As we have seen and stated a number of times during the pandemic, one clearly expected post-COVID-19 outcome is for accelerated digitalization across industries. This has come up during numerous interviews and other forms of research since the middle of March. We are already seeing this dynamic play out across financial services, as many more companies seek to add greater e-payments initiation and acceptance, given the general cash flow issues and BCP impacts. This referenced posting from American Banker provides another example of how the pandemic wake-up call is resulting in operational changes. The author discusses the surge in Citi corporate online banking new customer applications and usage from 2019 to pandemic times, with particular emphasis on mobile upticks.
That platform, CitiDirect BE, is used by large multinational institutions as well as small and midsizefirms to make payments to suppliers, pay bills and taxes, collect money and ensure they have ample cash flow…The platform’s online and app users grew from 470,000 in March 2019 to 584,000 in March 2020…The number of logins increased 18% from 3.7 million in March 2019 to 4.3 million in March 2020.Interactions over mobile devices also have risen, with a tenfold increase in active CitiDirect BE app users, from 300 in March 2019 to 3,400 in March 2020. Users can access CitiDirect on desktops, tablets and smartphones.
The mobile transaction jump is quite interesting, since these users are typically senior FPs and it’s been quite noticeable during the past several years that these apps are becoming the ‘go-to’ choice when out of office. The piece goes on to differentiate between the more straightforward nature of onboarding retail (consumer) accounts versus the multiple steps included for adding company accounts, including AML/KYC and beneficial ownership checks, etc. Although things still need to get done, by investing in automating the process, Citi has reduced online onboarding to an average of two days. Introduction and improvement of biometric verification is also a catalyst, as well as the use of AI (machine learning) for transaction monitoring. We recently published a report that speaks to the importance of incorporating AI in modern systems processes.
‘Although digital account opening is par for the course in retail banking, the CitiDirect BE platform is fairly unusual among banks in digitizing the account-opening process for large businesses…That’s because corporate banking is very relationship-driven and the security risks increase with larger dollar amounts…Citi says it addresses security threats proactively. The company uses machine-learning algorithms to spot unusual logins, transactions and system navigations (such as different typing cadences) that deviate from a client’s typical activity.’
Overview provided by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Group at Mercator Advisory Group.