The battle for the bank in your pocket

As the era of the ATM gives way to increasingly sophisticated, secure always-on digital banking, will the old guard of bricks, mortar and paper based high street banks evolve or die?
Written by Oliver Marks, Contributor on

Most people are aware that the international financial markets and associated business entities rely on quicksilver fast technologies to trade and interact with each other, and that constant upgrades of technologies are a given to stay competitive. 

In an era when, regardless of business sector, the customer and her digital presence and propensities are regarded as the epicenter of selling and satisfaction opportunities, it's a bit of a conundrum that retail banking has been relatively slow to evolve into seamlessly digital experiences. 



Retail banks globally tend to have vast land, brick & mortar commitments, but even as the retail store sector emphasizes the importance of multiple channels of connection and increased customer intimacies - in store, mobile, desktop, geolocation ('omnichannel') etc and more importantly predictive digital intelligent assistant guidance in search, retail banking still tends to limit itself to simple mobile phone apps to interact with your account and physical ATM locations. 

 At the root of the modern digital experience is the sense that as a customer you have at your fingertips a vast array of attributes and data about the service or product you are focusing on. There is a widespread expectation that any sort of query will yield multiple opinions, perspectives, reviews, options and comparisons along with a degree of transparency and full disclosure. 

Retail banking, along with most of the insurance industry, often has archaic IT back offices geared up for compliance and associated requirements for monitoring, management of risk and adherence. Tighter regulations put in place since the 2008 bank risk induced economic crisis have exacerbated the short comings of these old infrastructures, stretching them to beyond their envisaged limits.

 Implementing those post 2008 reforms has been very expensive and primarily focused on shoring up the old IT and security platforms put in place last century. With a few exceptions, little thought was put into digital platform strategy to provide the sort of digital back end fit for purpose to streamline and simplify expensive internal processes while offering a more agile and richer interface of offerings to customers and prospects.

The rigidity, complexity and inflexibility of these old IT edifices make it very hard to launch new products with any speed in an era when the clock speed of product launches in other sectors make most banks look increasingly out of touch. You can almost see the join marks where consumer digital initiatives have been grafted onto the old entity, a little like using a Windows phone and running out of modern mobile user interface as you drill down through the layers.

Given the incredible explosion of increasing analytics potential retail banking now have, the promise is a digital banking future of real-time self-serve analysis, unobtrusive cross-selling suggestions within an ever more important sense of security, fraud and risk detection and management. Strategizing and designing the secure, seamless customer experience across terrestrial and digital is rapidly becoming a race for dominance, with a platform that enables rapid products and services evolution at the core. 

This is likely to be a high stakes competition between old line vendors - just as the financial trading market vendors can get rapidly knocked out of their game by not constantly updating their technologies, the retail banking customer is going to migrate to the securest, most empathetic and respectful provider to manage their funds. 

Image: Washington, D.C., circa 1918. "Bankers Automatic Receiving Teller Co." These machines (designed to look like little bank buildings) were used, among other places, in the D.C. schools into the 1930s to encourage thrifty habits.

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