Most consumers want to improve their financial health. 80% expect their financial institution to help, but only 14% say their institution provides any meaningful assistance. Banks and credit unions can be more effective in meeting this need by sharpening their strategic focus, embracing open banking technologies, and adding easy-to-use planning and payment tools through partnerships with fintechs.
Earned Wage Access (EWA) programs provide benefits to consumers and also give banks an opportunity to build relationships with business customers. This program works by giving employees of a company the opportunity to withdraw the wages they have earned at any point during the pay cycle, helping them better manage their cash flow. For their employers, it provides a retention tool at little to no cost. And for the banks that help set up these programs, it generates considerable goodwill with the business and helps deepen the relationship. A clear win all around.
“An unhappy customer is a valuable customer because they can help you do better”. This is one of the takeaways from the first day of The Financial Brand Forum. Many customer complaints are never addressed, which not only may result in a lost relationship but also misses a learning experience that can help a company improve its operations. Another interesting insight: instead of creating a company mission statement, create a customer mission statement. Center it around what the customer wants to achieve, how they want to be served, the impact that your institution will have on the customer, and why customers care about what your bank does. Then let this mission statement guide your operations.
The digital-only business bank Grasshopper has a diverse business model to rely on to help it confront this challenging economic environment. Revenue sources include NYC-based digital entrepreneurs of all sizes, tech lending to the venture capital community, and CRE and SBA lending. Deposits to provide the needed funding come from three BaaS relationships from fintech companies, which also add a little non-interest income.
Three-quarters of banking executives believe AI and machine learning will transform the industry. But challenges to using these technologies include reskilling employees, effectively deploying the technology across the enterprise, and seeing how AI will generate new revenue streams. Key Bank established a Center of Excellence to help drive its strategy. It then partnered with Google and brought in a dedicated team of analytics, product, and technology people. This approach led to the development of a conversational AI solution, along with a variety of other customer-facing and back-office applications.
