This article was originally published on CUInsight.
According to PWC’s 2020 Retail Banking Survey, 61% of bankers say a customer-centric business model is ‘very important,’ but only 17% are ‘very prepared’ for it. Digital transformation is one key component in facilitating a customer-centric model. Consumers commonly equate digital access with convenience, ease-of-use, and a time saver. While digital enablement and adoption is not a new concept for financial institutions, there is growing popularity among consumers of all ages to favor more self-service, digital options, such as P2P payment apps and budget tools.
While Millennials and Gen Z continue to be high digital adopters, the trend is becoming more popular among older generations as well. In 2017, 57% of American adults reported using a P2P payment app service which increased to 70% in 2020 according to the 2020 PaymentInsights report provided by Mercator Advisory Group. On top of that, a report released from Chase shared that 30% of P2P payment app users have signed up just in the past six months.
Research by the Digital Banking Report found that 75% of financial institutions considered themselves ‘not adept’ at leveraging their data and analytics effectively. More automation, artificial intelligence, and machine learning tools are being introduced that help provide actionable insights for both members and credit unions. Digital sources provide more data on who, what, where, and how members are interacting and engaging with your products and services than ever before. However, if there’s not a strategy in place to analyze these data sources it makes it hard for financial institutions to make sound, informed decisions.
Big data can feel unstructured and impossible to manage, but when strategically tackled, can help pinpoint consumer wants and present a more complete and accurate picture of strategic growth opportunities. Being able to consolidate and analyze data sources is a powerful tool for financial institutions to leverage, and ultimately transform, their member experience.
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