Digital Banking vs. Branch Banking (Ashish Kumar)
Transcript of Digital Banking vs. Branch Banking (Ashish Kumar)
Branch banking vs. Digital banking and how to go forward Presented by: Ashish Kumar Second year Student of Asia Pacific Institute of Management New Delhi
EXECUTIVE SUMMARY • Banks try to capture more market
share and for that they adopt digital business model.
• Gradually Banks reducing paper based interactions, primary focus has been on enhancing the product suite with the value added service.
• Capture more customers with Digital Banking.
• Road map for ING VYSYA Digitalization
Digital banking vs. Branch Banking
• People like Digital banking because it is More Cheaper, Faster, Easier and Less Time Consuming in comparison of Branch banking
• People like Branch banking because it is More Secure, Receiving information on product/ services first hand, Personal relationship/service, in comparison of Branch banking
• The increase in internet and mobile adoption provides new ways for consumers to access banking services.
• New channels include websites, social media, mobile apps and others.
Consumer Trends | Digital Adoption
As per RBI data electronic transactions are increasing day by day and transactions in paper are decreasing. It gives positive indication for Digital Banking.
• The main challenge in mobile financial services is keeping them simple and intuitive, as financial services can be complex
• As per RBI Mobile transactions are increasing day by day.
• New bank ing and invest ment apps are more secure and make log ging in and use much eas ier than the web site. Consumers use these apps 30% more fre quently than any other app type.
Branches are expensive and un wieldy 95% of new product sales happens at the branch
Online
80% adults use internet and 51% bank online
Mobile
52% CAGR for Mobile Banking Transactions
Social Media
2.4B Social networking accounts
SWOT Analysis of Branch Banking ETOP SAP
Customized branches according to region Secure
Capture the rural market Knowledge accessibility
Expansion of anti-cyclical Management activities Personal relationship/ service
Building new client relationship Receive advice first hand
Expanding the advisory and other services offer to clients Focus on Customer service
Wastage of paper Promotions
Lot of queue More convenient
Maximum Number of employee Needed
Highly qualified and experienced staff
Slow Process Maturity matched funding
Changes of errors are high Time & money consuming
Limited Time hours High queues
SWOT Analysis of Digital Banking
ETOP SAP
Environmental Factor Internal Factor Online Market Unique Products
Innovation Technology
New Services Cost Advantages
Emerging Markets Customer Loyalty
New Products Brand Name
New Markets Cost Structure
New Technology Customer Service
Bad Economy Weak management
Govt Regulations Weak R&D
Political Risk High staff Turnover
Volatile Revenue
Substitute Products
SWOT Analysis of Branch and Digital Banking
The path to next gen digital banking
EXTEND business models
ENGAGE stakeholders
ENABLE through technology
Customer Reach• Channel Omnification• On-the-go banking• Preferred channels
Increase speed • Applications modernization• Cloud / SaaS• Selective outsourcing
Remote Access Tools• Remote deposit capture• Digital vaults and wallets• Decoupled debit cards
Customer Experience• Unified experience• Self-service• Faster navigation
Improve efficiency• Business process re-engineering• Process automation • Reduce operating costs
Alternate Models• NFC / QR Codes / P2P• Advisory through PFM• Gamification
Sales & Marketing• Analytics and contextual services• Predictive selling• Loyalty
Workforce Enablement• Digital sales tools• Deliver faster & better service• BYOD & remote availability
Products & Pricing• Product Packaging & bundling• Simulations• Relationship based pricing
Digital TransformationBank address key challenges of Cost, Compliance & Customer Retention
Digital Banking core challengesRetail,
Wholesale Banking
• Core Banking Modernization
• Pricing & Billing• Loyalty
Investment Banking
• Securities Back-Office Transformation
• OTC Derivatives Trading
Wealth Management
• Wealth Management Advisory
• Portfolio Analytics
Credit Organizations
• Loan Origination• Credit
Information Services
Payments & Cards
• Payments Transformation
• Card System Transformation
Insurance
• Package Implementation
• Distribution Management
Customer initiates Transaction
0 Seconds Web page slow to load8 Seconds Web page
doesn’t load18
Seconds
80% customers quit
30 Seconds
Interested Unhappy Annoyed Dissonant
Analysis of ING VYSYA Product and services
ING VYSYA Unique features to its customer that help to improve the revenue and taping more market share.
• Self employed and small to mid sized enterprises
• New to Bank salary accounts
• Institutional customers
• Zwipe classic savings account for mass affluent Segment
• Flexi current account targeted at owners of seasonal businesses
• Easy credit overdraft facility for salary account holders
• Institutional savings account and fixed deposit for institutional clients requiring customized solutions
• Creating stickiness by delivering superior experience on internet banking and mobile banking
Future Road Map for ING VYSYA Happening Now SubjectGamification Niche Targeting, Personalization /
Customization, Loyalty, Location-Based offers
Content & Consumer Centricity
Comparisons, Reviews Video & Chat functions for advisory services, Online Account Management
Online Advisory Services
QR Codes, Crowdfunding / Group Payments, hands-free
P2P, immediate transfers, NFC, Mobile Wallets & Couponing
Online & Mobile Payments
Pure-Play Mobile Omni-Channel, Direct Service Multi Channels & Devices
E-Vaults Expedited Payments, Configurable alerts
Self Services
Social Investment for banks, reviews, social media P2P payments, Community Banking model
Benchmarking, social log-in, social investments, marketing
Social Media
Digital Road Map for ING VYSYA
Digital*
Personalized• Self Service• Peer 2 Peer /
Group payments• Customer
enablement • Basic social media
& analytics• Online Chat
Digital*
Engaged• Channel integration• Online Video & Chats• Online Account
Management• Partial fulfillment• Max. services through
digital channels
Digital*
Innovative•24x7x365 access to all services through digital channels
•Focus on functional innovations and new operating models
2 Online Advisory Services
3 Online & Mobile Payments
4 Online Advisory Services
5 DIGITAL
Digital*
Informational• Personalization / Customization
• Loyalty• Consumer Centricity
Digital*
Transactional• Online Video &
Chats• Comparisons &
Reviews• Online Account
Management
1CONTENT & CONSUMER CENTRICITY
Online Video & Chats• Video & Chat functions for
advisory services
• Online virtual chat
Comparisons & Reviews• Competitors start to feature
reviews on their products & services, especially in insurance.
Online Account Management• Consumers can apply for
banking account, insurance services etc. online
• Mobile signature and data retention
Digital Banking is only about new technology or business models. So ING VYSYA has to take these steps.
• Mobile is the game-changer so Bank has to make its mobile app simple and more popularize
• Increase Online Market Presence Using Advanced Technology Platforms Such As Web 2.0 and Social Networks
• Increase Push Towards Web-Based Activities to Put the Online Channel on an Equal Footing with Branch Networks
• Increase Spending on Customer Analytics Tools to Improve Customer Relationships.
• Bank has to make a customize app for Wealth management and Bank Insurance
Peer 2 Peer / Group payments• Immediate transfers
• Crowdfunding• Mobile & Social Media
p2p payments :Social media enables instant money transfer among members of the family and friends. This is especially beneficial to Gen Y consumers.
Online / Mobile Services•Configurable alerts now span a variety of needs, such as bill payment reminder, incoming payment alert, etc.
•Expedited payments
Digital ATMs• Smartphone-enabled
ATMs
• Video Tellers
E-Vaults•E-vaults enable clients to store important and critical documents in the secure folders that are provided along with their online accounts.
Technology•NFC•Hands Free•QR Codes
Omni-Channels• Services are available
seamlessly on any platform
• Online / offline convergence
Direct Service• Online channel for
offline competitors
Pure Play• Online / Mobile only
Convenience Solutions•Mobile Wallets & Couponing
•Check deposits & mailing
ConclusionDigital Transformation:• Not restricted to channels or
technology only, needs to be a holistic transformation across back-office, staff and operations as well.
• About building the right mix of “Bricks and Clicks”.
• No silver bullet, it has to be unique strategy based on business drivers, customer segment, goals etc.
Thank you