Banks are at a turning point. Technological advances and hyper-personalization have radically shifted the expectations of their business customers. At the same time, a looming economic downturn further threatens the future of long-standing institutions. Despite these changes, banks are still best positioned as businesses’ dominant financial service providers.
According to a McKinsey study, companies who excel at personalization earn 40% more revenue from those activities than the average players, and this is no different in the banking industry. Hyper personalization has become a dominant trend when it comes to customer preferences, and banks must invest in technology or partner with fintechs to quickly offer personalized services to their commercial clients. A 2021 capco study found that 72% of respondents identified personalization to be ‘highly important’ in today’s financial landscape.
Innovation Threats in the Market
Due to the rise of hyper-personalization, neobanks and fintechs are quickly growing their ability to compete with larger banks and credit unions. Consumers value this personalized experience, and the innovative services neobanks and fintechs deliver make these experiences possible. If banks don’t deliver these experiences, customers both new and old will turn toward the neobanks and credit unions who do offer these services.
Banks can and should take advantage of new technology by embracing innovation and partnering with FinTechs. Advances in data personalization will help banks deliver even more value to their corporate customers and maintain market share. Now is the time to get ahead of the industry through strategic investments and forward-thinking approaches. Here’s how to take your bank from industry follower to industry leader.
4 Ways To Take Your Bank To The Next Level with Embedded Banking
1. Develop an Innovation Strategy
Simply deciding to innovate isn’t enough; identify your differentiators and opportunities for growth. Establish and pursue clear goals with measurable results — and track them month over month. Foster a company-wide culture of innovation and collaboration. New ideas often come from the places you least expect. Encourage employees of all experience levels to participate in brainstorming sessions and set aside regular time for networking, attending conferences and reading industry news.
2. Make Smart Partnerships
Beef up your technological offerings through strategic relationships that fill a void within your organization. The right partners will have industry recognition to back up their reputations. Our on-demand webinar,“Friend or Foe? 5 Ways Fintechs, APIs & ERPs Unlock Hidden Business Banking Revenue” delves into fintech partnerships and how they can help banks drive digital transformation for their clients. Remember: contextual banking starts with a strong embedded banking foundation. Look for platforms that seamlessly integrate with your existing services via APIs and native ERP adapters. Banking collaboration with the right partnerships can help you widen your service offerings in a faster and more efficient way.
3. Gain Trust
Embedded banking doesn’t work without access to customer information. Not surprisingly, corporate customers must be careful with the sensitive data they’re willing to share. Gaining their trust requires complete transparency and open dialogue. Be prepared to answer questions surrounding your security and privacy systems. Most importantly, never use a customer’s data in a way that wasn’t expressly permissioned. At FISPAN, trust is at the forefront of all our activities from end-to end, learn more in our article here.
4. Enhance the Customer Experience
Once embedded banking is in place, harness data and analytics to provide customers with the right offers at the right time. Keep in mind: banks are fast approaching a culminating point where customers expect to be put at the center of every company they do business with. The driving motivator behind every decision should be: “How is this adding value for the customer?”
FISPAN’s embedded business banking platform makes it simple for banks to offer bank branded and embedded commercial banking applications. FISPAN provides instant scale and reach for banks who want to remove friction and add value by enabling their commercial banking clients to access banking services through their operational software of choice.
Ready to embed your banking services? Contact FISPAN today to request a demo.