Open Banking: what changes in terms of our relationship with money?
To begin, we want to ask a question: is your bank charming? Think about this question as a collaborator and as a customer.
This thought may seem romantic, but this will make your corporation survive through this crisis scenario, pandemic, and the post-normal reality.
Relax! We know that the idea of a bank that provides delightful experiences combining emotions and finance may seem strange, but we’ll prove that that’s not necessarily true. Fintechs are here to show that enchanting service can increase revenue by millions.
We don’t want to keep harping on this, but our world has changed a lot in the past months. Covid-19’s global pandemic caused the rapid and intense change – including technological changes – that transformed everyday life.
And not only that: in the meantime, Open Banking has become regulated, which has dramatically affected banks and financial institutions. As we already touched on here, the rules of the game have changed.
This leads us to the following conclusion: our relationship with money is no longer the same. Nor can banks be.
We will talk more about this in this article. Follow along to learn about this new type of bank. Spoiler: the customer is your most valuable asset. And technology will be the enabler to help you focus on your user’s experience.
The game has changed: Open Banking is here!
The banking sector was stable. Customers were unhappy with low exchange rates. Having to go to the agency, finding it difficult to manage their own money, being held hostage by fine print, fiddling with a nonfunctional app, waiting in line to talk to the manager, and continued putting up with that service, because they had no other options.
In turn, banks made little effort to consider their customers’ sentiment when planning positioning, products, services, and communication.
However, in a world of information overload, the bank’s customer is no longer the same. Open Banking has come to prove this and change the rules of the game once and for all.
Open Banking will bring about data sharing, and consequently, open competition. It is nothing more than an ecosystem that simplifies data portability.
This is when banks need to be more concerned than ever with their customers’ feelings. Even more so than with the customer journey in your sales funnel.
Our tip is: roll up your sleeves because it’s time to transform your bank’s business model! Along this path, the first step is to rethink your institution’s role in the lives of users and be proactive in valuing that relationship.
And where does the GDPL come?
It is the foundation that will ensure that data will only be used if the customer authorizes it.
Open Banking only works if it’s well regulated since it is the regulation that enables accessibility and systemic security. Therefore, GDPL (General Data Protection Law) is a critical issue in Open Banking.
From the moment that customer information (the financial portfolio) can be shared, a security protocol is required for this data to be transported. This ensures that the user feels protected and that transactions work safely.
As we have already said, the customer is the focus. Their experience needs to come first. So knowing that your data will not be shared improperly makes all the difference. Our tip is that banks start diving into these regulations to have the tools needed for Open Banking.
UX: putting the customer first
It is time to build a much more humanized strategy, structured on transparency and truth. It must solve the customer’s problems – the main objective of the UX discipline (user experience).
Peter Drucker, management consultant, educator, and author, emphasizes the importance of a user-first strategy.
“Know and understand the customer so well that the product or service adapts to them and sells itself.”
Write it down: it is necessary to recalibrate the balance of Risk Management and prioritize User Experience (UX) solutions.
Simplifying the obvious: accessibility in digital products
A bank concerned with the feelings of its customers is not a distant dream. They are already here, among some of your consumers’ favorite apps. The user’s heart and the market continue to win with a 100% digital and personalized service.
You must be picturing a pretty tech-savvy customer. Someone from Generation Y, a digital native who doesn’t need to learn how the app works, knows how to figure it put themselves, right? Well, yes and no.
If we are talking about the customer journey, it’s essential to keep all the different user profiles in mind. Your product or service’s UX must be following the elderly, disabled, and even people who aren’t familiar with screens on its radar.
The quarantine forced these users to migrate to digital. Therefore, it is up to corporations to think about how they can simplify their digital products and services. In social isolation, these users cannot ask for help from other people and need simpler interfaces.
- This is worth noting: The Age of Hyperconnectivity no longer supports the one-size-fits-all mentality. You need to invest more and more in personalization if your bank wants to remain competitive.
Take the leap, and don’t lose your customers!
Artificial intelligence, cryptocurrency, data science, and open innovation have reshaped the financial services market. They’ve all aligned with the user’s expectations. Here are some tips to help you stay the course on this journey.
1. Digital Transformation
The buzzword to watch out for here is Open APIs. Yes, they are what will make Open Banking possible. Immerse yourself in 100% digital and user-centric solutions. Being invested in technology and innovation is a crucial strategy to win market share and customers.
2. New business models
Involve approaches such as Design Thinking, User Experience (UX), Open Innovation, and Agile Practices. Adhering to user-centric business models and frameworks like Lean and Agile eliminates waste and bureaucracy.
- The highlight is an organizational culture geared towards people and not products.
3. RPA + IA
In this journey, financial institutions must combine humanized relationships with automation (RPA) and Artificial Intelligence.
4. Mindset Analytics
There is no way to be competitive without knowing your users in depth. This knowledge allows the Research and Development team to build products, services, and processes in line with market and customer wishes, increasing sales.
5. Data is the new oil!
Fact: a deep dive in Data Science is inevitable for banks that want to survive.
The result: access to new markets and the heart of the public.