Fintech Insights

Financial institutions are entering the next stage in banking’s evolution.

Nick Woodcock | SVP, Group Executive, FIS

October 12, 2020

What’s more important to consumers: the speed, convenience and reliability of digital banking, or the nuanced human interactions traditionally found in a branch?

Now more than ever, the answer is, “both.”

Digital and mobile technologies have revolutionized how financial institutions and consumers interact. Waiting in long branch lines to conduct routine transactions is out, replaced by simple, intuitive digital tools available 24/7.

The migration to digital and mobile was already gaining steam entering 2020. The ongoing disruptions stemming from COVID-19 are accelerating this shift.

The next stage in the evolution of banking is likely a synthesis that blends the best of the physical and digital realms. A new generation of digital tools is filling the gaps to satisfy rising consumer expectations, wherever and however consumers choose to bank.

A Banking Landscape Transformed

It’s easy to forget how rapidly digital tools have become the new baseline for banking service. Not long ago considered “nice to have,” digital and mobile tools quickly became “must haves” for financial institutions

An August 2020 Aite Group survey found that 89% of U.S. consumers access their banking information via online or mobile channels at least once a month. Seventy-six percent of survey respondents access online banking weekly, while 29% use digital banking services daily.

COVID-19 has accelerated this momentum to digital and mobile. A July 2020 Citizens Bank report found that digital was the preferred channel for 69% of consumers. Half of consumers surveyed said the pandemic changed the way they interact with their bank, while two-thirds of respondents believed those changes would be permanent.

This “new normal” features a decreasing reliance on the branch as the gravitational center of banking. A June 2020 study by Boston Consulting Group found 24% of banking customers plan to use branches less often or stop visiting them completely after the COVID-19 pandemic abates.

Despite these trends, the human touch remains an essential component of the consumer banking experience. The recent Citizens Bank report found that 65% of consumers prefer human expertise to advise them on financial matters.

Filling Consumer Expectations Gaps

Consumers crave real-time access to live banking professionals who can answer questions, provide guidance and collaborate to find the best banking solutions. Self-serve digital tools and AI-assisted chatbots certainly satisfy some of those needs, but not all. Also, call centers remain a cornerstone of customer service, though reduced call center capacities stemming from COVID-19 mean longer wait times.

Many banking interactions simply require richer interactivity than existing services offer. From mortgage loans to wealth management, many banking functions are infinitely easier for consumers to navigate with the assistance of a trusted financial advisor.

The Best of Digital and In-Person

Face-to-face remains vital for both consumers and bankers. Secure chat and interactive video tools are making that a reality today in the digital realm.

A new generation of digital banking services offers the ability to share and annotate files, share screens and chat securely. The ability to easily execute complex documents via digital signature removes a long-standing pain point.

Replicating a wider range of banking functionality previously available only in a branch improves customer experience while creating more operational flexibility and efficiency for financial institutions.

Banking customers crave continuity, especially when working through more complex functions like mortgages. Offering the ability to connect virtually with a personal banker helps maintain seamless continuity though the most important events in a consumer’s financial life – regardless of their ability to be in a specific branch at a given time.

The next generation of digital banking tools allows agents to respond to customer chat inquiries, initiate and receive internet calls, annotate and send documents, chat face-to-face via live video, and more. These digital tools elevate digital and in-person experiences, such as the ability to collaborate with remote bank employees.

The Future of Banking, Today

As digital banking services have matured, their ease, speed and reliability have proven irresistible to banking consumers. As transformative as these services have been, their scope has been limited.

Today, that’s starting to change. A new breed of digital and mobile banking tools is helping financial institutions navigate this critical time of change and transition for consumers and financial institutions alike.

Though the urgency to reinvent a broader range of in-person banking functions digitally may be born of the necessity to adapt to 2020’s unprecedented challenges, serving banking customers of the next decade and beyond demands transformation today.