Lion Finance: Competing like a fintech, winning as a bank

Lion Finance Group is a financial-services holding company with universal banking operations in the growing markets of Georgia and Armenia. The group had $22.6 billion in assets as of March 2026, serving 2.7 million active retail customers.

Archil Gachechiladze, Lion Finance and Bank of Georgia CEO, recently sat down with Gökhan Sari, a senior partner at McKinsey, to discuss the bank’s ongoing financial success.

This interview has been edited for clarity and length.

Gökhan Sari, McKinsey: Archil, thank you very much for joining our interview today. Before we start, would you like to introduce yourself?

Archil Gachechiladze, Lion Finance Group: My pleasure. I have the privilege of leading Lion Finance Group, a commercial banking operation in Georgia and Armenia. We’ve been on the London Stock Exchange for 20 years now, since going public in 2006, and we recently celebrated our 20th year by attaining the FTSE 100 in March.

Gökhan Sari: You have delivered very strong financial performance over time. What do you see as the core factors behind your success, and how do they come together in your model?

Archil Gachechiladze: There are several main factors. On one side, we have been very lucky with macroeconomic performance. Both Armenia and Georgia started with low per capita in the early 2000s, and now they each have about $10,000 of GDP per capita.

Over the same period—20-plus years—we have been winning market share and delivering value for our customers through focused execution. It has not been just one or two particularly good years, but consistency in delivery over time.

Another factor has been our obsession with customer trust and satisfaction, which is something that has served our organizations very well.

Earning customer trust one step at a time

Gökhan Sari: You mentioned customer trust. How did you build it? That’s not an easy task.

Archil Gachechiladze: It happens step by step. Once you develop a product, it’s important to understand what customers want and need and what they like and dislike. Once you know that and measure it, it’s all about incorporating that data into product development, and doing it fast. Then once you develop the product, you measure again to see how much people like or dislike it.

Facing the threats and opportunities through digital transformation

Gökhan Sari: The product point is very important, and I think the digital platform you built is quite powerful. How did you start the journey, and what were the key inflection points?

Archil Gachechiladze: We experienced an inflection point when we restructured in 2019, which acted as the right moment to rethink our strategy and understand the threats and opportunities out there. We also found that developing technologies—primarily digitization—had become a major part of how banking was offered over the past decade. And we understood that there were digital disruptors who were actively finding more customers in different parts of the world by being very good at digital delivery.

At the same time, the digital attackers that didn’t have the balance sheet were struggling to build profitable models. Another thing we had, and they didn’t, was the trust we enjoyed from all our customers.

We saw that as a threat, but also an opportunity, and thought, “What can we do to develop this?” So we decided to be as good as fintechs in the things they’re good at—and at the same time, retain and develop some of the things we had, namely trust and the balance sheet.

To develop digital delivery, we had to transform the whole organization and flatten it. Fifteen people directly report to me instead of the four or five you find in most organizations. We also delegated more responsibilities to different parts of the business. We had to develop the technology as well, learn how to measure performance division by division, and align the interests of the shareholders and the company with those of the different division heads.

All this is easier said than done and involves a lot of different kinds of work. To summarize, it means delegating to a point where a lot of development happens without involving top management. You delegate a lot of decision-making to many different departments; but to do that, you have to measure, become accountable, and align the KPIs.

It also means there has to be a culture of allowing mistakes. And that goes against the DNA of established universal banks. How do you do risk management so that mistakes are allowed, but you don’t bet the house and you don’t make mistakes that hurt the bank to the core?

That’s the art, and I think we’ve done it quite well.

Succeeding through full cultural change

Gökhan Sari: Neobanks are growing faster than traditional banks in Europe and North America. How do you view the challenges to the growth trajectory of neobanks in your region and more broadly?

Archil Gachechiladze: Neobanks are very successful now and over the last decade or so, precisely because of some of the changes and challenges we experienced. And I think all universal banks are experiencing something similar. Some are faster than others to react to it. The ones that are not as fast are creating the opportunities for neobanks.

Neobanks will develop, but their challenge is to develop customer trust so they are not only used for transactional business—which is very important, obviously—but for keeping customers’ longer-term savings. That’s a challenge, as well as building out all the back-office functions, and at the same time not becoming bureaucratic. The balance for neobanks is to retain the positives of agility in terms of product development, trying new things, and the like, while becoming fully compliant with the regulatory requirements that come with proper banking.

Without the larger balance sheet, the actual highs of profitability cannot be achieved. Once you go into deposits or loans and you go into transactions and risk management, the challenge is to retain the agility so you continue to develop fast.

The other side of that coin is for universal banks to try to do the same, which, to me, is even more difficult because it involves a full cultural change within the organization. In many cases, the present culture has been formed as a result of not just one or two decades, but more than 100 years. To transform suddenly, and vertically manage the organization into something culturally very different, is quite difficult. That’s the challenge for established universal banks.

Finding new usages for AI almost daily

Gökhan Sari: Let’s talk about the hot topic—AI. How do you think about the role of AI in your bank, and where is it really making a difference right now?

Archil Gachechiladze: AI is, and will be, used in almost all parts of banking at some point. It’s a step-by-step process, but it feels like it’s all coming at once to many different parts.

What we’ve seen most is very active usage of AI in chatbots. The younger generation seems to prefer chatbots to call centers, which is great for us, because call centers are expensive to operate. The voice chatbot in Georgian is still not as well developed as it is in English and some other languages, but the typing chatbot is quite well developed. About 65 to 70 percent of all interactions are fully handled by the technology. That’s heavy AI usage.

What is also important is measuring customer satisfaction in those interactions, and the customer satisfaction (CSAT) score there is very high. Anything above 85, 90, is very good, and we believe we are increasing that score while maintaining customer satisfaction.

There’s plenty of usage of AI in the automation of customer emails. There’s more happening on the valuation side for mortgages; more than 80 percent of all mortgage decisions are now made within a few hours.

We are also using AI for next-best offers. Increasingly, we can capture interactions with each and every customer, regardless of channel. All this data is aggregated and analyzed by AI, which then helps us generate the next-best offer for the customer. In other words, we are using AI to predict what customers may be looking for based on their transactional data and interactions with the bank.

AI is widely used in many departments, and it’s going deeper. Corporate bankers are increasingly using it to help them analyze and summarize some of the information they have for customers and so forth. We’re finding new use cases almost daily.

Gökhan Sari: You mentioned that younger customers seem to prefer chatbots. We also see that a lot of younger customers are trusting financial decisions to AI agents. Do you see this trend affecting banks in Georgia or Eastern Europe in general?

Archil Gachechiladze: We are seeing signs of it emerging, and we believe that over the next three to five years it will become a major trend. In fact, we find ourselves asking all kinds of questions to AI and chatbots on a number of different things, even without fully trusting it at this stage.

As AI improves in terms of quality and output, I believe the trust and decision-making will increase as well. So a big part of our focus will be on how to interact with AI and how to be well represented in the top choices AI recommends for its younger customers in the future.

Moving the needle means measuring, reacting, and delegating

Gökhan Sari: Incumbent banks have been doing well globally in the last couple of years, but they are struggling to understand if their recent successes will be long lasting. If you had to pick one or two things that might move the needle, what would they be?

Archil Gachechiladze: The main thing would be to measure customer satisfaction and understand what customers want and need. That’s one side of the story. Then react to it and change internally, and delegate more to different people and incentivize the right people to change dramatically. This encompasses a lot of change. But that’s what needs to happen for universal banks to be the financial intermediaries of the future.