AI can help banks make up ground in the payments race
How can financial institutions start to play catch up with fintechs for payment innovation? First, it’s important to understand what customers and members are interested in and what they expect.
Today’s consumers have a “do it for me” expectation. They want every interaction with a company or a brand to require as little from them as possible. Most people are time-starved and distracted and want to make sure everything they do, especially the necessary things like paying bills, transferring money or paying a friend, are as simple and quick as possible.
Leveraging technology as well as the data at the banks or credit union helps create a tailored experience that makes customers' and members' lives easier. New technologies like AI and machine learning can provide recommendations and proactively engage with customers and members to help them pay their bills or pay friends and proactively manage their financial well-being. When FIs can achieve this goal of making customers’ and members’ lives easier, that is when they succeed in creating a “wow” experience.
This experience not only encourages customers and members to stay with the FI, rather than turning to an outside fintech player, but also encourages them to tell their friends or family about their experience, urging them to engage with their bank or credit union, as well.
Overall, when banks and credit unions think differently about digital payments, they open a new world of opportunity to better serve consumers and protect them and their deposits from moving to non-bank competitors. This is not where it stops, but merely where it starts. As long as banks and credit unions continue to reassess themselves and innovate in the future, they will be well positioned for success for years to come.
How do consumers prefer to do their banking? Do they primarily use a mobile device? What services do they expect? How are your services simplifying their lives? It's important to take the time to evaluate what your bank or credit union is currently doing, what it is not doing and what it needs to start doing to win and retain consumers.
Next, benchmark how your FI is doing. How is it measuring up against competition? Look both inside and outside the industry to see how the experience you are providing is on par with what consumers are experiencing elsewhere.
Finally, once your FI has taken the time to assess its performance and areas for improvement, it is time to start integrating new technology. When banks and credit unions have ideas for how they can take advantage of the opportunities before them, they should be the ones who lead in bringing them to life.
This is why it’s key to ensure the FI has the best collaboration partners for major innovation initiatives. It is important to choose a technology partner that shares the vision of your bank or credit union and works alongside the institution. This type of collaboration can improve customer or member experience and keep deposits with the FI. It is imperative to give consumers the reason to stay with your institution and not go elsewhere.