By Monica Hovsepian, global industry strategist, financial services at OpenText

The pandemic has forced entire industries to shift online to the digital space. Banking is no exception to this. While banking could be viewed as a more traditional industry that is perhaps slower to respond to societal trends, many have had no choice but to undergo rapid digital transformation to remain relevant and meet customer needs.

The new digital world
Over the pandemic, online shopping sales rose by an impressive 48% in the UK, to £11 billion worth of sales. This is unsurprising when you consider that UK adults spent an average of 3 hours and 47 minutes online each day during the pandemic. The new digital economy has arrived, and it is likely here to stay. The decimation of the high-street continues, and companies that have not adapted quickly enough are floundering. Banks themselves must rethink their traditional methods of operation. To do so, they should ensure that they too are digitising and utilising data that they receive from their customers to build a smooth and rewarding customer journey.

A recent Accenture report found that an even smaller proportion leverage AI capabilities to maximise that data. Essentially, many banks are missing an opportunity to make the most of the data they are gathering from their users. During the pandemic, the financial institutions that had already invested in digital transformation and data analytics were able to respond quickly to new market opportunities. Having access to real-time customer data meant that these organisations could personalise their communications, services, and introduce a new digital-first process, providing them with a vital competitive edge.

‘Anywhere access’ across an omnichannel platform
Customers today own a range of devices that can all be considered ‘smart’. These include smart televisions, tablets, mobiles, desktops and laptops. They have now grown accustomed to accessing the same service from a multitude of devices. Not only do they expect a service that can be accessed from anywhere, but they now also expect the communications from the provider to be consistent whether it be via a phone call, an email or an SMS and so on. Banks now have to meet this same level of expectation. The experiences the customer encounters as they access the bank via various channels should be consistent and have a similar look and feel.

Omnichannel platforms must mix the old with the new
This is unfortunately where many banks can hit a wall. Currently, only a very small number of banks actually offer a connected omnichannel banking platform – and the omnichannel does not just refer to a presence across digital channels. While the pandemic accelerated a move to digital channels, it’s important that more traditional channels still remain part of the mix. Customers like to do business with a person in a physical branch and our research showed that the branch is still the primary source of new customer acquisition. However, the primary reason for this is the inability of many banks and credit unions to support digital account opening or loan applications. In other words, rather than the ‘preferred channel’ for consumers, the branch is often the default channel due to lengthy digital processes. To remain relevant and competitive, banks need to evolve their traditional physical branches into something more like a service hub. This could be a place where their customers could access a range of services in person. They could then integrate this service hub into a digital omnichannel mix to make interaction simpler for their customers.

The exponential rise of fintechs, and why that’s a problem
The pandemic is not the only pressure on banks. They are operating in the age of fintech, where new technologies and companies are sprouting up constantly. A recent report from PWC seemed to confirm the unease in the financial sector’s C-Suite, with 81% of banking CEOs reporting that they had concerns about the speed of technological change – more than any other industry sector. Banks cannot ignore new fintech challengers and the high customer satisfaction ratings they are achieving.

Competition in the financial sector has always been fierce, but a global pandemic and the rise of fintech incumbents has added further pressure on banks to stand out, and remain competitive. One way they can do this is by providing the best possible service to their customers. If they succeed in providing a seamless, entirely accessible and personalised digital experience across their customer journey, they will not only survive an incredibly tough period – but thrive.