Machine Learning

Nordic Banks Move to Digital Services for Competitive Edge

ISG Provider Lens™ report sees banks in the region embracing artificial intelligence, blockchain and other emerging technologies to improve customer experiences

Banks in the Nordic region are looking to modernize and digitize their services in response to the COVID-19 pandemic and emerging competition from FinTechs, according to a new report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2021 ISG Provider Lens™ Digital Banking Services Report for the Nordics finds banks in the region embracing outsourcing services as they look to update their IT systems. The report sees a fierce turf war for banking customers in the Nordics, and in response, banks there are embracing digital technologies.

“Newer Fintech players are challenging traditional banks in the Nordics, like in the rest of Europe,” said Owen Wheatley, lead partner, banking and financial services, for ISG. “As homegrown and global players disrupt the market, traditional banks are attempting to defend their territory by reinventing their digital models.”

The report notes that 90 percentage of the population uses cashless transactions, and about 95 percent of Nordic households having internet access, allowing online competitors to gain a foothold with banking customers. As FinTechs embrace cashless payment models, many traditional banks have seen a drop in their revenues. Some banks have been unprepared for the move to digital technologies.

The report also sees increasing demand from banks for third-party integration services. Banks in the Nordics want IT service providers that can offer commercial off-the-shelf products but also customize them. Banks are interested in deploying artificial intelligence, machine learning and blockchain and are turning to service providers to implement these technologies.

Banks also want to use AI and related technologies to deliver hyper-personalized services to customers, as a way to improve revenue and cut costs, the report adds. Banks in the region see customers as familiar with digital services because government services are already highly digitized.

In addition, banks in the Nordics are moving to replace their core legacy platforms, some of them running on mainframes dating back to the 1980s or ‘90s, the report says. These mainframe platforms have become complex, with banks layering on technologies to accommodate new products and functions. Banks are now replacing mainframes with software-as-a-service platforms and the cloud. Cloud-native platforms support real-time processing and are highly cost effective because they are offered on a pay-per-use subscription model.

The report sees providers offering new approaches to core modernization. Low-code platforms are gaining traction because they can carry out complex tasks and integrations by allowing employees to point and click rather than write code. Low-code platforms also are being integrated with AI and machine learning capabilities.

The 2021 ISG Provider Lens™ Digital Banking Services Report for the Nordics evaluates the capabilities of 22 providers across four quadrants: Core Modernization and Integration Services; Banking Governance, Risk and Compliance Services; Transformational and Digital Banking Services, and Payment and Card Processing services.

The report names Accenture, Cognizant, HCL, Infosys, TCS and TietoEVRY as Leaders in all four quadrants and Capgemini as a Leader in three quadrants.

In addition, LTI was named a Rising Star—a company with a “promising portfolio” and “high future potential” by ISG’s definition—in all four quadrants.

Customized versions of the report are available from Capgemini and Infosys.

The 2021 ISG Provider Lens™ Digital Banking Services Report for the Nordics is available to subscribers or for one-time purchase on this webpage.

For more such updates and perspectives around Digital Innovation, IoT, Data Infrastructure, AI & Cybersecurity, go to

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