If you are a lender, technical, agent or most notably a consumer in BFSI Segment, I would certainly take it for approved you must have heard the new buzz word "Digital Banking". In my circle, I did conversation with numerous people and remarkably, no 2 individuals seem to perceive this in exact same fashion - well, this is type of overestimation, however you understand! This made me take a time out and think what this can suggest to somebody like me who is an expert in the industry, to answer if a coworker, buddy, or somebody at my box asks me concerning this. As a true CrossFit athlete I follow a minimum of the first guideline - inform everybody you find concerning CrossFit.
The reason I bring up CrossFit is not even if of my attraction or, even fixation. CrossFit is a bit of facility as well as discouraging to those inexperienced, but to put it simply it is strength and also conditioning program, which enhances fitness. CrossFit specifies health and fitness itself in regards to 10 elements - Cardiovascular Endurance, Endurance, Adaptability, Strength, Power, Speed, Agility, Control, Accuracy, Equilibrium. But, generally if you ask any of your close friends what is health and fitness, you could obtain numerous reactions. E.g. a jogger will certainly state capability to run half-marathon, or a weight lifter could say deadlift of at least 1.5 x body weight, or a individual into yoga could claim doing 108 Suryanamaskaras. Well, each of them might be right in their very own way. Your meaning of health and fitness might be doing every one of those, or you could just say I am fit enough if I have the ability to do my 9-to-5 work without taking any kind of authorized leave in an evaluation cycle.
On the exact same lines, financial institutions can interpret Digital Banking in their own terms and also in a similar way, individuals like you and also me will certainly have created some viewpoint based upon our very own exposure.
Over the years, banks of all sizes and shapes optimized a lot by adjusting to IT/ ITES (IT Enabled Provider) as well as they have attained sandstone hub diverse degrees of success. Nonetheless, due to lack of focused as well as longterm strategy, creation of disjoined systems, rapidly altering business and also running circumstances, etc, the desired goals might not have actually been completely recognized. Some of those " stopped working" efforts might have been driven by the establishment's urge to be an very early adaptor of a modern technology or fad ( banking on a wrong equine). On the contrary, we may shed a massive opportunity, if we don't recognize and also bet on a winning horse. So, the method is betting on the ideal equine, at a right time - i.e., when the chances are low. Normally, markets use what is called a Hype Cycle to evaluate a new innovation or fad. If you are interested to recognize what is a " buzz cycle", please see Gartner's methodology. I will attempt to string together several of the vital elements of Digital Banking, as unlike most of the buzzwords, it is neither a single solution neither a modern technology.
Simply around the time (2008-10) I spent about a year plus in Brussels, 3 big financial institutions (Fortis, Dexia and KBC) which constantly found as incredibly risk averse bankers from the BeNeLux area, started encountering major pressure and their value deteriorated significantly as well as activated warmed discussions in the neighborhood - who thought their money is always risk-free with the financial institutions (either as a depositor or share holder). What actually took place there, is really complex. Secret aspects being, huge sovereign debt hovering between 84 to 99% of GDP, lack of Government for 533 days, etc. These triggered liquidity problems. If you contribute to this various other upheavals in the financial market globally, it is simple to understand that the " depend on" within the system was under threat. Exactly how would certainly we construct depend on? By being transparent. Consumers require (not desire!) transparency in the entire system. Younger the customer base, that need felt is much more intense. This, when you look from the altering customer experience as well as assumptions from retail industry (Amazon, Flipkart), transportation (Uber, Ola), food market (Zomato, FoodPanda, ZaptheQ), you know where the financial market is. Customers have reset the expectations in regards to value, experience, as well as options. The Trick takeaway for the lender - Individual Experience - abundant, consistent, mobile (anywhere), protected, enhanced value.
Lots of people I have communicated with just recently on this topic, opined Internet Banking or Mobile Banking as Digital. Yes, this is only the beginning of what could be Digital Banking. Most likely, they cover earlier collection of client expectations. Moving on, could we see a day soon, where there is no paper in any of the financial purchases? When I claim paper, I am not simply referring to money! Few points which are already in practice in few financial institutions and also getting energy across are - digitizing procedures within the financial institution (like consumer on-boarding, financing application), cheque truncation systems which allows you to take a photo of the cheque on your mobile as well as send to your financial institution, and so on - there by bringing efficiency in decisionmaking, ability to tailor processes to particular client demands, conserve some unnecessary trips to the branch, etc. This might suggest in other words, carrying out document/ image management systems, company process monitoring as well as tracking systems, incorporating these elements within the existing IT solutions. The Trick - digitizing inner processes.
Social Media in the last few years have brought most significant effect throughout boundaries - be it, Tahrir Square revolution, Ice Container Difficulty, which mobile to purchase, just how we order and also pay for lunch or identifying a fine dining place and sharing while sharing the costs. Social Media is currently bring disturbances in terms of which bank to count on, what they can expect from a bank in regards to solutions, provide a voice to their discontentment. Which in turn implies, banks have to be on the very same Social network listening to their consumers, selling their services as well as likewise ultimately, attracting new clients, preserving the customers as well as even more notably, coming to be "The Goto Bank" if the client has numerous accounts. As an example, what might not have actually been anticipated couple of years back, in Kenya, among our respected client's Twitter manage (@ChaseBankKenya) makes use of Twitter to attach, launch and share CSR activities, and address consumers' questions and also concerns extremely effectively. That is, The Reach factor.
Another silent thing happening behind the walls in a bank is called Data Analytics or Big Data. These churn out unprecedented insights into customer behavior and preferences, driving extremely focused strategies. These also help customers to understand their spend analysis, plan their budgets, financial goal management etc
. Apart from these key components, there are several others which could make the bank more "digital" - chat and video discussion facilities to bring bank closer to the customer when he/she needs it, or educating customers through online tutorials like financial literacy, tax planning, etc, integrating various solutions and systems in the bank to reduce data replication and redundancy and helping the bank make more Straight Through Processing systems there by reducing errors, cost of operations, and increasing efficiency in the entire system. Banks could significantly increase seamless data exchange with others partners like regulatory bodies, clients, government bodies thus making entire process much more transparent and efficient.
Finally, the big question is what should be achieved from the big task list to call a bank "Digital Bank"? Just like in fitness, there is no single solution or the right solution. Each bank has to define its own strategy, execution plan to reach the goal of customer delight, operation efficiency, and overall share holders' enhanced value.
With our sharp focus on Core Banking Solutions, and wide range of experiences in consulting, implementation, testing, integrating several solutions at various banks across the globe, we at Bfsi consulting will be glad to engage with you or your team to help realize some of these goals.