The COVID-19 pandemic is likely to emerge as the gravest challenge for the banking industry in nearly a century. As the economic fallout grows, retail banks are reconsidering key priorities that need concrete steps to brace the uncertainty, while also strategizing for the future. The banking industry was quite stronger before this pandemic than the financial crisis of 2008. But, the need for smarter and better strategies related to innovation, digital banking, and marketing became clear much before the pandemic hit.
As the COVID-19 pandemic unfolds, banks and financial institutions must leverage this time of disruption to consider reshaping themselves from the inside out. Currently, banks need to better understand consumer expectations. They should focus more on the way they use data, human resources, AI, and technology to impact marketing, innovation, and the digital delivery of products and services.
Re-image Banking for Staying Stable Post-COVID-19
- All banks are revisiting their business continuity plans. This is a critical time for banks, and they must take a ‘Control Tower’ approach and build on robust business continuity plans. They must steer the ship by shifting their focus on customized scenario modeling and contingency planning to ‘run the numbers’ continuously. They must integrate the key indicators which are more relevant to the outbreak into decision making. Another main area of focus should be real-time judgment calls from client-facing, finance, and risk teams.
- Several banks are proactively engaging with their customers to support them as they navigate extraordinary challenges. There lies a unique opportunity amid COVID-19 crises for banks to deepen the relationship with customers. Many banks have set three priorities to stay meaningful during these challenging times. They are driving Relationship Manager (RM) outreach and feedback; Helping SMEs and Mid-market corporates understand their position and Assisting their clients to navigate the funding and restructuring solutions available to them.
- Banks are heading towards delivering on the demand for the digital. As the pandemic hit, the customer demand for digital channels has got aggressive, leaving banks to focus more on making them digitally-first bank. Assuming the fact that once getting accustomed to virtual banking, customers aren’t much likely to return to analog channels post COVID-19, digital transformation in the banking is inevitable. The traditional banks or banks are nearing a toss for sure.
In a nutshell, banking industry players must re-plot the Post-COVID-19 strategy to continue running a meaningful business and stay relevant when uncertainty lies ahead.
Moving further, we have mentioned below the key factors that are going to be especially important for the success of retail banking post-COVID-19. Though these may not seem to be noteworthy today understanding how consumers are behaving may help shape future product and distribution preferences.
- Take up a novel customer norm with modern business models.
- Rethink what drives brand loyalty.
- Restructure the market you can address to grow beyond the core.
- Reconstruct the resiliency plan.
- Validate long-standing business assumptions.
- Reprioritize capital allocation plans and M&A.
- Continue to build upon robust societal relevance.
Will you be able to deliver to customers in a post-COVID-19 digital-first world? Banks keen to deliver all that expected from a digitally-first bank can explore opportunities with Arttha, a Unified Fintech Platform. Arttha’s Digital Banking Platform, Digital Wallet, and Core Banking Platform can prove instrumental in making banks digitally-first.