As powerful forces including customer expectations, technological capabilities, regulatory requirements, demographics and economics continue reshaping the banking industry, a new narrative is starting to emerge.
Customers are demanding even higher levels of service and value. Eric Claudel, president: banking and payment solutions for the CISMEA region at Gemalto, highlights the need for a “new chronicle” within the banking sector – where creativity and innovation are leveraged to meet customers’ needs and expectations.
Bank customers are changing: they are becoming more international, more dynamic and more demanding as to the ways in which they interact with their banks. “This makes financial development and innovation essential in terms of meeting customer needs both now and in the future,” says Claudel.
He notes that banks arguably have a unique position between borrowers and lenders that puts them squarely in the driving seat of change. “At a practical level, as consumers’ habits change, banks have to adapt their products to meet the needs of their customers wherever they are, and however they choose to transact.”
Millennials are changing the nature of the game
Millennials in particular expect their banking services to keep up and be at the forefront of the technological trajectory. “They’re driving the debate that essential services such as banking must function smoothly on all the technology they use in every other aspect of their daily life. Banks need to embrace digitisation accordingly – throughout the customer lifecycle, right from enrolment to engagement and payment.”
The digitisation of enrolment
If enrolment processes are antiquated and time-consuming, customers are likely to be put off, says Claudel. “The process must be convenient, speedy, and secure – an important combination. It can be difficult to achieve this combination however, thanks to the challenges in place from KYC (Know Your Customer) regulations, which often complicate enrolment journeys which rely on paper-based processes.”
Unsurprisingly, this can deter customers from signing-up for additional services, declining extra offers and/or leaving the bank all together.
Digitalisation offers the ideal solution to ensure the enrolment process is truly convenient, speedy and secure. “Integrated apps which function on mobiles and tablets mean enrolment can become millennial-friendly. There are of course other key ways to streamline this process, including blockchain technology.”
From enrolment to engagement: the multi-channel experience
Once customers are enrolled, they need to be retained, therefore engagement process have to be optimized as well. Banks must offer a consistent, contextual experience across multiple channels, especially as multi-channel demand increases. They must also realise the importance of offering personalised and/or customised experiences for consumers. “Too often consumers feel like they’re just one of the crowd: a bank that instead treats them as individuals will reap the benefits.”
Digitisation creates the ideal platform to do this – including enabling social media engagement with consumers throughout their journeys, based on real-time behaviour. This is increasingly possible to monitor now.
The risks of resisting change
Without addressing the obvious challenges, banks risk losing credibility and negatively impacting their brand image. Addressing the challenges will however, improve sign up and conversion rates, as well as reduce existing levels of customer churn.
“Future success lies in a deepened understanding of customer relationships,” says Claudel. “As the world’s top-performing retail banks continue fast-tracking their digital transformation, those that haven’t yet begun will need to play catch-up – and quickly.
“Banks should seek to increase their interactions with customers to consistently deliver a positive experience, perhaps extending offerings to include non-traditional banking products and services through online and mobile channels, engaging customers in life events rather than simply offering products,” he adds.