The competitive landscape of banking is changing rapidly. The non-traditional upstarts are threatening to disrupt the existing century-old business model in the financial industry. Banks have never experienced change, as we’ve seen in the last couple of years. Customers prefer Smart innovations like cryptocurrencies, peer-to-peer lending, smart contracts, new types of online security, and more. Some banks are adapting to meet these new challenges, while others are sticking to their old ways. The question is will they be successful, or will they be left out? And that is exactly what we would like to figure out with an in-depth and data-backed analysis. Based on this analysis we have answered the big Q in the industry- What do banks need to do this year to prepare for 2022 and beyond? Here is our take on trends banks can’t ignore in 2022.
1 Social Media Storytelling and Copywriting
Contrary to popular belief, the real story of today’s customers is not all about you, your brand essence, or your products. But, it's more about how your customer truly feel about you when all is said and done. The fact is, customers are more sceptical than ever. Hence, banks need to examine their brand's essence to gain customer loyalty and trust in the digital world. Banks that are trusted by its customers will win the survival race in this digital age. Hence you need to create long-term relationship with your customers.
For which you should create connections where in you :
Provide insight about what your prospects and customers are experiencing and what you are offering.
Explain how your offering is in their best interest rather than your own.
Position your offer as the ultimate solution to your prospects and customers.
Appeal to your prospect’s emotions by explaining how your product or service will improve their life.
Present your offer as a complete package — think of it in a way that your prospective customers/clients will expect more from your brand.
2 Gen Z and its chronicles
Gen Z is becoming the new consumer group; unlike previous generations, they are poles apart in several ways. Most importantly, Gen Z is tech-savvy and digitally sound. Gen Z grew up in a world that was moving into massive digitalization, immersed in technology and was taught to use computers early.
They grew up understanding how technology can benefit their lives; they know how to use their phones and computers to stay in touch with their friends and use social media to stay updated with the latest information and breaking news. But, more than any other generation, Genz Z is concerned about their financial future. They have financially sound knowledge and are concious about their financial assets and investments from a very young age. It is this tech-savvy generation’s attention that banks need to address.
Many Gen Z consumers are now coming of age in a time of uncertainty and instability. The financial crisis of 2008 and the ensuing Great Recession caused a financial panic, and many people lost their homes, their jobs, and even their savings. Gen Z, who grew up in this uncertain time, has come to view finance as an essential life skill. Therefore, they are more informed and educated about personal finance and far more willing to become financially savvy than previous generations. This is great news for banks and other financial institutions because it means that Gen Z consumers, more than any other generation, are willing to keep up with financial trends and seek out financial advice.
As a result, banks can market their newest services like BNPL
, to millennials.
3 Using CDP (Customer data platform) to target the perfect audience
A customer data platform (CDP) is a platform that aggregates customer data produced by various channels and devices, and connects it with back-end systems. Companies may use CDPs to centrally store, manage, activate, and analyze consumer data. These platforms also provide connectivity with third-party solutions like Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), or Marketing Automation
(MA), allowing marketers to use the CDP's capabilities while creating customer-centric strategies.
Modern day marketers need to understand consumer behavior better, detect patterns, and customize customer experiences to connect with customers. A deep understanding on these metrics will help marketers reach their customers diligently, for which marketers need CDP. A CDP may also let marketers gather data from third-party websites or mobile apps.
Across financial services and fintech, CDPs have the potential to revolutionize the way that consumers view and interact with their companies. A CDP, or customer data platform, gives marketers access to a centralized platform, or hub, containing a person’s data (including its identity), interests and preferences, and information about their interactions across the company’s many channels. Marketers can gather, analyze and act on this data, using many tools; to drive personalized experiences and communications.
We're seeing technology advance and be commoditized in a way that we've never really seen before with the advancements around artificial intelligence and cloud capability, or even the revolution that we're seeing within the core banking sphere is really changing what financial services actually means.”
-David Brear, CEO and Co-founder at 11:FS
4 Self Service
We are living in the age of customers. Today, consumers expect greater accessibility and personalization. They want banking tailored to their needs. They want the ability to talk to humans when they need – but also, they want banking and payment tools that are intuitive and simple to use.
Consumers also want to speed things up as much as possible. They want everything to be quick and convenient. They want banking to be personalized and contextual.
As we look at the future of digital banking
, we see consumers interacting in a much different way than they did just a few years ago. It’s no longer about meeting every expectation but about anticipating them. For exampleif you know that your customers usually travel on Tuesdays, you can suggest that them to pay their bills on their return. This way, you won’t miss a payment, and your customers won’t incur late fees.
With more and more banks moving their infrastructure to the cloud, self-service banking is getting increasingly sophisticated. When we talk about self service we are not talking about ATMs or Digital wallets. We’re talking machine learning and artificial intelligence, cognitive technologies, and conversational interfaces. We’re talking about banking in 2022 and beyond. Its high time you analyse how your bank is performing in terms of the above-mentioned trends and start investing in them accordingly.
Q. What are the new challenges faced by modern banks?
A. Today, customers demand "quick" access to their money, and regulators are concerned that banks aren't providing enough services. So, banks have responded by making greater use of credit cards, debit cards and other financial products.
As banks have moved into other areas, they are faced with new challenges like:
A cultural shift.
Changing business models.
Q. What are some trends in modern banking?
A. The goal is to give customers a seamless and convenient digital banking experience. To stay competitive, banks are looking for ways to innovate. Some are turning to technology, including AI, machine learning, and automation. Others are adopting new strategies, like opening innovation labs and inviting outside entrepreneurs to test new products.
Q. Can banks use the public cloud?
A. Yes, banks can use the public cloud. , banks are taking note of the benefits of cloud computing. The cloud-based software-as-a-service model, for example, allows banks to focus on their core banking operations and outsource the management, maintenance and support of their IT infrastructure.
Q. What is the future of banking?
A. The Digital Revolution is changing the way people do their banking. Given the right access to the right information at the right time through digital means, customers are increasingly shifting transactions online. This has empowered them to make better financial decisions.