FSI Is Lagging Behind in Digital Adoption. What Can Be Done?
Image source: Adobe Stock Premium Collection / Blend Images.
by Mark Greenaway
posted on 07-23-2018
In its 2004 annual report, Wells Fargo Bank observed, “Banking is necessary. Banks are not.” In fact, I don’t remember the last time I entered my local bank branch. My payslips are deposited automatically. All of my monthly payments — auto loan, electric, credit card — are scheduled and processed online. I can get cash through any ATM and most shops. Given how few checks I’m writing these days, it’s unlikely I’ll need to order more any time soon. And if I do, I’ll place the order online. If it weren’t for the monthly emails telling me my banking statement is ready, I’d hardly know my bank exists.
But banking? Still a necessity, and notable that the emphasis here is on a service rather than an institution. Recognizing this shift, agile new startup banks are disrupting the old branch-centric paradigm, delivering digital-first services tailored to the needs of individual customers.
This wave of disruption is driving a transformation in consumer expectations. Today’s customers, particularly millennials, expect mobile banking apps to provide all the features of a traditional bank branch — and when banks fail to deliver on those expectations, customers switch. This is less of an evolution than a revolution, impacting every aspect of the retail banking sector.
But despite this wave of transformation, financial services industry (FSI) organizations lag significantly behind in prioritizing digital services. Adobe’s 2018 Digital Trends in Financial Services and Insurance survey found that a mere 9 percent of FSI companies report being “digital first,” lower by far compared to retail or food service companies.
What’s to be done about this alarming gap between consumer expectation and digital transformation? Here are a few practical insights on how to begin.
Prioritize digital adaptability
In last year’s Adobe’s Digital Trends Survey 2017, a full 91 percent of respondents agreed that customer experience was a priority for their organization. Even so, only 37 percent of FSI organizations have dedicated budget for digital transformation, whereas only 2.35 out of 4 European companies are ranked as digital-ready. Moreover, only 51 percent of FSI companies surveyed said that digital permeates most of their marketing activities.
The takeaway here is that, whereas almost all FSI organizations recognize the importance of placing customer experience front and center, far fewer are taking practical steps to make that emphasis a day-to-day reality. FSI organizations need to be doing more to ensure they’re as operationally efficient as possible, and are providing customers with an innovative and compelling experience.
This transformation is especially crucial in light of the appearance of start-up banks such as Monzo, which have replaced brick-and-mortar branches with adaptable mobile apps and online customer service. Many traditional banks have the resources to deliver similarly stellar service, but to delight their customers as the new disruptors do, FSI organizations need to dedicate more of those resources to digital-first initiatives.
Adopt experience-boosting technologies
The good news is that FSI organizations don’t have to restructure their entire budget to provide outstanding digital-first service. All it takes is the adoption of a few key technologies designed to enhance digital workflow, which can help give retail banking companies the edge on this new battleground of customer experience.
For example, the EU’s new EIDAS regulations have now come into effect, standardizing electronic and digital signatures and verification services across the EU. This means digital signatures are now just as legally binding as pen-and-ink ones, and fully admissible in legal proceedings.
Digital signatures have already been shown to greatly accelerate processes like opening a new account or gaining approval for loans. Customers are also far more likely to complete these processes when they sign online instead of on paper, which means the adoption of e-signatures significantly increases onboarding rates for many products, boosting productivity while raising the bottom line.
Meanwhile, advanced document technologies enable FSI companies to eliminate manual form filling, saving valuable time. The latest generation of customer relationship management (CRM) systems, such as the software on Adobe Document Cloud, integrate seamlessly with intelligent digital documents, automatically ensuring that banks capture every piece of data entered on these forms, and can leverage that data toward the delivery of enhanced customer experiences.
Adopting technologies like these can go a long way toward streamlining digital processes and strengthening customer relationships, but, ultimately, these tools must be treated as components of a comprehensive digital transformation strategy.
To learn more about bridging the gap between customer expectations and digital efficiency, download Adobe’s free report, Digital Efficiency in the Financial Services Industry 2018.
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