The drive to deliver better and more personalized digital customer experiences has fueled banks’ investments in data-intensive analytics and artificial...
The drive to deliver better and more personalized digital customer experiences has fueled banks’ investments in data-intensive analytics and artificial intelligence (AI) applications, particularly in the cloud. Customers want access 24 x 7 and are increasingly using sophisticated financial planning software to service their own needs.
Banks need to transform the way they deliver services to accommodate changing customer preferences as well as to create digital experiences that are as rich as those in the branch office. However, they are working within a regulatory environment that limits their flexibility and many run their businesses on legacy infrastructure that constrains agility and scalability.
The banking sector has been relatively slow to adopt cloud computing, for good reasons. Although 90% of U.S. banks maintain at least some data, applications, or operations in the cloud, just 5% describe themselves as “mature” cloud users.
This e-book explores the changes banks face and the challenges those changes create. It also proposes solutions that can help them innovate for success.
Retail banks have long relied on branch networks to facilitate strong customer relationships, but they can’t expect to do so in the long term. The number of bank branches has fallen by just over 900 annually since 2012. If the trend continues, some experts believe, branches could be all but gone by 2034.
The human touch is giving way to digital self-service options that enable customers to conduct transactions and invest their assets without interacting directly with a banker.
What does digital banking look like? “It needs to be seamless, providing integrated experience across all my banking business, including retail, mortgage, credit card, lending, trading, etc. The experience is delivered through an extremely simple user-friendly application interface that is secure and intelligent — and that proposes hyperpersonalized products based on my individual needs. The experience also includes always-on capabilities, eliminating the need to walk into a brick-and-mortar branch,” says Sheetal Rishi, a senior client partner at Kyndryl who has spent many years in the banking industry as a technology advisor.
Consumers, in general, have become savvier about their choices. They want the reliability and trust of the traditional bank but with a more convenient digital experience.
Cloud platforms are a path to modernization. Banks can use them to create responsive and mobile-friendly user experiences without rebuilding their core applications. Cloud-native constructs such as application program interfaces (APIs) and “low-code/no-code” development tools make this more feasible than ever.
Using these platforms, banks can find many new paths to innovation. For example, some now offer financial advisory and stock trading services. Banks can use cloud-native applications to seamlessly integrate back-end systems with partners to offer discounts, shopping recommendations, and special offers based on customers’ demonstrated preferences. Micropayments and microlending offer business expansion opportunities, particularly in developing economies.
AI has intriguing uses, including customized lending solutions, personalized money management, and savings and investment recommendations based on individual customers’ financial profiles. Generative AI, which creates unbiased training data sets through self-learning, can be used for better fraud detection, predictive modeling, and risk management.
Read how Kyndryl helped Krungsri, the fifth largest financial group in Thailand, to expand its online banking services, offer mobile banking applications, and enhance customer service using AI. Click here.
All these capabilities are available now. You can apply them to create distinctive customer experiences that make the mobile banking app a window to a wide range of financial planning and investment services. A hybrid cloud architecture enables you to combine the strengths of legacy system investments with the agility of cloud development tools.