Hungarian lender K&H Group is deepening its push into integrated digital services and artificial intelligence (AI) as customers increasingly expect banking to match the speed and simplicity of major online platforms.

Digitalisation has become one of the central pillars of the bank’s long-term strategy, reshaping everything from customer service and insurance processes to internal operations.

“One of the pillars of K&H's strategy is digitalisation, which permeates the bank's entire operation – from customer service through insurance processes to internal operations,” a spokesperson for the bank told bne IntelliNews. “Our goal is to become a true reference point in the domestic financial sector, providing a service experience that is fast, intuitive and fully digital at the same time.”

A key part of that strategy has been the deeper integration of banking and insurance services, allowing customers to manage both through a single mobile platform.

“One of the most important advances in recent years has been the deep integration of banking and insurance services,” the spokesperson said. “As a result, customers can now manage their banking and insurance matters in a single mobile application – this is called the ‘bank insurance in your pocket’ experience.”

Digital transformation is being driven by customer demand rather than technology for its own sake: “It is a response to the real needs of the customer, which prefers fast, transparent and smooth services.” 

Introducing AI assistant Kate

Artificial intelligence is playing an increasingly prominent role in the bank’s digital ecosystem, particularly through its AI-driven digital assistant.

“Artificial intelligence is a key element of digital strategy,” the spokesperson said. “Kate, K&H's digital finance assistant, is a good example of how AI can become not only a tool for increasing efficiency, but also a service that enriches the customer experience.”

The assistant, which has over 300 functions, already performs hundreds of banking tasks and is used by a large share of the bank’s digital customer base. “Kate” already supports banking for 150,000 active users, and held 1.7mn conversations in 2025. 

Over time, the bank expects AI assistants to evolve beyond simple support tools. “The development of digital assistants will play an even more decisive role in the coming years,” the spokesperson said. “While today Kate primarily provides banking support, in the future she will increasingly become a personal, forward-thinking financial facilitator.”

Rapid rise in digital banking adoption

The surge in usage of digital tools reflects broader changes in customer expectations, driven by technology platforms and AI tools. “Customer expectations have changed radically in recent years: we are not only compared to banks, but also to all other digital platforms,” the bank said. “This means that financial services must be as fast, transparent and personalised as any other digital experience.”

Artificial intelligence has quickly become part of those expectations. “Artificial intelligence has now become a natural part of everyday finance,” according to the K&H spokesperson. “Customers expect the same fast, easy, and personalised experience that they are used to when using modern AI platforms, especially ChatGPT.”

The shift is visible in the bank’s digital adoption figures. “The proportion of digitally active people has increased to 80%, and the number of mobile banking users has exceeded 700,000,” the bank said.

Digital channels are also becoming dominant in product distribution. According to K&H, 56% of its new retail accounts are opened digitally, as are 70% of personal loan applications and 75% of credit card applications. 

Usage data for the assistant further illustrates the growing demand for conversational banking tools. “Kate’s ever-growing usage numbers show that there is a strong demand for smart, self-service, conversational banking,” the bank said.

Robust growth 

The bank’s digital expansion has taken place alongside continued growth in its core business. Over the past year K&H’s loan portfolio expanded by 9% in 2025, once again outpacing the wider Hungarian banking sector, while its deposit portfolio increased by 6%.

In the first three quarters of 2025, K&H Bank reported net profit of HUF 91 billion. The figure represents a 15 percent decline compared with the previous year after accounting for HUF 26 billion in bank and windfall taxes.

“K&H delivered a strong business performance in the third quarter. All business lines showed significant growth, and our profit after tax amounted to HUF91bn. This is a 15% decrease compared to the previous year due to new IT investments and numerous government measures," Peter Roebben, CEO of K&H Group, said, according to a press release from the bank. 

“More than 800,000 of our customers have already had at least one interaction with Kate, our artificial intelligence-based digital financial assistant, which is regularly used by more than 25 percent of digitally active retail customers. But we also believe in the importance of human relationships, which is why we continue to invest in our network of 192 customer service points.”

The bank’s progress in digitalisation has also been recognised as it was named “Best Digital Bank Hungary 2026” at the Global Banking & Finance Review Awards.

Expanding AI and digital processes

The bank’s next phase of development will focus on extending these technologies across more services and embedding them more deeply into the organisation.

“The development focus for the 2025-2026 period is on the wider application of proven digital and AI solutions and deeper organisational integration,” according to the K&H spokesperson.

Priority areas include expanding its integrated banking-insurance ecosystem, strengthening end-to-end digital processes and applying artificial intelligence in line with evolving regulation.

“We are committed to client-centricity, digital innovation and sustainability. We will continue to use state-of-the-art technologies to provide our customers with the convenient, fast and reliable service they take for granted in today's digital world,” said Gergely Lóska, head of IT and innovation at K&H. 

In the longer term, the bank expects artificial intelligence to take on more autonomous roles within its digital architecture. “After VoiceAnalytics IQ, Kate, and several internal AI developments, the next step is building a more autonomous, agent-based operation,” the bank said.

The aim is to transform digital banking into a proactive experience. “Customers increasingly expect the bank to anticipate their financial needs, to provide personalised offers, warn you of important tasks in time, and support them in making informed financial decisions.” 

Sustainability alongside digital growth

Alongside digital transformation, sustainability is a core element of the bank’s long-term strategy. “The sustainable loan portfolio is more than €1bn, which is double the previous volume,” the spokesperson said. “Market share of our sustainable loans – around 20% – is double our traditional share of the credit market.”

The bank also highlighted its responsible investment strategy. “K&H's responsible investment strategy – which now manages HUF1,000bn in responsible, sustainability-focused funds that provide competitive returns – clearly shows that the financial services of the future must also serve the long-term sustainability of the environment and society,” it said.

More broadly, the bank believes Hungary’s digital banking sector has reached a new stage of development.

“Hungarian digital banking has matured: mobile banking penetration is high, the acceptance of digital products is growing rapidly, and the use of artificial intelligence is becoming more and more natural,” the bank said. “At the same time, there is significant potential in fully end-to-end processes, conversational AI, and personalised digital financial consulting,” it said.

Looking ahead, the bank expects several trends to shape the sector over the next few years. These include “the widespread use of AI-based conversational banking, the norm for fully digital financial processes, the rise of hyper-personalised customer experience, and embedding banking services in other digital ecosystems.”

“K&H aims to not only follow but also shape this development,” the bank’s spokesperson said. “By combining digital banking and artificial intelligence, we want to provide services that really make everyday finances easier and increase the financial well-being of customers.”