FEATURE: Fintech: Transforming Customers’ Experience
NANFeatures/Vol. 13/2019 (May 22)
By Chiazo Ogbolu, News Agency of Nigeria (NAN)
The banking industry is experiencing disruptive innovations at an increasing pace and one of these is coming in form of financial technology popularly termed “Fintech’’.
Today’s banking landscape has been divided into two main roles: traditional financial institutions and disruptive fintech applications and shares a goal, which has to do with improving the customers’ experience.
A disruptive innovation is an innovation that creates a new market and value network.
The traditional financial institution relies on face-to-face interactions to build and retain relationships but now, banks are currently pursuing new technologies to expand their relationships with customers.
Meanwhile, financial technology or fintech is now at the forefront of the financial services industry as a result of the ubiquity of technology and smartphones that are easily accessible to customers.
Fintech refers to the innovative use of technology in the design and delivery of financial services and products.
The application of fintech cuts across multiple business segments, including lending, advice, investment management and payments, thus making banks the major users of technology.
As today’s consumers become more reliant on smartphones and mobile devices to accomplish everyday tasks while on-the-go, expectations have shifted to include being able to accomplish routine banking tasks easily from a mobile device, anywhere and at any time.
A survey by Blumberg Capital notes that 88 per cent of all banking interactions will be mobile by 2022, an indication of the impact of Fintech.
The impact fintech would have on interactions on mobile for customers has to do with availability, being paperless, having control and being safe.
This new era of digital transformation in African banking space will be defined by customers and user experience and this will entail a shift from the old mindset to an experienced mindset.
The shift from the old mindset to the experienced mindset has led many banks to go into innovations that would aid the banking services and First Bank of Nigeria is not left out of it.
The Managing Director and Chief Executive Officer of First Bank of Nigeria, Mr Adesola Adeduntan, says the bank’s WhatsApp banking is a veritable tool for Customer and User Experience (CU/UX).
Adeduntan made this known at a recent “Future Banking Technology Conference’’ aimed at addressing the full value chain of the region’s banking and financial sector to best achieve financial inclusion and sustainable banking sector growth.
Adeduntan who was represented by the Head of Global Custody, First Bank, Mr Timi George, spoke on the topic: “The Future of CX/UX in West Africa’s Banking Sector’’.
According to him, the changes in the banking landscape speak to everyone to be prepared at all times and at First Bank, we have staunch support for future banking industry.
“Prior to previous banking, the banking behaviour and customers have changed as well as attitude toward banks and their expectations; which has lead to innovations.
“As a forward-looking and innovation-driven organisation, First Bank is one of the few banks that are already using WhatsApp Banking solutions to deliver unique customers and users’ experiences.
“First Bank ChatBanking offering delivers improved customer experience by enabling customers to seamlessly and securely perform banking transactions via the everyday messaging platform.
“The banking solutions have to do with making bank transfers, paying bills, buy airtime and data, checking balance and basic enquiries,’’ he explains.
Adeduntan notes that First Bank WhatsApp is enabled by innovative digital and data technologies such as digital security protocols, Chatbots, artificial intelligence and big data analytics to drive improved customer and user experience.
He points out that the future of customer and user experience in the African banking sector will be driven by specific trends that will ultimately lead to unlocking of enormous potential in the African finance service sector.
He mentions trends like: switch from selling to serving, provide solutions not features, connect emotionally instead of providing information, focus on disruption instead of protection and creating flow and avoid fragmentation.
“The bank customers of now, as well as future are seeking realtime interactions and pin-point accurate, personalised engagement.
“The banks that are winning and will win in the future are those that are able to deliver on both fronts for the customers through unique capabilities.
“The unique capabilities are: mobile and digital advantage, action driven, Omni channel experience, while and nimble, connected network advantage and big data analytics, ” Adeduntan notes.
Mr Steven Ambore, Head Digital Financial Services, Central Bank of Nigeria (CBN) says fintech globally addresses financial inclusion gap.
According to him, the CBN recognises the importance of digital financial services and thus has strategised its workings to ensure that fintech is adopted and works well for the banking industry.
“To make any progress, we need to focus on creating the enabling environment for fintech to thrive and CBN has instituted strategies toward that.
“There is a roadmap for that. Introduction of a tradition licensing, trying to understand what fintech does and its problems, holding roundtable with stakeholders and others,” he explains.
Ambore notes that women and the youth are the most financially excluded, saying the CBN is working toward ensuring that the gap is bridged.
He suggests making financial services very accessible, meeting specific needs and affordable.
In his presentation, Mr Benjamin Tordah-Klu, Principal Economics Officer, Ministry of Finance, Ghana, suggests that a proper regulatory framework is needed for fintech to thrive.
According to him, a lot is being done in the fintech space, like in areas of payment and others.
Mr Damola Atanda, Head, Financial Literacy Office, Consumer Protection Department, CBN, says that apart from an enabling environment, financial literacy is of essence.
According to him, we have technology but the problem is what do we do with the technology we have and its impact on the people.
“Forty million excluded Nigerians living in the rural areas have been living their lives well without technology and introducing financial technology to them will be strange because they will be wondering its use.
“How to get them understand the banking solutions is where financial literacy comes in and they should be made to understand the enormous responsibility that comes with it, ‘’ Atanda suggests.
He mentions that the CBN works with the National Youth Service Corps (NYSC) to enlist corps members to educate people in the rural areas on the benefits of digital services.
Atanda also notes other activities of CBN to ensure a boost in financial inclusion to include the development of a portal to help standardise financial literacy, putting together consumer protection framework and others.
Dr Evans Woherem, Founder and Chairman, Digital Africa Global Consult Ltd, and Compumetrics Solutions, says financial inclusion and fintech are very apt in the present world.
According to him, financial inclusion is important to us because of the need to ensure that the generality of people from 18 years upward become users of financial institution.
“It is so unfortunate that these demography are financially excluded and the need to ensure that things are done to include them.
“Fintech is something that we also need to pay more attention to as it is an exponential technology that will disrupt the banking system.
“The banking system has come a long way from the long queue banking to the realtime one but this is not enough. There is the need to embrace fintech in the banking systems,’’ he notes.
He advises West Africans to catch up on technology adoption, noting that the conference is a big opportunity to put heads together and come up with a decision that will help in going forward.
On the whole, traditional financial institutions and non-traditional fintech firms need to collaborate to ensure the success of fintech for the benefit of customers.
There is also the need to introduce financial technology to millions of rural dwellers through financial literacy so as to catch up with 2022 when a large percentage of banking transactions will be mobile. (NAN Features)
**If used, please credit the writer as well as News Agency of Nigeria (NAN)