.png)
The importance of staying at the Forefront of Mobile Banking Innovation
There’s an all-out war going on for the hearts, minds — and wallets (both digital and leather) of banking consumers. With a stark realization — and a COVID kick in the pants — that consumers no longer favor in-person banking, big banks today are spending billions a year on technology. They’re hoping to outmuscle their smaller rivals to stake their claim on smartphone supremacy and the personal portal that serves as a digital gateway into people’s lives.
There’s an all-out war going on for the hearts, minds — and wallets (both digital and leather) of banking consumers. With a stark realization — and a COVID kick in the pants — that consumers no longer favor in-person banking, big banks today are spending billions a year on technology. They’re hoping to outmuscle their smaller rivals to stake their claim on smartphone supremacy and the personal portal that serves as a digital gateway into people’s lives.
This digital revolution comes at a time when many community banks and credit unions are clinging to the traditional banking model — considering themselves more as a retail brick-and-mortar business than a technology company.
This is not only short-sighted — it’s a risky, bet-the-franchise proposition. Instead of shying away from technology, these local financial institutions will need to double down on differentiating themselves through digital-powered personal service.
Simply turning a blind eye to this digital reality will leave many financial institutions on the wrong side of this digital divide. A recent J.D. Power study found that 30 percent of banking customers don’t ever set foot in a branch; further, 37 million Americans currently have a checking account at a digital-only bank.
While big banks will try to combat these trends, as well as increase profits and decrease costs, through non-human technology, credit unions and community banks will need to access robust technology of their own if they hope to deliver people-backed services through the digital channel.
At BankingON, we think we can help community banks and credit unions have the best of both worlds — offering a best-in-class digital footprint while maintaining the caring spirit that differentiates them from their larger, more monolithic rivals.
Since our founding in 2017, we believed our calling was to understand how businesses can make their customers feel loved, significant, and cared for. We also realized that most of the banking apps on the market were built around requirements dictated by financial institutions, and not based upon what people need to manage their finances.
With these factors in mind, we designed an experience that is both logical and simple — orchestrating the complexity of the banking experience in the background, and delivering a simple, easy-to-understand interface on the front end. You could say we took some of our design cues from how Tesla approaches cars — a simple product distilled from a complex system.
We also realized that such app development is not a set-it-and-forget-it solution. Mobile apps must be kept up-to-date, or become obsolete. Sadly, a commitment to continuously improve the mobile experience requires heavy lifting that most banks are not culturally and strategically prepared to support. It simply would be difficult for a community bank or credit union to build the expertise necessary to deliver a next-generation solution. That’s why we feel BankingON sits at the epicenter of technical teams, user psychology, and business requirements.
Staying ahead of mobile banking innovation isn’t just a matter of convenience and efficiency — it can have real and measurable effects on customer retention. According to the Mobile Banking App Report by PYMTS.com, 82 percent of banking consumers prefer to make transactions using their mobile banking app. This makes digital banking a “sticky” product that institutions need to maintain loyalty.
But just transitioning to better technology is not enough. You need to be in control of your digital destiny and not allow your vendors to dictate the experience, services, and features of your digital services. If you don’t have the internal expertise or resources to continually improve the solution to keep up with user expectations and market forces, you need to align with the right partners.
Data suggest that retail banks that digitize their services could achieve a 20 percent increase in revenues and a 30 percent decline in their expenditures. Digitalization can even reduce the cost-to-income ratios by 12 percent for wholesale banking.
Do you need help getting your digital footprint up to be on par with your banking rivals? Please feel free to contact us at BankingON. We’d be happy to help you extend your brick-and-mortar branch experience into the speed and convenience of next-generation mobile.
Alexey Krasnoriadtsev is the CEO and Co-Founder of BankingON, a company he created in 2017 after realizing that most community banks and credit unions didn’t have the skill or resources to develop a best-in-class mobile banking platform to compete with the big banks and emerging FinTech companies. Alexey has a more than 20-year track record of successful app development, with a specialty in banking and finance technology.
