Transforming the Digital Banking Experience

By David Poole, Head of Financial Services Center of Excellence at Publicis Sapient

Prognosticators have been pointing to 2020 as a touchstone for change. What can we expect? 

A great banking experience no longer means having a great branch. Customers may never visit the branch, and they have an ever-growing choice of digital banking solutions. The banks that thrive will win on digital experience—less how it looks than how it feels.

The recipe in 2020 for a successful banking experience is LEAD—Make it Light and Ethical, including simpler, transparent pricing and fewer payment options, and more Accessible with a combination of voice and touch. Make it Dataful, using customer data for insightful experiences anticipating behavior and built around customer life goals. Here is more on each of these trends:

1. Ethical pricing strategy

Most consumers struggle to say what they’re charged for a checking account, ATM withdrawal, loans, advice, trades, and portfolio management, unlike the simplicity of a Netflix bill or Amazon Prime. The costs are spread across multiple providers, and fees are confusing and constantly changing. In 2020, banks will experiment with simpler pricing and product bundles, determining how much customers will pay, for what, and how to make it easy to understand. Monthly plans like Schwab’s $29 for financial advice and MoneyLion’s all-you-can-eat banking for $19 are early examples. Banks still rely on the old, punitive revenue streams like overdraft fees and ATM charges, and moving away from long-standing sources of revenue can be disruptive. TD Ameritrade saw this when it lost 15% of its revenue by waiving trading commissions to remain competitive with Schwab. Yet this sort of disruption is necessary to transform and thrive and offer the ethical experiences with a clear value exchange that customers prefer.

2. Lighter payment options

The rapid pace of payment innovation has resulted in a proliferation of new ways to pay– weighing down the point-of-sale with logos that confuse customers. In 2020, things will lighten up. We’ve seen the first instances of a combined click-to-pay button with the EMV SRC logo, live now on a few sites with more to come in 2020, replacing Masterpass and Visa Checkout. Expect fewer buttons, fewer steps in the process with increased adoption of stored payment within the browser, and fewer separate apps, replaced with effective one-stop services. An example of a light experience will be paying with PayPal, where they’ll build in the couponing service Honey. The frustrating task of finding a valid coupon will be built into checkout. Expect more mergers—like PayPal acquiring Honey—to offer one-stop convenience.

When payments are relegated to the background, the emphasis can shift instead to being dataful, using customer data to add value before and after the transaction, adapting the experience to the way the customer wants it and is most confident in accessing it. A dataful example is Capital One’s Paribus service wherein the case of a price drop, the service connects to the data in a customer’s email inbox and automatically requests a refund.

3. Graphical voice assistance

In 2020, banks will get much-needed voice lessons. Alexa skills from banks have yet to reach farther than novelty and niche, with voice-only interfaces remaining inherently limited for finances. When you add a touchscreen to view and interact with, the more complex tasks become possible, like a more accessible bill pay experience or portfolio review. Scenarios and the accompanying financial data can be visualized, cutting through long voice menus, while decisions can be simply articulated using voice. The sensitivity to hearing and conversing about private finances is replaced with sensitive data on the screen, while uncontroversial commands can be voiced. Voice-enabled screens like Amazon Echo Show can support these combinatory skills, yet so can smartphones—USAA being an early example with voice interface in the app and use of Siri Shortcuts to more quickly retrieve an account balance. 2020 will be the year when mobile banking apps better combine touch with voice,

4. Anticipatory banking

Customers are ready to cut the cord with their bank and switch to more dataful experiences that meet their needs. Anticipating customer’s goals started as a translation exercise. You say “car”—we say “car loan.” You say “new home”—we say “30-year fixed-rate mortgage.” Do you have a life event? We have a product for it. This new taxonomy suggested a customer-first approach, yet in reality, was thinly disguised product marketing.

Goals risk being just a translation for ‘savings account’ with digital envelopes for each goal, and round-ups to automate savings. Chase, Bank of America, and fintechs like Qapital and Simple are all exploring savings goals. Yet savings goals are just a contributing factor to a customer’s life goals that require a dataful experience to work. When a customer’s goal is “I want to get married,” the financial services required are less defined and prompt individual consultation and advice. In an April 2019 announcement of Bank of America Life Plan, the bank promised a fall 2019 release to use these sorts of goals to orchestrate services across the lines of business through Erica and the app. Initial impressions are of basic goal creation, and similar to the two-year lag with Erica between the PR and release, banks are finding these shifts take longer than anticipated to get right.

What will set banks apart in 2020 and beyond are LEAD (Light, Ethical, Accessible, Dataful) experiences enabled through the maturation of voice, chat and AI to tie the loose ends together and serve them up through improved apps and virtual assistants like Erica.