points along the transformation journey while progressing towards long-term goals. Lenders and banks of the future will benefit from a clearly defined roadmap that leverages proven strategies to deliver ROI faster.

Australia’s lending modernisation challenge in numbers

Over the past four years, Australia’s major lenders have experienced:

More investments

$25 billion
total investment spend by major lenders

Australian CEOs with an 'aggressive digital investment strategy'

More competition

non-bank and alternative lenders in the Australian market

total year-on-year decline in owner-occupied mortgages to December 2022

Limited returns

average cost-to-income ratio for major banks in 2022, vs 46.6% in 2018

$148 billion
lending market share lost by majors 2018-22

Transformation roadblocks

While the technology transformation journey is different for every organisation, most experience a common set of challenges that can lead to project delivery issues if left unaddressed. These modernising lending challenges can be broadly grouped into six key categories:

Skills shortages
Change management
Ineffective use of technology
Organisational complexity
Dynamic market conditions
Stakeholder management

Download our report

The future of business and banks lies in modernising technology, financial services and lending– but it’s a large and complex challenge. To find out more and understand how successful organisations on their digital transformation lending journey can achieve their finance technology goals, download our 10-page summary or full report.

How KPMG can help

With over half of all Australian projects destined to fall short of stakeholder expectations, we know how important it is not only to meet an organisation’s overall ambitions but also to deliver demonstrable benefits along the way.

KPMG helps to deliver successful technology transformations that release key 'value drops' along the journey to demonstrate return on investment and meet stakeholder expectations by leveraging:

  • KPMG's Target Operating Model
  • KPMG's Business Capability Map
  • Custom project delivery roadmap
  • Our global network of subject matter experts