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Fintech landscape - We need it all and we need it now

Posted by Ianai Urwicz on Jul 18, 2019 10:49:00 AM
Ianai Urwicz
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Fintech landscape Prisma Campaigns personalized marketingCompetition for small and medium size financial institutions is coming from all angles, from the tiny fintechs which originally looked like impertinent intruders and from the largest and wealthiest banks which can afford all the latest technology inventions, gongs, and whistles, without thinking twice.

How to catch up and keep competing?

Fintechs have become part of the mainstream banking, as have non-traditional financial services providers. This is both alarming and also a marvelous opportunity to expand beyond the traditional banking mentality. If going completely digital and getting into Open Banking and Beyond Banking is the expectation of the consumer and the compelling industry trend, if it is no longer an option but an essential, then banks face two major questions.

When? And How?

When? is simple to answer. NOW. As the boundaries between traditional banking and other actors in the digital economy continue to blur, the potential for a digital behemoth currently managing our searches or our inane comments and family photos to break into banking becomes even more likely.  

How? is a little more complex. Are the technological developments in digitalizing banking services driving customer demands?  Or are the customer demands been driven by their experiences with other digital platforms not related to banking? The Digital Banking Report produced a study in early 2019,  Retail Banking Trends and Predictions,  which established that customer experiences with Facebook, Google, Apple, Amazon and other monster firms that shape our digital world create in users a stronger emotional connection than those users have with their banks. They are able to do this because they blend experiences from the digital and physical worlds. The same study also found that the data and advanced analytics, the application of AI, open banking and API´s were the first priority, having over-taken the “improving customer experience” mantra.

BankingTrends

But the 2019 Retail Banking Trends and Predictions report also found that only half of the financial organizations surveyed already had a strategy in place for this next-stage digital transformation whilst another 28% claimed that their organization has a strategy, but that the strategy has not yet been implemented.

So there is a dichotomy between what banks should be doing, what they need to be doing according to all the research, and what they are actually doing.  

We all accept that the process of digital transformation is not easy and not comfortable. It requires a shift from traditional business thinking and business models towards an integrated, agile, customer-centric process, whilst maintaining the emphasis on quality, on compliance, and on security protocols to guarantee privacy and data integrity. Digital transformation requires leveraging these new technologies but also requires locating the trained personnel who can lead up the digital transformation process. Money alone cannot buy this, although it helps. 

BankOfAmerica

To remain competitive in the future, financial organizations will need to carefully plan, without the luxury of too much time, and equally, carefully implement digital platforms that can support current and immediate-future digital solutions. 

It´s a tall order but one way to manage this transformation may be to create a digital banking subsidiary with a separate business model, new business processes and new technology. J.P. Morgan, and who is more traditional than they, has done this with banking for millennials, a credit card deal with Apple and now a move into cryptocurrency. Is it the model to follow instead of struggling to convert the existing mother-ship? What about Libra from Facebook, the new kid on the block?

To make your digital transformation a reality, see this real case of personalized omnichannel campaign using Prisma Campaigns, the marketing automation platform for FIs!

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Topics: Prisma Campaigns, digital marketing in FIs, Digital Banking

 

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