By George Wright, CEO, Smart Communications
A new generation of millennial customers, increased workforce mobility, and on-going digitalization are transforming the role of customer communications in the financial services industry.
A one-size-fits-all approach to customer communications does not work in today’s omnichannel world. Financial services companies are increasingly looking to harness Customer Communications Management (CCM) to deliver relevant, personalized interactions with customers, based on their individual needs, through multiple digital channels. The emergence of mobile technology and social networks means companies have to master an ever-growing volume of new communications channels – with 63% of millennials already accessing their bank accounts via a smartphone. Even though Which? reports the bigger banks are enhancing their mobile and online service offering, there is still room for improvement if they want to deliver relevant messaging via the customer’s communications channel of choice.
As CCM evolves, the industry is keen to reap the benefits of cloud-based software-as-a-service (SaaS) models. SaaS applications provide immediate value to financial companies as they are generally much faster to roll out than on-premises solutions, highly scalable – enabling the management of multiple customers at once, and provide constantly evolving software.A recent survey commissioned by Smart Communications in conjunction with Celent Research,assessed the current adoption of cloud-based CCM systems by businesses within financial services including banks, insurers, wealth managers, and pension funds.
So what is driving movement of financial services companies towards cloud-based CCM models and how will this trend develop?
Benefits of cloud-based CCM
There are a number of factors motivating financial services companies to deploy their CCM systems in the cloud. The first is the need to rationalize legacy correspondence systems, which do not benefit the business user and can hinder the provision of a personalized customer experience. The second factor relates to the commercial model, as cloud-based systems provide companies with the opportunity to convert fixed infrastructure costs to variable costs, and to adopt a usage-based licensing model.
Finally a cloud-based system is generally quicker to implement than on-premises solutions,as well as more flexible and agile than on-premise deployments, allowing companies to scale up resources and add functionality as and when it is necessary. Financial services companies are now looking to solutions that can support faster development of innovative products while bringing in new functionalities to support digitalization while lowering operational costs.
Enhanced mobile channels will be a key focus for developing CCM solutions in the short term, with almost three quarters (73%) of survey respondents expecting an increased emphasis on mobile for improving customer communications.Additional requirements in the near future may include customer journey analysis, integration with marketing campaign systems, the functionality to produce truly interactive documents, and the ability to leverage real-time communication tools such as social media and instant messaging. All these will need to be easily integrated into systems to support the evolution of CCM in an increasingly customer-centric world.
Evidence of a wider cloud strategy
Financial services companies already use full cloud SaaS in many areas of their business outside of core customer communications. Nearly a quarter (23%) of companies surveyed use SaaS systems for marketing campaign generation, and almost half (49%) report this as their preferred option. Although the survey looked largely at the use of CCM systems, it also revealed almost a third of respondents already intend to apply outsourced models to a majority of their CRM, HR, and ERP systems, providing evidence of a wider cloud strategy.
The application of cloud-based models is still relatively low for activities such as complex ad hoc document generation, with only 4% already using SaaS solutions for this purpose. This indicates companies need further education about the benefits of switching to full cloud SaaS in operational systems such as customer communications. When it comes to placing CCM fully in the cloud, concerns about data confidentiality are the most prevalent with 93% of respondents citing this as a high to very high concern. However, the report demonstrates there is clear evidence of movement towards cloud-based models across the financial services industry, which will only become more widespread,as previous fears are addressed and allayed.
The hybrid cloud as a stepping-stone
There is one deployment model that is increasingly favored by financial services companies as it mitigates some of their key concerns. This model is the hybrid cloud, and almost 40% of respondents cited it as their preferred option when replacing their legacy, on-premises solutions. The hybrid cloud is a variant of a SaaS model where customer data stays securely inside the bank or insurer’s firewall during the document creation process, but is combined with cloud-based template design and content management. The hybrid cloud presents an ideal stepping-stone for the financial services industry as a solution that sits between traditional on-premise deployment and the full cloud approach.It enables companies to enjoy the many benefits of a cloud-based SaaS model while reassuring those who may be hesitant about moving to a full cloud solution.
Like most verticals, the majority of systems within the financial services industry are shifting towards the cloud. And as communication within the industry continues to evolve and be impacted by changing customer preferences– with a growing emphasis on effective, real-time interactions and personalised messaging – the hybrid cloud will become the deployment model of choice as a bridge to full cloud adoption. The hybrid cloud provides the flexibility and commercial advantage of a cloud-based SaaS model while also guaranteeing data confidentiality and network security, providing banks, insurers and other financial services with that much sought-after silver lining.
Click here to download a complimentary copy of the Celent Research report.
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.”
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