Traditional banks are struggling to build a loyal customer base. And the newly emerging digital-only banks, such as Monzo or Tandem, have all the attributes of a strong brand and can keep customers happy and engaged with their product.
The above fact validates the statement that there is no sign of slowing down in the growth of online banking. Convenience, speed, and safety are no longer just additional benefits in the minds of customers. They are now a standard requirement for the fast-changing relationship between customer and bank.
Banks will have to reinvent themselves, and the difference between those organizations that embrace digital transformation and those that do not will grow dramatically. In asking what it means to be a bank in the twenty-first century and what virtual purpose it will serve, one can say that financial institutions will have to support well-being, even more than storing or moving money.
Below is a list of important trends that are likely to shape the future of digital banking,
Customers today, particularly the digital natives, expect their service providers to have easy-to-use and clear digital experiences. Consumers can shop with one tap from Amazon; sign up for Instagram in less than a minute, and have instant access to music through Spotify, and expect similar experiences from their financial services providers.
The integration of online and real-life experiences is also, a key aspect in achieving excellent financial services customer experience. By integrating the "real-in-digital and digital-in-real" banks can build and foster a stronger connection with customers as well as a deeper level of customer engagement. Soon, we're likely to see more digital banking apps that access real-life interactions and communication seamlessly. We are also likely to see digital services proliferating in real-life banking experience.
According to research, banks are moving towards identifying and targeting new micro-segments based on lifestyle, values, aspirations, and needs (e.g., home seekers, frequent business travelers, etc.) with dedicated proposals.
Lifestyle banking also focuses on providing consumers with non-financial experiences that help improve their lives and integrate banking products and services into these experiences. The advantage of this approach is that it allows banks to be a deeper part of the life journey of their customers, enabling stronger customer engagement and the ability to gain better customer insights.
BBVA, which created an app called Valora to help clients planning to buy a home, is a great example. BBVA's app draws data from a variety of sources to provide homebuyers with price information on houses being sold, comparable sales figures for homes sold nearby and estimates what you can expect to receive if you sell your home.