Banking: The generation gap

You are on the road with 15 minutes to kill. The traffic crawls to a halt as vehicles line up bumper to bumper on the crowded road. Time to bank. After logging in on your smartphone, you check if your salary has been credited, settle your credit cards, pay your rent by bank cheque and move money into your savings account. All without leaving the car. Before you reach your destination, there is just enough time to locate the nearest cash point and check for discount offers at your favourite lunch spot.

It’s a far cry from old-school banking, and this is only the beginning of what Internet and mobile technology can offer. As device sophistication and network speed increase, so will consumers’ expectations of usability and service. Next generation customers want banking that fits into their lives, not the other way around.

For banks, this means we must adopt a whole new way of thinking, right down to how we develop our products and services. More than what we offer, it is how we deliver our services that will drive our relationship with the customer in coming years.

In next generation banking, there is no place for top-down, blinkered innovation. We must not ask: “What do we want to sell?”, but rather, “what does the customer want to do, and how can we help them do it?”

Standard Chartered’s customer research has revealed above all else a desire for a simpler, faster banking system, be it at the branch, on the phone or via mobiles. In general, customers have grown to demand more from service providers, and banks are seen to be lagging behind.

In the past, banks expected customers to follow their rules. Today however, there is a growing, global tribe of trend-setting and tech-savvy consumers who demand relevant banking that is instant, intuitive and integrated. United not by demographics but by mindset, these people want more control over their finances and financial services. If banks were slow to adapt usability to their services in the past, they now need to catch up. And fast.

We believe that many, if not all of our customers, will be using mobile phones to interact with us in the medium term. And mobile banking platforms won’t be limited to banking alone. Ultimately, such platforms will transform into integrated one-stop shops, where customers can do anything they want to do on the go, whether it’s checking their bank balance, buying a movie ticket or booking a flight. We want to be part of this exciting future.

However, this does not mean that we will invest in the mobile banking channel above all others. Increasingly, customers want to interact with banks across a number of different channels to fulfill their financial needs. A home buyer wanting to take out a mortgage, for example, may research options online, get details over the phone or through web chat and then walk into the branch to buy the product. This means that banks need to ensure all channels – including the traditional branch – are as user-friendly as smartphone banking.

To do this, banks may need to look for inspiration in new places. At Standard Chartered, we want to sustain a culture of innovation and learn from other industries and leading players such as Apple and Samsung. Particularly, we want to embrace co-creation, and actively solicit advice from our customers to get our solutions right before they hit the market.

We continue to invest in our branches, but we are making some big changes to provide a customer experience similar to what you might expect from an up-market coffee shop or fashion retailer. In the next generation branches that we have started to roll out across our markets, the shop front is open, the interior sleek and brightly lit.

We know that people bank because they have to. What we must focus on is making the experience as simple and convenient as possible so customers can get on with living their lives.

If we are to win over the new market of next generation consumers, we must position ourselves, not just as service companies, but as dynamic financial advocates that empower customers to reach their life goals.

While the marriage of new technology and changing consumer lifestyles will require banks to turn the traditional concept of customer service on its head, some things will not change: people will always have to pay for goods and services, to save and invest, to buy homes and increase their wealth. And trust between the bank and the customer will remain pivotal.

While channels of delivery will change as technology and needs evolve, this fundamental truth should never be forgotten.

The writer is group head of distribution channels at Standard Chartered.

Published in The Express Tribune, November 2^nd, 2011.