Across the whole globe, banks are searching for a way to convert to a more digital business model. The changes have not been too disturbing so far despite intrusive offerings from financial institutions or other Fintech businesses. However, the efforts taken so far are the very first step in the ladder of the financial digital market.
Digital banking means much more than just going paperless and being able to process more information in the shortest possible time. Leading companies are offering improved customer experience and delivering more efficient services.
Well, customers are having difficulties resolving some banking issues due to the obsolete rules still popular amongst the traditional banks. On the other hand, such a situation creates an amazing opportunity for the digital banking sector to develop a transparent, trusted and user-friendly digital solution. Recently, all the efforts are focused on customer experience and effective customer engagement as the “old” banks are trying to keep up in this fast-changing environment and because of such a vivid competition banks must adapt quickly to all innovations.
In its study, ath Power found that half of all digital banking users have attempted to open an account online at a financial institution — 57% of Millennials and Gen X respondents vs. 43% of Boomers.
Taking the above-mentioned data into consideration it is clear to state that the traditional banking approach does not work anymore.
Why Online banking? Benefits of going digital
Traditional banks are slowly evolving into online banking services to cover a wider array of customers. It’s basically fast, secure and convenient. However, let’s dig a little bit more. Online banks are decreasing the operational costs by eliminating of back-office processing operations and almost no errors and smaller branches which can be even deducted to video calls with banking specialists. Additionally, the operational costs can be greatly reduced, in some cases even up to 40%.
Online banking services are available 24/7, through any mobile device, PC or branch kiosk. It’s very convenient to use such a service as it can synchronize with all payment apps, e-mails or other bank accounts. It’s fast because mobile and online banking features are quick and easy to use, banking that used to take 20-30 minutes can now be done in 20-30 seconds. Last but not least its secure, digital banking is safe due to the implementation of the newest security systems like 3DS or 2-factor authorization.
Digital banking users are estimated to reach more than 2.5 billion by 2024 In a survey led by PwC.com, people have been asked about their banking habits. It is clea that mobile banking is very important for customers and it is point banks should focus on. Another thing that was touched upon, is the convenience of usage and a goal-oriented consumer in need of help to reach those goals. Also, more than 63% said that it’s good to have an app for mobile payments.
According to Banknews.com, the typical customer of a digital bank is an 18-44-year-old. Mostly western European or USA citizens. Going further it's worth mentioning that only 31% of the examined group indicated that visiting a bank branch is their primary method of banking. The rest is using ATMs or online banking via mobile, tablets or PC’s.
How to change the world?
Digital banking growth is huge nowadays. The customer is looking for a service that is easy to use and can provide the best customer experience, that is personalized, convenient, omnichannel and most likely digital. The more user-friendly experience, the more is the consumer engagement and that is what digital banks should focus on in the nearest future. Time is what really matters to facing innovative services from competitors all around the world. Digital banks are constantly reshaping the financial machine. The innovation is what matters and services like live video streaming may revolutionize the banking industry and the customer engagement, which has proven impact on conversion rates and seems to be a futre of bank content strategy. Today we are witnessing the transformation of the banking industry into digital. How far this digital revolution can get us? I guess we will know in a while.