The future of banking is digital. Period. Hopefully we’ve progressed to a point in financial services where this statement is accepted wisdom and no longer needs to be debated. There are reams of data that support this and nothing about the future as it is unfolding now suggests otherwise.
Another given is that all digital engagement strategies should now be “mobile first.” From the looks of some mobile banking apps deployed today, this has not yet reached the level of accepted wisdom in our industry.
Mobile first does not mean the browser and/or branch are going away. They will continue to serve as channels though their purpose and functions may change. However, mobile first does mean that if an institution cannot offer a solid mobile experience, its account relationships are definitely at risk.
For the sake of this forum, let’s accent the positive and discuss how any bank or credit union – not just the largest of FIs – committed to a mobile first strategy can best stay current in offering state-of-the-art mobile services. We’ll break the conversation into two distinct rationales, sharing one today and another to watch for next week.
“Good Enough” Isn’t
Historically, smaller banks and credit unions (with some notable exceptions, of course) have taken a “check the box” approach to digital services, making sure they had an offering in market, but not investing much time or resources into optimizing it. This worked to the advantage of core banking providers, who often included these modules in broader deals for minimal incremental cost while touting the benefit of hassle-free interoperability, which was too often more fiction than reality.
This arrangement of taking a “good enough” product from a one-stop big box software provider is no longer viable. A 2017 Harris poll sponsored by D3 Banking found that two-thirds of digital banking users have been frustrated with their experience. Not surprisingly, dissatisfaction is even higher among younger age groups. FIs are not blind to this fact and a few are trying different strategies to tailor digital offerings to fit demographic segments in their customer base. One institution I am familiar with is approaching this challenge by making three separate mobile banking apps available, each designed to appeal to a specific customer segment. The amount of initial investment and ongoing maintenance required to pursue this strategy is non-trivial, but the fact that this bank clearly understands the importance of mobile first cannot be questioned.
The good news for those who have a “good enough” offering now and wish to stay relevant to their customers and members is that superior offerings that can support this goal are available today. The key is to remember not to get distracted by shiny objects. An intuitive, simple user interface is vital, but behind that frontend must be an underlying digital platform that will enable continuous and frequent innovations going forward.