Kunal Nagarkatti COO, Clover Infotech.
In this day and age, there is no such thing as a non-digital consumer, everyone is a digital consumer. Hence it is mandatory for every industry to evolve digitally in order to serve their consumers better. The banking industry is no different. As rightly said by Brett King, author, futurist and co-founder & CEO of Moven, a New York-based mobile banking startup, “Banking is no longer somewhere you go but something you do”. Digitization in the banking sector has transformed the entire customer experience.
The idea of banking in India is changing from conventional to convenience banking. Digital transformation involves integration of digital technology into all areas of a business. Banks need to combine digital speed and convenience with human interactions that are both thoughtful and caring at crucial moments in the customer journey.
Digital transformation can be successfully achieved by taking an in-depth look at the following:
Branchless banking – Gone are the days, when customers used to stand in long queues in banks to deposit or withdraw their money. Now, everything is done at the click of their smartphones. Consumers want the process to be seamless at every step of consumer lifecycle. Banks need to match up to this speed and convenience. Not only does a digitized journey make consumers happy, it also frees up staff for more valuable tasks such as relationship building while simultaneously saving money by streamlining processes. If I take the liberty to crystal ball gaze into the future, the next generation of banks will operate without a single branch. The end-to-end process from onboarding to interactions, transactions to consulting would all be done over digital touch points and channels.
Redefine customer Journey – These days no company can survive without understanding the behavior of their consumers. Studying consumer preferences and behavior pattern is imperative to gain competitive advantage. Data analytics enables banks to understand their customers better, identify business opportunities and reduce costs. Through data analytics, banks can target their customers better. For instance, if someone has taken a home loan, banks can approach that specific person for home insurance. If a consumer has shown interest in buying a car by filling in a form for a test drive at any of the showrooms, then bank can approach that consumer for car loan. Due to the power of data analytics, consumer information circulates at lightning speed. Banks needs to ensure maximum avenues to utilize this information in the best possible manner.
Data analytics lets banks study customer portfolio, discover behavior patterns and derive meaningful conclusions out of it. Hence, it helps banks to predict defaulters and forecast risks to plan solutions. Fighting fraud with analytics have a positive impact on the banking industry as it improves profitability, reduces long withstanding legal hassles and payouts, and improves customer satisfaction.
Empowered with data and digital in its arsenal, banks will be more than just safe avenues to park savings. A bank will evolve into a partner who can offer the best solutions for lifestyle, travel, entertainment, and day-to-day tasks such as groceries, dining out etc. Imagine a banking application helping you with recommendations. What’s more, it might predict and get you the most contextual deals in advance. With chatbots and artificial intelligence, everything you need could be just a few clicks away on your mobile phone and you could reach it with seamless virtual assistance.
Preferences of consumers for financial products – With the help of advanced analytics, banks are able to study and understand their consumer base way better than ever. By leveraging this advanced understanding, they are able to improve their marketing significantly. This reduces time, effort and money wastage. Banks can easily identify highly profitable customers and develop more opportunities for cross-sell and up-sell.
Engagement with the consumer – Banks need to acknowledge that this is the era to engage with the consumer. It is more efficient than pushing the regular sales pitches across. Customers are becoming extremely demanding with the advancing technology. They want best of both the worlds; a digital experience when they need speed and convenience and human interaction when they need advice for products such as investments or mortgages. These days, banks need to combine human interaction with digital speed and self-service functionality. For instance, banks can use advanced location models to identify which service model (human, digital or a mix) is the most in demand at which location. While there is a proliferation of digital touch points and it is only going to go further north, the key lies in engagement. A judicious mix of communications, contextual targeting, contests, interactions etc. should ensure that the customer is digitally engaged and in alignment with the banks brand. “Engagement” is what will separate the best banks from the rest in this Digital Age. –
- Kunal Nagarkatti is COO, Clover Infotech.
