06 Feb The State of Banking in 2020
“Consumers aren’t necessarily making their banking choices based on whether you offer the latest new technology or not, but rather they want simplicity, ease of use and customized experiences – and we need to deliver that to them.” –Pierre Habis, Head of Consumer Banking at Union Bank
The banking industry is growing in complexity. As technology advances, banking, software, and security will become even more entwined than they already are. Combine that with shifting demographics in the banking population, and it’s clear—the industry is changing. But how quickly is it changing, and in what ways?
Here are our top insights on the state of banking in 2020:
The customer-centric business model reigns
84% of customers say being treated like a person, not a number, is vital to winning their business, and 61% of bankers say a customer-centric business model is “very important.” But, in the digital banking age, it’s more difficult to connect with your customers on a personal level than ever. So, how can banks implement customer-centricity as a strategy? Start by making the customer experience as seamless and convenient as possible. From a digital perspective, this means having an in-depth understanding of the customer journey and aligning your digital presence with that journey.
Caroline Hambridge of DXC Technology perfectly sums up this concept in a recent article, writing “Customers should always be just one click away from what they’re looking for.”
Take steps to streamline customer experience sooner rather than later to avoid driving customers to a different banking provider.
Multi-channel presence accounts for a greater share of transactions
According to a report from Fiserv, mobile banking is now the most used banking channel, with the average user accessing mobile banking 8.4 times a month. Does your bank have omnichannel capabilities?
One common mistake banks make when building an omnichannel strategy is assuming that the experience should be similar no matter what channel your customer is engaging with. Each channel should be custom-tailored to best meet the needs of your clientele and deliver the most convenient experience possible. A customer that goes into a bank branch should not have the same experience as one accessing your bank’s app. When executed correctly, this allows you to successfully connect with customers on their preferred channel, and that builds loyalty.
Some banks are even taking this a step further and developing completely new channels to better serve their clients. In 2019, Huntington Bank released Heads Up, an artificial intelligence-based software that provides customers with advice on savings, spending, and reaching their financial goals. This advice is based on real-time transaction data, so it’s personalized and timely—both strong contributors to the overall digital banking experience.
Marketing and product development efforts shift focus to Gen Z
A multitude of fintechs are already rolling out new apps and tools targeting Gen Z (those born between 1995 and 2015). Describing Gen Z customers, Kalpesh Kapadia, CEO of credit fintech Deserve, says, “What makes Gen Z different from other generations is that they are more fiscally conservative. They want to avoid debt and appreciate accounts or services that help them stay financially sound. They put mobile banking first and tend to see their banks as transactional versus relational.”
Gen Z grew up connected to the digital realm and 42.8% of them prefer traditional providers but via digital channels. As Gen Z gains even more spending power, well-implemented omnichannel capabilities will be even more important, especially mobile and apps.
To connect with Gen Z, know that they increasingly live on YouTube. According to recent research from Experian, 27% of recent high school graduates report learning about finances from watching YouTube videos. They’re also proactive savers, with 35% already planning to start saving for retirement in their 20s, and 60% voicing an interest in personal finance. Take advantage of this by providing insightful, easy-to-digest content in the digital arena. For example, your bank might build authority and buzz by creating a series of short videos explaining how to build credit. Or just try out a café branch concept—something Gen Z overwhelmingly favors.
Strategic partnerships expand capabilities
The speedy pace of change within the banking industry makes it impossible for any organization to go it alone. That’s why networks of providers are joining together in digital ecosystems that allow for additional functionality and innovation. SaaS company Acxiom notes in a new report that “the value of the right strategic partnerships has never been greater. Partnering can extend products and platforms into new markets, expose brands to new customers segments, and create scale.”
The key to a powerful strategic partnership is three-sided: scalability, trust, and vision. When a partnership has those three things, it unlocks immense value for all involved parties and allows for more personalized solutions. And banks are taking notice. First National Bank of Omaha recently launched their innovation lab, partly to show fintechs that they’re easy to work with.
One benefit of strategic partnerships that we think is under-utilized? Partnership marketing. With partnership marketing, your bank pools resources with a partner to create a marketing strategy. This provides a huge opportunity for growth by allowing both partners to capitalize on the value provided by a wide range of features and products.
Change isn’t just coming—it’s already here. With this in mind, banks need to think carefully about the experience and solutions they’re offering to customers and examine whether their strategic partnerships are helping them offer the best experience and solutions possible.
The right partnerships offer fantastic opportunities—including accelerated revenue growth, increased retention, and a better overall customer experience. To learn more about the benefits of BASYS Processing’s bank partnership programs, click here.
BASYS Processing as a business partner
If your processor isn’t delivering top-notch customer service and strategies to help grow your program, please call BASYS Processing at (800) 386-0711. Let’s talk about creating a true business partnership that will help you meet and exceed your goals.
BASYS Processing features:
– 90% + Customer Retention Rate
– Live operator when your merchant customers need support – no automated voice systems
– Dedicated relationship manager for questions and concerns
– Proactive contact with every merchant to walk through the annual PCI process
– In-house PCI Team to assist with questions and concerns
– Founded by a family who previously owned a bank
– Track record of successful bank partnerships
– Thorough Market Analysis followed by mutual plans and goals to grow your portfolio
– High-quality service mentality, similar to your bank
– Vested interest in protecting your bank’s hard-earned reputation
– In-depth initial bank training
– On-going bank training via weekly call and boot-camp programs
– Open line of communication between BASYS, you, and your customers
– Quick response time for your questions and concerns; you are a priority
About BASYS Processing
BASYS Processing provides credit card and debit card processing services, and solutions that include terminals, virtual terminals, e-commerce, mobile, and point-of-sale, customized to fit any need. Banks, associations, and software partners depend on us to strengthen their reputations and relationships with their customers by providing remarkable service paired with ultimate flexibility and pricing. Merchants depend on us to make accepting credit cards and debit cards convenient, safe & affordable. BASYS was founded in 2002 on one philosophy: to take care of our merchants, partners, and employees so they never want to leave. We are dedicated to working one-on-one with our customers to design the perfect solution. BASYS is Personalized Payment Processing.
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