Fintech rise forces retail banks to pivot, says report

  • “Customers are pivoting to competitors that offer more personalised, bespoke experiences, leaving retail banks lagging behind. That’s according to the World Retail Banking Report 2022 (WRBR) published by Capgemini and Efma.
  • The survey showed that 75% of customers are attracted to the cost-effective, seamless services offered by fintechs and traditional banks simply cannot keep up.
  • In the report’s ‘Voice of the Customer’ survey, three quarters of respondents said they are attracted to agile fintech competitors as they offer fast, easy-to-use products and superior customer experiences. Conversely, around half said their current banking relationships were neither rewarding nor emotionally connected, and 52% said banking was not ‘fun’.
  • According to the survey, more than 70% of banking executives said traditional banks lack data and analytics capabilities.
  • ‘While this has evolved within many of these incumbents’ digital channels, customers still expect branches to be experience centres, filled with self-service options and financial advice. By strengthening their ability to collect and analyse data, providers can identify what customers want, which ultimately is consistent omnichannel banking experiences.’”

https://businesschief.com/technology-and-ai/fintech-rise-forces-retail-banks-to-pivot-says-report

Artificial Intelligence in Banking: Top Priorities for 2022 (And Beyond)

  • “Several surveys and market research studies have found that people actually prefer interacting with bots instead of humans. Although some of these surveys are conducted by conversational AI vendors, skeptics should consider the fact that there are 24 million users of Bank of America’s digital assistant Erica and they completed 123 million interactions in the fourth quarter of 2021, up 247% year over year.
  • Juniper Research forecasts that chatbot interactions will save 862 million hours for banks globally, which equates to $7.3 billion in cost savings.
  • ‘With no shortage of customer data, financial institutions are sitting on a treasure trove of answers in terms of where customers are headed next and what their financial needs will soon be,’ Everfi writes. ‘Armed with that data, institutions can grow wallet share and generate revenue by catering their products and services to customers in anticipation of their time of need.’”

https://thefinancialbrand.com/141233/artificial-intelligence-in-banking-top-priorities-for-2022-and-beyond/

How AI is Changing Digital Marketing

  • “For those of us working in the realm of digital marketing, the impact has become even more clear over the last few years. To put things into perspective, 61% of marketers say AI is the most important aspect of their data strategy, according to MemSQL.
  • Have you ever searched for a particular product and then all advertisements you see after that search are for similar products? That’s AI at work. The power of DMPs (Data Management Platforms) allows AI to gather data from across the Internet – not just a particular website. This data then fuels predictive analytics, which empowers digital marketers to truly personalize their marketing campaign strategies to ultimately generate high-quality leads. Stronger leads = stronger ROI.
  • A Campaign Monitor report found that marketers saw a 760% increase in revenue from segmented campaigns.
  • What’s one AI tool we all encounter on a regular basis? Chatbots. These are used for everything from customer service to driving sales. Chatbots are becoming so sophisticated that according to a study done by Marketing Insider Group, two-thirds of consumers don’t know they’re interacting with these AI tools vs. actual humans.
  • According to a study from Bright Local almost 60% of consumers have used voice search to find business information in the last year. As the world has become largely mobile, voice search enhances the user experience, unlocking hands-free access to accurate data and results.
  • Google’s algorithms can understand human speech with 95% accuracy which is nearly equivalent to human-to-human interactions. With this in mind, embracing a humanistic SEO strategy is more important than ever before.”

https://www.datasciencecentral.com/how-ai-is-changing-digital-marketing/

The Growing Domination Of Chime, Cash App, And PayPal In Banking

  • “More than a quarter of Gen Zers (21 to 26 years old) and nearly a third of Millennials (27 to 41) now call a digital bank their primary checking account provider. Among Gen Xers (42 to 56), the percentage who have their primary account with a digital bank grew from 8% to 22%. Overall, six in 10 Gen Zers and Millennials whose primary checking account is with a digital bank has that account with Chime, PayPal, or Cash App.
  • Since the start of the pandemic, however, the percentage of Gen Zers whose primary checking account is with a megabank has dropped from 35% to 25%.
  • Chime is a strong neobank among Millennials, and is growing its primary customer share among Gen Xers. But its primary status among Gen Zers has slipped since 2020—from 6.5% in October 2020 to 4.6% in January 2022. PayPal and Square picked up the slack—and more—with 8% of Gen Zers now calling PayPal their primary checking account provider, and 4% applying that label to Cash App.”

https://www.forbes.com/sites/ronshevlin/2022/03/01/the-growing-domination-of-chime-square-cash-app-and-paypal-in-checking-accounts/amp/

Payment disruptions in digital banking – Entrust report

Omnichannel touchpoints are increasingly crucial in digital banking: In Australia, 93% of respondents say they prefer to bank online in some form. Evidence that digital banking is the new norm. However, it is still essential to provide various digital options, as 62% say they prefer using the app from their bank or credit union, while 31% prefer their desktop web browser.

Some people still prefer in-person banking at a branch (7%). Overall, this is aligned with global trends, and Entrust says it’s essential for banks to offer omnichannel, digital-first solutions to resonate with today’s consumers.
 
Customers are security-conscious, and lack of security can have damaging consequences: 95% of respondents from Australia say they were concerned about the potential of banking or credit fraud as banking and credit become more digital. 23% of respondents had personal experience with these fraud risks, having received notification of a personal banking or credit fraud in the past 12 months. These incidents harm customer loyalty, as 43% of respondents notified of fraud changed their bank or credit union as a result.
 
Fee structures and flexible payment options give banks an edge: Consumers are most likely to consider lower fees, digital solutions and security when choosing or changing their bank. Consumers looking for high-quality, low-cost digital banking, new entrants, or neobanks, could add to their current disruption by offering things like fee-free overdraft protection and unlimited foreign exchange. There is widespread interest in the digital banking atmosphere, with 66% of respondents from Australia saying they would consider using a branchless online banking service for their banking.

More digitally issued cards could further fuel the rise of mobile payments: 63% of respondents from Australia listed contactless credit or debit cards as their most preferred payment method, while 28% listed contactless mobile payments. Digital cards can be an effective selling point as 56% of survey respondents from Australia indicated their preference to open a bank account digitally.”

https://cfotech.asia/amp/story/payment-disruptions-in-digital-banking-entrust-report