bankingciooutlook

7 Trends Reshaping Retail Banking

By Banking CIO Outlook | Thursday, September 26, 2019

Innovative retail-banking solutions step ahead with a futuristic approach to drive success.   

FREMONT, CA: Evolving trends in the banking industry boost the financial status of the retail banking market and open gates for further growth and success, encouraging new digital trends to understand primary demands of the industry and tech-savvy customers. The evolving technologies such as artificial intelligence, banking analytics, and APIs applications, and more, offer massive potential to retail banking. Banking leaders and top professionals recognize the technology advantages over traditional methods. Here are few such trends and advantages, offered by technology.

1. APIs Through Open Banking

Open banking is rapidly gaining traction in the US retail banking market. The open banking system allows financial institutions to share their Application Programming Interface (API) with partners and other institutions. The open access to APIs allows non-banking organizations to develop applications for retailers, institutions, and end-users to connect with banking information. The facility eliminates involvement on any third-party intermediaries to make transactions. Transactions through API-developed app offers transparency and provides options for individual users or businesses to access data and make and receive payments. The fastest-growing API-developed applications help in customer interaction, collect real-time data, make smarter business decisions, offer wide payment options, and secure customer data.

2. Customer-Focused Strategies

Potentials and necessities of customer-focused business strategies play a significant role in the current business and banking landscape. Today, banking professionals are focusing more on addressing customer complaints and improving the sales rate. The new approach to boost the retail banking success ratios, by paying attention to front-lining customer demands, tools, reports, routines, and capabilities to maintain outcomes consistency. Prioritizing customer interests, bankers look for innovations to integrate with their developed product or services. The rising competition encourages banks to explore solutions by collecting in-depth data, analyzing, and identifying customer expectations. Retail banking institutions or organizations use analytics to perform successful conversations with customers and deliver personalized insights and services. The approach to understanding customers’ need builds loyal customer-base and improves both customer and market relationship. 

3. Security and Privacy

 As retail banking grows more and more flexible in delivering the latest solutions, advanced technology helps the bankers to develop top-notch security services that can easily integrate with existing or newly created transaction platform. Data security and information privacy always stand as the top priority for the finance and banking industry. Security services like updating a high volume of Personally Identifiable Information (PII) and payment card information with each transaction are implemented into every retail-banking platform.

The retail banking channels' preferences for data protection increase, as digital customers are expanding their purchase and transaction options across different countries, retailers, and brands. With different data protection laws from different countries, the retail industry shows interest in raising the customer information privacy level. The integrated blockchain platform creates a centralized ecosystem for transactional purpose, allowing highly protected blocks of information with quick and accurate transactional activities. Retail banking adopts recent security updates to expand consumer privacy rights, applies legal and forensic investigations in case of any cyber incidents, and opts for insurance solutions to mitigate the costs of cyber-attacks.

4. Voice Banking Interface

The increasing number of consumers adopting smart voice devices and appliances open new banking opportunities. Eliminating the need for a visual interface, advanced banking and retail institutes bring in numerous digital banking channels and retail banks to connect and offer transaction facilities to the users. The progress in machine learning and automation over the last years help retail banking to implement natural language processing in API-developed applications. The conversational artificial intelligence enables retail banks to introduce services and offers to customer’ day-to-day lives through smart home appliances or smartphones. AI-integrated retail banking applications provide faster ways of payment and other banking processes. Retail banks strategically partner with smart voice device developing organizations in order to build a customized user interface for banking.

5. Cloud Technology

Deploying cloud technology into retail banking services can create cutting-edge competition in the existing market. Cloud technology makes it possible to host Service as a Solution (SaaS) for retail banking applications and promotes faster access to innovative solutions, transformation at scale, and speed to market. The advanced technology allows the retail-banking platform to consume instead of running core application and free up resources to focus on the market competitiveness. The cloud-based solution offer integrated and standard application infrastructure with high data protection, seamless transaction performance, and excellent banking operations.

Retail transaction applications integrate cloud-based solutions; as the cloud-based solutions provide packaged payment services and exclude the scheme and regulation changes, and provide easy access to introduce latest payment innovation in the existing platform. The advanced solution offers faster decision-making abilities, efficient liquidity management, and quick and transparent payment processes. SaaS solution allows faster execution of innovation and streamlines all elements of service- contracting onboarding, service operations and upgrades, and billing.

6. Omni-Channel Banking

Retailers approach for omni-channel banking platforms, which allow real-time data synchronization between different channels. Omni-channel banking processes eliminate the need to provide the same data repeatedly. The advanced process can be used in various back-office operations, while improving the market performance, simplifying onboarding processes, boosting customer retention rates, and more. The innovative platform allows customers to perform all transactions through mobile and web applications. The optimized banking applications with omni-channel benefits enable instant money transactions, to write checks, apply for loans, and order credits cards. Customers can quickly raise complaints regarding any service-related banking problems. The integrated platform provides a customer support center, the chatbot in the application, video tellers, and other communication channels for standard services.

7. Blockchain

The expanding roots of blockchain into banking industry helps retail banking face modern world challenges in transaction management, customer service, and inventory management. The disruptive technology offers smart contract to expand the scope of automation in the internal operations, such as billing, and supply chain management. Integrating smart contracts can automate payment processes for online as well as offline transactions. The highly secured platform with the abilities to track growing records of banking applications saves a huge amount of money by spending less on auditing and accounting processes 

The growing partnership of banking with evolving technology creates revolutionary waves in the retail banking industry. From innovative digital purchases to the instant transaction of money, technology advancement develops a new business model with the digital ecosystem. Powered by innovative solutions, retail banking successfully initiates customer-focused, multi-channeled, and simplified processes for future service or product offerings. Banking technologies for retail banking sector covers the overall segments of customer experiences, business challenges, and smart strategies to generate business revenue and growth. Today, the retail-banking sector stands at the edge of the next-generation banking landscape with the supports backed by technologies like artificial intelligence, cloud computing, big data, blockchain, and many more.  

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