Once upon a time, withdrawing or depositing money meant going to the bank, standing in snaking queues to gather tokens, and then wait some more for your turn. ‘Bank work’ was a valid reason to take half a day off from work. After all, if you didn’t make it to the bank, how could you make your money work?
The story is quite different today. Given the gold standards of digital engagement and experiences set by Amazon, Apple, and Google, consumers are in the driver’s seat, demanding that their banks behave and emulate top technology brands. Banks have entered the digital race and plan to spend US$9.7 billion to enhance their digital banking capabilities in the front office alone.
Today, the banking sector is charging ahead to enhance its digital banking capabilities because the consumer demands so.
“Change is constant. Satisfaction is relative. Innovation is continuous.” This seems to be the mantra to live by today. Given the changing operational and transactional dynamics, greater technology adoption, and meticulous focus on customer engagement and satisfaction, how will this banking ecosystem evolve? What will the digital bank of the future look like?
Let’s give you a drone’s eye view of this digital bank.
The drone flies into a mall and sees the bank branch, which it can recognise only because of the branding. There are no tellers in cages, nor are there any deposit and withdrawal slips. This space looks like a retail outlet with swanky interiors, swankier gadgets in place, and tables and kiosks all for banking functions. Did we mention that we see no employees in sight?
The drone watches as a customer walks in and goes to a kiosk. It seems she wants to open an account. She walks over to the machine and scans all the necessary documents. Her signature is captured on the machine via a stylus, and biometric verification is done. A machine lies next to this station where she can print her debit card instantly. She smiles at the card in her hand and is happy that now she can walk into the high-end mobile store next door and avail that discount offer available for the cardholders of this branch.
The drone flies out further into the mall. It spots a couple talking about evaluating home loan options. It seems they’ve finally got their sights on their dream home, and now the only thing standing between them and this dream is a home loan. “Let’s go to the bank and find out the best home loan options and the line of credit,” says the man. The woman nods in agreement and takes out her smartphone. She logs in to the bank app and clicks on ‘home loans.’ She then compares rates and calculates the numbers. The couple talks over what kind of payment type would be best suited for them. The man insists that they go with the basic variable rate loan. The woman insists that they look at the flexible option and tailor it to suit their lifestyle. They decide that the best thing to do would be to speak to an expert and click on a button to speak to a specialist. Before they’ve finished their shopping, they’ve got a clear idea of their eligibility, the payment options, and their EMIs. “Great, now let’s apply for the loan”. A click later, their home loan application is being processed.
A little ahead is a father talking to his teenaged daughter about the importance of savings. The daughter, like a typical teenager, rolls her eyes at his inputs until he talks about opening a bank account to save for small things that she likes. “You need to go beyond the piggy bank and make your money work for you”, says the father. Unimpressed, the daughter says, “I don’t have time to go to a bank and do all this”. It’s time for the father to roll his eyes now. He logs into his bank on his smartphone, gets out her passport for verification, gets her verified online and five minutes later, her account is open. He then goes on to show her how she can check her spending impulses and change them into saving habits and proceeds to familiarize her with the several savings options of the bank.
The drone flies over several such people, all going about their banking activities without disrupting their day. The bank is now where you are, or rather where your smartphone is.
Technology is truly transforming banking from what we have been used to. As banks embark on the digital journey, it is technologies such as AI-driven big data analytics that are honing the customer journey and making it more personalized. These are also making banking safer with fraud analytics that recognise patterns of fraudulent transactions and predict the next fraud in progress and recommend the necessary steps to stop fraud promptly and thereby reduce costs and improve service. These technologies also help to identify the right cross-selling and upselling opportunities for new products and promotions, leveraging regional and local sales analysis, and customer segmentation analysis amongst many other opportunity areas.
The digital banks of the future present a smarter alternative to banking as we know it. As smart tech becomes increasingly mainstream, the time to manage our finances the smart way will be upon us, sooner than later.