Nationwide Building Society has allocated a further £1.3 billion to a five-year technology refresh, taking its overall spending target to £4.1 billion.
The investment programme will result in an additional charge of between £200 million to £250 million in the current financial year, with a target of £500 million in annualised savings by 2023.
Nationwide says it plans to take advantage of opportunities generated by Open Banking and will open a new technology hub, employing over 1000 people.
The move comes just days after the building society announced the recruitment of RBS CIO Patrick Eltridge as its new chief operating officer. Joining in February next year, Eltridge will be expected to apply his experience in revitalising the RBS technology estate to Nationwide’s IT infrastructure.
Nationwide chief Joe Garner says the focus on technology will not diminish the role of the branch network in serving customers.
“At a time when customer expectations of service are rapidly changing in a digital world, we are investing to ensure that we continue to provide leading service,” he says. “We believe that our members want a combination of human service on the high street, as well as digital convenience. As a building society, we are able to deliver both – continuing to invest in our branches alongside this significant investment in our technology and operational capabilities.”
Nationwide launched is own £50 million fintech venture fund in June, and has since invested in online lender BlueVine and a GDPR-compliant data sharing startup spun out of University College London. It is also applying for £50 million funding from the RBS bail-out fund to move into small business banking.