Having a 360-degree view of consumer interactions across channels, products, and systems will pay off by building stickier emotional engagement. View in article, Grace Noto, “Capital One joins effort to educate seniors about online banking,” Bank Innovation, August 5, 2016. Last but not least, consider the digital banking platform’s security and stability - you need to be able to provide 24/7 service availability with frictionless payments, regardless of the market conditions you operate in - be it a mature or a developing market. View in article, Frank Chaparro, “JPMorgan Chase launched an online bank for millennials called Finn, and I prefer it to the real thing,” Business Insider, July 8, 2018. UK Finance recently found remote banking had increased across all age groups during the pandemic, with 72 per cent now using online banking and 50 per cent using mobile banking. Most tellingly, digital adventurers demonstrate the highest levels of satisfaction and advocacy for (are most likely to recommend) their primary banks. If your bank has already completed all the internal changes necessary for digital banking and the board is sold on the idea of digitization, go for the platform approach. Explore our collection of thought leadership to make sure your bank is ready. As such, we highlight country differences along the way to offer a perspective of consumers’ relationship with their banking institutions in individual countries. Deloitte Support Services India Pvt. Social login not available on Microsoft Edge browser at this time. According to our survey, consumers are more likely to increase use of digital channels (both online and mobile) if banks increase security, provide more real-time problem resolution, and allow for more regular banking transactions to be handled digitally (figure 8). Such building blocks could be customer onboarding, digital identity, strong customer authentication, loan origination, different payment types, workflows, integrations, notifications and more. View in article, European Commission, “The Digital Economy and Society Index (DESI),” accessed on September 19, 2018. Scenario modelling . View in article, Li Hong, “ICT lifts China to become global trendsetter,” Global Times, April 12, 2018; Melissa Cheok, “For all its tech savvy, Singapore still prefers cash over digital payments,” Bloomberg, September 5, 2017. A higher proportion of consumers in India and Indonesia are likely to recommend their banks than are those in Japan, Singapore, or the United States. First, digital technologies increase a bank’s connectivity—not just with customers but also with employees and suppliers. ... but the power of today’s new digital capabilities is vast and growing. We also captured consumers’ expectations and perceptions of digital banking capabilities, and the likelihood of using additional digital banking services in the future. Explore our collection of thought leadership to make sure your bank is ready. Technology companies that are consumers’ favorite brands not only have best-in-class digital capabilities; they also do a superior job integrating digital and physical environments and integrating both strategically to foster an emotional connection.17 Amazon’s digital prowess allows customers to discover, research, and buy products in minutes, while enabling its physical supply chain to deliver the goods most efficiently. View in article, Scott Magids, Alan Zorfas, and Daniel Leemon, “The new science of consumer emotions,” Harvard Business Review, November 1, 2015. Nearly one-quarter of traditionalists have never used online banking to access their primary bank. capabilities, digital strategies can be delivered at scale and speed, with streamlined processes and well-defined governance. Expand mobile apps’ capabilities to simplify its user interface to engage online embracers. On the one hand, this translates to having the flexibility to quickly launch digital financial products and services and their variations for target customer segments. DigiWave Digital Banking Platform empowers banks with the foundation for digital transformation, the flexible capabilities for exceptional omni-channel experiences, and the technology to leverage open banking at its best. Taking action against systemic bias, racism, and unequal treatment, Key opportunities, trends, and challenges, Go straight to smart with daily updates on your mobile device, See what's happening this week and the impact on your business. Consumers today are used to consuming products and services online and they would only be so happy if more of their banking work could be digitized and automated. In a digital driven bank or credit union, digital is treated as a priority that needs a clearly articulated strategy, funding, talent, agile ways of working and an organizational culture that is willing to take risks. Fintechs and BigTech have been quick to seize the opportunity and fill in some of the customer need gaps with a multitude of innovative services, such as digital wallets, P2P lending, remote digital advisors, personal finance management, etc. Only this level of transformation is likely to strengthen banks’ emotional ties with consumers and earn them a top spot in the list of consumers’ favorite brands. The banking industry is in a digital arms race. This is not a one-size fits all. The banking industry is changing extremely quickly on both the retail and wholesale sides. Among the other countries surveyed, though, the general trend is that many more banking interactions are made online and via mobile devices than through ATMs and branches. Emphasize the convenience of digital with traditionalists. Of course, these are broad recommendations and as such, they will not uniformly fit the different consumer banking systems, experiences, and cultures of every country. Next in line are France, the United States, and Indonesia, with 41 percent, 38 percent, and 35 percent of their samples, respectively, falling into the traditionalist category. A subsequent report and interactive will dive deeper into these geographic differences and their reasons. If these favorite brands become financial services providers, then what?”. A robust Integration Framework is a key advantage of a digital banking platform, enabling process, channel and system integrations, unified customer data, central monitoring, business continuity, IT asset reusability, and more. A best-in-class digital banking platform should give you the speed to respond to ever-changing customer needs. The response from the target demographic has been overwhelming. And although few banks allow their customers to apply for a consumer unsecured term loan or small business loan through digital means, nonbank fintechs have been allowing this for almost a decade and some banks have followed suit.10 Yet, for the most part, retail banks still require human intermediaries and cumbersome nondigital documents to process loan applications.11, Further, banks’ “pull” approach versus a “push” approach to digital service could be standing in the way of creating emotionally engaging digital interactions. All Rights Reserved. Meanwhile, many traditional financial organizations still struggle to execute their digital strategies. In 2018, banks globally plan to invest US$9.7 billion to enhance their digital banking capabilities in the front office alone. Please see www.deloitte.com/about to learn more about our global network of member firms. How BCG Supports Clients in Creating Bionic Capabilities . Consider boomers and seniors who may be hesitant to use digital channels. has been saved, Accelerating digital transformation in banking The bank now has 66 million consumer customers that interact with it 10 billion times a year. Merging the physical with the virtual/digital is key to superior customer experience: putting the “real in digital and digital in real.”. Simplify the Onboarding Process Banks can make onboarding easier for customers, as well as employees, through a fully-mobile process that is enabled by advanced technologies. The physical and digital worlds have been blending and customer expectations could only be met with seamless digital financial journeys across channels. It is  the central hub from which, and to which customer data flows, providing a 360-degree view of the customer. Email a customized link that shows your highlighted text. Change of customers’ behaviour and their shift to the digital world raises the need to be in the digital world as well. Forbes' second annual list of the World's Best Banks underscores that digital technology is revolutionizing the global banking market. Picture these scenarios: Consumers hanging out at or working from café-resembling bank branches, interacting with their bank’s mobile apps as integrally and joyfully as they do with social media apps, or reporting lost/stolen card using the bank’s app instead of dialing the call center. View in article, Sara Baker, "Why voice biometrics will end the password era," Security Brief, July 9, 2018. Adobe Stock. Digital and mobile capabilities in banking used to be cutting-edge – and optional. By Ian Johnson, Managing Director of Europe, Marqeta. DIGITAL BANKING: ENHANCING CUSTOMER EXPERIENCE; GENERATING LONG-TERM LOYALTY 3 requires an enterprise-wide approach that can be implemented in localized ways, such as for specific lines of business and functional areas. For example, w… The Center wishes to thank the following Deloitte professionals for their support and contribution to the report: Michelle Chodosh, marketing senior manager, Deloitte Center for Financial Services, Deloitte Services LP; Patricia Danielecki, senior manager, chief of staff, Deloitte Center for Financial Services, Deloitte Services LP; Erin Loucks, manager, Deloitte Center for Financial Services, Deloitte Services LP; Limor Mazlin, senior consultant, Deloitte Consulting LLP; Stephanie Posner, senior manager, Deloitte Touche Tohmatsu Limited; Ayrton Rodriguez, consultant, Deloitte Consulting LLP; and Julius Tapper, senior consultant, Deloitte Consulting LLP. Please read more about the segment characteristics in “The digital-emotional connection” section later in the report. already exists in Saved items. A powerful, purpose-driven strategy allows companies to align and inspire teams, launch the right digital initiatives, and build the capabilities, processes, and mindsets necessary to sustain a digital advantage. The ICS BANKS Digital Banking software suite future-proofs banks by offering a broad range of features and capabilities, which then provides greater agility and flexibility to enrich the customer’s experience. On the other hand, a platform should enable the easy creation of more complex digital banking solutions, such as mobile wallets, end-to-end self-service digital channels, and more. Put simply, a digital banking platform enables a traditional bank to quickly transform itself into a truly digital bank. Roberto Ferrari, General Manager of CheBanca!, has performed an analysis in The Financial Brand by adapting the book The 7 Habits of Highly Effective People by Stephen R. Covey to the digital transformation being experienced by the banking world at the present time. Of course, banking systems and the behaviors of consumers vary across markets in different geographies. 3. It could include a credit bureau check, embedded pre-approval AI, go through a branch officer, etc., the workflows could vary substantially across businesses, products and channels. The central bank, the Monetary Authority of Singapore, awarded digital full banking licenses on Friday to Sea, an e-commerce and gaming group, and to a consortium between Grab and Singtel. Consumers’ fascination for omnichannel experiences is real. These influences will only grow as the online channel facilitates and influences even more customer shopping activity and product and service innovations. Consider the launch of digital-only banks. The fact that such a prominent entrant into the digital bank … But more tellingly, digital channels are used more frequently than branches and ATMs (figure 3) across all generations, and in all countries. The difference is that when a bank uses a multichannel process, its touchpoints will not be seamlessly connected – this means its customers will not enjoy consistency and real-time access between any channel, anytime, anywhere. eMasraf Digital Banking solution goes beyond traditional online banking to deliver an Omni channel platform that delivers a unified customer and social experience across all bank channels and all entities. There are three main directions in which the platform approach empowers bank digitalization: First, customer focus - a digital banking platform enables banks to deliver the engaging omni-channel banking experiences and personalized products customers expect today, fostering customer loyalty and attracting the new wave of digital-first generations. The bank spent the past decade strategizing how it can digitize its products to provide a mix of remote and in-person capabilities… Eighty-six percent of consumers use branches or ATMs to access their primary bank; 84 percent use online banking; and 72 percent use mobile apps to access their primary bank. Within the Asia Pacific region, for example, consumers in India and Indonesia are more satisfied with their banks than are those in Singapore, Australia, or Japan. For example, Bank of America currently receives more deposits from its mobile channel than it does from its branches.2 The bank’s CEO Brian Moynihan recently stated that investing in digital banking capabilities has helped improve customer satisfaction.3. Lastly, break the channel silos. Russian Doll: Building digital capabilities into a bank’s core. Small banks have none of those advantages Open Banking is evolving the industry toward hyper-relevant, platform-based distribution and enabling banks to expand their ecosystems and extend their reach. Digital adventurers also own many products, but they transact much more frequently than online embracers do. Many consumers already interact with digital banking channels quite frequently, which is a highly positive development. To increase online embracers’ willingness to use mobile banking, banks should focus on making mobile apps more intuitive and more comprehensive. Want an easier way to bank? Below we have listed some benefits of digital banking that cannot be ignored by anyone: 1. Copy a customized link that shows your highlighted text. And although just under 32 percent and 11 percent would prefer to apply for a personal loan online and on their mobile app, respectively, this compares to 25 percent and 7 percent for online embracers and only 17 percent and 6 percent for traditionalists. Predictably, when looking at clustering by country, 75 percent of respondents in Japan, a digital banking laggard, are traditionalists. Capgemini, Open Banking Ecosystems, 2017 The banking industry is in a digital arms race. Which channels they prefer to access a range of services: transactional (withdraw money, pay bills), informational (inquire bank balance, inquire about a bank product, update account details), problem resolution (dispute a transaction, report lost or stolen debit/credit card), and product application (apply for a loan). 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