Digital Trend in Banking Industry
Digital trend in banking industry is evolving at a rapid pace. With numerous trends developing, which one will financial industry bank on? (pun intended)
But what IS digital banking? For banks in Indonesia, digital banking means internet banking, mobile banking, mobile money, and more. Digital banking has become a catchall phrase that means any customer interaction that happens beyond branch, ATM, and call center.
For some banks, the purpose of digital in banking is to provide easy access for their customers. To these banks, digital banking is a necessary evil that they need to get involved in, because everyone else is doing it. They need to catch up just to survive.
Other banks look at digital banking to provide another option for users to interact with them. Mobile and internet banking enables customers to never have go anywhere near the physical presence of a bank, except maybe an ATM when they need cash in their pockets. These banks understand that most customers don’t want anything to do with banks unless absolutely necessary. However, while the option is appreciated, are these banks ignoring the fact that maybe they need to improve existing customer experience instead of just offering another option?
Improving existing customer experience is key, otherwise you’re just offering customers another way to have a lousy experience. (tweet this)
Digital Trend: Serve Customers or Serve Banks?
Location and Activity-Based services is one digital trend that has become mainstream. Indonesia on e-commerce businesses and mobile providers have embraced these services in order to provide “relevant” information and offers the customers. The ads are targeted at us based on our online history, when we arrive at specific area, etc.
Some banks have come to embrace this trend as well. These banks use targeted advertising on social media platform such Facebook Ads, Google Ads, Linkedin along with targeted SMS blasts.
The tracking goes beyond location and current activity. With Big Data, when you transfer money, pay bills, buy electricity voucher, top up phone credits, everything is recorded. Syncing with their customers’ shopping behaviours (debit/credit card activity), banks get an even clearer picture of their customers.
The technology to do all that is here. The question is what will banks do with all this technology?
Will banks learn from the experience of industries like retails, news, and entertainment that have already jumped used these technology for years? Will banks actually use the technology to help customers or to help themselves?
Consider a customer who’s going through a shopping spree on her credit card. Will the bank use the tech to offer her a financial plan app to better manage her finances, or an insta-approved customer loan?
2015 might be the year for digital banking
But that’s what they say every year.
The question is not whether you’ll catch the right trend. The question is whether you’ll catch the trend the right way. (tweet this)
Mess it up, you’ll not only have a failed innovation on your hands, you’ll lose trust, and increase customer churn.
Keep these two tips when choosing which trend to invest in:
- Choose the ones that fit YOUR business. Just because your competitors are following it, doesn’t mean you have to ignore the publicity machine, focus on tech that improves your overall business processes.
- Focus on your customers, not yourself. Truly understand your customers, empathise with them, and if your mother were to use this tech, whose life would it improve more? Your bank’s? Or you Mom’s?