Traditional banking institutions are facing challenges due to the presence of several innovative FinTech startups. This rise of FinTech startups has resulted in raising customer expectations for enhanced customer services.
FinTech startups are often referred to as neobanks. A typical neobanks uses 100 percent digital medium to reach its customers directly on their devices. Neobanks are increasingly becoming successful as they leverage cutting edge technologies to provides better and faster services. Neobanks have now become an integral part of the banking ecosystem and are driving a fundamental change in how financial institutions are conducting their businesses. Leading financial institutions are leveraging the opportunities to transform their business by focusing on providing enhanced customer experience.
Neobanks can provide a personalized and meaningful experience to their customers. Users can access services through a simple interface from any devices, anywhere, and at any time. Traditional financial institutions, with their siloed systems, are unable to keep up with rising customer expectations.
Rising innovation and expanding utilization of mobile devices for banking and payments are making it simpler for neobanks to acquire new customers. To sustain in the banking ecosystem, traditional financial institutions (FI) need to find a way beat the neobanks and turn them self into a competitor.
This can be done by –
- Improving customer experience
- Using omnichannel delivery model
- Making mobile devices the key growth channel
- Regaining control over digital strategy
FIs should not focus only on the channel, but also on service delivery, transparent experience, customer-centric innovation and understanding consumer behavior, preferences, choices of channel and devices. They need to improve existing services with digitalization, change banking culture and focus on transforming into customer-centric organizations.