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New Customer and New Competitor: Faceless and Boundaryless

As I write this blog, every second a new customer is added to the banks clientele and also a new competitor sprouts out somewhere on the landscape.

With the emergence of 'everything online' the customer interacts with the bank(s) online and also gets presented with competing options for his banking needs online. The pandora is shrinking, unobtanium has been obtained. The landscape is swamped with faceless entities which are customer to a bank as well as its competitors. A possible scenario with facebook/google being a customer to a bank xyz and also competing in Payments space with their own payments systems.

It always amazes me to realise that till few years ago we were acquiring the known financial faces of the world as our customers whereas now we're not only serving them but rather gearing up products (although in smaller pockets of domains) competing the same faces. What has happened in all these years?

The only thing thats remaining with a face for banks in todays environment is 'challenge', and it has many faces. Multi-faceted challenges in areas like technology, customer acquisition, competition outrun, Regulations and compliance, security etc. Its a complex mesh where consolidate and grow is the mantra. Banks are offering new services on various comfort-oriented modes like online, mobile or at-your-door in order to acquire new or retain existing customers and the supporting companies for these banks are also developing parallel products at killer costs to the same customers and hence running a parallel banking ecosystem. While it takes years of investments for a large scale bank to evolve and hence offer better technology/service to clients, it takes fraction of a time for these single-service-offering companies to improve the product and hence channelise more customers from banks to themselves and gain benefits of volumes.

With the amount of personal information content and users registered with social media like facebook or twitter, they can very well become a parallel banking universe offering basic daily need services to all these customers at no charge since thats not their main business and hence could be threats to existing mainstream banks.

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