Five key innovation trends to watch over the next three years include re-imagining processes and product delivery for the digital era, presenting personalized, contextual information to customers tailored to their individual needs, and using partnerships to help spur innovation and enhance capabilities. Low-code/no-code presents opportunities to improve internal productivity and efficiency. And finally, it would be a good idea to monitor developments with the metaverse.
New exam guidance from the CFPB challenges banks to take a hard look at their marketing and pricing practices. The agency’s concern is that decision-making algorithms, marketing/advertising programs, and identification practices might discriminate against protected groups. They are looking at this in the context of all the products/services that the company offers – not just lending.
Creating a separate digital bank can be an attractive alternative to banks looking to expand into new markets or target different customer niches. Implementation of the idea leads immediately to the ‘build versus buy’ decision. In most cases, the ‘buy’ route is likely to result in the fastest time to market, the highest ROI, and the lowest level of risk.
Return on Experience (ROX) is a metric originally created by PwC and is described as “a holistic approach to understanding and increasing the value of your investments across customer experience, employee experience, and leadership experience.” Going beyond purely financial measures, ROX can incorporate different customer-centric and employee-centric KPIs to better capture the value added by new projects.
Interest in RfP (Request for Pay) is growing rapidly in the ever-changing payments landscape. This messaging capability establishes a secure connection between the biller and payee, supporting one-click real-time payments. This occurs outside of the current payment rails and can simplify consumers’ lives while greatly reducing businesses’ processing costs.
Helping customers achieve their financial goals also builds strong emotional connections that are key to retention. Giving customers a holistic view of their financial picture across institutions and then using data to offer meaningful, individualized advice will help stem the flight to fintechs.
Marcus will be introducing an interest-bearing checking account to the general public later this year to complement its high-yield savings account and personal loan products. Created based on extensive customer research and feedback, this latest move will help position Goldman Sachs as more of a consumer bank.
A group of East Bay activists is pushing for a public bank that would be jointly owned by Alameda County as well as the Cities of Oakland, Berkeley, and Richmond. The blueprint envisions the bank would make loans to support affordable housing, and for small businesses owned by Black, indigenous and other people of color. It could potentially even do some infrastructure lending for municipalities. This would be similar to the Bank of North Dakota which was established in 1919. Philadelphia is currently pursuing a similar public bank initiative.
