The new era in banking - Digital transformation

Abstract

We all witness how technology is affecting our everyday lives. From socializing and entertainment, to the way we do business and so on. Banking operations prove no exception. We are far beyond the time where customers, in order to conduct a financial transaction, had to visit the bank branch. The evolvement and use of Mobile Technology, the need for cost minimization, the urge to innovate in order to outperform competition and most importantly the shift in customers’ needs and expectations, has resulted in a new banking perception.

The digital evolution has brought new and uncharted areas in the financial ecosystem, as we proceed to the age of the empowered customer. Today’s modern customer is more demanding than ever, wants and expects instant access to basic financial transactions, seek for transparency, products and services that are tailored to their personal needs and the option of transacting seamlessly among the banking channels of their preference.

In this fast changing environment, banks must develop new ways to manage effectively the shift in customer’s behavior and deliver a more engaging way of communication that enables smooth interactions between customers and financial institutions across multiple touchpoints. For this purpose and in order to sustain a competitive advantage in the financial services marketplace, banks must develop an Omni-channel banking customer experience, a powerful business approach with the purpose of delivering maximum customer satisfaction through the right content.

Moreover, banks must commit to transform their operating environment from legacy and paper based operation platforms and redesign their operating models into to fully digitalized businesses and adopt a customer – centric approach. Banks have a vast amount of customer data available that can deliver insights and build intelligence on customers’ evolving needs that will allow growing customer value, thus increasing revenue and profitability.

Banking institutions that fail to engage in this process of digital transformation will be in distress as new entrants emerge out of “every corner” disrupting the banking ecosystem posing a threat to their existence. Banks need to respond quickly, by adopting Omni-channel strategy, establish a customer-centric business model and facilitate their digital transformation through their collaboration with financial technology firms (Fintechs).