Banks must not lose their human touch in the digital age

This disruption has led to a shift in customer preferences and expectations by moving away from traditional banking practices and opting for online, branchless banking which provides a one-stop destination for all banking needs.

With the emergence of fintech companies and Neobank, India saw a fintech adoption rate of 87% compared to its global counterparts (with only around 64%), making the country the third largest fintech market in the world.

Banks need the right software that not only allows the front and backend systems to be connected but also minimizes the costs that can come from revamping their entire technology.

Given that traditional banks have an edge over fintechs in terms of customer trust and customer data, deploying the right software can help banks enhance customer experience and provide personalized services. For example, with the right software, banks can suggest personal loan schemes and financial plans to rural customers. Today, banks need to accelerate their digital transformation and establish themselves as a one-stop shop for all banking services, thereby strengthening their relationship with customers and maintaining their trust.

With the onset of the COVID pandemic, banks have transformed the way they operate by adopting cutting edge technology to grow and transform their business. Customers today are deeply rooted in a digital or mobile-first approach and are seeking better hyper-personalization from banks.

Traditional banks thus need to rethink everything from their people and their data to their architecture and ecosystem, by transitioning digitally and accelerating the adoption of digital banking and payment tools and platforms among banking customers. for.

Increasing their spending on new technologies, increasing investment in infrastructure and upgrading their IT systems are some of the key areas that Indian banks should pursue to bridge the digital gap. Banks can do this either by partnering with fintech companies or by building digital capabilities in-house.

trust factor

Customer retention and trust are critical to the success of a bank. Therefore, it is imperative that banks create ecosystems that offer value-based engagement and ultra-personalized services and meet their short and long term needs to create and maintain consumer loyalty and trust. .

Digitizing pricing and billing processes can help in consolidation of products and services to prevent any revenue leakage by implementing the right solutions. Banks and financial companies should focus on accelerating their digital transformation journey and modernizing their legacy core systems to increase agility, scalability and innovation.

Legacy data systems are usually silent and designed to aid human decision making. As a result, more and more banks are adopting new data-driven technologies such as cloud, AI and ML that will enable them to make real-time, large-scale, automated decision-making that will radically speed up their primary processes.

With tech and fintech companies offering customers digital products, banks should also focus on leveraging concepts such as open banking and application programming interfaces (APIs) that enable access to customer data and account information. Digital transformation helps banks drive customer relationships to ensure high levels of loyalty, improve product depth, retain existing customers and attract new customers through cross-selling. Banks should always focus on being one step ahead of the customers and become a financial supermarket (providing all banking services under one roof) for their customers.

It is also important for banks to understand the importance of providing value to their customers in every transaction.

The challenge the leading banks are working on solving is how to create a different experience, innovative proposition and a human connection when banking is in danger of becoming a faceless, price-sensitive commodity. It is imperative that banks develop a roadmap to create an immersive experience, innovative technology proposition and humane relationship with their customers.

Those in the banking industry who adopt cutting edge technology to grow and transform their business will eventually be able to meet the changing expectations of customers and emerge as winners.

Nand Kumar is the founder and CEO of Suntec Business Solutions.