Financial Technology: Why Commercial Banks Must Follow Retail Banks


nnnRecently, many commercial banks have also recognized the advantages of financial technology, began to follow the pace of retail banking, and financial technology companies to seek cooperation. This is mainly because financial technology can improve the digitization of banking, so that banks can reduce development costs, improve system flexibility and bring better service to users. For commercial banks, this is a golden opportunity, must be a good grasp.n
nnTranslated by: Inan
nFinancial technology that was only seen as a subversive factor in the past was being welcomed by many banks as a shortcut to digital transformation. They are often only one goal of cooperation with financial technology, that is, the millennium generation from the non-traditional banking industry to attract over. According to the MasterCard survey, about 33% of the world’s 1.8 billion millennials believe that banks may be no longer needed in the future. This is indeed worth worrying about.n
nDigital-focused financial technology companies have attracted billions of dollars of funds, some of its investors are eager to provide customers with high-quality new mobile services retail banking. Some banks have also joined forces to set up digital laboratories to create innovative environments outside traditional enterprise environments.n
nHowever, until recently, commercial banks were willing to follow the practice of retail banks and their financial and technological cooperation companies. This business relationship seems to be more practical than the relationship between the brand and the consumer, and less dependent on more value strategies. In addition, the introduction of this mobile exclusive online banking business, consumers almost do not face an emergency situation. But in fact, commercial banks and financial technology companies may be very little cooperation, because there is almost no “killer application” or a strong feature.n
nHowever, to help people get the market and consumer data analysis to get more people use, which has become a necessary condition for commercial banks to start to reflect. One of the main sources of data is the business card plan. Providing a business card is a valuable service, meaning that there will be more money in circulation, rather than invoice issuance and value increase.n
nIt has other benefits. Take a detailed way to collect and analyze the data can be detailed for each customer and valuable characterization. Using tracking parameters – such as each account spend (SPA) and average transaction value (ATV) – to identify opportunities to maximize investment, can also improve the ability to combat high default rates and other potential problems.n
nHowever, organizations with billions of pounds worth of business cards each year often lack the necessary system to analyze the overall expenditure for each account, and do not recognize customers who are likely to increase their income through specific projects or the fastest growing customers in the future.n
nThe use of financial technology means that these and even more vision can be achieved. Establishing a partnership with it is a way to accelerate the introduction and development of services. They enable banks to avoid any flexibility in legacy systems while reducing internal development costs. Banks do not need to pay huge fees for significant implementation to get the product roadmap to keep their technology, products and customer service up to date.n
nCommercial banks that have found these advantages report that their customer retention rates have increased, and business card users and card deposits have increased.n
nA good customer experience is just as important in a business or B2B environment as in a B2C business. If the product is easy to use and can provide value, no need to change. Business card users will see a decline in their customer development costs and an increase in lifetime value.n
nIn addition, a recent report says that 87% of banks working with financial technology have reduced costs and 54% have increased revenues for banks.n
nAs with the retail sector, commercial banks also need the flexibility and innovation of financial technology companies. Now can not miss this opportunity, and should cooperate with them to share its advantages.n

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