Digital Banking Photo: I-lend.Ca

Consumers have embraced digital banking during COVID-19 pandemic ─Study

*Experts say bank customers are now far more likely to open accounts with a wide range of digital banking tools without visiting branches

*A recent report also discovered that financial technology (FinTech) firms have a significant head start over conventional banks, and are now employing artificial intelligence (AI) and blockchain to improve the consumer experience

Gbenga Kayode | ConsumerConnect

Instead of heading for a physical branch for financial transactions, several consumers have flocked to online banking, the channel which has got a significant boost worldwide during the disruptive Coronavirus (COVID-19) pandemic, as practically all banks and other financial institutions closed their lobbies at a time.

However, a fresh study of digital banking suggests that has only accelerated a trend that had already been taking hold.

A consumer digital banking study by FICO, an analytics firm, found that US and Canadian consumers have accepted a wide range of digital banking features, agency report said.

The study findings found that more of them are opening accounts online instead of going to a nearby branch.

Financial product and service consumers are also increasingly open to biometric identity procedures such as fingerprints and face scans.

Liz Lasher, Vice-President of FICO, said: “In an effort to help stop the spread of the virus, consumers across North America have accelerated their move from brick-and-mortar branches to digital banking channels.

“As a result, consumers’ expectations have shifted, placing higher priority on having a seamless and engaging digital experience, which includes establishing account security.”

For financial service providers, Lasher says the message is clear. Providers will have to have a solid digital platform to not only deliver good customer service but also improve fraud protection and financial crime compliance.

In terms of rising expectations, the study found that consumer expectations have risen along with the shift to online banking.

The authors say bank customers expect a seamless, uninterrupted experience when opening accounts digitally when using a website or a mobile app.

They also don’t want to be forced to use another channel to complete tasks, particularly those associated with proving their identity.

The survey of consumers found that 25 percent of Americans will go to a competitor or abandon the application completely if they are asked to mail documents, visit branches, or send scanned documents by e-mail

Banks are also finding themselves in increased competition with FinTech firms that provide many of the same financial services but are completely digital.

Research and Markets, in a recent report, also discovered that FinTech firms have a significant head start over traditional banks and are now employing artificial intelligence (AI) and blockchain to improve the consumer experience.

The authors of the report stated: “AI interfaces and chatbots have primarily redefined customer service, and its expanding business will enable AI-oriented FinTech market to grow at an impressive rate through 2025.”

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