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Who will win the banking race?

FNB reflects on the hype around behavioural analytics as transaction volumes on its banking app surpass online volumes for the first time.

The winners in the financial services world will not be those banks that offer all the products their competitors do, but those who can anticipate clients’ needs and see their moments of vulnerability, and address them appropriately. 

Every now and again something big happens in a person’s life, says Jacques Celliers, CEO of FNB. Someone buys a house. Or sells it. A hailstorm hits a farm. Someone gets married, or divorced, or has a child.

Being there for clients during these events and offering appropriate solutions during ‘moments of truth’ – whether good or bad – is what banks will have to package better going forward.

“The winners of the future are going to be people [banks] who get those moments right and help with solutions much broader than just financial services.”

Using customer data to sell to them

His comments come as competition in the banking space heats up and amid expectations that the focus on digital banking will put pressure on banks to carve out a competitive advantage using customer data to gain insight into clients’ lives in the hope of selling more products to them, something the industry refers to as cross-selling.

Addressing investors at FirstRand’s half-year results presentation on Tuesday, CEO Alan Pullinger said that although there is some hype around new entrants being the first to offer “behavioural banking”, the group has probably used behavioural analytics for two decades and continues to refine it.

During the six months to December, FNB’s banking app transaction volumes grew 52% year-on-year and surpassed online banking volumes for the first time.

Source: FirstRand Group

“This migration is important because it allows us to give much better, more timeous and considered offerings to our customers,” Pullinger said.

In the past, a customer may have been in a bank branch without the bank having a record of it, but even if it did, these visits were usually infrequent. With the growing use of digital channels, there is significantly more scope for banks to interact with the client in a personalised way.

“In our world, you come see your bank accounts and that gives us a reason to talk to you and to cross-sell you … and to build more data and understanding about you,” Celliers says.

Bank … or Big Brother?

The bank will not only know where a client works and lives but will see which places they have visited.

“We build lots of data around you and then we try and use the moments of activity to understand your context better and then we offer you more contextual solutions for the moments.”

A decision to offer licence disk renewals at FNB not only allows the bank to assist a customer during a moment of anxiety but provides it with another opportunity to interact with the customer and predict when they will buy or sell a car in future. It could potentially also warn the client about entering an unreliable dealership previously removed from the bank’s client base.

While the move to data or behavioural-based banking could offer benefits for banks as well as their clients, it may also come with added risks, particularly around privacy.

FirstRand, which comprises FNB, RMB, WesBank, Aldermore and Ashburton Investments, reported normalised earnings growth of 7% to R13.3 billion in the six months to December 2018. Normalised return on equity was 22.3%.

The group’s share price closed 2.04% higher at R63.39 on Tuesday.

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When a bank such as this can not get basic service service right for one on one customers. How can you offer personalised service as this. Sort out your cashier service out first and do not order customers to make withdrawals up to R10000 and deposits up to R20000 at your ATM’s in the presence of the street public. Firstly the queue’s are long and the risk factor for theft to great. Or is the safety of your customer’s not a concern?

Yip-personal human contact is the key. Dehumanizing of customers by treating then like numbers instead of people is going to cost the banks dearly. Treating long time customers like criminals also does not help.I mean having to provide proof of address to get a replacement credit card at the bank where you have banked for 30 years is pathetic.

Right now Capitec is leading the race by a mile by charging competitive fees and providing better service. Wonder if that is going to continue now it is getting to the size of the big four.

as a new client to FNB I am not impressed with their after sales service. they can talk about digital innovation until the sun falls into the sea – but like ALL banks there is a BIG disconnect between the staff of the bank the guys that rake in the big pay checks and live in these bubbles where they speak this jargonised BS. they should be forced to work a counter in a branch or man desk in a call centre so that they can be at the front end of their wonderful system limitations. Their app has a lot of functionaility that just doesn’t work – phone the call centre or use the IM feature and the excuses or suggestions are amazing. These guys don’t know how to make money, so they focus on cutting costs.

My problem with banks is that they have innovated, but I question the functionality of the innovations, as in most cases they are thought up in dinge rooms and then handed to the IT team who have no concept of banking service – so you are pushed through all sorts of routines which are unnecessary. Banks became absolutely ineffectual the moment they introduced call centres – they staffed them with “off the street” employees who had no knowledge of banking and are incapable of problem resolution due to their lack of knowledge. Then the real pits is this take a ticket and stand in that queue over there for who knows how long as they never seem to man workstations based on queue history. Also today you don’t ever see a queue manager who walks the queue determines delays and fixes the problems.
Bankers today are not problem solvers they are problem creators

FNB has been the dumbest so far

They had a pretty good website but some tweenie came along and told them that they need to change make it look like a Telly Tubby dream along the lines of Windows XP

So true Grahamcr. Every person who answers the phone on a helpline at FNB is ‘under supervision ‘ which is code for ignorant and incompetent and their standard response if they get confused is to cut you off or leaving you hanging on until you cannot take it anymore.

Swapped my FNB Black Card for a Gold Global One Card (hahahaha).

….not looking back.

Indeed, don’t look but unless you want to go back.

However, take a side look and you will see a Virgin Money Credit Card which will absolutely make you not looking anywhere else but forward. ZERO FEES.

What does “transaction volumes on its banking app surpass online volumes” mean?
Can one use the app without being online?
Or, what exactly does “being online” mean?

I also wondered about that – perhaps it’s one of those mystical phrases that only FNB customers can understand. Anyway, I had a FNB mortgage bond once and believe me, that was the first and last I ever want to see of FNB; when I sold the property my transferring attorney arranged that they refund me the R9000 they tried to do me in with on the bond….ever heard of the Saambou saga? Ever heard of a so-called Step-Up mortgage bond…?
Discovery Bank also aims to build services and products around their members’ fitness levels – no thanks!

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