Multichannel banking is no longer an option, it's an imperative. While mobile banking adoption is still relatively low, accounting for approximately four or five per cent of transactions, banks can no longer afford to ignore the huge revenue opportunities that mobile, and in particular tablets, offer. When people made the move from branch to online banking, banks found that they interacted more and subsequently, business grew. The same dynamic is taking place now as customers rely more heavily on their mobile devices.
One of the key drivers behind this trend is that the experience on a tablet is fundamentally different from the traditional banking. Tablet banking sees more "snacking" by customers. Idle moments are used to check balances, transfer funds or check out insurance for a new purchase. For customers, the benefits of this greater access to and management of their funds are clear; banking is transformed from a chore into a way to improve a lifestyle. The banking app now sits next to a music player, TV download app, travel advisor and online shop. In fact, the smart banks are using this to their advantage, offering their services within these other platforms. For example, a current account could be displayed within a shopping app so consumers know how much they can afford.
These changes to the way customers interact with banks isn't just beneficial to them. Banks too are able to take advantage of the new relationship. These short interactions are great opportunities for banks to engage with customers through targeted offers and promotions, reinforcing the perception of convenience and availability. However, banks shouldn't just see tablets as another communication channel, they can also be invaluable within branches. Equipped with tablets, bank staff can provide up to the minute information on a wide range of products and services, and the rich graphical interfaces help explain complex financial products in straightforward and compelling ways.
In order to support these fundamental changes, banks need to look at their IT infrastructure and ensure their systems can be device responsive. It'll be too costly to develop applications for each operating system, device and format as they emerge. Flexible architectures that allow for responsive design will allow banks to quickly reformat output to a wide and fast changing device set.
Furthermore, banks will need to make investments in data analytics to quickly understand both individual needs but also trends in usage patterns. Fast to understand allows fast to act, which is crucial in an increasingly competitive market. Large scale core infrastructure transformations aren't likely to deliver the type of platforms needed to support future banking models. By the time the project goes live, the customer and technology landscape may have changed beyond recognition. Short run projects to add features and functions to a system are more likely to deliver returns on investments.
And yet, while many of the implications of tablet-based banking require technology changes, they also often need a deeper cultural shift within the bank; challenging established practices with new ways of working and thinking. Banks need leaders who are able to work with new partners and are open different ideas. Rather than build large teams, centres of excellence in new technologies can help drive pioneering projects and establish ways to organise and facilitate these new approaches to banking technology that can be shared across the organisations.
So, if you think the advent of multi-challenge banking and tablets is the chance to create an app and post it to the App Store, think again and think differently.
This guest blog post comes courtesy of Mohit Joshi, VP and FSI Regional Head for Europe at business technology consultants, Infosys.