Banking on technology: Here’s how digital tech can help banks serve millennial customers better

Merely implementing technology will no longer cut it; banks must seek to achieve true digital transformation.

Digital technology has sprawled to every nook and cranny of Indian businesses and banks are no exceptions. Banks now face a new challenge in form of disruptive competition eagerly eyeing their market share. Moreover, India’s millennial consumers are reshaping the marketplace with more informed and digital decision making.

Banks need to go a step further into digital. Merely implementing technology will no longer cut it; they must seek to achieve true digital transformation. It can help not only strengthen the internal operations of a bank, but also stand their ground against disruptive competition and serve their millennial consumer base better.

Here are three areas where Indian Banks must bank on technology:

Creating a multichannel bank

Modern Indian customers expect more from their banks. This is a generation of consumers that has an iPad in one hand and a smartphone in the other. That is, they switch actively between various channels in their everyday life. Banks need to ensure optimisation and integration of channels to cater to this consumer base.

If we take the example of lending, banks should aim at creating an application process that allows initiation from different devices such as mobile, desktops and tablets. These should act as self-service portals for customers resulting in increased business value. As the applicants fill the application online, their activities should be tracked to offer intelligent assistance.

Also, applicants should have the option to save their application and continue from where they left to complete their applications. Prospective customers should be able to apply, be approved and fund a new account all within a single session. Further, they can offer integrations with chat systems to provide assistance and reduce abandonment.

Fencing on risk management and security

Risk Management is critical for banks’ overall financial health and business profile. Additionally, regulations are very dynamic with regulators periodically review scenarios to come up with new regulations. It is critical for banks to invest in a technology that can meet the requirements of new regulations in time, and this needs to be done in line with other business demands.

In this case, building processes for flexibility is key. This is even more important since it’s difficult to foresee and establish a regulatory direction with consistency. Banks should look for ways to better equip themselves on monitoring and measuring risk. They should move toward technologies that integrate with various third party systems like External Credit Bureaus along with internally developed scoring engines to help reduce NPAs.

Moving from information to insight

Siloed operations are the bane of banking processes. Typically different banking departments work in silos. This makes banking processes opaque and difficult to track. Banks need technologies that offer a bird’s eye view of key processes, offer mandatory document or process check-list at to reduce rejections.

Further, credit risk operations can be centralised to achieve leaner branches. To ensure insight into critical data, banks can use inbuilt loan calculators score engines for automated credit risk assessment, instant summary template for review.

Banks can leverage technologies that ensure pre and post disbursement loan documents are tracked and reviewed automatically in accordance with credit policy and compliance. It allows generation of custom reports for deeper insights.