ING Customer Experience Centre

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Ignacio Juliá VilarChief Innovation Officer, ING Group

• Competitors come out of restructuring

• Focus on capital conservation + cost reduction

• Exiting subscale and capital-intensive business

• Some peers have more ambitious targets than ING

• Contact has moved massively to digital

• Expectations keep rising; people are more willing to shop around

• As branch visits become more infrequent, building our digital offering is key

• Corporates no longer want to depend on banks for payments

• Mid-corps increasingly considering non-banking players for core banking products

• Hard to reap benefits from regulatory environment, due to lack of European harmonisation and local regulatory deviation

• Capital requirements continue to increase

Customer Behaviour

CompetitiveLandscape

Technology Fintech

Regulations

• Technology is enabling new breed of competition and new business models

• 30% of bank income is at risk from fintech competitors

• Focus is on pain points: overcharging, underserving the customer

Developments moving faster than expected

• Trust in banks remains low• Still bigger trust in

established brands• Banks still trusted more

than others to protect data

Society

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Innovation is a key priority in the Think Forward strategy

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A few of ING’s own innovations

Peer-to-peer payments app TWYP> 280,000 users in Spain and the Netherlands

One-stop-shop platform Moje ING

Mobile payments solution Payconiq: successful in Belgium

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8New products New features Maintenance, mandatory projects

Project Change Portfolio

Launch in market

PACE Innovation Approach

BUILD MEASURE LEARN• Low budget and stage gated funding• Ongoing experimentation to validate

your business model

MVP

… Towards new way to develop innovation projects (PACE)

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Benoit LegrandHead of Fintech, ING Group

ING’s approach to the fintech revolution

Benoît Legrand – Head of FinTech

Press meeting

Amsterdam, 17 June 2016

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Today, the status quo is no longer an alternative

35-40%

(1)

Revenue at riskfrom

fintech

(1) Sources : Accenture – Mc Kinsey

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Are banks fit enough to… adapt?Are fintechs fast enough to… survive?

The 4P’s of cooperating with FinTechs

1.Priorities : should be set and communicated clearly internally

2.Processes : simplify processes to enable fast, actionable decision-making

3.Principles : cooperating with fintechs is a mean not an aim to achieve a strategy

4.Performance : ability to assess performance, pivot, fail fast, learn and start again

Eventually, it all comes down to sharing values and vision

ENABLERSINNOVATION PRIORITIES

With more than 12.000 fintechs worldwide, we need to focus on ING Strategy and Innovation Priorities

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Retail/SB Bankwide Wholesale

ING principles for fintech partnerships

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A means to implement faster and better the Bank’s strategy‘A fintech is a company which provides an innovative/disruptive product or service that is of added value within the financial service industry AND does not have a relationship with ING yet’The Partnership with a fintech is neither a Venture Capital nor Private Equity activity

The Business is ultimately responsible We aim to maximize the number of potential partnerships reviewed with a quick turnaround process to evaluate the strategic rationale. We should only establish a partnership when the Business confirms a strong commitment to take ownership

All deals are by default booked centrally and administered with Corporate InvestmentsStandard templates/documents are available and timelines have been defined to speed up fintech onboarding

The process leverages as much as possible the existing ING teams/competences and governance

Fast-track processes

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= test a solution for a limited period of time

Proof of concept / Pilot with a fintech

= ING provides funding to a fintech that provides an innovative/disruptive product or service of added value within the financial service industry and does not have a relationship with ING yet

Equity and equity-like investments in a fintech

Investments in Venture Capital / Private Equity Fund= ING provides funding to Venture Capital / Private Equity funds focussing on fintech investments

NOTE: After the successful POC/pilot, the business can either invest in the fintech company or have a standard supplier relationship.

Target : 4 weeks

Banking will more and more be like oxygen…

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« The main challenge of the digital revolution is not digital… it is human

and cultural »

Thank you

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Pieter-Paul van den Hoven

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Etienne Tatur

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Frans van Hoogstraten

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Niels Corver