Asthe battle for customer acquisition and retention escalates, victory exceedinglyhinges on a bank’s ability to provide an integrated channel experience thatgives customers one place to logon, make transactions, ask questions—and getthe same real-time answer no matter which channel they use.
Accordingto a 2013 global consumer survey by Gartner,1 of the more than 9,000respondents aged 18-74, the breakdown of channels used at least once over athree-month period goes as follows:
- 88 percent, branches
- 85 percent, online banking
- 33 percent, smartphones
- 15 percent, tablets
Based on its survey findings, Gartner assertsthat financial institutions must consolidate customer-facing channeltechnologies into a single system, because channel-specific processes and datasilos that can’t communicate with each other are no longer acceptable toconsumers.
Integrationvs. Interface
Years ago, most banks brought new products to market usingthe best-of-breed approach, which only required technologies to interface with their core. Coreproviders took care of such basics as demand deposit accounts and CDs, advisingtheir bank customers to seek out their preferred channel products, and they’dinterface to it. That yielded various providers exchanging information severaltimes per day, with the different balances squared up once daily—at best.
With channel integration,your core provider not only supplies all your digital channels, but also suchancillary solutions as document imaging, government watch list screening andnetwork management. Integration allows your customers real-time accountvisibility no matter which channel they use, while the bank sees tremendousincreases in efficiency.
Theongoing benefits of integrated technology include:
- Error reduction due to lack of duplication ofmanual data input
- Simplified problem resolution by dealing with asingle vendor
- More consistent data from real-time, integratedchannels
- Reduced cost of electronic channels
- Improved employee satisfaction
- Increased customer satisfaction and retentiondue to ease-of-use, improved account access
- Reduced IT costs and maintenance
While the impact of interfacing involves:
- Errors typically being found by customers, creating extra work, increasedcall levels and satisfaction issues
- Increased problem resolution times and decreased quality ofproblem solving
- More time/effort/disruption when new versions of multiple vendorproducts are released
- Challenging, complex environment for bank management
- Customer confusion due to lack of real-time balances
- Dissatisfaction of customers because of inconsistent channelexperience
- Increased possibility of vendor acquisitions
VendorManagement Simplification
According to the FDIC Quarterly Report for First Quarter2013,2 the average U.S. bankwith under $200 million in assets uses 15.5 products from multiple vendors.Imagine the costs saved and efficiencies gained if you could integrate 10 to 12of your most important products from a single provider?
Further, in October 2013, the Office of the Comptroller ofthe Currency issued risk management guidance for third-party relationships,promising compliance citations and fines to financial institutions that fail toeffectively manage risk in all areas of operations, including those performedby third-party vendors.
Gainand Retain Customers Through Channel Integration
Asthe financial services industry grows in complexity, more banks seek coreprocessing partners that can provide all digital channels as well as mostancillary products—thereby substantially reducing their number of third-partyvendors. Doing so also secures them the streamlined, efficient,consumer-friendly experience that increases profits, eases compliance concernsand attracts and retains customers.
Moving forward, banks must look toward single-source technologyproviders that can integrate solutions across channels—and deliver a cohesivecustomer experience.
Formore information, download our free white paper, Get More FromYour Core.
About Nathan Tatum
Nathan Tatum is vice president of business development forCSI Meridian, a role in which he provides leadership for new initiatives andproduct innovation. Nathan works closely with financial institutions to aligntechnology projects with strategic objectives, helping them capitalize on growthinitiatives.
1http://www.gartner.com/document/2578917?ref=feed
2http://www.fdic.gov/bank/analytical/quarterly/2013_vol7_2/FDIC_Quarterly_Vol7No2.pdf
