The banking dilemma

The banking dilemma

Over the last few years banking has evolved from an industry that interacted with its customers on a face-to-face level to interacting with them digitally. Not long ago, if you wanted to open a bank account, apply for credit or take out a mortgage it would mean a trip to your local bank and lengthy face-to-face meetings with your personal banker. Today, however, everything can be done online. From the first paperless mortgage to digital mobile-only banks gaining popularity, banks are embracing digital transformation at a rapid pace, according to Rob Clegg.

Rob Clegg says that this new focus on digital transformation means customers are becoming reliant on online tools to perform everything from routine to complex financial transactions. Where bricks and mortar establishments and personal bankers were once the go-to for consumers, today they now have a long list of self-help options: mobile applications and online portals, ATMs and kiosks, chatbots, and video and telephone banking tools at their disposal.

The tools offer many benefits to customers, with services being available 24/7 and a significant increase in the speed of banking transactions, and they have also allowed banks to cut costs by closing bricks and mortar branches and focusing more technology to take over banking processes.

Over the last few years banking has also evolved from an industry that interacted with its customers on a face-to-face level to interacting with them digitally. Not long ago, if you wanted to open a bank account, apply for credit or take out a mortgage it would mean a trip to your local bank and lengthy face-to-face

Digital overkill

It is estimated that 73 percent of Brits used internet banking in 2019, a figure which has almost doubled over the last ten years. It was also revealed in a 2019 study from Accenture that mobile banking is experiencing an explosive growth in the UK, with digital-only banks expected to triple in size in the next year. These findings highlight that consumers today are embracing digital innovation and are steadily adopting the new tools on offer.

Because banks cater for a diverse range of customers and their needs vary significantly, it is therefore unwise to apply a one size fits all approach to digital banking. For instance, research has shown that while the younger generation have adopted digital banking without hesitation, the older generation have been more reluctant and less trusting.

There are also still those customers that wish to speak face-to-face with a personal banker before making a mortgage application or taking out a bank loan. They will increasingly grow frustrated if they are not offered an opportunity to speak to an actual human. As a result of these issues, when embarking on digital transformation projects banks must ensure their new initiatives meet all their customer’s needs, otherwise they will be at risk of losing them to competitors.

Embracing digital, but keeping things personal

While there is no denying digital banking offers significant benefits, digitising the entire banking experience is not recommended. Robert Clegg explains that introducing new digital tools which can speed up the process of banking, without confusing the tech-novice customer is vital. It also means giving customers the opportunity to do their banking online, but also offering them the choice of working with a personal banker if that is what they prefer.

When it comes to bricks and mortar branches, these should now be used more as a place to provide customer advice rather than simple banking transactions. Digital transformation is critical element of banking today and customers have grown to expect that most of their day-to-day banking can now be carried out online. However, this does not mean banks should look to digitise the entire banking experience. As a result, financial institutions should start to steer their digitisation efforts in a slightly different direction. Find out more about Robert Clegg here and follow the Rob Clegg Twitter page.

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