Reimagining financial services: What exactly do banking consumers expect?

Main visual : Reimagining financial services: What exactly do banking consumers expect?

Banking is a sector where technology has transformed the way we interact. Not that long ago, it was a face-to-face, analog, highly conventional business that gave itself a buffer of several days to implement customers’ instructions (remember cheques, anyone?).

It’s different today. Banking is now online, digital, and instant. Everything can be done from wherever you happen to be, whenever you choose to do it.

The changes we have witnessed in 2020 have simply ratcheted customers’ expectations of change even further. To respond correctly, it’s vital for banks and insurance companies to understand how customers have been affected by the crisis and how their needs have changed as a result.

Fujitsu’s research confirms they are fully aware of just how much change has happened and – thankfully - most say it’s been for the better. Nevertheless, consumers are not about to pat their banks on the back and pronounce “job done”. Far from it.

Almost two-thirds expect their banking experience to be even better in five years. Nearly half want their bank to be more innovative with technology, but a quarter thinks their bank simply lacks the technology and innovation to give them the services they wanted.

Striking the right balance

If customers are willing to embrace change, they often want to keep hold of traditional banking norms. The research showed this clearly, with six in ten still preferring to deal with a person, rather than technology, when resolving an issue with their bank, a clear majority more likely to deal with a bank if it has a local branch, and nearly three fifths concerned that they won’t be able to easily access cash if banks were to remove ATMs.

This desire for improvement plus familiarity makes transformation complex. It requires a balance between maintaining fundamentals and new ways of delivering products and services by creating customer experiences that are innovative and flexible and secure (both in terms of money and personal safety).

What’s needed is a reimagination of the financial services business and how it interacts with both customers and employees, leading to a robust, agile, sustainable, and resilient business.

How has the pandemic changed attitudes?

Let’s look more closely at where are we today, now the pandemic has retrained us to stay away from branches and town centers, has convinced retailers that it is common sense to accept digital payments even for cents rather than dollars, and to seek help and information online as much as possible.

The latest data seems to point to a radical shift. To take one representative example, the results of a new nationwide survey in the USA show that 50% of consumers and 76% of businesses think the pandemic has changed the way they interact with their financial institutions, with 66% of consumers and 73% of companies believing these changes will be permanent.

Fujitsu’s research shows that, while consumers do not pinpoint a single killer tech proposition, how it is used will very soon be a determining factor in where they bank. Nearly a third plan to open an account with a bank that offers better digital services in the next six to 12 months and almost three in ten will switch to a challenger bank unless traditional banks can provide the same service level.

The pandemic has demonstrated to these customers that digitally-enabled enterprises are better able to quickly adapt their operations and workforces to maintain the integrity of their brand and deliver secure, high-quality customer engagement.

At Fujitsu, we see digital transformation in financial services as the key to providing a great digital banking customer experience through great employees who can engage directly with your customers. It’s about driving internal efficiencies by targeting automation to cut costs and eliminate errors, as well as ensuring that your business is more resilient.

What are the key technologies?

Successfully enhancing customer experience in financial services relies on data. The banking and insurance sector has always been a data-rich business because customers and their transactions generate vast volumes of information.

When it comes to leveraging data, AI is an endlessly adaptable framework, capable of molding to any application. Predictive maintenance is a front-runner use case, and in banking, AI is already being applied to ATM data to detect the early warning signs of mechanical or software failure.

According to a new Fujitsu White Paper, insurance is still at an early stage of AI maturity, but it is set to see AI-supercharged savings in process automation. While RPA (Robotic Process Automation) yields roughly 20%, machine learning-based hyper-automation results in approximately 60% savings — improving over time as the algorithm becomes adept at more complex processes.

The industry also has to manage and eliminate fraud. The FBI estimates non-healthcare insurance fraud alone costs US insurers $40 billion per year – adding $400-$700 extra on to annual premiums for the average American family. AI’s aptitude for pattern recognition excels at identifying suspicious transaction sequences.

Optimize every aspect of business at lightning speed

Another new technology finding new applications in financial services is Fujitsu’s Quantum-Inspired Digital Annealer.

Until now, real-time optimization has usually been impossible because the number of options is beyond the capacity of conventional digital computers to answer quickly enough to be commercially useful. Quantum computing, which has potential to take IT to a totally new level, might offer a solution in the long term. However, it remains at an experimental level for the immediate future, with the associated high costs and risks.

Fujitsu’s Quantum-Inspired Optimization Services (QIOS) are based on today’s ultra-reliable digital platforms, meaning they are available today, rather than needing to wait for true quantum computing to arrive. Going far beyond the power of ordinary computing enables a critical edge in a challenging environment where change can be sudden and disruptive. They allow banks such as Spain’s BBVA and NatWest in the UK to become what Fujitsu calls ‘Always Optimal’ – with the ability to optimize every aspect of a process quickly enough to be usable in near-real-time (you can find out more about this in What if you could reimagine your business to be Always Optimal?).

Using the latest technology in the right way

Technology on its own, of course, is not the answer. The experience of 2020 put the spotlight on those businesses unable to offer a truly personalized, context-specific digital banking customer experience. To put that right, Fujitsu can deliver high-quality data to make it real at every touchpoint.

We help financial services organizations leverage data to enhance the customer experience at every touchpoint – so you can get ahead of disruption and build on your brand legacy. This means you can be powerfully digital while delivering a very human customer experience. To survive, banks will need to match their offering to consumers that are both demanding and discerning. Using the latest technology in the right way is what Fujitsu understands best. Let’s talk about how this will be key to thriving through the new age of banking by asking Fujitsu.