Italy’s biggest bank Intesa Sanpaolo has told staff they can sign up to test from March 1 the app for the new digital lender it is setting up with British fintech Thought Machine, an internal document showed.
Intesa last year unveiled plans to invest 5 billion euros (A$7.7 billion) in technology under its 2022-2025 strategy, of which 650 million is destined to create its new digital arm called Isybank.
Intesa has struck a five year partnership with Thought Machine, founder and CEO Paul Taylor told Reuters, making the Italian bank one of the biggest customers of the UK firm.
Thought Machine will provide Isybank with the cloud infrastructure to serve 4 million customers under 40 who Intesa intends to migrate to online and mobile banking services.
With an ageing population Italy lags other European countries in the shift to digital banking.
Intesa, which is counting on Isybank to cut operating costs by 600 million euros in 2025 and 800 million euros a year from 2026-27, has closed more than 550 branches from the last quarter of 2021 as it prepares to launch the new digital bank later this year.
The trial phase would subsequently be expanded to include a wider group beyond staff members, the document reviewed by Reuters said.
Intesa has said it would eventually consider adopting the cloud for its entire core banking technology infrastructure, seen as a complex move that poses a major challenge for traditional banks.
“We see this as one of the most innovative and forward-leaning fintech measures among European incumbents,” Goldman Sachs analysts wrote.
Intesa in January named the board of Isybank which is led by Antonio Valitutti, an Italian engineer Intesa poached from rival group Banca Sella last year where he led challenger bank Hype.