United States

Build relationships with digital banking

Three steps to develop a digital banking road map

FINANCIAL INSTITUTIONS INSIGHTS  | 

Strong customer relationships are fundamental to the success of all financial institutions. Community banks and credit unions have made personal service a cornerstone of success, and have differentiated themselves from larger competitors through an emphasis on member and customer service. Consumers now have rapidly changing expectations for how they communicate and how they interact with all businesses, and your institution must keep pace with those expectations to engage customers and increase loyalty.  

Enhancements in technology, including the ubiquitous access to smartphones, have fundamentally changed how financial institutions must interact with consumers. Digital banking options span a wide range of delivery channels, products and services that can be deployed. What is the right strategy for your organization? Below are three steps that you can take to develop an effective road map for digital banking investment.

Step 1: Identify your goals

It is important to align digital banking initiatives with your strategic plan. Your target market segments, deposit and lending growth goals, and product strategies must be considered when evaluating and prioritizing digital banking options. Self-service capabilities in branches can lower expenses and support expansion to more markets.

In addition, applications supported through online and mobile banking channels can drive loan and deposit growth. Online functionality support tailored to small businesses can improve your ability to acquire and retain these profitable relationships and garner additional fee income. Developing a digital banking road map that supports your business goals will serve as the basis for prioritizing future investment and managing the implementation of new digital banking services.

Step 2: Assess the competition 

Your customers and members have an increasing number of banking options. Digital banking capabilities allow consumers to perform the majority of banking activities from anywhere at a time that is convenient to them. This ability to make banking convenient to the consumer builds loyalty and threatens financial institutions that do not have digital capability.

Your competition is no longer just the bank or credit union down the street. Developing an inventory of all competitors’ capabilities (local and national) in the following areas is necessary when considering digital banking options:

  • Online and mobile banking
  • Mobile functionality and utilization of device features
  • Online and mobile customer and member service capability
  • Business-focused online services
  • Self-service branch design
  • Use of social media

Step 3: Evaluate your capabilities

Assess the digital banking systems that you have in place today. Identify gaps in the services that you have deployed, compared to the competition’s offering and with services that support your strategic goals. Identify potential system providers for solutions that are a match for your needs.

In addition, compare vendors against your financial institution’s requirements and priorities, and validate that potential solutions are aligned with your technology infrastructure. Review your organizational structure to determine if appropriate management, oversight, and roles and responsibilities are in place to support the digital banking strategy.

Financial institutions, especially community banks and credit unions, often choose to work with an independent consultant with broad experience in the industry to guide the organization through the assessment process. A qualified consultant understands that a digital banking strategy must fit your organization and brings knowledge across the landscape of solutions available in the market, as well as unbiased guidance to determine the best match for your financial institution.

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