Retail banks must blend technology with touch

BCG hails the ‘bionic’ bank.

JOHANNESBURG – Leading retail banks are blending smart technology and digital innovation with a human touch, according to the Boston Consulting Group (BCG), creating “bionic” banking that meets the varying demands of a diverse customer base.

In a report on ‘The Bionic Bank’, BCG notes that as customer expectations grow more complex – with demands for simplicity and efficiency existing concurrently with a desire for personal attention to their financial needs – retail banks must combine digital technology with a human touch.

“Offering just one or the other is no longer enough. In a sense, retail banks must become “bionic”: they must provide digital functionality for speed and convenience, as well as thoughtful, caring human interaction when the customer needs and demands it,” BCG explains in its article, The Bionic Bank.

Among the six key strengths of bionic retail banks, BCG lists clear vision, customer-centricity, technology and operational excellence, and a future-proof distribution model.

On the last point, the consulting firm points to the importance of multichannel delivery, where simple products and straightforward transactions can be processed digitally, so creating space to better invest into and deliver complex customer service.

“A recent BCG survey of customer behavior revealed wide disparity in channel preference and digital aptitude in a typical retail-banking customer base,” BCG notes.

This is true in the South African context, too, where banks are serving such diverse customer bases as young professionals in Sandton to pensioners in the rural Transkei.

Mind the gap

With payment options that range from the traditional cash and bankcard options, to innovations like Apple Pay, Google Play and SnapScan, Gemalto’s Paul Opie says banks realise that they need to support the hybrid technologies used by their customers.

Gemalto is a digital security company that does works across such diverse sectors as government, transport and the machine to machine universe.

Opie, who is banking marketing manager for Africa, notes that where banks fail to offer certain solutions other service providers will spot the opportunity and fill the gap.

He relays a conversation held with someone in Kenya who was using his mPesa account to buy shares on the Nairobi Stock Exchange (NSE) simply because his bank didn’t offer the service. The gentleman would’ve preferred to avoid the added administration (transferring money from his bank account into his mPesa account), but ultimately used the service available to him.

Understanding customer needs and delivering strong propositions to satisfy them is a vital part of being customer-centric and often means simple offerings that “avoid an overproliferation of distinct products and price points”, says BCG.

“A number of leading banks have recently rationalised and simplified their product ranges by as much as 40% and reduced documentation by as much as 80%,” it says.

With banks offering mobile services (think FNB selling iPads to customers or partnering with Cell C to sell SMS and data bundles) and mobile companies moving into banking (think Vodacom’s mPesa and MTN Mobile Money), market dynamics have changed significantly. 

Opie tells Moneyweb that Gemalto has virtually integrated its banking and mobile divisions due to the massive convergence between these sectors. 

COMMENTS   1

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Surely before you implement such changes you should survey what your customers want and need and then fashion your offering in terms of customer needs. Seems like BCG are typical consultants – have all the blue sky chatter, but typically can’t land a thing

End of comments.

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