Sumit Kuhite, Partner Management and Marketing, TCS BaNCS
In today’s world, the value creation for a customer has moved away from the bank’s internal value chain. Banks need to figure out a way to understand where exactly and at which exact moment this value creation is happening and how is it related to the context of a customer.
Post covid, the future of spending is changing in our society. We, as a society, are becoming cashless and moving away from cash payment to online, contactless, QR codes and many such other payment alternatives. People have become more comfortable with digital approach. Rather than visiting a bank branch, they are now comfortably engaging with banks on the apps. These changes have challenged Financial Institutions to change the way they work. We are seeing the result of that with the way banks are interacting with customers. Even in the pre-covid era, the financial landscape was disrupted by new players such as fintechs and neo banks. With these players not subjected to strict regulatory environment, they are able to proactively launch new products into the market by partnering with other technology providers in a shorter timeframe. This has caused the traditional banks to rethink their approach towards digitalisation.
The new-age customers are no longer content with mobile banking apps catering to basic requirement of providing account balance and facilitating bill and P2P payments. With a constant exposure to digital world, customer expectations are only growing. Today, customers are asking banks to categories their expenses and transactions and help them with their budgets for a sound understanding of their overall financial condition. Customers now want to bring all their accounts, be it savings and trading account, together to get a holistic view of their banking world.
The market has moved beyond digital channels and expectations have only increased. The banking engagement has moved beyond selling a finance product and it is now more about how banks can embed finance in the journey of budgeting and planning. Merely pushing products, sending notification is no longer the engagement the customer is wishing for. Customers, in fact, want banks to be available for them at the time of need. Banks need to think about how they can be available 24/7 for providing banking services when needed. A customer may walk into a Walmart to buy a 55-inch Television and would be expecting his/her bank to offer a personal finance right there on the shop floor itself.
Beyond that, banks need to think about how they can make the whole customer engagement journey fun and educational. It is about creating a gamified banking experience that empower users to go beyond traditional banking use cases. Such an engagement is critical for banks targeting young generation, and millennials. It can include things like creating budgets, taking financial challenges, saving goals for customers to not only keep them engaged but gradually make them financially smarter. One way to improve the engagement is by mimicking the social media channels such as Instagram and Facebook. These channels hook their audience by offering newsfeed, challenges, gamification, and non-intrusive notification. With technology companies like Meniga, banks can analyse customer’s data be it transactional to produce smart insights based on their habits and likes. Banks can use this analysis for creating an engagement mix to picturised conversation with customers. These personal insights can be offered to customers in the form of feed to keep engagement at a personal level.
One other approach could be to talk about the issues the customer care about such as climate change and global warming. Customers are willing to actively contribute towards planet’s sustainability. Companies such as Meniga helps banks engage with customers by creating awareness around sustainability by tracking their carbon footprints and exploring ways to explain how they can be more sustainable. Young adults caring for such initiatives would want their banks to offer such information and if they do not, they may switch to other banks which does so. Talking about something the customer cares results in better engagement with the bank. Because the customer cares for the topic, banks can recommend a relevant product around it which the customer may accept happily. That is one-way banks can make money by upselling and cross-selling.
That is what makes collaboration the need of the hour. Gone are the days where banks or even solution providers could build everything on their own to become a specialist in everything. It is important like never before for banks to gear up the ability to work with ecosystem partners.
TCS BaNCS Ecosystem and Marketplace plays a key role in ensuring that banks can make the most of the technology and solution partners present in the market. It provides an innovation hub for fintechs, customers and prospects bank to iterate and create cutting edge innovation. Banks are regularly investing in their ecosystem but TCS BaNCS, with its ecosystem of partners, adds value to existing value chain to create overall value proposition beyond banking. With partners such as Meniga offering sustainable banking and Personal Finance Management capabilities, TCS BaNCS ensures that banks get the technology they need to stay relevant to its customers. With its marketplace, which has more than 20 APIs of Meniga, any bank can evaluate the use case for PFM or carbon footprint capabilities to understand and evaluate the use cases.
Building and bringing new products to the market has never been a trivial task. With banks being challenged by new players to launch products in short timeframe, they need to react fast to the market requirement. TCS BaNCS Ecosystem and Marketplace with its catalogue of curated and complementary Fintech solutions ensures that banks can speed up their go-to-market strategy by collaborating with the partners and experimenting with their offerings in a secure and trusted sandbox environment and utilizing our pre-packaged and curated solutions. Be it PFM or sustainable banking, the key is to understand what customers want and collaborate with a partner whose technology can help banks meet customer expectations.
Disclaimer: Views or opinions represented in this article are based on the conversation between Meniga and TCS BaNCS.