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The retail banking and payments industry are undergoing reshaping from powerful forces. Shifts in digital, mobile, cloud, data and analytics technologies are rapidly redefining customer expectations just as regulators in many countries are relaxing controls to encourage digital innovation. As a result, banks are being challenged by agile “digital first” competitors who are aggressively pursuing customers by addressing their needs in new and distinct ways. To compete, banks need to radically transform themselves and innovate for the future. Banks need to have a checklist comprising the following:
- Mobile Banking Growth:
Mobile banking is a service provided by a bank or other financial institution that allows its customers to conduct financial transactions remotely using a mobile device such as a smartphone or tablet. Banks have opportunity to use technologies embedded in mobile devices to create richer customer experiences. As smartphones become more sophisticated, banks must find ways to deliver value to customers.
Unlike the related internet banking, it uses software, usually called an app, provided by the financial institution for the purpose. Mobile banking is usually available on a 24-hour basis.
Banks come up with several advanced apps that help in online banking from the smart phones. As a result, the customers can do online banking from anywhere and at any time.
The banks make mobile friendly websites and features that help customers to bank efficiently. With just a few clicks on the mobile phones, the money can be transferred and bills can be paid with great ease.
Along with the above mentioned benefits, mobile banking is also an eco-friendly option. With the help of digital banking, a lot of paper is saved and other such areas like office space, travel, and so on are made greener.
- Online banking:
The online banking feature provides you the luxury of banking anytime and anywhere. Throughout the year, website services are offered round the clock for internet banking; except for time needed for website maintenance. To facilitate online use, most banks that offer online banking provide a host of high quality, technological solutions that make your banking experience easy and fast.
Most online banking systems offer the same common features, with only a few exceptions, and most of these services are given to customers free of charge. Some of the common online banking features and services include:
- View a summary of your account and transaction history
- You can view or print your account statements and balances
- Set up online payments and direct deposit services
- Reorder checks for your account via the web
- Some services allow you to export your account histories to third-party accounting software
- Transfer funds from one account to another or make deposits which saves a lot of time and money for you.
- Automatic Bill Payments:
How many bills do you pay every month? For most of us, the answer is “too many”. You’ve got rent/mortgage, utilities, car loans, various types of insurance, student loans and all of the other subscriptions. That’s a lot of bills to juggle even if they come once per month!
Most online banks allow clients to link their bills directly to their account and have them paid on time automatically. For every bill a client sets up, that’s one less thing one needs to juggle every month. This can add up to a lot of reduced stress.
- Secure Message Alerts:
One of the most important features of digital banking is that one can receive notifications in close to real-time. These notifications can be trivial or annoying at times, but they can also save your life.
For example, one can be notified when:
- transactions are completed or denied,
- a bill payment date is approaching,
- a client`s bank balance has reached a specified target amount,
- details of one`s account were changed,
- there were failed attempts to log into one`s account.
If anything suspicious happens to one`s account, it’s incredibly helpful to have an immediate alert since waiting too long can have disastrous consequences.
- Non-Internet Based Phone Banking:
Consumer banking has also been made more convenient on devices that do not have an internet connection. These services include SMS, Missed Call and USSD banking.
With SMS and missed call banking services clients are only required to send text or give missed calls on some specific numbers.
USSD banking lets one access a host of banking services just by dialing dedicated numbers from mobile handset and interacting with a menu.
These services present several advantages. They can be accessed from anywhere and at any time since they do not need an internet connection. They are free services and all transactions are completely cashless.
- Rewards and Loyalty Programmes:
Today, there are two performance differentiators in banking; product uptake and customer engagement. The good news is that these don’t have to be mutually exclusive, the better news is that digital rewards & loyalty programs can fulfill both simultaneously.
These digitally integrated programs can challenge traditional methods of customer acquisition and retention by introducing cost-effective and measurable, reward and incentivisation capabilities. Becoming a platform for business innovation and growth by creating more profitable and loyal customers.
Programmes that allow earning of points based on customers’ monthly activities within the bank’s network as well as its partners, can be introduced. Customers can later redeem them for various products, travel experiences, etc.
- Unified Payment System:
Depositing money into someone’s account used to be a considerable hassle. One had to visit the nearest branch of the respective bank and then, fill a deposit form. Once that process was done, he or she had to get in line and make the payment. This process was full of hassles and time consumption. Moreover, one had to check the account’s balance in order to confirm that the deposit was made.
Customers can now make transactions through their mobile phones from any location and at any time of the day. Thanks to the integration of the Unified Payment System (UPI) and the digital banking solutions, the customers are now able to transfer money from one account to another with much ease.
- Personal Finance Planning:
These days, there is a lot of competition in the banking sector, and most banks want to have an edge over other banks to be successful. Therefore, the banks come up with advanced websites that have several banking options.
Some of the sturdy features of digital banking on advanced websites are loan calculators, premium calculators, financial planning tools, tools to help analyze investments, budgeting, forecasting, and also tax preparation, etc. These help consumers to keep alert with many different features in an effortless way. As a result, most of the financial planning can be done efficiently without the need to personally visit a bank.
Digital banking is the digitization of all traditional banking activities and programmes that historically were only available to customers when physically inside of a bank branch.
This includes activities like:
- Money Deposits, withdrawals, and transfers
- Current/saving account management
- Applying for financial products & Loan management
- Bill pay &Account services
Whenever a new concept, like digital banking, comes on the scene, a lot of institutions ask themselves the same questions: Is this just a “one-time thing”, or is it here to stay? In the long run, will the concept measure up to all its high expectations?
Technology boom has been the major driving force behind the expansion of banking business across the world during the last 20 years. Now, internet and mobile access are available even in remote corners of the world linking people and organizations across the world like never before.
The technological revolution over the years has transformed the expectation level of customers and the way of functioning of organizations. First impact was felt in improving operational ease, but it was just the beginning. The next stage of digital banking was to meet increased customer expectation levels. This compelled banks to come out with better innovations, products and services to ensure customer satisfaction and delight. Digital Banking has indeed redefined the style of banking. Today, customers manage their banking transactions at the comfort of own drawing-room without the involvement of banking staff.
About the Writer:
The author worked extensively in mainstream Banking & NBFIs. He is a Chartered member of the CGIA Institute, USA, a Google Certified Digital Marketer and an Author.
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