February 11, 2023 / VOLUME NO. 248

Where One Superregional Invests in Technology

The PNC Financial Services Group has spent the last three years rebuilding the underlying technology that powers its consumer banking group, said William “Bill” Demchak during the keynote conversation last week at Bank Director’s 2023 Acquire or Be Acquired conference

His comments show how one superregional bank — in the wake of a massive acquisition — is investing in technology to improve the customer experience and control costs. Over the last three years, PNC has focused on “a complete rewrite of everything we do that deals with the consumer,” Demchak said.

This reconfiguration, which the bank internally calls “ready to scale,” features real-time data layers that generate real-time information. All of the bank’s online and mobile applications, along with its ATMs, are cloud native and leverage application programming interfaces, or APIs. APIs allow for quick integration with a company’s existing technology systems. One place the bank used APIs was to integrate its mortgage product built by a third party directly into its system. 

“In a modern stack, you’re literally connecting APIs that have all the information you need,” he said. While “that all sounds fancy and charismatic,” it allows branch and care center employees to make updates quickly — such as moving a checking account around on the interface, linking accounts or correcting a misapplied payment — simply by clicking their mouses. That eliminates the time and expense of sending requests to back-office staff when retail staff couldn’t fix certain customer problems. 

“It’s our attempt to get control of the cost side of retail, which is what’s killing our business right now,” he said.

APIs are key to PNC’s ready-to-scale retail banking overhaul, and they’re not alone in leveraging them. Just three years ago, only 34% of respondents to Bank Director’s 2020 Technology Survey rated APIs as one of the top three technologies most important for their institution. Last year, 66% of respondents to Bank Director’s 2022 Technology Survey said they’re using APIs to generate efficiencies within their banks. APIs were second only to cloud usage at banks, according to the 2022 survey. And that’s a good thing. A thoughtful API strategy is one where banks big and small can eke out efficiencies in this challenging operating environment.

• Kiah Lau Haslett, managing editor of Bank Director

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