The driving force behind digital banking becoming the most popular form of banking today is definitely saving time and effort. According to research, an average individual spends nearly 7.3 hours a year visiting banks and even longer in developing countries. On an average digital adoption in banking can save over $12billion. Moreover, digital banking also is a very effective means to curb petty crimes when the crowd goes cashless.
Australia as a country has come a long way in adopting digital banking. Since the introduction of telephone banking in the early 1990s, internet banking around 2001 to mobile banking around 2010s the country has made amazing breakthroughs from “not so important” to “can’t live without” forms of digital and mobile banking offerings. Today as per a recent report published by Visa Card, Australia is an established leader in digital and cashless banking. The report recognizes Australian cities Sydney and Canberra as the digital banking leaders owing to Australia’s advanced digital banking payment systems.
Digital Banking Disrupters
Digital is completely changing the face of the Australian banking system. The pace, scale and breadth of strategic disruption, the whole industry is going through, in the country is staggering such that the new banking system will be completely different from our traditional idea of banking. Some of the powerful factors currently reshaping the Australian banking ecosystem are:
- Increasing urbanization, wealthy customers and a mature population has made Australia a thriving place for the banking business today. While housing the wealthiest generation in Australian history, banks are increasing their portfolio and thinking about new means to enhance customer engagement.
- With a digitally advanced, open and secure digital banking arena, it has become relatively less time consuming and easy to complete a transaction online. Thus, increasingly people are opting for digital than the traditional means to bank.
- The highly volatile nature of customer loyalty spreading to the banking industry and the increasing choices offered by Fintechs, banks are reassessing the way they engage with their customers to enhance customer trust and experience.
- The changing technology landscape has made it highly imperative to put stringent compliance and regulatory rules to secure the Australian banking ecosystem while accelerating efficiency and maintaining the high bars on customer satisfaction.
Decoding the Modern Banking Conundrum
Traditional Australian banks need to change with changing times to stay relevant in the contemporary ecosystem. With Australia ranking among the top digital embracers in the banking around the world, Australian banks need to upgrade to a smaller, simpler and highly connected version of them to cater to the modern tech-savvy customers. They need to be highly focused, strategic and secure, pivoting around productivity and building better trade relationships. Smaller banks do not mean lesser customers but highly target segment oriented with clearer and narrower focus on their natural customer groups. Selective customer base also means selective products and highly distinct customer service.
Simplicity in banking will be concentrated on investments, customer focus, innovative products and revenue growth. This will encourage rationalized service suite and product lines that provide higher revenues within shorter-terms. Moreover, embracing a holistic, multi-dimensional approach to customer service via social media helps employees understand customers from a more personal angle leading to better customer engagement.
Connectivity in banking stems from understanding your customer better. This will help major players to solve and pitch problems that traditional banking mechanism was elusive to like tax, inventory, supply and invoice management. Providing such unique, targeted and irreplaceable solutions will enhance customer loyalty and trust. With such highly focused banking strategies Australian banking system will revolutionize the way banking works.
Navigating the Traditional Shift
- Customer centricity
Being distinct is the only way to thrive in the current banking system and Australian banks are well aware of the fact. What with catering to the wealthiest population in Australian history and a highly tech-savvy economy, banks have realized that their service should explicitly revolve around keeping their customers as comfortable as possible. Top Australian banks are investing heavily in tracking satisfaction metrics, understanding their focus groups, market research, data, analytics and customer engagement and reaping the benefits of all the hard work.
The unclearly differentiated banking core services have always been the primary problem for customers to relate and understand banking. Making banking products and services simpler and less confusing for customers will definitely endear core banking to today’s fast-paced generation. Thus, Australian banks are working out different ways to find unique solutions to every possible situation and make banking simple and efficient. This includes having fewer touch points that are more functional and better integrated, highly focused and targeted marketing messages, simplified products that can be easily understood and compared and fees or charges that are not hidden or complicating.
- Value chain footprint
Traditional banking as we know it is fast deteriorating in Australia and thus, it is imperative that banks create strategic differentiators to better integrate with customers over their value chain. The simple answer to this enormous challenge is to streamline their FTE footprints and provide customers with a holistic experience that customers expect out of their financial partner.
Australian banking economy has been pivoting to customer-led innovations the past years as they understand that to stay relevant they need to exercise greater customer connect. Traditional Australian banking institutions are already adopting customer orientation, digital transformation, focused accountability and greater collaboration of traditional and non-traditional partners.
- Regulation & Compliance
Being world leaders in digital banking comes with its own set of responsibilities. This means ensuring better security to digital transactions to earn customer trust and loyalty. Embracing regulations and compliance to bring about greater deal of privacy and security to banking transactions is essential to minimize business risk and nurture credibility.
Raising the Banking Bars for the World to Follow
Australia is revolutionizing the way the world looks at financial institutions. With the launch of ‘Neobanks’ the complete digital bank merging world-class technology with digital services, Australia is setting trends across the financial ecosystem.
So what is a neo bank?
It is a comprehensive digital bank, which does not use any physical infrastructure or digital operating systems used by any existing Australian financial institutions. The technology used in a neobank is developed from scratch and is accessible only through an app. These banks are all set to launch a series of hyper-competitive product line and incomparable, high quality mobile banking apps. Some of the neobanks already on the run are the Up, Revolut, Volt Bank, 86 400 and Archa along with many more.
Curious to know what a neo bank feels like? Ditto! Can’t wait to know and understand the nuances and workings of a complete digital bank, but wait we must.