In Customer Experience, Operational Efficiency, Risk Management, Trends

In our last post, we noted the importance of reinvigorating and investing in your digital strategy in light of the coronavirus pandemic. While many bank branches remain open for business, financial institutions cannot ignore the realities of the current national and global climate.

Business as Unusual for Banks

People are intentionally avoiding public spaces, many companies are requiring employees to work from home and some municipalities have taken drastic steps to limit individual interactions.

All these are prudent measures to help limit the transmission of the coronavirus, but they have a very real impact on the ability of consumers to conduct their financial lives. As Jim Marous notes in his provocatively titled blog, “Banking Without Branches a Matter of Life and Death”:

“[T]he need for banking services will not cease. In fact, there will be an increased demand for credit availability, new savings and investment accounts, new or replacement debit and credit cards, as well as general financial advice.”

Jim also points out that many FIs are woefully “unprepared to react to an immediate shift to digital products and services.” This is driven by a number of factors, not least of which is the lack of a cohesive, digital-first strategy for traditional FIs. Many organizations have paid lip service to the idea of embracing mobile and online channels for all their customer interactions, but precious few have wholeheartedly embraced the approach.

The Status Quo is Changing

A recent Q&A article from SmartBrief features Richard Hunt, President and CEO of the Consumer Bankers Association. In that article, Hunt offers a decidedly different take than Mr. Marous, noting that banks are proactively taking steps to protect the health and well-being of employees and customers. Hunt mentions that banks are stepping up cleaning of their branches and ATMs, and focusing on customer interactions through drive-through windows.

Hunt also points out that “[m]ore than 99% of branches in the US are open” and available for customers, and that “[m]ore than 80% of Americans have a mobile phone…and already use mobile or online banking for everyday transactions.”

While this is true, the underlying reality is that a rapid and sudden pivot to digital-only (or a primarily digital engagement model) is fraught with perils for both consumers and FIs. These include challenges communicating the digital-first approach, introducing additional channels for fraudsters to exploit, and scaling existing systems to cope with the rapidly increasing demand. What’s a bank to do?

Adapt and Align to Survive and Thrive

First, take a deep breath. It is true that challenging times will require rapid change, but that change need not be haphazard and reactionary. Most organizations will be looking at their continuity plans to ensure they can continue to provide the services and support their customers expect. The well-timed inclusion or activation of a digital strategy will pay huge dividends down the road – Hunt rightly says many FIs “will see a huge benefit from their…investment as customers discover the full array of options available to them.”

Bringing a digitally-native platform into the organization is a logical place to start. The right platform can support your entire business, from DDA and card to auto, default management a more. It will also provide a robust and fully vetted data provider network, with pre-built connections to pull the right information into the right lines of business for your unique needs.

The right partner would be able to scale with you as you continue to expand your digital-first strategy, and support full customer lifecycle needs – from account opening to onboarding, from credit line increases and new product addition to default management.

The right partner would also have deep expertise and strong integrations with fraud detection and prevention solution providers. As more and more interactions happen digitally, your FI will need assurance that your KYC, AML, ID and device verification capabilities are ironclad. The right partner can help you quickly and easily implement solutions to help mitigate risk and protect your customers and your organization.

No matter where or when you implement your digital-first strategy, make sure you have what you need at your disposal. We at Zoot are committed to helping our customers and our soon-to-be customers with custom platforms that can help you implement, expand and refine your digital offerings.

Questions about the impact a Zoot platform can have for your digital initiatives?

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