Digital Transformation in Banking – The Four Key Pillars

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Digital Transformation in Banking – The Four Key Pillars

The digital transformation in the banking sector has developed quite rapidly in recent times. The traditional banking system has undergone tremendous technical intervention and is empowered with the latest to provide an ideal, integrated experience to the modern-day customer.

Digital transformation has become far more significant and immersive than the simple provision of online and mobile transactional features. Artificial intelligence in banking and financial services has revolutionized the industry. Blacklight Software specializes in providing digital transformation services.

Traditional banking providers must combine digital speed and atm services with human interactions which are thoughtful and caring at critical moments in the customer journey. Let’s take a look at the 4 pillars or priorities needed to create a successful digital strategy in banking:

1. Strengthen Customer Journey

The outdated banking model is no longer in use, it’s gone. In today’s world, every business is turning towards digitization. And therefore, consumers’ expectations are constantly increasing. They want and demand sales and customized service in their way. They expect a seamless, secure login process through fingerprint or facial recognition, one-click withdrawals, etc. while interacting with their bank. Find ATMs near you for convenient and accessible cash withdrawals, aligning with the evolving preferences in the digital era.

Traditional banking providers must identify what is important at the critical time during the customer journey. Banks must determine what is going to vary greatly between different consumer segments, and then they need to work continuously on the same to improve the experience.

Banks must adopt an omnichannel strategy to make transactions easier and optimize the customer experience. By adopting the omnichannel digital solution, banks can access any device anywhere, anytime, with a stable experience across the channel. The ultimate goal must be to make the consumer journey completely digital from beginning to end.

Cloud-based CRM is a very important tool in the arsenal of innovative bankers. By moving data onto a cloud platform you can get a 360-degree view of every customer. Get a sneak peek of your entire business, customers, and prospects with Dynamic 365. With a comprehensive data valuation on a huge scale, banks can obtain every information and improve their services and create more value. Big data allows the use of artificial intelligence, blockchain, and Internet of Things to create and plan a competitive edge over other financial institutions.

2. Power of Data

Data and analytics allow banks and fintech companies to better understand customers, identify business opportunities, identify high-ticket clients or cross-selling opportunities, reduce costs, satisfaction and retention. With onboard analysis, financial institutions can speculate on loan defaults. Also, they can identify customers onboarding in banks who are taking advantage of excessive discounts and restructuring the price of products and services.

Plunging deeper into analytics enables firms to compare details of an individual customer product with the average. This might help to enable personalization, which will further deepen the business-customer relationship. Another aspect of data science is that data mining may actually assist identify the right prospects and customers. A further benefit of data mining is that it prioritizes leads and connects with current and prospective clients.

An individual can also combine behavioral analytics to identify customers who are at risk of becoming transitory. And then they can create an individual action plan to maintain the loyalty of those customers.

3. Cloud Banking

Given the high risk of cybercrimes that occur as a result of the new digital economy, there is a significant need for IT platforms. This computing platform will provide more flexibility than ever before. The restructuring process and operational model are the most important aspects for the successful development of bank-based branchless banking. The use of unprecedented capabilities in a cloud organization can accelerate dynamic digital transformation. And also they provide improvements in enterprise-wide processing.

Digital transformation goes beyond the provision of online and mobile features. Banks that provide online banking options or those that for the most part are operating on a digital core may have lower costs and streamlined processes. This end-to-end integration also contributes to delivering an irreproachable and more attractive customer experience.

4. Leverage Technology to Reshape the Business Model

There is a growing desire for the best digital experience when customers need speed and convenience. And they expect the best human experience when they need advice for more complex products such as investments or mortgages. Hybrid sales, customer service, and well-executed business models can inspire loyalty and delight a customer.

Banks that successfully combine human touch with self-service capabilities through AI bots and custom-built portals can expect revenue and satisfaction levels to rise by 15%. And also expect to see branch network costs to decrease by 35%. Thus, you must leverage technology to reinvent banking businesses. These Blockchain and artificial intelligence technologies are creating new avenues for conducting business. There are also personal banking and open banking solutions that are creating quite the buzz now as well.

Blockchain technology can reduce fraudulent activities in the banking sector. It can be also used by agency banking solutions for cross-border payments to reduce the processing time. Blockchain technology can be also used in other fields of finance such as transaction management, private equity asset transfers, loan records, mortgages, and customer service records.

Wrapped Up

The journey of digital transformation in the banking sector is a long one. While other sectors are taking advantage of the latest technologies to create an incredible customer experience, the banking industry is still lagging behind. A true digital transformation has an impact on the whole organization and the value of digitization in all areas of activity must be adopted and maximized. It is time for the traditional banking system to embrace new technologies, to combine digital speed and human interactions, and focus on a more people-centered approach to make your digital transformation initiative effective.

Author Bio

Nikunj Gundaniya, Product manager Digipay.guru, one of the leading fintech solution providers USA, which provides mobile finance application development services. He is a visionary leader whose flamboyant management style has given profitable results for the company. He believes in the mantra of giving 100% to his work

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