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A whole new world: Digital banking services for the digital era

Widespread improvements in the speed and geographic reach of mobile internet have led to the creation new digital banking services driven by cloud computing and intelligent terminal technology.

Digital banking services

A whole new world: Digital banking services for the digital era

Industry analysts consistently predict branches, credit cards and cheques are on their way out, to be replaced by more capable, fully-automated ATM and POS networks that improve banking network efficiency, widen access to financial services, and reduce costs.

In five years’ time, consumers will combine banking with a trip to their local café or supermarket, paying for insurance and other services through super-capable POS terminals, or withdrawing cash when paying for their coffee – according to Li Yan, Founder and CEO of Wiseasy in an interview with James Wood, Managing Editor of Payments Cards & Mobile.

The digital advantage

Digital banking has a number of attractions, not least because it is based on more flexible and cheaper intelligent terminals and cloud computing. These intelligent networks reduce the investment threshold for banks and help innovate new services, with lighter terminals, a smarter network and the capacity for a range of intelligent sensors, from 3D light cameras and NFC readers to fingerprint scanners and GPS communications.

This revolution in banking service delivery will have wide-reaching effects, including enabling those without sufficient access to financial services to enter the banking system, a market valued at around $380 billion per year.

To succeed, banks need to completely change the way they think about their existing systems. And it’s not just about new opportunities: as the world moves online, existing customers will expect faster, cheaper, more secure and flexible services as and where they want them.

Using digital banking solutions, banks can quickly and cheaply set up new service networks with wide coverage in both physical and online environments. It’s also possible to bind payment services based on traditional bank cards with mobile wallets, making the card itself a thing of the past.

In the future, digital banking powered by apps and mobile wallets will upgrade the security and speed of payment services at lower cost for everyone. Banks should ask whether they are ready for fully digital, secure customer onboarding.

For fully automated cash deposit and withdrawal, and for instant, real-time cash remittance services. Are your systems fully equipped with Artificial Intelligence (AI) and Machine Learning (ML) capabilities that can tailor products to customer behaviour, delivering value-added services such as smart automated payments and loyalty products on top of traditional payments? If the answer to any of these questions is “no” – then you need to upgrade to new, fully digital systems.

Both start-ups and traditional banks globally have started adopting innovative, digital first client services. Although still in its infancy in Europe and North America, fully digital banking is more advanced in Asia, the Middle East and Africa, where banks have fewer legacy systems to manage.

There is a clear development path to fully digital banking. First, mobile wallet apps replace traditional card payments. Next, consumers switch functions like bank transfers and bill payments to apps. Finally, consumers begin using their app as the bank itself, including value-added services like loyalty programmes, investments and insurance.

Digital banking is an enormous and exciting opportunity for the world’s banks. Banks that embrace the digital revolution will win business, reduce their costs and widen the envelope of services they offer.

More than that, they will ensure customer loyalty at a time when they face stuff competition from FinTech challengers and big tech’s ambitions in financial services.

Deliver tomorrow’s bank – today

COVID-19 has accelerated the shift to digital banking. What could have taken decades will happen in 5-10 years maximum.

Tomorrow’s digital banking solution will be a stand-alone technology platform that can be deployed anywhere, from high foot-traffic areas such as shopping malls through to sports clubs and concert venues.

Alongside this new generation of digital banking technology, best-in-class data security will play a vital role. Given the widespread proliferation of smartphones, it is certain these will play a central role in customer ID and verification over mobile devices and networks.

Banks should be investing in mobile security solutions that are easy-to-use and secure – which means combining customer ID documentation with identity checks using mobile SIM registration data. Above all, banks must act now, since the evidence is clear: prepare for the digital future, or risk being sidelined by customers in the next decade.

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