Here is how experts see the banking sector post pandemic

“Going forward, any organisation that will have both the capabilities of being ‘high-tech’ and ‘high-touch’ would be a winner.”

Shreya Sinha
ETBFSI
September 05, 2020, 08:42 IST

Even before Covid happened, the Indian banking industry had already set on their journey of digital transformation to keep the customers happy and be at par with its international counterparts, though the progress was slow but steady.

However, when the pandemic hit, banks had no choice but to steadfast the process and adjust to this new world order. They came out with multiple solutions, such as, leveraging technologies to increase operational efficiency, understand customer/consumer patterns, roll out smooth customer identification and authentication, predict future scenarios by analysing past trends, identify banking frauds quickly, install chatbots and voice assistants to fill in for a human, and much more.

‘Hi-tech & hi-touch’

The ever-evolving high-tech world has left humans desiring for high-touch — the involvement of personal attention and service. High-touch refers to situations where trust between the customer and employed individual is necessary. And with the growing influence of millennials — both customers and new-age banking employees — personal touch will be key in maintaining valuable relationships in the banking sector alongside the evolving technologies.

Former RBI deputy governor SS Mundra believes that banks were already on the path of digitalisation but they would still be at the behest of a ‘personal touch’.

“Going forward, any organisation that will have both the capabilities of being ‘high-tech’ and ‘high-touch’ would be a winner. It can't be one single thing,” said Mundra.

Segregation of roles

Segregation of duties (SOD) is a key principle in financial control that helps reduce the risk of frauds and errors. The principle of SOD is based on breaking down processes to more than one person or department such that the power doesn't lie in the hands of one person.

Rahul Bajoria, chief economist, Barclays India, believes that SOD will make a difference in the years ahead.

“Digitalisation is already happening but the move towards it will pick up pace only when segregation of roles is given a priority.”

Speaking on the work from home culture, Bajoria added, “I feel those who can do better in the work from home environment shouldn’t be called to office unless it is absolutely necessary.”

Focus on ‘digital customers’

Due to the cutting-edge competition every bank is working towards adopting new technologies to keep meeting expectations of their customers and providing them with satisfactory experiences in the era of digitalisation.

Another former deputy governor, RBI, R Gandhi said that digitalisation is now spreading across the banking sector while earlier it used to be more for transactional banking and liability banking; and that it will continue to enhance customers’ convenience.

“Banks will need to have interaction with the customers more closely in person. Unlike some other service sectors work from home can be a normal thing but in banking this can’t be the only option. Banks cannot fully go for it.”

He further said that credit monitoring/modelling also needs to be further strengthened. “Credit monitoring will benefit banks and security systems. This is the clear projection that we can have.”

Conclusion

Indian banks used to focus on retaining customers by providing innovative solutions via branches, mobile and the Internet. But ever since digitalisation moved into top gear, banks shifted focus to keeping their customers glued to them.

“Consumers will prefer banks that align with their environmental and social values in a more purposeful age, where local and cooperative principles align to matters of global responsibility. Open cultures that build and curate communities will set leaders apart as they grow values-driven ecosystems,” noted a Forrester report.

It might so happen that leading banks would use technology and far deeper customer insight to push financial services at the customer’s moment of need, overlooking brand visibility.

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