Banks Search For Competitive Gaps
Whether building in-house or scanning the fintech market for third party banking solutions, providers of digital financial services find themselves in an arms race to provide the very best customer services to an increasingly digital-savvy user base.
Digital banking services and digital platforms have enabled consumers to manage their money whenever they want from anywhere. As the industry has grown, financial institutions have been responding to new trends and developing new technologies to keep up with expectations to offer customers market-leading digital experiences. Open banking, AI-powered customer assistance, blockchain technology, and other regulatory and market forces have all contributed to the rapid changes to these platforms. From retail checking to wealth management and business banking, providers are looking to assess where they sit within the competitive set – in terms of what their digital banking platform offers and the sophistication of the digital experiences they facilitate.
Traditional banking services – from everyday account management to lifetime financial decisions such as mortgage applications – have been overhauled for the digital age. Deposit holders and lenders have built digitization and the competition it brings into bank operations everywhere from core banking systems to risk management. However, it is in providing the best digital experiences that banks are looking to attract and build their customer bases. A nimble digital strategy and awareness of the competitive landscape are critical to this. From shopping to lending, success depends on the ease with which users are onboarded and services delivered as much, if not more, on the ease of application and quick approvals as it will on competitive rate offerings. For both sides of the balance sheet, a provider’s digital platform will need to keep pace, both in-app and online.
The economic turbulence spurred by inflation and the resultant higher cost of living means banking service providers increasingly need to offer tools that assist in day-to-day financial management as part of customer service. In expanding their digital banking services, leading providers have built out self-service financial wellness initiatives that encourage users to bank well and bank regularly. Through desktop, for example, a handful of wellness features and functions became must-haves for consumer checking providers at the beginning of 2023, such as:
- Low balance alerts
- The ability to set up and edit automatic savings
- The ability to set and display savings goals
In-app, providers are playing to the channel’s strengths, with sophisticated account management capabilities built in using a device’s core functionalities such as pop-up notifications and the various technological faculties provided by mobile, such as the device camera.
However, the pace of innovation weighs heavily on every modern institution, and banks are no different. With new product and transformative thinking around interface delivery occurring frequently banks must continually assess the market for the latest in the digital platform evolution.
Digital Banking Platform Priorities
The Digital Banking Analyzer observes more than 300 providers across 18 countries across retail checking, business banking, Open Banking, unsecured lending, credit card, mortgage, saving and investments to allow banks to benchmark and compare digital platforms against direct and indirect competition. With more than 150,000 screenshots across more than 3,000 journeys, digital teams can assess experiences through the eyes of the user.
Resident Curinos Digital Banking Analyzer experts are immersed in user experiences and provide macro and micro level assessments of each market, offering direction and analysis across onboarding and servicing deliverables.
At the beginning of 2023, our consultants identified a number of key trends that banks should be monitoring:
- Card management capabilities such as spending limits and temporary locks
- Credit score insights and readings for financial wellness
- Account customization
- Digital wallet capabilities
- Prompts to try out new features
Over the last five years, bank shopper preferences have changed...
Institutions are also transforming the digital lending experience, including:
- Access to help and support
- Optimized dashboards
- Education/Learning centers for a range of related financial services, including wealth management
- Tools like calculators, charts and payment plans
- Financial insights, including current credit score and trends
Current Market Gaps
It’s a matter of continual improvement, however. At the beginning of the year, for example, 76% of providers tracked by the Digital Banking Analyzer offered the ability for savers to move money between accounts online, but the figure drops to 71% through mobile. That same count, 76%, allowed for transfers between externally linked accounts online but was only 59% in-app (and several of those providers didn’t offer customers the ability to see pending or scheduled transfers). Similarly, while 82% of providers allowed customers to set up recurring or future-dated transfers online, the figure fell to 65% in-app. Few market participants had set up referral facilities, with about a third doing so online and less than 20% on mobile. And only about a quarter of providers allowed their users to transfer funds to an individual through either channel. However, this is far from a static market and with financial service providers upgrading their services constantly, the DBA’s Data Explorer updates these macro level assessments frequently.
Innovations are occurring across the board. USAA’s tile system, for example, displays balances of externally linked accounts, lets users customize their homepage and, at their discretion, view resources and savings goals. Discover lets users move funds to another person from their savings account using Zelle, an element of flexibility other providers have yet to embrace. Providers are finding the more information they have on these updates, the better they are positioned to react to them.
Insights Into UX
Curinos offers insights into the newest technologies, digital platforms and features available on the market, as well as analysis from digital banking experts – those with their finger on the pulse of the digital financial ecosystem. It’s what gives Digital Banking Analyzer clients the very latest assessments of digital UX.
Curinos enables our clients to keep up with the most recent trends in digital banking and to thereby help them discover performance gaps, push their boundaries and identify opportunities to go even farther.