A traditional bank can launch a digital bank via two approaches – using a brownfield approach or a greenfield approach. The brownfield approach remains the oldest form of digital transformation and still resonates with bank leaders worldwide. However, deploying a complete big-bang strategy can be time and cost-intensive. Moreover, legacy infrastructure enhancements and upgrades can be complex activities.

Banks such as Goldman Sachs, HSBC, DBS, and others have taken a new approach, known as the Greenfield approach to building a digital bank to overcome these roadblocks and challenges. By definition, Greenfield allows the incumbents to break free from existing systems, business models, and talent constraints. Creating a new independent entity from scratch is a process that has a lower cost and a faster way to get new propositions to the market. Using this method, banks can leverage their already existing assets, i.e., their brand, customer data, stability, and existing infrastructure, to create a nimble and agile subsidiary that is cloud-native and uses extensive APIs networks – to provide a hyper-personalized offering to their customers.

Our latest whitepaper, written in collaboration with IBS Intelligence, covers the latest trends in Greenfield banking and our 4-I Framework for enabling banks to structure their digital-only efforts.