In Customer Acquisition and Retention, Customer Experience, Regulations, Trends

We recently returned from our favorite event of the year: CBA Live. Hosted in Washington, DC, CBA Live 2019 brought together more than 1700 bank executives, technology partners, solution providers – and yes, even regulators – to collaborate and share ideas about consumer banking.

Zoot was there primarily as an exhibitor and a speaker. But this year, we also took our podcast on the road and covered the event! Stay tuned for our CBA Live ‘CX roundup’ podcast in a few weeks. In the meantime, here are the main takeaways we got from the event.

1. Fintechs Are Friends, Not Foes

The banking industry has a new threat, and it’s led by tech giants Amazon and Google. In this changing landscape, up-and-coming fintechs are getting recognized for the opportunities they present to banks and are less likely to be perceived as competitive threats.

Tech giants have created a level of customer expectation that can be hard to match. Elizabeth Dobbers, EVP at BBVA Compass, remarked, “Consumers have led the charge on changes to the banking customer journey. Small business used to accept 3-5 day processing times, but small business people are consumers and they expect speed.”

To meet this expectation, banks are often looking to partner with fintechs.  By collaborating with fintechs, banks are creating new opportunities for both sides. Noting this, Joseph Otting, OCC Comptroller of the Currency remarked, “It’s a great time to be a small bank.”  No longer is it up to banks to do it all themselves, nor (according to some) can they expect to remain competitive in today’s tech-dominated landscape without help.

One notable dissenting opinion on the topic came from Brian Moynihan, chairman and CEO of Bank of America. His keynote speech pointedly mentioned the threat of fintechs and other non-banking entities, stating, “[T]here’s been a lot of talk about the differences between big and small banks, but in reality there is no division in our industry. …The division is between those that are inside the [regulatory] tent and those that are outside.”

2. CX is [Still] King

As our podcast host, I was onsite at CBA Live this year interviewing attendees for The Finance Frontier. Many attendees spoke on their biggest Customer Experience challenges, as well as how the digital revolution is affecting the way they think about engaging with their customers.

“Digital experience is really turning banking on its ear,” remarked Jackie Buonassisi, Vice President of Omnichannel at US Bank. “It’s a game changer. We’re now having to look at how we can streamline the customer experience, how we can make it simple, easy… how few clicks you can get through to onboard a customer.”

Peter Ungerleider at FI Consulting weighed in as well: “With all of these technology investments it’s making it easier for customers to sign up for new products, but at the same time it’s making it easier for them to switch to other institutions if they have a bad experience. A bad decision [made by a bank] is a bad experience [for the customer], and could result in attrition of their most profitable and prior loyal customers.”

Gavin Geraci, COO at PNC spoke to us about the value of building organizational structure around the customer experience. “If you want to be true to the customer experience, you have to organize around it,” he said during his small business panel on the customer experience journey.

3. CRA Modernization

There was also a lot of conversation on the topic of the Community Reinvestment Act (CRA). This set of regulations have remained largely untouched since their inception in 1977, despite the dramatic changes to the world around them. Amidst today’s landscape of smartphones and mobile banking, regulators seem to agree that it is time to modernize CRA regulations.

FDIC Chairman Jelena McWilliams indicated that CRA modernization was “not her top priority” but she was hopeful that it would be completed within a year. Otting asserted that it would be complete by December. The audience, however, disagreed – over half of CBA attendees polled did not believe regulators would enact meaningful CRA reform.

4. Financial Inclusion

From panels to sessions to keynotes, financial inclusion was a theme that wove throughout the conference. In one of the first sessions, Dr. Emre Sahingur, SVP of Predictive Analytics at Vantage Score, cited the 50 million ‘unscorable’ Americans out of 252 million credit aged people in the US, and noted that the these ‘unscorables’ had a definite demographic correlation.

“A person is much more likely to be without a credit score if he or she is Black, Hispanic, or of the millennial generation,” he shared. He went on to note that many of these so-called unscorable adults would be strong customers with good repayment tendencies.

On the regulatory side, FDIC Chairman Jelena McWilliams spoke of the millions of Americans living paycheck to paycheck, and the need for the industry to embrace small dollar lending in order to meet this growing need.

Richard Hunt, CEO of the Consumer Bankers Association, cited McWilliams’ comments earlier in March, when she stated, “when I assumed the chairmanship of the FDIC … I did so with a firm belief that people like my dad, people like me and people who are not part of the financial system need to be part of the financial system.”

5. Diversity in Banking

If last year showcased an uptick in women in the spotlight at CBA Live, this year, it was a downright agenda item. To quote CBA, this year’s event included a women’s networking breakfast “to honor the role of women and diversity in the retail banking industry.”

Breakfast attendees listened to a fireside chat with Hilani Kerr, Managing Director and Head of Global Cross Currency Product at Bank of America Merrill Lynch, and Mary Caroline Tillman, co-head of Russell Reynolds Associates Global Financial Services Sector.

Chase CEO Thasunda Brown Duckett gave a rousing opening keynote on Monday, stating, “I am my ancestors’ wildest dream.” On her position at Chase, and being one of the most senior black women in finance, she said, “janitors, cooks, and secretaries … are the ones that put tiny cracks in the ceiling, allowing me to exist here today.”

She acknowledged there is still much more work to be done, urging audience members to “decide” they want a culture of diversity, and then ask why it is not yet a reality.

Wrapping Up a Great Week

Dynamic, diverse, inclusive and innovative – these are some of the main themes from this year’s gathering in DC. It was a great conference and we had a lot of fun listening and learning from the industry leaders. We also enjoyed sharing our story and our thoughts in the panel session and at our booth.

If you didn’t get a chance to stop by, please contact us to learn more about who we are and how we can help you as you continue the evolution of your company.

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