Omnichannel Banking: Is It Really Required?

Ashish M. Shaji

08 Aug, 2020

Digitalization has created a massive disruption around industries. Now customers expect more exceptional services across all platforms. Likewise, financial service providers are also looking to provide more from the channels that they use for banking. In this article, we will discuss the omnichannel banking process that has emerged to satisfy customer expectations.

What is Omnichannel banking?

Omnichannel is a process through which customers are provided a set of services across all channels, both digital and offline. It allows the bankers or financial service providers to offer secure banking services anywhere and at anytime.

An Omnichannel platform of banking also allows real-time data synchronization between various channels. It means that customers may start the onboarding process with one channel and end with another without providing the same data again and again.

What is the need for Omnichannel banking?

The omnichannel approach has not been a new term. It came about in early 2010. After that, it made its way into industries like media and retail banking. The significance of the omnichannel approach in banking can be deduced by the fact that digital channels have grown tremendously over the years, but that doesn’t eliminate the need for a physical branch as half of the public still want branch services.

If we are to breakdown the need for this form of banking, then we find three main reasons for it:

• Growing customer expectation

The advancement of technology and the digitalization of industries have impacted the way people interact, live, and do banking. It has rapidly transformed the expectations of the people with respect to how they conduct daily businesses of life, like banking. Their expectations have been ever-changing and evolving like never before, and to meet these, an omnichannel approach is a way forward.

• Issues with present Multichannel strategies

A multichannel strategy that means the provision of offers and services through different media and access points has been found in today’s banking. However, the issue with these strategies is that many bank’s offerings have been made available online, but they are operated and made differently from each other. 

• Omnichannel is customer-centric

If banks require moving towards digital advancement, then they must bundle data from various sources and structure and link that information. With the omnichannel platform of banking, banks can access relevant customer information in all processes. It makes for a customer-centered model. 

How does the Omnichannel method of banking improve customer service?

This banking platform improves customer service in the following ways:

• Digital providence

It allows customers to perform transactions through web and mobile applications. It permits them to transfer money, apply for loans, and access many other features through the banking apps. This is something that is appreciated by the customers.

• Solves customer query

If customers wish to raise any query through their devices or want to get any issue resolved, then the omnichannel platform through the integration of customer support center, chatbots, and other communication channels, fulfill those requirements.

• Real-time data synchronization

In case where bank clients start a transaction or raise an issue, then they don’t require entering the same data all over again, even if they change the communication channel in the process.

What are the challenges of Omnichannel banking?

According to a recent survey conducted by a consulting firm, only a few bankers are prepared for this form of banking, and many others are in the adoption stage. Many banks believe the omnichannel approach to be the best but still certain issues like sizeable investment, complete technological redesign, etc. keep them away from it. 

Another challenge with it is the fact that emerging technologies have enabled the customers to demand personalized services at a lower cost, but bankers face the challenge when they have to keep up with the unmanageable product development process and require responding to the change in situation. 

How can customers benefit through banking with an omnichannel platform?

The customers can benefit greatly through it as it provides some key benefits that customers are looking for. In this segment we shall look at some of those benefits.

• Transparency

With the omnichannel platform, customers can be assured of transparency in the process. It allows them to view their data at any time and also can correct it if required. Apart from it, all information that is accumulated online or offline can be discussed with the bank advisor. 

• Simplicity

As stated earlier, customers don’t require providing the information again and again. They have to provide it only once, and then it will be available for every transaction. Customers with the help of data of their history obtain a customized offer that takes all factors into consideration. 

• Flexibility

This is the biggest benefit for customers that they have access to all channels online or offline 24*7.  This makes customers not to be dependent on the opening of the branch.

• Speed

The processing time is usually short, and consultations with customers and other internal processes are also minimized.

How can banks benefit through the use of an omnichannel banking platform?

It’s not just the customers who benefit. Banks also benefit from its use in the following ways:

• Less time consuming

The banks save a lot of time as the administrative work is reduced mainly due to the availability of the information with only a push of the button.

• Better communication with customers

It also provides improved connectivity with customers, which in turn leads to better communication with them.

• Lower costs

A lot of expenses can be reduced, and operational costs can be reduced with digital operations.

• Digital security

It also ensures digital security and protects the bank from unauthorized access and unwanted risks.

Conclusion