Banks are equally bad everywhere. A bank customer in US or UK faces the same set of challenges faced by a bank customer in India or Mexico. In a 2017 survey, carried out by the Financial Brand, it was found that most banks do not have a formal customer experience plan in place. In terms of key drivers of customer experience, technology ranked 5th and channel ranked 9th, below branch personnel which was placed 4th. The importance given to branch banking over technology and channels in an increasingly digital world can only be put down to misplaced priorities in the banking sector.
Banks have a strong reservoir of trust, to be sure, but they seem to be losing ground, with PayPal and Amazon nearly as high as banks in recent study by Bain & Company. Just as intriguing is the increasing willingness of the respondents in India, Mexico, US and UK to run their finances through a fin-tech firm according to the study. Should banks worry? They do appear to be vulnerable to fin-tech companies providing better customer value propositions with data enabled offerings.
Compared to the rapid pace of innovation in other industries, banking foray into the digital sphere can be best described as rudimentary. In a way we can say that the digital revolution in banking has just begun, with banks offering mobile apps and high quality websites to their customers, allowing customers the ability to open an account, checking their account balances, and making payments However, all said and done, all these changes are perfunctory, barely skimming the surface considering the wealth of data and customer goodwill at the disposal of the bank.
For a long time, the banking industry was resistant to change, as it was in a comfortable position, with a captive market, little or no competition, robust customer relationships and no pressure to change. Now, new competitors are flooding the industry, with digital only agile models, driving rapid innovations in product and service, leaving banks struggling to regain their loyalty as well as market share.
The customer’s attitude towards banking has also changed, adding insult to injury. They are comparing their banking experience to other disrupted industries (Netflix, Amazon) and finding banks falling short of their expectations. In fact it would be fair to say, that even today, after many years of digitization, bank customers are still waiting for that new banking experience, touted as revolutionary and transformational, with customer centricity at the heart of everything.
Therefore, the biggest question that banks have to address today is what is next after digital banking? This comes from the realization that they have to dive much, much deeper than their perfunctory digital offerings allow, in-order to first understand and then serve their customers. Ideally Retail- analytics should have transformed banking by now but it has not. However, the rise of fin-tech and the digital customer have renewed focus on big data, AI, Machine Learning. Here, it is worth mentioning that banks have laid down stringent requirements for account opening, which makes the customer database more robust than the customer database maintained by telecom companies. This data can be used to create a better customer profile, helping banks to segment customers and provide individualized engagement to each of them.
Banking CVM – The next step after digital
Banking Customer Value Management (CVM) help banks to understand their customer and fulfill their needs with contextualized offerings that are mapped to customer personas. CVM uses customer data to drive sentiment analysis, 360 degree customer profiling, customer segmentation, next best offers, and channel management.
Social media platform are great sources of feedback for improvement opportunities, and banks should know how to leverage this information. In this regard, advances in the field of Natural Language Processing, machine learning, text analytics are helping banks to uncover customer sentiments from structured as well as unstructured data, allowing them to address customer issues quickly.
Banks have much to gain by gaining a 360 degree understanding of their customer, as it gives them the actionable insights for fine tuning marketing campaigns, improving customer’s engagement with the product, predicting customer behaviour and stopping churn before it is too late.
Similarly, customer segmentation allows banks to provide a higher level of personalization, assess customer’s pricing sensitivity, and build relationship with their valuable customers. For example, banks can used card usage data to design personalized loyalty programs, where customers are offered cash back offers according to their card usage. Similarly, banks can optimize their revenues by testing customers across multiple pricing points, and applying the one that is most optimized. Pricing segmentation also allows banks to give preferential treatment to their most valuable customers.
Next best offers (NBO) provide banks with an opportunity to re-engage with their customers and provide a cross sell or upsell opportunity. It helps to increase loyalty by providing relevant offers in a timely manner. NBO helps the bank in identifying products or services customers are most likely to purchase next allowing its marketing managers to run campaigns like Amazon’s “you may like to buy next”.
Finally, CVM keeps track of customer journey, helping in the understanding of channel effectiveness, driving more relevant content, and optimizing conversions.
Shift to personalized banking
Banking CVM provides a shift from mass marketing to n=1 marketing, where services are tailored according to user personas.
CVM provides valuable insights on customer’s lifestyle by analyzing transactional data. This information can be used to design loyalty programs with vertical partners that reflect customer lifestyles. By allowing the customer to indulge in activities and content of their choice, the bank improves customer loyalty.
New revenue through cross sell and upsell opportunities
Similarly, it will help the bank to realize new revenue streams through up-sell and cross sell opportunities based on customer segmentation, Next best offers.
Identifying the right channel
In today’s omni-channel world, the customer is leaving his footprint on multiple channels like mobile, social media, web, chat, branch and so on. Big data analytics analyzes customer journey in order to understand where the sale is taking place in order to make the conversion funnel better and improve marketing effectiveness by driving the right content on the right channel.
Allows banks to plan for the long haul
Customer segmentation allow banks to take a long term business view by targeting customer segments, like students, who are likely to evolve into a profitable segment in the long run.
According to Financial Brand, Analytics is the CX initiative that is most challenging for brands. It further goes on to say that most bank marketers are using the same outdated data sources and marketing methodologies they have used for decades, which is only alienating their customers further. In this light bank needs CVM to utilize data at the same level of sophistication of digital disruptors like Netflix or Amazon to drive higher customer engagement and revenues.
Amit Sanyal is the Chief Operating Officer of the Consumer Value Solutions at Comviva, a business focused on Customer Value & Life-cycle Management solutions in the telecom space. A marketer at heart and with over 11 years of work experience in the telecom and internet service provider spaces, Amit has also worked with various industry leaders such as Bharti Airtel and Sify Technologies in a multitude of marketing functions across the Usage and Revenue/Retention and Value Added Services domains. A PGDM (Marketing & Finance) holder from TAPMI, Manipal, Amit graduated from the University of Delhi with an Honours degree in Economics.
Study of 50,000+ UK banking app reviews reveals customer ‘frictions’ among prominent retail banks
o Login and user authentication: Nearly a third (30%) of digital banking app customers had issues with logging into the app through their devices, and 1 in 5 (20%) cited problems with username and password or passcode authentication
o Customer service:
§ Nearly a quarter (24%) of customers felt like they were waiting too long for customer support
§ Over 1 in 5 (22%) were unhappy with the customer resolution
§ Over 1 in 10 (16%) customers cited that the support over chat was unavailable or not useful
o Notifications: Almost a quarter (24%) cited that the wrong operation – or none at all – was performed when they clicked on the notification icon. 23% didn’t receive notifications for payments while 1 in 5 (20%) received too many notifications
Today Mobiquity, a full-service digital transformation enabler, launches a ‘Friction Report to benchmark UK & NL mobile banking apps,’ identifying ‘frictions’ within the UK digital banking app customer experience.
The study of 50,000+ UK customer banking app reviews within the Google Play Store and the App store shows the main ‘frictions’ across prominent UK retail banks.
One of the key issues was with login and password authentication. Nearly a third (30%) of digital banking app customers had issues logging into the app through their devices and 1 in 5 (20%) cited problems with username and password or password authentication.
Another ‘friction’ was customer service; nearly a quarter (24%) of users felt like they were waiting too long for customer support.
Almost a quarter (24%) cited problems with notifications. Either the wrong operation was performed, or no operation was performed at all when they clicked on the notification icon. 23% didn’t receive notifications for payments while 1 in 5 (20%) received too many notifications.
Meanwhile, over 1 in 5 (22%) were unhappy with the customer resolution, and over 1 in 10 (16%) customers cited that the support over chat was unavailable or not useful.
Commenting on the report, Matthew Williamson, Vice President of Global Financial Services, Mobiquity said: “As the use of digital payments increases during the pandemic, so has mobile banking usage. The launch of Mobiquity’s Banking Friction Report helps banks to identify the ‘business frictions’ in their mobile banking experience to help align with evolving customer expectations.”
“An interesting observation that can be made is that most of the banking apps in the Google Play and App store score highly, but when you only account for reviews where people actually leave comments regarding an app feature, i.e. feature ratings, scores are quite low. This can be attributed to users no longer having to proactively go to the Google Play or App store to rate an app, but now are prompted to review an app while they are using it.”
“Nowadays, banks cannot risk treating their customers as passive observers, building products and features that do not take their feedback into consideration. Looping customer feedback into the decision-making process is key as banks get real-time information regarding which aspect of the app customers value the most, and where they find the most friction while interacting with the app.”
The future of offshore banking
By Granville Turner, Director at Turner Little.
Despite its misconceptions, the popularity of offshore banking is growing. Not only is it a perfectly legal way of holding your money, but with the right professional advice, it is also reassuringly simple to open an account.
This ease-of-use is prompting many offshore banks to change their offering to compete and make overseas banking even more accessible. No longer is it limited to just the super-rich.
So, what does the future look like for offshore banks? We’ve compiled a list of the top fundamental changes happening in the realm of offshore banking.
Catering to niche markets is the future
Rather than managing account holder’s money in general, offshore banks are tapping into how they can best serve different demographics. Essentially, it is about taking a more bespoke approach to managing money at various stages of life.
But catering to a variety of markets doesn’t just stop there. Many overseas banks are now accepting crypto as a form of currency to appeal to digital, tech-savvy generations.
Cryptocurrency is also attractive for those who see the security benefits it can offer.
Paper chains are fast becoming a thing of the past
As banks move away from paper in favour of digital, security is on everyone’s minds. This is because information is an important asset to many businesses, so protecting it is vital. As such, banks are securing data with the most vigorous encryption security standards.
For account holders, this means digital bank transfers and communication become less of a risk and the smarter thing to do. Paper chains are fast becoming a thing of the past.
Instant access, day or night
In today’s digital world, you don’t need to travel overseas to open an offshore bank account; everything can be done online or over the phone. And like most UK standard current accounts, many offshore accounts now offer online and mobile banking features. So account holders can manage their offshore finances and investments while transferring funds with ease.
Offshore banks are following the same route of challenging onshore banks by going branchless. This offers substantial benefits for account holders, as branchless offshore banks don’t pass on as much overhead costs to the customer. Ultimately, this means customers can earn better interest rates and other returns on their investments.
Happy to help
At Turner Little, we work closely with offshore banks to provide you with quality service tailored to your needs. With over 20 years of international banking experience and specialist expert knowledge, we will assist you with your enquiries, no matter how complex. And every account we arrange comes with internet banking, card facilities and the ability to transact internationally.
Hong Kong’s First Multi-Cloud Challenger Bank Goes Live with Temenos
- WeLab Bank designed, built and launched using cloud-native Temenos Transact in less than 10 months
- WeLab offers next generational digital services for the 7.5m people in Hong Kong to access from their mobile phones
- Customers can open accounts remotely in just 5 minutes with bank reporting 10,000 account openings within 10 days of launch
Temenos (SIX: TEMN), the banking software company, today announced that WeLab Bank, Hong Kong’s first homegrown virtual bank, has publicly launched using cloud-native Temenos Transact to provide a range of next generation digital services for customers to enjoy 24/7 from their mobile phones. Designed, built and launched in less than 10 months, the fully digital bank has seen rapid take up with a reported 10,000 account openings within the first 10 days of launch.
WeLab Bank is powered by cloud agnostic Temenos Transact for core banking along with Temenos Analytics and Financial Crime Mitigation. Implemented on Amazon Web Services and Google Cloud, WeLab is the first multi cloud digital bank in Hong Kong. Operating on multiple clouds at the same time gives WeLab increased operational resilience and disaster recovery capability and is a regulatory requirement of the Hong Kong Monetary Authority for new digital banks. According to the Economist Intelligence Unit 2020 report for Temenos, 81% of global banking executives surveyed believe a multi-cloud strategy will become a regulatory prerequisite.
Developing a cost-effective and scalable core banking solution was paramount for WeLab. Temenos cloud native software is built for the digital age using API-first and DevOps principles and engineered to deploy in containers and microservices. This makes it easy for WeLab to scale for future business growth efficiently and eliminates the need to provision for peak processing volumes so that the bank only pays for its actual usage, yielding significant cost savings.
Critically, with NuoDB the solution delivers a cloud-agnostic, distributed relational database that enables WeLab to deploy an active-active on-demand database across multiple cloud providers with near zero downtime failover.
Temenos Transact is a preconfigured system and so requires very little coding and with Temenos model bank to address local practices and regulations, WeLab was able to bring its service to market faster and extend its innovation with more than 400 out-of-the-box APIs.
With Temenos, WeLab bank is set to transform banking in Hong Kong. In as fast as 5 minutes, customers can remotely open a WeLab Bank account with $0 monthly fees and start enjoying differentiated services such as time deposits with competitive rates, an interest-bearing deposit account with an instant virtual Debit Card, and real-time payments powered by Faster Payment System (FPS). Everything can be done on a mobile phone, simply and effortlessly.
Adrian Tse, CEO at WeLab Bank, commented: “WeLab Bank was born from an initiative to reimagine the banking experience for the 7.5 million people of Hong Kong. From the start, we knew this vision needed the most advanced cloud native technology and a partner that shared our vision for digital transformation. With Temenos we have efficiently built WeLab Bank from scratch, free from any legacies, with innovative features that proactively help customers to take control of their money and their financial journey.”
Max Chuard, Chief Executive Officer, Temenos, said: “Congratulations to WeLab Bank on the launch of their trailblazing new digital bank. Building and launching a licensed bank in such a rapid timeframe is a fantastic achievement and we are proud to have supported them in becoming the first multi-cloud digital bank in Hong Kong. Temenos cloud-native, cloud-agnostic strategy means we can satisfy the needs of the most innovative and ambitious neobanks like WeLab Bank to run on multiple cloud providers. We know this is just the beginning for WeLab and we are excited to be part of their story as they revolutionize banking for people in Hong Kong.”
Bob Walmsley, CEO of NuoDB said: “We are excited to be partnering with Temenos to help WeLab Bank achieve their aggressive launch timelines and deliver innovative banking services to its customers. We were inspired by the technical vision of WeLab and knew that executing an on-demand, multi-cloud strategy was a perfect fit for NuoDB. Our enterprise-class, distributed SQL database combined with Temenos’ cloud-native technology helps banks of all sizes around the globe migrate to the cloud to improve agility and reduce costs.”
How can businesses celebrate Halloween virtually?
Bring the spooky season to life by virtually gathering the team for fun activities during October. Even though this year’s...
Five key challenges CIOs in insurance will face over the next 12 months
By Andrew Jenkins, Principal in the CIO & Technology Officers Practice at Odgers Berndtson, discusses five challenges CIOs will face as...
Why the future of work hinges on a mutually beneficial employer-employee contract
By Stuart Hearn, CEO and founder of Clear Review, the leader in performance management It feels like there’s been almost continual talk of...
For lenders: 5 reasons for losing a customer
By Matt Cockayne, Chief Commercial Officer at Yapily Businesses of all sizes are battling the ongoing effects caused by the...
Eight Benefits of International Financing
By Luigi Wewege is the Senior Vice President, and Head of Private Banking of Belize based Caye International Bank Lending...
How the UK’s tax system could change to recover from COVID-19
By Finn Houlihan, Director at ATC Tax The economic impact of the COVID-19 pandemic on the British economy continues...
LightArt’s Project Demonstrate What The Future Hold For Real Estate Market
This piece explores how LightArt byTom John Or-Paz seeks to leverage art to improve neighborhoods at scale in the branded...
The digital game plan for CFOs in a post COVID-19 world
By Neil Kinson, Chief of Staff, Redwood Software – explains the digital priorities for CFOs as they prepare for a...
Keynotes Announced: SAP Financial Services Live 2020
We are delighted to announce our Keynote Speakers & Session Titles for the upcoming free to attend digital event for...
Using AI to combat fraud risk
By Andrew Foster, VP consulting, AppZen Fraud experts use three factors to explain the motivation for an individual to commit...