The days when banks and credit unions could get away with a mobile banking app that did little more than show balances and transaction histories are over. Today financial marketers’ approach to the mobile channel must be centered on consumers, not on products. Quite simply, banking providers must personalize the experience.
Innovative offerings and delivering a comprehensive range of services and solutions can be differentiators. In short, deploying digital capabilities to solve users’ problems will be the key to building long-term relationships with consumers.
One way to ensure higher conversions is through selective customer targeting and retargeting of products and services. Reaching out to consumers with relevant offerings in their decision-making phase will help create trust, then making it easier to sell, upsell, and cross-sell for the bank.
You must think mobile before you design anything.
The dominance of mobile in banking is growing dramatically, fast-replacing traditional channels because far more consumers than the young and tech-savvy now live off their smartphones. This also means that people will increasingly demand more from the mobile channel.
However, many banks and credit unions have done little more than mold their existing applications for the mobile platform, or — worse yet — point mobile users to other channels through their mobile application. This leaves a lot of ground to be covered for true digitalization in the mobile channel before banking providers can serve people from end-to-end in terms of onboarding, decisioning, and servicing.
Here are four ways banks and credit unions can improve mobile banking today.
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1. Keep Honing the Experience
The key is to make people’s lives easier by offering smart services like:
- Uploading of documents.
- Reading and filling data automatically.
- Pre-filling earlier data.
- The ability to stop and later resume longer processes
Gradually, all mobile banking offerings will move towards giving a completely paperless experience with self-service capabilities. Banks and credit unions will have to adopt an approach to deploy into the mobile channel service. This would include such points as collaboration platforms, optical character recognition (OCR) based automatic reading and filling of data, and remote digital signature capabilities.
Convenience and speed are the two most important considerations, but banks and credit unions must take care not to over-promise — or, better yet, they can work to meet their initial promises.
An example: Currently, some banks provide instant credit decisions on the web and over mobile. But shortcomings frustrate consumers. Not every applicant gets an instant decision — even after entering a lot of data — due to the bank’s inability to process information immediately.
And repeating the same information to a customer service representative when the consumer has the next interaction with the institution only adds to the frustration. Eliminating such friction in the customer journey through the mobile channel will make life smoother for consumers.
Forethought helps, too: Some banks have implemented one-click loans, but the question still remains: How can a one-click process handle all kinds of scenarios? Making loans simply isn’t as straightforward as ordering a book on Amazon.
People interacting with the mobile application of a bank will expect an electronic response — naturally. But banks with highly manual processes behind the scenes will not be able to serve such requests. To keep up, they must integrate their origination systems with the mobile application, credit decisioning system, and various verification systems for seamless processing. The different hand-offs happening between dependent systems will also have to be managed efficiently.
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2. Aim for Hyper-Personalization
Ensuring that mobile banking centers on the consumer is important, but not enough. It must be highly personalized for each individual.
Consumers should be able to choose and have control over what they see and what they do. In time, banks and credit unions will need to apply machine learning techniques to better understand how to target people differently and give them options for customizing their mobile banking usage. Understanding the lifestyle of each consumer and designing pro-active product offerings at the right pricing for them will lead to higher satisfaction.
Proactive consideration of data points, weighing that data appropriately and utilizing various machine learning techniques, will enable banks to build a model that can predict each customer’s likes and dislikes. Solutions built, and products and offerings designed around these insights about individual customer needs will be more valuable for their target user.
3. Don’t Be Afraid To Bust Through Traditional Walls
Institutions should begin thinking in terms of providing end-to-end mobile-based service for any product or service that they offer.
For example, take car loans. Banks and credit unions, typically seen as lenders only, could integrate with third-party service providers like car dealers, car accessories merchants, insurance companies, car repair merchants, etc. Mobile consumers will come to view their institutions as holistic service providers and not just financial services organizations. Such an approach could also help build volume, as lenders would be seen increasingly as part of that mix, rather than a passive player buying indirect dealer paper.
Open application programming interface (API) banking will be part of the solution. Embedding such a variety of services in their mobile app via APIs will help banks and credit unions retain existing relationships as well as acquire new ones.
Good examples of this strategy can be seen among large players in China, such as Alipay and Tencent (WeChat). Both provide a plethora of cross-vertical services through a single mobile application, making them a one-stop-shop for everything a user needs. American banking regulators might have some thoughts on how closely U.S. institutions could emulate those examples. But at the least such examples can inspire reinvigorated thinking under domestic rules.
4. Fresh Mobile-Friendly Approaches
Consumers want to save time and simplify their lives. Those apps that help will win, dominating the mobile banking space.
For example, being able to scan documents, and automatically verify and onboard a consumer within minutes, will reduce the barrier to acquiring accounts. Banks and credit unions will need to focus on transforming paper-intensive complex processes, such as those related to loan products, to achieve quick and simple processing. Faster credit decision making, instant payment options, and integration with third-party vendor services are basic ways to enrich mobile offerings.
Possible additions to further enhance the experience include: smart watch integration, IoT-based device integration to track customer activities, and smart reminders for repayment or premium payment due dates.
Such advancements will also gather data points about usage, so that more personalized and relevant options can be presented. Collaboration with fintech companies represents one way for banks and credit unions to adopt such features more quickly.