{"id":569765,"date":"2025-08-22T12:37:10","date_gmt":"2025-08-22T11:37:10","guid":{"rendered":"https:\/\/ibsintelligence.com\/?post_type=blogs&#038;p=569765"},"modified":"2025-08-22T12:37:10","modified_gmt":"2025-08-22T11:37:10","slug":"how-uk-building-societies-can-future-proof-community-banking","status":"publish","type":"blogs","link":"https:\/\/ibsintelligence.com\/blogs\/how-uk-building-societies-can-future-proof-community-banking\/","title":{"rendered":"How UK Building Societies Can Future-Proof Community Banking"},"content":{"rendered":"<figure id=\"attachment_569768\" aria-describedby=\"caption-attachment-569768\" style=\"width: 300px\" class=\"wp-caption alignright\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-569768 size-medium\" src=\"https:\/\/ibsintelligence.com\/wp-content\/uploads\/2025\/08\/nikhil-sengupta-300x300.jpeg\" alt=\"Nikhil Sengupta, Global Business Development Director 10x banking\" width=\"300\" height=\"300\" srcset=\"https:\/\/ibsintelligence.com\/wp-content\/uploads\/2025\/08\/nikhil-sengupta-300x300.jpeg 300w, https:\/\/ibsintelligence.com\/wp-content\/uploads\/2025\/08\/nikhil-sengupta-150x150.jpeg 150w, https:\/\/ibsintelligence.com\/wp-content\/uploads\/2025\/08\/nikhil-sengupta-100x100.jpeg 100w, https:\/\/ibsintelligence.com\/wp-content\/uploads\/2025\/08\/nikhil-sengupta.jpeg 449w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><figcaption id=\"caption-attachment-569768\" class=\"wp-caption-text\">Nikhil Sengupta, Global Business Development Director, 10x Banking<\/figcaption><\/figure>\n<p>By Nikhil Sengupta, Global Business Development Director, <a href=\"https:\/\/www.10xbanking.com\/\">10x Banking<\/a><\/p>\n<p>In 1775, a group of neighbours in Birmingham changed the future of financial services in the UK. By pooling their savings to help each other buy homes, they undertook a radical act of mutual trust that gave rise to the world\u2019s first building society.<\/p>\n<p>And for 250 years now, building societies have been guided by a \u2018members first\u2019 ethos\u2014a North Star that has enabled them to grow while remaining community anchors, built on principles of collective responsibility and shared prosperity.<\/p>\n<p>But today, the mutuals sector faces a pivotal moment in its history. In the crosswinds of economic volatility and demands for digital-first convenience, they are confronted with an intriguing tension: how to preserve the values that have sustained them for centuries, while adapting to thrive in an ultra-modern digital society.<\/p>\n<p>Building societies have traditionally been cautious about technology investments or infrastructure overhauls, wary of straying away from their members-first ethos. And rightly so \u2013 it\u2019s a caution that has positioned them for long-term stability and stood the sector in good stead during times of volatility in the market.<\/p>\n<p>But with today\u2019s market demanding speed and agility \u2013 and the Labour government\u2019s aim to double the size of the<a href=\"https:\/\/www.bsa.org.uk\/media-centre\/press-releases\/labour-manifesto-aim-to-double-the-size-of-the-co-operative-and-mutual-sector\"> sector<\/a>, now introducing greater scale as a necessity \u2013 transformation has gone from a risky undertaking to a necessity for success.<\/p>\n<p>Luckily, building societies can solve this tension without sacrificing the heritage that has served them and their communities so well for a quarter of a millennium.<\/p>\n<p><strong>The Bedrock of Success: Why Mutual Values Matter<\/strong><\/p>\n<p>Building societies have something big banks can\u2019t replicate. Member ownership means they aren\u2019t beholden to shareholder pressure, so they can reinvest profits into better rates, local initiatives and long-term stability. This model has long fostered trust, and it\u2019s why building societies tend to do so well in times of uncertainty. In a cost-of-living crisis such as the one we find ourselves in today, society\u2019s member-centric models offer an ethical and viable alternative to profit-driven banks.<\/p>\n<p><strong>The Digital Dilemma: Adapting Without Losing Identity<\/strong><\/p>\n<p>When respondents to a <a href=\"https:\/\/ifamagazine.com\/building-societies-rank-highest-for-customer-satisfaction-but-are-failing-to-convert-customers\/\">recent study<\/a> were asked to rank the businesses most likely to act with their customers\u2019 interests at heart, building societies came out on top, with 41% of the vote.<\/p>\n<p>The model works, but in a digital age driven by the desire for speed and convenience, it needs to adapt. The challenge is twofold. Firstly, legacy technology is slowing the speed to market for building societies. One example use case where this is having a particular impact right now is the ability to change savings rates at speed in response to central bank rates.<\/p>\n<p>And then there\u2019s the generational disconnect. Building societies possess just a third <a href=\"https:\/\/ifamagazine.com\/building-societies-rank-highest-for-customer-satisfaction-but-are-failing-to-convert-customers\/\">(32%) <\/a>of market share and are struggling to attract the younger generation of savers. The market share drops to just 24% amongst 18\u201334-year-olds. Mutuals have aging member bases, and they need to adapt to connect with younger generations to avoid stagnation. Historically, when the sector has been stagnant, it tends towards consolidation.<\/p>\n<p>So, adaptation is essential. But the question many building society leaders are pondering is not <em>whether<\/em> to adapt, but <em>how <\/em>to do it successfully without sacrificing the members-first ethos that is the core of their identity.<\/p>\n<p><strong>Bridging the Gap: Balancing Heritage and Innovation<\/strong><\/p>\n<p>I use the word <em>core<\/em> deliberately\u2014because it is at the core that building societies must begin addressing today\u2019s demands. Core transformation is crucial to accelerating product development, cutting costs, and strengthening resilience against cybersecurity threats and service outages.<\/p>\n<p>For example, core transformation can speed up product development cycles, enabling mutuals to proactively launch offerings that reflect the economic realities of their members. It can also empower employees to deliver enhanced customer experiences\u2014whether in-branch, over the phone, or online.<\/p>\n<p>The UK government\u2019s ambition to double the size of the mutual sector adds further urgency. Labour\u2019s manifesto pledge signalled growing recognition that mutuals\u2014with their commitment to financial inclusion\u2014are vital to a fairer economy. But scaling sustainably means tackling the limitations of outdated tech stacks.<\/p>\n<p>Smaller societies, in particular, often lack the resources for standalone tech investment. Collaborative models\u2014such as shared digital platforms or joint ventures\u2014could democratise access to innovation. But building societies can begin to innovate themselves, at the core.<\/p>\n<p>New approaches to core banking, such as the meta core, can enable building societies to overcome the challenges of legacy cores and avoid the complex set-up and scale challenges of neo cores. What this means in practice is that mutuals can harmonise in-branch and digital experiences and cater to the changing needs of members at a massive scale, while reducing risk and cost.<\/p>\n<p><strong>A 250-Year Vision: Collaboration as the New Radicalism<\/strong><\/p>\n<p>250 years ago, building societies revolutionised finance through collective action. Today, that same spirit of collaboration is key to their future. The path forward is clear: mutuals must evolve now to preserve their role as community anchors for the next quarter-millennium. This means embracing technology that amplifies their values, forging partnerships that extend their reach, and educating younger generations about the power of member-owned finance \u2013 something which mutuals like <a href=\"https:\/\/www.westbrom.co.uk\/about-us\/news-and-media\/news\/2025\/west-brom-building-society-announces-major-digital-transformation-with-10x-banking-and-deloitte\">West Brom Building Society<\/a> are already acting on.<\/p>\n<p>As the Labour government\u2019s manifesto commitment to double the sector highlights, the wind is shifting in mutuals\u2019 favour. There are challenges to overcome\u2014but beyond them lies vast opportunity, enabled by fresh approaches to core technology and the vision to act on them.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Nikhil Sengupta, Global Business Development Director, 10x Banking In 1775, a group of neighbours in Birmingham changed the future of financial services in the UK. By pooling their savings to help each other buy homes, they undertook a radical act of mutual trust that gave rise to the world\u2019s first building society. And for [&hellip;]<\/p>\n","protected":false},"author":35621,"featured_media":569768,"template":"","categories":[11395],"tags":[26892,31078,12965,13207,11409,35898,11406],"class_list":["post-569765","blogs","type-blogs","status-publish","has-post-thumbnail","hentry","category-analytics","tag-10x-banking","tag-community-banking","tag-community-banks","tag-digital-adoption-at-speed","tag-digital-transformation","tag-fintech-solutions","tag-uk"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.9 (Yoast SEO v24.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How UK Building Societies Can Future-Proof Community Banking<\/title>\n<meta name=\"description\" content=\"In 1775, a group of neighbours in Birmingham changed the future of financial services in the UK. 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