This article is an excerpt from a white paper co-authored by Peter Alkema and Dr Jeff Yu-Chen from Gibs University.
Customers are increasingly relying on various smart technologies in daily life – Part 2
Ubiquitous banking also requires taking customers’ behaviour as the focal point and designing services accordingly.
Investments in big data will generate more precise analytical marketing efforts based on customer behaviour insight.
Leveraging big data analytics in this manner means that banks will be relying on artificial intelligence (AI) more than ever before.
In 2014 a partnership between Swiss banking giant UBS and Sqreem, a software vendor, enabled the bank to determine a client’s behaviour by analysing huge volumes of data, thereby offering detailed, personalised services.
The South African banking industry already fosters world class innovation in many of its products and services.
Chip and pin cards, trigger messaging and highly advanced self-service digital and ATM channels leave many international and developed economy banks in South Africa’s slipstream.
South Africa is already the most cashless economy on the continent. All banks here already offer cashless tools such as credit and debit cards; electronic funds transfer; and digital wallet solutions such as FNB’s e-Wallet.
Disrupting any industry requires doing something totally different and too compelling for customers to avoid, even if only due to FOMO (Fear Of Missing Out).
Digital disruption in South African banking will be no different to this and it is important to understand the modulating forces at work – but indications are it will be at least five years before they result in any seismic shifts.
Machine learning technology has made rapid advancement, it is predicted that AI will reach human levels of intelligence by 2029.
Efficient, bespoke services can be achieved with AI-assisted platforms.
Even though currently no bank yet offers a fully conversational interface outside their own app, AI remains as an exciting prospect for the players within the sector.
Such rapid advancement of AI may result in a reduced dependency on bankers to provide the expert advice.
Ultimately, it is the customers who will decide what new lines of business succeed and how they want to interact with their bank.
Many progressive banking executives realise their customers will always need banking, but they may not always need bank in the traditional sense.
These customers are increasingly the flexible, tech savvy, price sensitive millennial individuals who not only want everything on their smartphone, but have become somewhat distrustful of banking through the global crisis.
How to develop trust and win back the customer will remain at the top of any enlightened bank’s agenda.
Digital disruption also facilitates the physical banking branches undergoing radical change to improve service levels.
Bluetooth Low Energy (BLE) and iBeacon technologies offer the ability to provide personalised services when customers visit the branches and this is clearly demonstrated in the consideration of Barclays towards their customers with disabilities.
In certain branches of the bank, positioning systems notify staff of the arrival of a customer with disabilities, enabling staff to take the required measures to improve the customer experience.
Artificial intelligence technology has also been welcomed with delight in some banks: Customers visiting Japan’s Bank of Tokyo Mitsubishi UFJ can expect a 58 centimetre-tall humanoid robot, named NAO, to address their basic service-related questions in one of 19 languages.
It isn’t just a one-sided conversation, NAO is also capable of interacting with customers’ smart devices and evaluating customers’ behaviours as well as facial expressions.
This has not only reduced customer waiting time, but has enhanced the overall customer experience.
Sometimes, efficient services may not always demand the use of advanced technology.
Despite being technologically savvy, the customers of BofA take advantage of the bank’s digitisation and schedule nearly 21,000 appointments with branch personnel every week using their mobile devices.
Scheduling appointments online means that bankers can meet at a time that’s convenient for their customers and yet such a simple concept has not been fully embraced to its maximum potential within the industry.
The ability of a bank to combine technologies with human interaction that offers personalised banking services will become one of the key differentiators.
Banks are therefore compelled to think more radically on how to service and engage with existing and potential customers in the future.
