Is the time of Core Banking over – Time for ccccc?

Here goes the life history of banks –

Banks were first created for handling all the financial needs of people and businesses with licenses to run their segregated operational world- designated masters of their turf.
Their turf was taking deposits and giving loans, which resulted in banks creating intertwined operations based around products – payments, mortgages, credit cards, insurances etc. to name a few with their delivery channel – “The Branch – one stop shop”
In came the new generation banks with innovation up their sleeves that led to the induction of some new channels – Direct Sales Representatives (DSR’s) followed by the Call Centre.
While the DSR’s worked through branches and were served by them, the call center was a whole new remote branch with an entirely new structure of operations. But still, the underlying data was delivered only through the system based on branches.
So essentially both these channels were designed to serve as a layer placed on top of the existing branch based system.
Then came the next generation and another channel popped up: The Internet.
With it came the concept of online banking and the mad rush by banks to get into this space and the thought that the branches may have met their match in internet services.
However, the underlying data was still part of the bundled product held in silos with the internet now supporting the customer’s view of banking since the data speed and services was still limited and customers especially businesses were reluctant to lose their branch connection.
So again internet came about as another layer over the branch based system alongside the mesh of call centers and DSR’s.
Even with the new age storm of cloud, mobile, “app” and big data the inherent problem remained the same – For time immemorial Banks have operated as a vertically integrated business with  business and processes structured  around products rather than customer requirements. Therefore, the limited channels of banking were ill-suited to serve the multichannel world of banking that has now surfaced.

The Challenge –

  • Banking organizations being too introspective, designed products and processes to suit their requirements and rather than based on customer needs, in the process losing customer focus.
  • Banks kept on adding channels over products whereas they needed to leverage data to service customers effectively
  • Data within product silos cannot be leveraged
  • The branch concept of end-to-end banking is lost with customer moving on to internet, mobile, “app”, cloud etc.

The Need –

Leverage customer data to focus on customer service and customer relationships with a refreshed technology for the enlightened and technology savvy  customer of the new world who believes in mobile,  social media, ‘apps’, cloud etc. for living their lives. Towards this, they must acquire the right technology, which can enable them with a holistic view of customers across all channels and touch points.  And that is why systems need changing
With the customers now gifted with the ability to devise and share their lives through technology, in comes the concept of “Enterprise Solutions- a business tool which provides interoperability, and integrated data and, content with easy access, to empower banks to take advantage of emerging opportunities and market changes effectively”.

Benefits –

  • An enterprise solution employs a repository of information and business logic to integrate various business channels and all the backend applications enabling flawless transactions, understanding of customer potential and risks thereby providing the ability to leverage customer data effectively
  • By componentizing the database and rule engine for different banking domain and modules, enterprise solution on one hand provides business flexibility while on the other hand facilitates standardization of reports, reconciliation activity.
  • With an enterprise solution banks can leverage customer information for selling not just deposits and lending products but a wide range of derivatives, insurance products and also enabling banks to perform predictive analysis of customer’s future need.
  • Banks can simultaneously offer better customer service and reduce operational risks and meet compliance standards and regulatory norms.

That is why more number of banks needs to change their core systems and move on to enterprise solutions.

Creating Content in the New Banking Scenario

In our last post, we established that content should be created once and repurposed to suit multiple needs.
Before the bank creates content, it is important to establish content guidelines and standards. These guidelines and standards lay a firm foundation for ensuring consistency, quality, reuse, brand identity and a personal voice. When laying down the rules, the bank needs to think about:
Need: The bank’s content needs, or in other words, the intent in creating content, drives two of the most important pillars of your bank’s content strategy – the Tone of Voice (TOV) document and the Style Guide.
A TOV lays down guidelines on the tone (e.g. personal – impersonal, formal – informal, etc.) to be used when creating content. When content needs to be repurposed, it is important to note the spectrum of such repurpose before deciding the various tonal aspects.
A Style Guide lays down guidelines for grammar, use of abbreviations, fonts, font sizes, acceptable colors and a lot of other such details, which if not spelt out, will prevent content from being seamlessly reused.
Geographies: In a flat world, banks operate in multiple geographies. For maximum reusability, content should be simple, unambiguous and gender/ locale/culture-neutral. This allows it to be translated easily, and also makes it easy to add or modify content to incorporate the local flavor.
Regulatory requirements: Every business is governed by rules. Banking is even more regulated. It is mandated that banks regularly share some information with regulatory and governing bodies.
Customer requirements: Although banks would want to push certain kinds of information to customers, they must also bear in mind their customer’s information and communication needs. These must drive content creation.
Employee requirements: Efficient, motivated, engaged employees have diverse information needs,  ranging from company policy, to corporate news, to functional & product training to recreational information.
Time: Creating content catering to multiple requirements takes time. When banks have strict deadlines to meet, e.g. launch of a new product, meeting a regulatory requirement deadline; they must allow for sufficient time to create quality content.
Resources: Content creation is not dependent only on talent. In today’s world, the tools and technology of content creation are equally important. Curating content is as important as creating it. The publishing medium and distribution channels play an important role in deciding the tools and platforms to be used for content creation.

Mobile Wallet – A long way to go

Mobile Wallet Blog
Last evening I threw a party at a popular pizza joint, in celebration of my promotion. At the checkout, I realized to my horror that I had left my wallet at home and had neither cash nor card to pay with. I had to borrow money from a friend to settle the bill. Had this restaurant signed up for a mobile wallet service, I wouldn’t have faced such embarrassment. With the growing numbers of smart phone users and tech-savvy population across the world, mobile wallet adoption should have been a done deal; yet, we continue to carry physical wallets. The reason is that there are a number of bottlenecks hindering adoption by both merchants and consumers.
In the case of consumers, these are either security concerns, low awareness of the technology, resistance to change, or lack of appeal of mobile wallets. On top, the retailers who do accept mobile wallets have largely restricted them to payments. They must try to expand the use of mobile wallets by adopting solutions that enable them to run loyalty programs and discount promotions based on user profile, and communicate the same to customers via mobile apps. This strategy of making offerings based on a user-first approach will help merchants increase in-store sales and reduce delivery time.
At this stage, with multiple options floating around and no single market leader in the mobile wallet space, customers and retailers are in a confused state of mind. Retailers are not convinced about the benefits of this technology and hence do not bother to educate customers. Mobile providers should take up the responsibility of building technology that can make payment transactions easy, convenient and cost efficient, to encourage mainstream adoption of the mobile wallet.
Currently, the mobile wallet service is restricted to big retailers for in-store payments only. When companies like Square, Paypal, Google Wallet and ISIS are redesigning the mobile wallet to better suit customer and merchant needs, it is important to follow their lead and enable the payment of utility bills and the bills of small vendors like taxi cabs and grocers to accelerate adoption.
Banks and Financial Institutions are also reluctant to adopt this technology, and are confused about whether to partner with the mobile service provider or develop their own wallet. Since customers must link an account to a mobile wallet application for payment, Banks and Financial Institutions should provide a master wallet feature enabling consumers to add multiple mobile payment applications and use them at their discretion. This will help the institutions stay on top of mobile wallet service providers.
Here’s hoping that the mobile wallet will be a preferred option to the credit card or even its physical counterpart someday soon.