Survive able to adapt as quickly as possible
Future banks, the vitality of effectively response of each request, the ability to “personalize and set up” banking services to one customer, why banks care about their staff, the environment, communities and the economy, why company values will impact the choice of financial partner – about this Yevhen Kulikov, Head of Multinational companies coverage of UKRSIBBANK BNP Paribas Group, mentor of the Future project by NBU Bank told the “Future. Financal Wealth” magazine.
It is hard to imagine what will be the Bank of the Future.
Old generation, those who have huge experience, very often may tend to be too cautious and conservative, being under pressure of all that experience… maybe sometimes not very pleasant one. New generation, in its turn, can think out of the box and find parallels with absolutely non-banking industries, thus generating a lot of brilliant ideas, but may lack understanding of how the business is done. No matter how we imagine the Bank of the Future, it is just a reflection of our internal “me”. So, here is the short list of the features of the Bank of the Future, which I found inside of me:
- Speed of reaction. The world is moving faster and faster. 8 seconds, which is one of distinctive features of Generation Z, will become “ooh no, it is too long” already in few years. Bank must be able to react literally immediately. Forget about call-center telling you “Thank you for your call, please stay on the line…”. It is immediately or nothing. Next step is that bank must be proactive, being 1 second faster then you think of something. Hard to imagine? Let’s check in 10 years… Fintech giants and start-ups can be a good example of implementation of “time to money” principle.
- Big data. Closely correlated with first point, but I will add a bit of challenge. Most people share their personal data easily or even can’t imagine their life without sharing smth about themselves with the entire world. But there will be more and more legislative initiatives limiting possibility to use and circulate the data, especially in the banking sector. In ten years personal data will be the most valuable product on the market. The Bank of today already has a lot of information about you, but the Bank of the Future will have it 10 times more. At some stage it may become more challenging for the bank to comply with data protection requirements then with Central Bank’s regulations. No need to repeat all the opportunities for “personalization and customization” of services offered by the bank to a single client or a group of clients driven by “big data”. It is not the future, it is already happening now.
- Balance. Customers of tomorrow want the bank to be “one click away”, easy, light, transparent, charming, present in all social media, having no stupid rules and no limitations. And on the other hand bank must comply with endless number of limitations imposed by Central Bank, governments and legislative bodies of other countries, internal procedures and legal constrains. And if not, the bank may pay huge penalties or simply disappear from the map. The Bank of the Future must find the balance between customer’s expectations and another side of the banking system with all it’s regulations, liquidity management, solvency and credit risk, code of conduct and other things that can’t be ignored. It is already a challenge today and will be even harder tomorrow…
- Social responsibility. Even though each bank’s target is to make money for its shareholders (sorry, if it is a surprise for you), the Bank of the Future will not be able to ignore request for social responsibility, since that is the direction where the whole developed world walks. The bank must be a relevant counterparty and take care of it’s people, of environment, of communities and of economics. It is not just about nice slogans or posts on social media, or social responsibility departments. It is about action. Action, that may mean far less profit for the bank, but much more contribution to healthier (in wide meaning of this word) society.
- Values. Values that are shared by personnel and management. Values that are translated to the market through actions. Values that are conveyed from one person to another inside the bank, and from banker to customer. Values that define the strategy of the bank, its product range, its pricing and its commitment to the countries and societies where bank operates. Very soon the Customers of the Future will choose among the banks with similar proposition by saying “Okay, I’m choosing you because we share the same values”.
- Diversified business model. Focus on mono-strategy, one core product or one category of clients is the way to lose everything sooner or later. The world around banks is changing extremely fast and customers’ expectations are developing rapidly. Your value proposition of today may mean nothing for the customer of tomorrow. The Bank of the Future must have diversified business model in order to be able to absorb shocks, face challenges and catch new opportunities. But even more important, the Bank of the Future must change all the time, not just reacting on changes but initiating them.
And the last one. It is not the largest banks, that will survive in 10 years, but those that will be able to adopt faster to the changing world.
The article is issued in «Future. Financal Wealth» / «МайбутнЄ. фінансовий добробут».