The Connected Bank: How to Catch Up in the Digital World
Retail banking, traditionally one of the most customer-centric businesses, has been left in the dust when it comes to the digital world. In a recent issue of 360° – the Business Transformation Journal, experts from the banking and technology industries share some key insights on why retail banks are lagging and what they must do to catch up.
The article, “New Banking Trends, A Step towards Connected Banking,” discusses how the small advances traditional brick and mortar banks have implemented are not enough for them to be taken seriously in the digital world.
Instead of using mobile services to promote product, banks must seriously start thinking about how people want to be connected digitally. The steadfast focus of banks on products is a significant disadvantage in the customer-centric digital world and many banks don’t get that. The opportunities are there – Web 2.0 and the mobile Internet can provide a foundation for a new way of banking, but many institutions have what the authors call “technological paralysis.”
What’s a bank to do?
So what will it take for a bank to fit into a digital lifestyle? According to the experts, here are the key qualities banks need to adopt:
- Openness when dealing with customers – they’re fantastic co-producers so get them involved.
- Design thinking – use feedback to evaluate new offerings and muster up the courage to discard the ones that don’t work.
- Knowledge workers – make sure they’re networked, and no longer siloed.
- Openness with dealing with third-party offers – help your customers get the best products, even if they’re not yours.
- Customer development – realize branches are the icing on the cake, and no longer the foundation of customer-centric banking.
And there’s one more thing – banks need a sophisticated IT platform to support all of the above. Look for an open, flexible, and
scalable platform that allows Web services and mobile apps to be quickly integrated into the platform. Transparency, speed, and support for real-time customer data are equally important.
Here’s how banks should do it!
The article shares a highly successful example of a virtual bank that gets what it means to be connected. Fibor Bank AG in Germany has a prepaid credit card with emergency funding which gives people access to money that they might need in a pinch. This reduces the need to carry multiple credit cards and creates great convenience for the bank’s customers. The bank also has initiated “social lending,” which integrates third-party products and services – a rarity in retail banking.
There is also a video link at the end of the article that highlights an innovative service from the Commonwealth Bank in Australia. Its offering, CommBank Kaching, provides a true mobile banking experience, with the ability to pay on the spot via email or Facebook.
To read more insights on this topic, access the full article on page 6 of Issue 10 of 360° – the Business Transformation Journal. This publication is produced by the Business Transformation Academy, a thought leadership network devoted to providing cutting-edge insights on innovation and business transformation. For more business transformation articles on the SAP Community Network, please visit the 360° – the Business Transformation Journal library.