BankTech Bulletins: Focusing on the strategic shifts which matter most

This is the fourth BankTech Bulletin, a research series which focuses on the intersectionbetween banks and tech-driven change, including looking at shifts in the way lendersoperate, regulators regulate and customers behave. Previous editions focused onchallenger bank funding, digital bank licences and JPM's decision to enter UK retailbanking, complemented by client calls with industry experts on these and other topics.

Discovery: Dominant in SA health insurance via shared value...

Discovery Holdings, headquartered in South Africa, is a pioneer of a shared valuecustomer proposition which rewards clients financially for certain behaviours which aremodelled to improve the profitability of the business itself. Discovery Health, forexample, with ~60% market share now from a standing start in the early 1990s, payscustomers for exercise and other behaviours. Discovery Life, which acquired 12% of themarket in 7 years, also compensates clients for healthier living. Discovery Invest rebatesadministration fees based on the duration of holdings and drawdown levels. DiscoveryInsure rewards lower risk driving via telematics. And all of these group businesses rewardcustomers for achieving higher tier status through behaviour and wallet share, a driverto some extent of cross-sell. The data in this report around market share, product savingsand observed customer behaviour is strategically fascinating, we think.