Postfinance, the banking unit of Swiss Post, has decided on a new strategy, according to information obtained by finews.com. It will launch a digital-only service and focus on three other specific pillars of growth.

Bern-based Postfinance in 2019 had decided on a plan to turn itself into a digital powerhouse as it was pushing to become more profitable. It has now turned this strategic decision into a tangible plan, pursuing its goal of turning itself into a diversified, innovation-driven financial-services firm.

In the strategy for the period of 2021 through 2024, Postfinance has defined the targets which it aims to implement over the four-year period. Over the past days, the management of the firm has presented the program to its staff. The strategy aims in four directions:

Four Long-Term Pillars of Business

  • Postfinance wants to become the one provider of comprehensive payment and collection services for business clients. True to its roots as a banking service for everyone, Postfinance will also make available the services needed by its retail clients.
  • The company aims to offer solutions and advisory for physical and digital money matters to clients in the retail segment.
  • Postfinance will launch a new digital banking service. The new product will be launched next year, according to a report by «NZZ am Sonntag» (behind paywall).
  • The company also aims to develop its service for comparing mortgages, Valuu, to the leading platform in this segment. Postfinance is building the platform in cooperation with Hypothekarbank Lenzburg.

Postfinance has seen its profits decline over recent years as its main source of revenue, interest income, has slumped. Operating profit in the first half of 2020 dropped to 60 million francs ($66 million) from 146 million in the same period of 2019. Also, the company lost some 32,000 of its clients over the period.

Mortgage Business Not for Postfinance?

Postfinance had hoped to convince parliament to grant it the right to sell mortgages and received the backing of government for the move. It looks though as if a majority of lawmakers will object to the move, according to a survey by «Sonntagszeitung» earlier this month. The cantonal banks (also state-owned, but by the cantons) as well as Raiffeisen are said to vehemently oppose the introduction of a new rival for this vital business of theirs.

With the chances of getting its foot into this big business segment waning, Postfinance will feel all the more pressure to get alternative plans implemented quickly.