Omnichannel banking has been the latest buzzword in the financial world. With customer experience gaining immense focus in the last decade, it has become imperative to build online and offline financial channels available on different devices. However, many omnichannel myths have prevailed in the financial world, and it’s time to get to the bottom of some of them.

Debunking the myths of omnichannel banking

Multichannel and omnichannel are not the same.
Many banks today offer their presence through ATMs, Kiosks, internet banking, tablet banking, mobile web banking, mobile banking applications, social media banking, and more, apart from conventional branch networks and extension/service counters. This is called multichannel banking.

Omnichannel is not about only consistent look and feel
Having a consistent look and feel across all channels is one part of the story, and it cannot be confused with the story itself. Look and feel only caters to the cosmetic part, but it cannot represent the complete customer experience.

By offering multiple channels, customers will move to self-service channels and will help the banks to cut cost
One has to understand the channel behavior and usage pattern before making such assumptions. Alternate channels complement existing channels but do not completely replace them. Banks have to use the right tools to engage customers through these channels. This strategy will help them to reduce certain costs and explore new income avenues through additional / value-added services.

Enterprise Service Bus or Middleware exposing APIs will do the magic
Some of the tech-savvy banks have been arguing that by having an ESB or Middleware, they will be able to expose all back-office services/transactions as APIs which can be presented through any channels.

Once again, ESB / Middleware is an enabler that facilitates data exchange between the back-office system and frontend channels. It does not replace a need for an independent channel layer that can manage channels more effectively and deliver a consistent user experience across channels.

Not all bankers subscribe to these myths. In reality, this situation arises due to many factors.

Heterogeneous technology platforms: With the evolution of technology, Banks keep acquiring technologies and once acquired it is not easy to replace, technically as well as financially. This results in heterogeneous technology platforms which results in inconsistencies across channels or point of interactions.

Different Vendor: Different Experience: Continuing from the earlier point about acquiring technologies at different points of time, these technologies or solutions are often acquired from different vendors. This results in delivering a different experience to the customer.

Lack of single team being responsible for customer experience: In many banks Internet Banking, Mobile Banking and channels like ATMs / Kiosks are handled by completely different business units. Hence there is no cohesive thinking about customer experience delivered across all points of interaction.

Having talked about myths about Omnichannel banking, let’s understand what Omnichannel means in the commoditized banking world.

“The Customer First” Approach: As per the conventional bank thinking, customers typically approach banks to avail specific solutions or products and services.

In the commoditized market, banks are often found chasing the customers to offer the products and services. And given the number of options available to the customer from banking and non-banking players in the market, the onus is on the bank to be accessible to their customers.

By this theory, Omnichannel Banking puts the customer first so much so that the entire strategy revolves around the customer. To offer Omnichannel Banking, banks have to understand the customer and customer’s world. They have to be present in the customer’s world.

Empower the customer to define the experience they want: In the world of Internet and mobile most of the service providers allow the customer to define the experience they want.

If you look at the telecom service providers, they allow the customers to define their plan, caller tune, data sharing plans, close user groups and so on… Banks cannot be any different. They should allow the customers to define their experience.

Experience here is not restricted to look and feel. But it allows the customers to define limits, security levels, preferences, favorites, add billers, beneficiaries, manage alerts and reminders etc.

Consistent User Experience across all channels: Once you empower the customer to define their experience, their expectation will be to get consistent user experience across all channels, whether it is on the internet or mobile or ATM or call center. They would expect the bank to remember their preferences or limits.

If the customer has set up the beneficiary and limit for that beneficiary, then whether they are making payment through the internet or mobile or at an ATM, the same registered beneficiary should be available across all channels and the limits defined by the customer should be enforced. If the customer has configured the transaction password, the same should be prompted across all channels.

Be present in the customer’s world: Understand your customer’s world and be present in their world, subtly. This will help the bank to engage with their customer.

If the customer is on Social Media, be present on Social Media or bring Social Media into banking. If the customer is spending time on eCommerce sites, banks have to either be present on eCommerce at the point of Financial Transaction or provide options to the customer to shop while they are availing banking services.

A study by CB Insights suggests that customer expectations have dramatically evolved in the past few years. Retailers are expected to be present on multiple channels at the same time. From headless commerce to virtual try-on, there are quite a few technologies that enable a seamless experience. This indicates that banks need to ramp up their operations to not just go digital but move closely into the commercial lives of their customers. They must learn to play a greater role not just at the moment of financial transactions but before and afterwards as well.

Keep listening and engage

As you engage more and more with customers, keep listening, to understand their likes, dislikes, spend patterns etc. And as you listen and analyze the data collected, respond with suitable products, services and offers to stay engaged with the customer.

Be open to changes and respond quickly

Both customers’ worlds and their points of interaction will keep evolving based on the prevailing socio-economic-technology-regulatory environment. Being open to these changes embracing them is the way forward. Using open architecture helps banks launch new channels or new services or respond to changing environments fairly quickly.

If banks understand these realities and implement Omnichannel Banking with a customer-first approach, it will deliver on their objective, whether it is to improve the bottom line by bringing down servicing / operational costs or improving revenues by increasing transaction velocity or acquiring/retaining customers. If you’d like to know more on how to get started with your first step, Clayfin is here to help. Request a demo or visit our website for more information on omnichannel banking solutions.

Jishith Gangadharan

Jishith is a marketing strategist with more than 16 years experience in IT industry. He has extensive experience across various facets of marketing in the industry. Jishith spearheads marketing and communications for Clayfin. Outside office, he enjoys travelling, reading and aquascaping.

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