85% of adults are willing to take personal action on environmental and sustainability issues according to Mastercard research. 116 banks worldwide, including 9 in the US, have already agreed to participate in the UN’s Net-Zero Banking Alliance. Participants must address two key questions: how to internalize ESG and sustainability across every facet of the business, and how to turn sustainability into a genuine competitive advantage. Given the importance of ESG issues to their customers, financial institutions will increasingly need to factor these concerns into their day-to-day business activities.
Marketing decisions related to deposit acquisition are often based on the bank’s desire for certain products along with assumptions about customer behavior. While somewhat technical, this article describes how machine learning algorithms can be used to identify factors that will drive purchase behavior. The effectiveness of any marketing campaign can be greatly increased by creating targeted promotions based on the results of advanced analytics.
Thinking about money makes half of the respondents in a recent survey anxious. Three areas in which financial institutions can support their customers include providing useful financial tools and apps accompanied by proactive and personalized recommendations, protecting personal data, and providing context around transactional data.
Banks are increasingly partnering with fintechs to expand their service offerings and appeal to a wider swath of customers. But a question that needs to be considered is: what happens if a partner company fails? This is something that should be explicitly addressed up-front in the contractual agreement. Going forward, maintaining strong lines of communication with the other party is essential to anticipate – and potentially help prevent – any unfortunate outcomes.
“The cloud is the foundation for 21st-century banking”. That said, relatively few banks have moved to a more flexible back-end. Steps to address this include acknowledging that the ‘cloud’ is the future by creating awareness across the organization of its practical value. Recognize that it’s not about IT, but about making the business more valuable. And understand that existing processes will have to change to take full advantage of cloud-based automation opportunities.
