Every day, people turn to technology to replace the traditional banking experience. In fact, 50% of all adults will use a mobile device to access financial services by 2021.
However, banks aren’t exactly optimistic about this change. Since 2012, several major US banks have experienced a gradual decline in the rate of active mobile banking users. And even today’s most popular institutions only boast 20% mobile services adoption rates.
So, despite growing global smartphone penetration and more mobile device users than ever, why is this happening?
Technology offers tremendous business advantages, but for many consumers it’s still a very scary thing. After natural disasters, technology is actually ranked as people’s second most serious fear. And, for 44% of US consumers, identity theft and banking fraud are life’s biggest concerns—ranking twice as highly as the fear of being victimized by a terrorist attack.
Given the recent string of finance sector cyberattacks and data breaches, public trust in this industry is at an all-time low. Of those that have never used mobile banking services before, a whopping 73% cite security concerns as their primary detractor. Even if they do use mobile banking, only six percent of these users trust finance sector technology for legitimate transactions outside of checking account balances.
As convenient as mobile banking can be, for many people a technology-driven solution still seems overly difficult. More than anything else, today’s digital experiences carry the most weight in a financial services customer’s mind. So much so, in fact, that many of the industry’s institutions are shifting their focus to the not-so-simple task of convincing customers to change a lifetime of banking habits.
That’s why 72% of financial services organizations believe redesigning and/or enhancing their digital customer experience is a top priority in 2018. Moving forward, expect many organizations to leverage high-powered innovations like advanced analytics, machine learning, and contextual engagement to further personalize and upgrade digital customer experiences.
Remember when mobile banking burst onto the scene? Banks attracted new, tech-savvy customers by the millions. Today, however, every financial services company has a mobile solution, making it much harder to differentiate and compete across the industry marketplace.
Instead of fighting over a shrinking pool of users that still refuse to advantage of mobile banking, successful organizations are leveraging hybrid offerings to increase customer engagement and loyalty among those who do. By giving digital-minded consumers faster, more convenient access to in-branch services, it pushes them to consume more banking products/services—and on a much more frequent basis, too.
While mobile banking is the most commonly encountered feature of an organization’s digital customer experience, finance companies are finding other new, meaningful ways to influence and enhance positive consumer engagements.
Financial organizations have used Application Programming Interfaces (APIs) for years—but not like how industry leaders are leveraging them today. By the end of 2018, half of all global Tier 1 and 2 banks will offer at least five external APIs due to a combination of new regulatory requirements and the potential for partnerships with other technology-minded enterprises.
By exposing APIs to outside parties, banks will be able to develop a more agile, modern customer experience—and can do so without surrendering the slightest bit of brand control or protection.
AI and the Banking Experience
Since automated technology is 50% to 90% less costly than a human employee where mundane, repeatable tasks are concerned, finance companies are increasingly investing in Artificial Intelligence (AI) to streamline everyday operations and deliver services to customers at the lowest cost possible.
Unlike businesses of the past, today’s financial industry leaders collect enough data to understand buyer behaviors and create unique products/services tailored to each customer’s preferences. AI aids this process by automating any associated time- and/or labor-intensive processes and simplifying customer-facing systems and processes—thereby improving the overall customer experience.
Bringing Biometrics to Security
As the number of technology-based bank security threats explodes, financial organizations are spending more than ever to keep data safe and reassure customers. This year, spending on next-generation security authentication methods will rise by 20% as the industry attempts to improve its cybersecurity image with brand-new techniques and technologies.
In addition to enhancing data protections, biometrics improve the customer experience by preventing the need for consumers to remember multiple user account credentials and passwords. That means a safer, simpler digital banking experience for everyone moving forward.
Speaking of the future, the finance industry is more excited about the Internet of Things’ (IoT’s) potential than any other technology—and companies are making investments to back up that belief. Today, 73% of financial services organizations say IoT receives the bulk of their organization’s digital investment, and 63% believe that will still be the case three years from now.
Over the course of 2018, financial institutions will deploy more IoT solutions than ever before. By using a small-scale, proof-of-concept deployment before rolling out this technology enterprise-wide, these organizations can accelerate implementation times and reduce the number of issues a company’s IT team will eventually need to manage.
So, will mobile banking evolve and improve by incorporating today’s new technologies? Or will the finance industry be forced to find another way to improve the digital customer experience altogether?