Hybrid banking: a digital tectonic shift

Hybrid banking: a digital tectonic shift

Hybrid banking, the integration of digital banking facilities with the brick-and-mortar branches, has been gaining popularity since the height of the Covid-19 pandemic in 2020. This approach has birthed many mobile initiatives including omnichannel banking, voice recognition, and video interactions, to cater to diverse customers’ personas namely the traditionalists and the digital savvy. While this approach spells growth for banks, they also need the right strategy for effective execution.

In this blog, we explore the emergence for a hybrid banking approach, why hybrid banking is here to stay, and suggest how financial institutions can kickstart this journey. 

Setting the context

Digitization has simplified workflows for many industries, including the banking and finance industry. Banking customers looked for simplified options to make their day-to-day transactions and other banking requirements as seamless as possible. Therefore, banks felt the need to streamline processes such as customer sign-ups, onboarding procedures, daily transactions, loan applications, KYC compliance, and more, simplified, and easy for customers.  

Furthermore, the year 2020 saw tremendous changes in every sector. Every industry was forced to go almost completely virtual because of lockdown and social distancing norms.

That was the time when the concept of “neo-banking’ became the need of the hour. Many countries had become accustomed to wholly digital services because “neo-banking” offers customers the flexibility of using a range of banking facilities at the click of a button from the comfort of their homes, while banks enjoyed lower costs of operation. Therefore, this shift began as a necessary adaptation to the pandemic and produced benefits that have spurred continuous changes and reimagination in banking touchpoints. By 2030, all banks are expected to use technology to activate insight from customer data to enrich customer journeys.

The challenge and solution

Digitization has provided many benefits including better quality of the products and services at a lower cost. However, in some countries like India, adapting to “neo-banking” is challenging owing to the diverse demographic factors. A large portion of the population consists of senior citizens who might not be digitally savvy and are more resistant to change. In contrast, tech-savvy millennials would prefer a comprehensive banking solution that combines all services in one location. With this dynamic, customers’ requirements become more complex, and banks must incorporate both offline and online services in their pedagogy and strike the right balance for their diverse customers.

Financial institutions have thus broadened their digital capabilities and cater to diverse customers’ requirements while maintaining the standards of offline channels. This has led banks to identify more opportunities to increase cost savings, flexibility, security, and their customer base. For instance, banks have sought to synchronize online and offline channels by integrating customer data across relevant channels, enabling more seamless, real-time banking experiences. The result is greater customer affinity and higher top-line growth.

Getting started

Hybrid banking will continue spelling growth for businesses, and financial institutions must buckle down for an omnichannel approach to capture more value. To execute omnichannel engagement effectively, banks need to acquire a single 360-customer view that enables real-time assessment of customer journeys. Banks will then be able to gain deep insights into customers’ behavioral patterns preferences, and pain points, all of which lay the foundation for personalized customer engagement, increased brand loyalty, and top-line growth.

If you are looking for the right tools to kickstart your hybrid journey, look no further. Schedule a demo with us today.

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