Key Digital Banking Transformation Trends for 2021

Banking CIO Outlook | Tuesday, November 23, 2021

Fremont, CA: Despite the fact that the pandemic has become a day-to-day reality for everyone and every business, organizations cannot use this as an excuse to stop moving forward. New initiatives that can use data and analytics to improve the customer experience must be prioritized. Digital engagement must be improved, with a focus on simplicity and speed that goes far beyond what is currently available. Furthermore, financial institutions must maximize the use of existing technology.

Every bank and credit union must embrace the ongoing digital banking transformation trends in 2021, falling back on the commitment to improving digital customer experiences as well as the internal processes, infrastructure, products, and personnel that will serve as the foundation for future competitiveness.

Emphasis on Digital Banking Experiences

Financial institutions will face increased pressure to provide digital functionality that is both simple and quick. To meet rising customer demands set by big tech organizations, it is important to focus on internal processes, procedures, and data flow to allow completion in less than a minute, as opposed to new account opening or loan application procedures that can be completed in 5-10 minutes.

To improve digital consumer experiences, financial institutions may separate their external presentation layer from their back-office data layer in some cases. The Google Plex partnership with many financial institutions is an example of this transition. In addition to improved account opening and the combination of checking and savings, the new service offers simple, seamless, and personalized digital engagement.

The risk of failing to provide this level of customer experience is that new and existing businesses will shift to organizations that have succeeded in rethinking legacy processes for a new digital reality. It is more than just easier account opening; it is an improved user experience (UX) throughout the entire customer journey.

Use of AI and Data for Predictive Personalization

With the COVID crisis, financial marketers were thrust into the spotlight, requiring them to respond to unforeseen circumstances in an instant. Instead of selling services, marketers were asked to personalize communication to assist customers in dealing with the financial consequences of the pandemic. Blanket communication about branch closures needed to be quickly transformed into personalized messages about loan payment deferrals and how to use unfamiliar digital tools.

The next evolution of financial marketing will occur in the coming year, with data and advanced analytics being used to provide predictive personalization. This application of AI and machine learning will lead to tailored websites, real-time financial recommendations, and a level of test and learn capabilities far beyond what was previously imagined.

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