The digital interface is the future of banking

The digital interface is the future of banking

Peter Dalton, group general manager, innovation at ANZ, believes the next fintech revolution will be in the customer interface.

If you think about your money, there are only so many things you can do, generally speaking – be it earn it, save or spend it, manage it better, borrow it, invest it for the future or, if you’re lucky enough, even give it away.

While these fundamentals haven’t changed much in centuries, it’s fair to say the way we interact with our money has. For some, the huge range and availability of financial products out there can be liberating. But for most, it’s just confusing.

More is not always better, especially if the relationship with your money becomes more fragmented and disconnected in time.

I’ve said before , I don’t believe the successful banks and financial services providers of tomorrow will be that far removed from those of today. Rather how customers interact with them will be different. The relationship we have with our money is being completely reimagined for the digital world.

With the rise of mobile banking, your money is accessible at the touch of a button, swipe of the screen or tap of your card or device using PayWave or PayPass or other platforms.

A digital front-end is what engages customers. It’s the core selling feature and one of the most compelling features of many (if not all) of the products customers are looking for, whether that be transaction accounts, super or insurance.

What the future of banking could look like on your mobile device.

Old-world blues

Not so long ago, banking involved opening a transaction account, getting a money box and passbook, depositing or withdrawing cash from a branch and waiting for a monthly statement in the mail.

Your balance was your main concern and a statement was how you kept track and understood your money.

The same could be said for a home loan, a superannuation account and other products - they were unsophisticated, digitally speaking. This model worked for a hundred years or more but it had some limitations.

For example, it was slow – the information on printed statements was out of date by the time it reached you. It also lacked convenience – for example, if you wanted cash and your local branch was closed.

And you practically needed the stars to align if you wanted to activate a new account, redraw a loan or transfer some money, which you could not do from your passbook or statement.

In more recent decades, there’s been plenty of innovation with the rise of credit cards, ATMs and online banking. Banking like many other industries has been given a gift when it comes to digital.

Now customers have powerful computers with large, bright screens as well as secure data connections to almost anywhere in the world. It’s well documented the mobile phones of today have more processing power than the computers which put man on the moon: some might say the force is truly with you!

And money itself – once confined to wallets, pockets, purses, suitcases and in some cases the space under the bed – is finally digital, thanks to a lot of groundwork laid down by many banks and other innovative organisations over the years.

To this extent, we are already living in the future of banking.

Taste the future

Today, anyone using a payments platform like Apple Pay can get a taste of how new payments interfaces will work and continue to make money faster and simpler almost in the background. All of a sudden the ‘traditional’ payment card is gone and the screen on your phone or watch face is all you see of the brand and product.

Elsewhere, more personalised financial aggregation tools (like ANZ’s latest Grow by ANZ app) can help customers see and manage more of their money in one place, with banking, insurance, super and share investments together behind a secure fingerprint login or PIN.

Balances can be seen any time in a single swipe, new accounts opened in a few steps, and customers who want to know more simply tap for in-app help or to speak with an expert.

Similarly transformative platforms exist in wealth management and pension schemes like Australia’s superannuation system.

These are just the start of making money more personal, accessible and meaningful for our customers.

Imagine a home loan that doesn't just show you how much you owe and this month’s payments but also includes photos of your property, interactive visualisations of how much you have paid off, when you look like being debt free and how much time and interest you could save if you made small extra repayments?

Or, a banking app that proactively helps you manage bills and keeps an eye on your savings, presenting personalised investment opportunities when the time is right – all available instantly at your fingertips.

Banks are in a great position to lead this vision of the future with great people, an intuitive interface and a trusted brand behind them.

This op-ed first appeared on ANZ BueNotes

Comments: (2)

Colin Weir
Colin Weir - Moroku - Sydney 25 April, 2016, 12:16Be the first to give this comment the thumbs up 0 likes

Mortgages are a great example given they attribute almost 50% of the reveniue pool. In this segment most banks will fail to take the lead on this vision as their current business model is predicated on keeping the customer in poverty. It doesnt matter than someone CX guru thinks he or she can dress this anathema in an easy to consume way. The disruptors that are focussed on growth and customer acqusition in contrary way have a very real opportunity to leave those with great colouring in skills well behind 

James Piggot
James Piggot - Finastra - London 26 April, 2016, 09:28Be the first to give this comment the thumbs up 0 likes

Many years ago I worked on a project for a major Australian bank's HK subsidiary for tailored home loans. Based on the assumption that peoples income rises over time, the interest rate on the home loan started low and then was incremented annually by an agreed rate. Prospective customers were shown a graph that modelled the effect of this on the repayment period, early repayment date and the savings this produced. I don't know whether it was ever implemented.