Debanked: Europe’s ING Bank, Commerzbank to Slash Jobs, Go Digital

Europe is debanking.

Last week, two large European banks — ING and Commerzbank announced they are slashing jobs and spending the savings on digitizing its their businesses.

Amsterdam-based ING Bank will slash 7,000 jobs, around 3500 jobs in Belgium and another 2300 in the Netherlands. The savings ( around 900 million euros in five years) under the bank’s ‘Think Forward’ strategy, will be used to migrate to a single integrated banking platform in the Netherlands and Belgium. Separately, ING will also invest 800 million euros in digital initiatives over the next five years.

“Customers are increasingly digital and bank with us more and more through mobile devices. Their needs and expectations are the same, all over the world, and they expect us to adopt new technology as fast as companies in other sectors,” said CEO Ralph Hammers in a statement.

ING is not alone in marching towards technology; Germany-based Commerzbank also said that it will slash approximately 7,300 jobs over the next four years and spend 700 million euros annually on technology under its  ‘Commerzbank 4.0’ strategy. Later this month, the bank plans to roll out ‘One,’ an integrated sales interface, enabling the bank’s sales staff and customers to interact and transact on the same platform and by 2020, it aims to have 80 percent of its relevant business processes digitized.

“It is inevitable that the various measures and intentions announced today may have a significant impact on many of our colleagues. It means some functions will change significantly in nature,” said Hammers.

The move from major banks is coming at a time when fintech is heating up — Europeans startups raised $348 million (£238.2 million) in the first quarter of the year, up from $337 million (£230.6 million) in the first three months of 2015. And with banks deciding to go lean, it could only open up the opportunity for more collaboration than competition among banks and startups.