Carlos Abarca, Chief Information Officer, TSB tells Scott Thompson about the bank’s migration to the new Proteo4UK IT platform, the launch of its new mobile app and straddling the digital and physical banking divide
Your new mobile app is the first new service built by the Proteo IT platform. Could you tell us about the decision to build the platform following the Sabadell acquisition and benefits that are coming from it?
Carlos Abarca: We are building a bank for the 21st century, with digital at its heart. As part of that, we are migrating to our new Proteo4UK IT platform, which will not only liberate TSB from our current legacy systems but also make us more agile. This will accelerate our ability to make banking better for all UK consumers and provide opportunities for us to become more innovative in responding to our customers’ evolving banking requirements.
Put simply, we will be a digital business that just happens to be a bank. The decision to develop the Proteo4UK platform for TSB was simple. The Sabadell Group’s Proteo platform is more modern and digital friendly than our current legacy systems and provides a unique opportunity for us.
Customers have already had their first opportunity to experience the new platform through the launch of TSB’s new mobile app earlier this year. We collaborated with customers, design agencies and TSB Partners to design the app, and we’ve been making regular tweaks to it since launch, which demonstrates our ability to react quickly and effectively to our customers’ feedback.
The new platform will also reduce TSB’s costs considerably; with the contractual increase of more than £100 million in outsourcing fees that we’re paying to Lloyds Banking Group this year being reversed in future years.
Separating large, complex banking systems is no easy task. What have been the key challenges and issues and how were they overcome?
CA: Migrating IT systems is always a challenge and preparation is the key to success, together with people.
We have the experts in our corner; we know what we’re doing and we have the right people for the job. For example, we’ve had more than 200 TSB Partners working on migration since 2016 and around 800 software engineers working on building the new banking platform. We’re using 70,000 different test cases to make sure everything works as it should. Building and testing our new banking platform will take around two million hours of effort – that’s equivalent to 1,200 years for one person.
We’re making great progress so far; we’ve built Proteo4UK, kicked off training, opened our first account, installed our first new ATMs, processed our first Faster Payment and started to roll-out new IT equipment to our branches and offices.
What would be your advice to other banks looking to go down this route?
CA: Digital is not just about technology. It’s more about having the right culture and mindset, such as being agile and collaborative. For example, we collaborated with customers, agencies and TSB Partners on the development of our mobile app to make it better.
Furthermore, having a strong central team and making use of the best subject matter experts around you is really important. You also need high planning capabilities, to prepare a phased approach for migration so that you can prove that each new stage is fit for purpose before you cut the rope.
Going back to the mobile app, what are the key features and what has been the customer reaction thus far?
CA: Customer feedback about the first version of our mobile app has been really useful for us. Our mentality is one of constant improvement, with customers’ feedback at its heart. What this means is that we’ve been making regular tweaks to our app and the updates have been based on what our customers tell us they like or would like us to do better. In the digital era, being able to listen to customers’ feedback and using it to design future versions, adapting and improving quickly, is the only way to satisfy our customers’ needs.
In terms of the key features, the new app is much improved on its predecessor and has a more user-friendly interface. Day-to-day banking is simplified with fingerprint login for enhanced ID security, the inclusion of the available balance checker, a currency converter for holiday money, a tool that enables you to book mortgage appointments, and improvement to make it easier to manage standing orders and direct debits.
And as I mentioned earlier, we’re making regular tweaks so, for example, customers will soon be able to request overdrafts or eSavings at just one click.
The mobile app will in future integrate with third party apps and services from FinTech startups, with the aim for it to become truly integrated with customers’ digital lifestyle. Could you tell us more about this?
CA: We’re working hard on this, but I can’t tell you much at the moment. However, what I can say is that we will collaborate with our shareholder Sabadell Group, with the FinTech environment, and with some well known partners such as Samsung. Stay tuned to your screens.
Many of your challenger rivals are digital-only ventures, but you promote great face-to-face service combined with state-of-the-art digital banking. Is this the best model going forward or will branches eventually die out, as many industry observers are predicting?
CA: Digital brings enormous benefits to banking, but there are also times when only face-to-face will do. That’s why TSB is part way through a multi-million pound investment programme in branch and digital banking services, helping customers get the best of both worlds; great face-to-face service combined with digital banking. The way people bank is changing fast and our investment programme is about getting the balance right.
In just two years, we have completed over 150 branch refits and refurbishments and nearly 40 branches have received six-figure upgrades. In addition, at the end of last year we opened brand new flagship branches in Aberdeen and Birmingham.
This balanced approach offering customers the choice of face-to-face or digital is working well. TSB was named Britain’s most recommended High Street bank in 2016 (benchmark study, covering all major banks, conducted by BDRC Continental; sample 15,000 UK consumers, November 2016) and recognised as the best High Street bank for service by Which?
What can we expect to see next from the Proteo platform?
CA: We’re completely focused on migrating to our new IT system at the moment. Lots of milestones have already been completed, with many more to come. Some things that are happening are more visible to customers, such as the mobile app and from now on through to the end of the year, we’ll update the mobile app at least a couple more times. Other milestones are about making sure everything runs smoothly in the background.
Another thing coming up is the introduction of a new Mortgage Sales and Originations (MSO) system, which will provide us with market-leading sales and originations functionality, enabling us to provide a differentiated level of service. The software will be ready to roll-out to our mortgage intermediary team later this summer, followed by a phased roll-out to our direct channels. This will allow our service to brokers – and subsequently to our own customers – to be so much faster.
About me: Freelance journalist specialising in FinTech, banking technology and retail technology. Former Editor of FStech, Retail Systems and IBS Journal. Further info here.