The world we know is not static; it’s gradually evolving with a host of new inventions and innovations happening across various industries and businesses. This shift is simply known as digital transformation, and it is set to digitalize service delivery and make it as convenient, easy, accessible, cost-effective, and as fast as possible.
Before the emergence of modern technologically inclined financial companies like Swissmoney that provide digital solutions, banking and financial services delivery had always been too slow, expensive, time-consuming, and cumbersome.
Also, there has been a poor way of managing customers’ data, which has led to many fraudulent acts on many people’s accounts for a very long time.
However, the narrative is changing as many businesses, including traditional banks, seek ways to incorporate or digitalize their service to meet the ever-increasing customer expectations and demand and remain competitive in the market.
In this article, we will explore what digital transformation is; highlight why traditional banks must embrace it, and discuss some strategies banks can use to stay competitive in the fast-evolving digital world.
What’s Digital Transformation?
Digital transformation is simply about changing the way businesses interact with customers and operate. Across various companies and industries, businesses have shifted from their conventional or traditional mode of operation to a more digitalized one in order to improve their customers’ experience.
When it’s about digital transformation, it is about making interaction and service delivery easy and convenient for a business and its customers.
The essential of digital transformation is to create new possibilities and opportunities. It is to increase productivity efficiency and enhance customer experience. In this technological era, digital transformation is a necessity for every business that wants to scale and thrive.
Of course, every business needs customers to thrive, but the customer demand is changing, and there’s a need for every business to do whatever will make them win their customers over. For instance, retail businesses are now leveraging the internet and technologies, such as IoT, AI, and Big Data, to attract their target audience.
Why Digital Transformation is Important for Traditional Banks
For traditional banks, digital transformation is more than just updating their database or technology. It is about completely overhauling and reimagining how banking services are rendered to customers.
Adopting digital transformation for banks will mean creating a customer-centric new system. Embracing this technology will help banks enhance their security, streamline their operation, and provide the services they need, when and where they need them.
The profound digital transformation in traditional banks will make them apply new technologies such as smart contracts, Blockchain, AI, and others that have recently shaken the entire financial services landscape.
These technologies offer innovative solutions with a level of efficiency, security, and convenience that are unmatched by traditional banking platforms.
Strategies to Make Traditional Banks Stay Competitive
As many businesses are struggling for the soul of their customers, traditional banks need to improve their chances of winning customers amidst the growing number of Fintech organizations. Below are ways they can do this:
Incorporating new technologies
Traditional banks will need to incorporate new technologies such as machine learning, blockchain, and AI to enhance service delivery. These technologies can be used to detect fraudulent acts, automate tasks, and personalized customer experience.
Adapting to competition
Whether traditional banks admit it or not, they are in a race with Fintechs and digital banks. So, they need to upgrade their services so they can compete favorably with other digital financial services providers by offering top-notch services that are friendly and convenient.
Traditional banks will need to adapt to this new competition by improving their digital offerings and delivery.
Enhance Mobile banking options.
Mobile banking is gaining momentum and traditional banks should ensure that their mobile banking apps are friendly and offer seamless services. They should also focus on enhancing mobile banking features, such as peer-to-peer payments, mobile check deposits, and instant alerts to easy banking processes for their clients.
Build a culture of innovation.
Traditional banks must create an enabling environment for employees to think creatively and carry out new innovations and ideas.
This can include setting up innovation labs or partnerships with Fintech companies to bring new products and opportunities for employees to explore.
Leverage on social media banking
Banks should leverage social media apps such as Twitter, Threads, Facebook, and others to provide customer support and offer banking services.
For instance, traditional banks should make it possible for customers to check their account balances and perform other transactions on their WhatsApp platform.
Shift to mobile and online banking.
As customers are more comfortable with mobile and online banking systems, traditional banks need to stay focused on these areas, expanding and including features that will make their apps and platforms attractive and easy to use.
Although shifting will require significant investment into infrastructure and technology, it will improve their chances of being known and attractive to customers.
Leverage voice-activated banking
With the increasing popularity of virtual assistants such as Alexa, Google Assistant, and others, banks can operate voice-activated banking systems that enable customers to operate their accounts, as in a request for account balance and perform other transactions only with their voice.
Incorporate Biometric authentication
Traditional banks should offer biometric authentication systems that allow the use of fingerprint and facial recognition to offer a more convenient login experience.
Biometric authentication is more secure than traditional passwords as it is unique to the user and can’t be easily replicated.
Place greater emphasis on customer experience.
Digital banks and Fintech startups are known for providing quality service delivery and customer experience, and traditional banks will need to cope with this by offering the best for their customers.
This will require a shift in the mindset from product-centric to customer-centric, with a focus on specialized services that will meet customer needs.
Conclusion
In conclusion, all these digital identity solutions are necessary to improve customer experience and stay competitive for a very long time, even as digital transformation is happening all across different organizations and businesses.
As we move towards a more digitalized system where industry and businesses are shifting from the norms, banks must incorporate new technologies to meet customer needs.
Sharon Howe is a creative person with diverse talents. She writes engaging articles for WonderWorldSpace.com, where she works as a content writer. Writing allows Sharon to inform and captivate readers. Additionally, Sharon pursues music as a hobby, which allows her to showcase her artistic abilities in another creative area.