Even after putting most of the branching functionality in the hands of its customers through digital channels, Customer Experience in banking is undergoing a paradigm shift.

Till a few years back, customers would open their mobile banking app while at a store to check their available balance to decide on whether they could buy something they liked – “Can I buy this?”

This is no longer sufficient, as customers now engage with their banking app to get more insightful information, based on historical data, to get to a state of responding to “Should I buy this?”

In the not-so-distant future, customers will expect the bank’s app to provide them an experience of a proactive, intelligent and personalized financial advisor by answering “How can I buy this?” for them, through leveraging Artificial Intelligence, Machine Learning, Deep Analytics and front-ended by Augmented Reality.

As the bank gets more and more intelligent with analyzing customer’s data, we may reach the point of “invisible banking”, where customers get to use and grow their money without even realizing that they are banking, and the customer’s experience of banking transactions blends into other aspects of their daily life.

Mobile Banking, as we know it today, may soon be dead!

In the age of the tech-savvy customers, who are constantly delighted by engaging customer experiences, expectations from banking solutions are at an all-time high. Digital Banking is no longer limited to banks providing for an Omni channel experience across online and mobile apps. Customers now need to be engaged through other media such as voice and chat, rather than app-based screen flows.

Conversational Commerce is picking up the pace in retail, and banks are rushing to integrate their functions through chatbots (https://www.abe.ai/blog/10-big-banks-using-chatbots-boost-business/). Natural language processing (NLP), which allowed a single field based search to remove the clutter of scrolling through menus, is now unleashing digital assistants in a chat window. Customer support, notifications, requests, and transactions may soon be transformed to sending and receiving messages as part of a natural conversation.

Imagine how WhatsApp, which is integrating UPI for India payments in their social messaging app, will alleviate the friction experienced by customers today to make sending money a breeze; bringing also a whole segment of customers, who are not used to banking apps, to this state of invisible banking.

Voice is also pushing the frontiers of customer engagement and is being seen as an alternative to typing (http://www.kpcb.com/internet-trends, slides 46-48). This opens up fresh avenues for integrating banking functions into new age devices such as Amazon Alexa or numerous IoT-enabled devices without a textual interface.

Invisible Authentication

Customers, even today, struggle with remembering passwords and going through the tedious process of resetting credentials mars the customer experience, in turn reducing their stickiness to bank’s channels. To counter security concerns, financial service providers are trying to improve the experience of authentication through liveliness checks and combining multiple biometric modes, such as fingerprint, iris and 4-fingers recognition.

This trend is also extending to behavioral biometrics, which authenticates customers non-intrusively through a number of uniquely identified usage patterns and continues to learn.

Such multifactor biometric authentication, coupled with data insights and machine learning is expected to take us to a state of continuous, behind-the-scenes authentication, where intrusive forms of challenges (passwords, OTPs) may cease to exist. This should lead to significant reduction in frauds and improve customer experience, as the device will know exactly who is initiating a transaction, along with other contextual parameters such as location, velocity, transaction patterns; “invisible banking” at work again!

Know Thy Customers, and their Preferences

Though every bank follows a KYC process to meet regulatory requirements, true engagement comes from understanding a customer’s usage and preferences over a period of time. Banks sit on large amounts of financial and non-financial data of their customers and should leverage the same through analytics and AI to push targeted offers and proactive notifications.

Banks can provide an invisible banking experience when their Digital suite is geared up with an Analytics-powered platform and AI components to support interactions that are seamless, contextual and rich, and can be accessed across multiple touch points such as voice, chat, apps and even APIs available across devices and interfaces. This will help customers trust their bank, and see them as a financial partner, in turn leading to a superlative customer engagement.

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4 thoughts on “Paradigm Shift in Customer Experience

  • Just to share a thought my bank (ICICI) provides me an option of chatting with the bank instantly through net banking for any concerns – I find it much convenient rather than to go through the IVR on phone or await for e-mail reply which always has a TAT!

  • Nice article Puneet. The time will come when AI applications will tell customers “Why we should not buy this”, based upon data analysis and background details of customer and then the whole decision making power will be overtaken by machines and the human will not be more than a biological product.

  • This is a perfect primer on the continuously evolving subject of customer experience, and there does not seem to be an end to the evolution process, which is exactly why banks remain confused. Just like the blog explains the reduced impact of screen flows in mobile banking, and rising influence of bots, what if the much-hyped customer experience of today dies tomorrow? Thus, it is prudent for banks to ask themselves

    Should I invest in this technology?
    Can I invest?
    How should I invest?

    And clear answers to these questions should come from financial technology companies so that it’s a win-win-win for banks, fintechs and customers alike

    • Rightly said! In an ever changing world where new technologies become obsolete as quickly as they emerge, it is a constant battle for banks to balance out the hype and true value-add. One approach that banks are trying out for this is to integrate with FinTechs, which gives them an opportunity to fail early with lesser investments.

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