Nearly every management team working in financial services today is focused on the digital channel. It has become a competitive mandate. According to a recent Accenture North American Consumer Digital Banking Survey, virtual banks and payment providers saw a net 15 percent gain in new customers in the past year. Banks must continue to refine and expand their digital capabilities or be left behind.
But where to start?
We’ve been watching this space closely since 2009, providing strategy and execution that has resulted in dramatically improved digital experiences and award-winning solutions created and offered by our clients.
In 2013, financial institutions were struggling to juggle a host of digital initiatives, investing in everything from personal banker tablet applications to mobile application management. By 2019, much of the initial work of digitizing our banking platforms has been completed, but there are still some critical initiatives remaining. This is where leading banks are focusing their digital investments now.
Driving new deposits and loan growth
For depositories, everything depends upon attracting more customers. This is challenging when 79 percent of your customer base views their relationship with the bank as purely “transactional.” That’s the result of an Accenture BNY Mellon study and it explains why consumers find it so easy to switch.
If competitors steal the bank’s loan business, they’ll steal away a treasure trove of consumer data that will put them in a position to take the rest of the customer’s business. Banks must defend their loan market share.
Consumers are seeing conversational interfaces in other places, and they expect their bank to keep pace. Easy to use applications offered by fintechs are luring eyeballs and activity away from traditional financial institutions. Financial institutions must realize they are not top of mind with the average consumer so they must find ways to fit into a consumer’s lifestyle rather than the other way around. Yesterday’s chatbots are not capable of doing the job.
Integration and open banking
Open banking platforms are becoming more important as technology continues to evolve at a rapid pace. With open banking solutions, financial institutions can easily update, convert and integrate the latest solutions to meet customer and member expectations. Open banking also enables banks and credit unions to comply with existing and emerging government requirements in some markets, leverage customer data to create personalized offerings, including solutions offered by third parties. It also helps establish and nurture successful FinTech partnerships.
Data, AI and machine learning
Banks need more data and more power to process it. The AI they employ must be smart enough to learn over time and improve on its own. These technologies are available now, and bankers must employ them to offer the customer support that is expected. In addition, the data is crucial to risk and fraud management, sales and marketing for personalization of offers, credit underwriting and wealth management, to name a few areas.
Security and authentication
Cyber security will continue to be one of the most significant challenges we face in the online environment. Consumers expect their financial institutions to adequately protect their personal data and ensure security. Some solutions that help streamline authentication include device and fingerprint ID, voice and phone number identification and blockchain initiatives. Financial institutions can also utilize a customer identity and access management solution to streamline the authentication process.
If you’re investing dollars in digital initiatives that don’t deal primarily with one of these key focus areas, reach out to us to find out more about how our unique consulting business helps financial institutions create more engaging online, mobile and tablet banking experiences.