Financial Services

5+ Areas Financial Institutions Must Focus on in the Current and Post-COVID-19 Era

Corporate Business Team Office Meeting.

We have been talking about digital transformation for over 10 years, and the financial industry has been leading the change, albeit at its own pace. This year COVID-19 has been a major disrupter, immutably altering the traditional brick and mortar channel. Financial institutions must begin now to prepare a solid 2-year plan to manage this transformation; otherwise, they will lose ground to new competitors entering their footprint.

Financial institutions must understand the new journey customers and colleagues have embraced in 2020 and begin to change their strategy from FI-focused to customer-focused for both the front and back office. Furthermore, financial institutions should use AI to better understand what works and, more importantly, what does not.

Digital Banking: Demand for digital banking has accelerated over the last 6+ months and should be a top priority for financial institutions. COVID-19 has changed both customer behavior and expectations, leaving them no choice but to use digital and contactless for their financial interactions. Now that the consumer has acclimated to the new way of doing business, their behavior is not likely to change.

Onboarding: Small businesses have embraced digital onboarding for the Paycheck Protection Program (PPP) and will demand the same across other financial products and services.  Financial institutions should look across all their products, services, and processes to automate the customer’s digital experience. PPP onboarding ushered in a customer-centric approach – putting the customer at the heart of the digital engagement. This will now be the ‘new normal” for customer onboarding across all products and services, whether retail and commercial.

Security: Disabling security to enable security, making it easier to become a customer, and enabling safe and secure data sharing will be the hallmark of new security strategies. Security processes should be continuously revisited and refreshed as the digital engagement will take over as the FI’s primary connection with customers.

Marketing: The financial industry will use videos to engage with customers, replacing FAQs, and product demos. Financial institutions need to use videos that create a human connection and speak directly and personally to the customer.

Contact:

  • Sales teams need to use digital tools to connect with clients (e.g., booking appointments, working with sales and support teams online). Video tools such as Zoom and Microsoft Teams provide greater personalization and interaction with the customer than phone calls.
  • Customer service is at the heart of the customer-centric transformation. The contact center must support:
    • Appointment scheduling, coupled with the use of call-back technology
    • Video tools to engage for a more human touch
    • Chatbots for automation of common interactions and extended to use on mobile apps and the web
    • Intelligent email automation to automate common interactions

Branches will continue to reduce in size, and more closures will occur. Financial institutions will need to rethink their overall channel strategy and reduce their reliance on the branch as a channel for revenue generation. A physical presence is still very important for visual engagement with a customer. Transforming a branch into a combined branch and corporate office brings sales and services closer to the customer and provides enormous benefits to staff working closer to home.

About the Author

Bo Berg specializes in strategy, innovation, systems architecture, and technology transformation. With over 20 years of experience, he has led digital transformation efforts to revamp financial service businesses by adopting digital technologies. He has provided strategic leadership for companies to incorporate blockchain technology into their commercial and retail banking applications.

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