Online retailers "putting pressure" on financial services

By Matt Phillips, VP Banking, Diebold Nixdorf UK/I

24 August 2018

It is impossible to ignore the effect of today’s mobile world, particularly in the financial services sector. Customers are increasingly turning to their mobile devices to manage all aspects of their daily lives, including their finances. This ongoing shift in consumer behaviour is certainly being felt by financial institutions who are working hard to transform their digital offerings.

Under pressure from not only these changing consumer behaviours, but also from other organisations - such as retailers, restaurants and convenience firms- as well as ongoing industry changes and regulations, the race is on for financial organisations to rapidly evolve the way they interact with customers.

Mobility of services is set to continue to change the customer service landscape and therefore there is a pressing need for the industry to respond now, in order to futureproof services. Banks and financial organisations need to evolve, innovate, and connect the complete customer journey in new and interesting ways.

According to research, we have an average of 24 apps installed on our phones and most of us unlock our phones 28 times a day to check these apps. It is rare to see a millennial without their mobile phone in hand, or even placed next to them in a meeting. In fact, half of millennials carry their phones with them everywhere they go.

The time for the financial services industry to embrace digital disruption is now. Online retailers have become extremely resourceful in finding new and improved ways to connect with their customers and are often setting the standard. Today in the UK, Amazon and eBay are some of the most popular apps as they make transactions simple, seamlessly connecting customers to their purchases.

For many financial organisations, following in these footsteps (or fingerprints), involves a seismic shift – from relying on physical touchpoints such as using a debit card at an ATM, to focusing on the digital, the unseen, and the automatic.

This is invisible banking. Invisible banking is where engagement takes place over apps (not just over the counter), where the mobile wallets go beyond expectations of the customer, and where an open API economy offers up new opportunities. 

With so much to achieve, and so little time to achieve this in, here are five key tips for embracing these digital opportunities:

  1. Focus on quick wins with maximum impact: for banks, digitisation involves more than simply adding new and improved features to a mobile banking app. It is a big beast, and one that is constantly changing shape according to customer demands and the competitive landscape. Focusing on where you can make quick changes is a useful tactic to employ, if you want to make an impact, while working on the long-term strategy in the background.
  2. Integration rules: integrating out-of-the-box services into your offering can be a really effective way of bringing new solutions to market, quickly. Many app creators have multiple ready-to-go financial services apps and hundreds of features that can be integrated with back-end platforms and data to bring them to more customers quickly.
  3. Be flexible: the open API world is bringing with it a new realm of possibility for organisations that want to digitise. By creating an open and standardised platform, it becomes possible to integrate more offerings into your portfolio more quickly – with flexibility and adaptability built in from the beginning. Ultimately, being open and flexible like this, will allow financial services firms to future-proof their operations and evolve quickly.
  4. Work collaboratively: many banks are already working on incubator schemes with third parties to develop, test and deploy new innovations into their complex systems. The Barclays Accelerator and the City Ventures Fintech Accelerator are two great examples of this. Both are helping fintech start-up concepts to find a place in the banking ecosystem, thus reducing the pressure on internal teams. 
  5. Branch out – every market is different, and customers have different needs in each. The UK is further advanced in the world of mobile banking than some other countries in Europe - with payments, contactless transactions, and even biometric authentication building momentum in the UK. So, if you are implementing person-to-person payments or customer experience bots as part of your digital offering, make sure they are tailored to your customer’s needs.

Digitisation is, and should be, about a lot more than just adding gimmicks to your offering. Bringing services in line with consumer expectations is vital in our increasingly digital world as the boundaries between different sectors continue to blur. Improving the overall experience and making banking a seamless part of your customer’s everyday life is imperative.

In this new era of seamless banking, creating a culture of connected ecosystems and embracing the new realm of ‘invisible banking’, is really what’s driving results. And while consumers won’t see it, they do experience it - ultimately enhancing customer satisfaction and driving brand loyalty.

Become a bobsguide member to access the following

1. Unrestricted access to bobsguide
2. Send a proposal request
3. Insights delivered daily to your inbox
4. Career development