The New Normal of Online Banking

It’s undisputed that the pandemic brought upon new obstacles to the way people bank and pay each other, and many of the resulting shifts in consumer behavior are here to stay. From banks reducing branch access and hours to the fear of COVID-19 being spread through the exchange of cash, the coronavirus pandemic has accelerated the digital transformation within banks and led to a rise in the use of digital payment apps.

In 2020 alone, Venmo processed $159 billion in total payment volume, which displays a 59% increase from 2019.

However, despite this rapid acceleration towards digital adoption, most financial service organizations have not scaled their digital technology tools to meet changing market needs. A recent report by Accenture found that while 78% of banks collect data, only 7% utilize analytics and only 5% enable AI capabilities, to reap the full benefits of data throughout each stage of the customer experience.

As we navigate such changes and consumers increasingly manage their money on digital platforms, banks, payment apps, and financial service organizations need to scale these key enablers to keep up with consumer expectations.

Below are five considerations financial service organizations and banks should keep in mind as we navigate the new normal:

1. Adopt Technologies that Boost the Customer Experience: The financial services industry would be keen to consider adapting AI technologies such as conversational design. Considering companies like Apple and Google already provide digital wallet applications and contactless payment options, they hold the potential to facilitate the majority of digital payments and banking operations down the line. For banks to meet industry standards, it’s time to consider revamping their rolodex of digital technologies.
   
   
2. Build Customer Profiles: The circumstances of this past year have catapulted us all into the e-commerce, digital landscape, and the old brick and mortar bank solution doesn’t work for the next generation of consumers. To stay relevant and meet consumer expectations, banks must re-evaluate their digital communication tools to hyper-personalize interactions with customers.By partnering with an omnichannel communications provider, financial service organizations can leverage data to create customized customer profiles to anticipate a consumer’s needs and share the right message at the right time.
   
   
3. Reassess Customer Segmentation: Furthermore, now is the time for banks to either reassess or build a system of customer segmentation.Customer segmentation will aid banks in customizing customer interactions through compiling customers with similar needs in one group. For example, if banks can identify financially at-risk customers (think: employees who haven’t received their salary, self-employed individuals experiencing a dry spell, and businesses who are ineligible for Covid-19 relief funds) and send them helpful information on benefits plans or short-term loans, customers will feel like the brand understands their specific needs—which will ultimately lead to more satisfied customers.
   
   
4. Secure Your Platform to Protect Customer Data: In addition, banks need to ensure their digital platforms are secure and do not put the consumer’s information at risk. During the pandemic, cyberattacks spiked at an alarming rate, and according to a report by Interpol, phishing scams were up 59%, use of malicious domains increased by 22% and we saw a spike of 36% in malware attacks. For banks to protect customers, it is crucial to incorporate proactive communication tools to mitigate fraud and authenticate the customer’s identity.
   
   
5. Educate Customers: In addition, financial service organizations should educate their customers on ways to identify a cybercriminal. To begin, banks should let consumers know they will never send a bitly link in any correspondence, and therefore, consumers should never click on bitly links within messages. Another way consumers can protect themselves is through vetting all messages from their financial services provider. To vet text messages, consumers should always check the brand’s online portal before interacting with the text message further.

As we head into the new normal, banks that are revamping their technology will have an extreme advantage over those who don’t. Now, only time will tell what the future of banking will come to be.

Mr. Brien Jones-Lantzy is the Head of Carrier Relations for North America at Infobip.