Banking services in India are undergoing digital transformation
From teletext services to SMS to Interactive Voice Response (IVR) systems, technology has always affected how businesses reach out to consumers. This is true of today’s digital ecosystem as well, which has empowered consumers to make choices more than any other era.
In a competitive business environment, there is an increased focus on customer centricity as a differentiator. Traditionally enterprise-facing sectors such as banking are overhauling their product offerings and service channels to reflect the demands of the socially mobile consumer.
Taking a cue from the government’s push for a cashless economy and the rise of digital wallets last year, financial institutions are focusing on mobile product design. This includes augmenting existing services, such as NFC-assisted mobile banking while developing completely new tools for customer outreach.
AI-based chat bots are an interesting avenue to build trust through intelligent conversations. Sweden provides an excellent example of this; customer satisfaction with banks was at an all-time low in 2016 when Swedbank turned to Nina, a chatbot that takes care of all service calls. This frees agents up to drive sales.
Indian banks have also turned to these bots to make customer service better SBI’s SIA chatbot handles customer queries and guides customers through retail products and services. ICICI Bank’s iPal helps with new feature discovery and automatically routes queries to humans if needed.
HDFC Bank’s EVA, meanwhile, provides a conversational experience to customers across digital platforms. Customers can access product details, fees, application processes, branch IFSC codes through the chatbot. These assistants can handle millions of customer queries across multiple channels and improve on-the go. This also gives banks a huge mass of data which can then be analysed to refine their offerings.
‘Open banking’, which involves building a platform based on open Application Programming Interfaces (API) is a concept which could change the way banks approach customers. By allowing third parties to access their APIs, banks can offer a multitude of services outside their ‘core’. A bank could partner with bank partners with start-ups and online platforms to acquire new technologies, or extend their reach. They could then offer virtual assistants that help optimise your cash-flow, across all a customer’s bank accounts.
Open banking is already in practice in Europe and the UK; Germany-based Fidor Bank’s FinanceBay platform allows customers to select from banking services from fintechs in an ‘app-store’ experience. This gives fintechs access to new customers, while Fidor gains valuable insights. Other partnerships have helped banks acquire new technological capabilities like payment services and expand their services to new customer segments.
With over a billion mobile phones, India presents a unique opportunity to achieve true financial inclusion, especially in rural areas where mobile marketing is expanding at the rate of 10-12%. Customer-centricity focus by banks will eventually lead to bitcoin entering the mainstream for cross-border payments and trade finance. Keeping the Digital India vision in mind, we will see more data-driven partnerships emerge.
Mobile Banking in India is the new norm in the financial circles.