Here are some steps a bank can follow to transform into a smart financial institution

Becoming a smart company is no longer a luxury. It is a necessity. You can transform into a smart business using the following eight steps:

  1. Embrace digital technologies: Implement digital solutions such as mobile banking, online banking, and other digital payment options to provide customers with a seamless experience. As a small retail business, introduce convenient options for customers to pay you. Have options like mobile money payment, scan and pay, point of sale, tap and pay etc. And of course, accept cash. Make it easier for customers to pay you. If you are a financial institution, make banking a lifestyle using technology to deliver convenience. Let people access their money anywhere, any time, securely. Whether they need to check their bank balances, invest or tithe, make it available seamlessly. As the cost of internet access and mobile phone ownership reduces, digital technologies are key drivers of convenience since customers can transact with your bank without being in physical contact with you.
  2. Invest in data analytics: Use data analytics to better understand customer behaviour, preferences, and needs to provide personalized services and improve customer experience. How do you know when the majority of your customers use which delivery channel to prioritize your channel options? Who are the 20% of your customers who bring 80% of the revenue? You need data analytics to dig deep into this and make decisions informed by insights from the business and not hearsay. With lots of data produced daily, investing in data analytics and business intelligence is imperative to offer products that anticipate customer needs. Take an example of a bank with over 20 counters at different branch locations. If that bank has been operating for the last 3 years, there exists a lot of data to analyse customer behaviours and banking time preferences; and location. Such data would show the preferred time to visit a specific branch by the majority of the customers; and the bank can re-organize operations accordingly, for example, by closing off some tills, and instead having the tellers visit customers in the field for a better experience. Why should a bank continue operating a counter that no one visits? Or one with just a 10% use rate?
  3. Adopt an open banking approach: Partner with fintech and other financial institutions to offer a wider range of products and services to customers. An open application programming interface provides opportunities for innovators and start-ups to develop apps and connect to your dev sandbox to improve innovation effectiveness. You want to encourage as many partners to securely connect to your systems to increase value offerings to customers. For example, a bank customer that can seamlessly allow customers to access their bank accounts, and pay service providers as well as receive income from customers is more relevant to the customer than the one that cannot. Open banking approach: with security at the centre, offers more competitive advantages.
  4. Implement security measures: Ensure that digital services are secure by implementing strong security measures such as multi-factor authentication and encryption. Trust is always at the centre of any customer journey. People will do business with a company that does not jeopardise their privacy or loss of money. To win as a smart business, invest in security to ensure confidentiality, integrity and availability.
  5. Create a culture of innovation: Encourage innovation and continuous improvement by investing in research and development and fostering a culture of innovation.
  6. Focus on customer experience: Put the customer at the centre of the bank’s operations by focusing on their needs and providing a personalized experience.
  7. Foster collaboration: Foster collaboration between different departments, stakeholders, and partners to drive innovation and provide better services to customers.
  8. Stay up to date with industry trends: Stay up-to-date with the latest industry trends and technologies to stay ahead of the competition and provide the best possible services to customers.

Copyright Mustapha B Mugisa, Mr Strategy