Globalization 3.0 for Customer 3.0 with Web 2.0 – The Future of Transaction Banking

In this era of Globalization 3.0, the next generation of Customer 3.0 dominates the market and companies have to keep pace by using innovative technology designs such as Web 2.0 to thrive in this hyper-connected, competitive environment.

In the banking industry, the role of bankers and corporate treasurers has evolved from being mere transaction providers. To service new age customers who demand real time transacting and access to information, the focus of banks should be on building integrated systems and flexible architectures to provide real-time data and relevant reports.

Create a Customer-Centric, Technology-Oriented Roadmap

With the digital transformation happening in the banking industry, banks need to upgrade their systems to make it more flexible, accessible, transparent and customer-centric. They need to create a roadmap to integrate technology that will revolve around customer behavior and preferred services and products. Some of the milestones that banks should work towards in their transformative journey include:

1 – Real-Time Data Accessibility

Majority of corporate treasurers state that it is critical to have access to real time information in order to optimize their online cash management experience. With the environment becoming highly competitive and the prolific use of devices, there is a frantic need for customers and bankers to access real time information and data. Banks will have to build systems that provide access to this real time information and a well-strategized communication plan as well.

 2 – Building Integrated Systems

As the role of banks and corporate treasurers evolve, integrated and consolidated transactional capabilities have to be improved. With corporate banking becoming more demanding, it will not be sufficient to build corporate portals that provide access to account information and payment transactions. Providing a 360 degree view of financial data and enabling detailed reporting using analytics will become necessary.

3 – Flexible Architectures

As emerging banking technologies are introduced, banks will need to improve their cash management systems based on flexible architectures. This will enable them to easily integrate systems efficiently and add new channels faster in order to offer new services and products especially in this age of social and local mobility in financial transactions.

4 – Use of Analytics

Analytics plays an important role in banking. However, it is fairly underutilized especially in the banking treasury services and corporate sector. Besides using behavioral tracking and risk management for fraud prevention, analytical methods such as trend analysis can also provide insightful direction for banks to better position their products and introduce higher level of services and value-adds.

5 – Relevant Reports

As stated by majority of the corporate treasurers, most of the static reports submitted by banks are not relevant and they prefer exporting data from the bank’s site to generate their own reports. It is high time that banks create dynamic and interactive reporting designs to enable multibank capabilities. The way forward is an advanced platform feature that will allow users to transfer funds and initiate payments within the report.

 

With these milestones in mind, banks and financial institutions need to increase technology investment and optimally utilize automated systems to provide customized products and services.

As the new generation of customers dominates an evolving market, banks need to differentiate themselves in this competitive market. They should be open to investing in emerging banking technologies which will be supported by an advanced transaction banking platform. Get to know about a high-speed banking platform which provides an advanced highway to run customer payments services, receivables management, cash management, liquidity management, trade finance and supply chain finance in an integrated set, through a single platform.

 

Find out more in this year’s annual conference of Sibos, where iGTB will be showcasing its core comprehensive products, from Corporate Banking Exchange, Customer Onboarding, Payments Services Hub to Liquidity Management.

 

Create a Customer-Centric, Technology-Oriented Roadmap and Invest in Technology to be a part of the Future of Transaction Banking 

SIBOS

Corporate Banking On The Go. High-Speed Banking for Executives on the move.

It’s a bright sunny day, you’re enjoying a round of golf and you get pinged to approve a $4.3bn transaction. Think it’s possible? Yes, because there is an app for it.

Mobile corporate transaction banking is no longer an exception, it is a necessity. Banking technology has evolved with the changing landscape of customers, from corporate internet banking to corporate mobile banking.

As the corporate treasurers’ role transforms, what corporate banking customers want today is access to information and services, secure transacting and automation of processes to enable efficiency. Recognizing this need for change, banks are primarily focused on integrating and utilizing emerging technologies.

Mobility in Corporate Banking – Not Just Servicing the “Schedule-Stricken Senior Executive”

The benefits of mobility in corporate banking are not limited to authorization processes and engagement of senior executives or treasurers.

  • Streamline work processes – The introduction of mobility in corporate banks and financial institutions can help in streamlining processes that have evolved over time into complex procedural tasks. Complex banking operations can be simplified using new banking technology.
  • Monitor and make decisions in real-time– With a single view of the bank’s cash position, senior executives can monitor and make decisions in real-time, based on the dynamic environment. By using the mobile channel, the financial stability can easily be monitored and it can be secured with quick decision making.

The Skeptical Adoption of Mobility by Corporate Banks

As compared to the widespread adoption of mobility in the retail banking space, corporate bankers are still skeptical about complete adoption. Their main concern- security.

Is confidential data secure?

Are user-authentication procedures concrete enough?

With Bring Your Own Device (BYOD) being the ‘in’ thing, what if a device with sensitive information is misplaced?

While these concerns may be valid, corporate bankers need to take a look at the customizable features of emerging banking technology products. With embedded, robust security systems, high-speed performance, user friendliness, device and channel agnostic characteristics, adoption and integration of innovative banking technology is inevitable.

Technology companies are building new mobile banking systems specifically for corporate customers. They are introducing relevant functions that can be used on the go. Functions such as multi-device operability, workflow and transaction approvals, fund transfers, secure bank messaging and alerting. Corporate banks need to extensively adopt mobile banking technology in order to provide mobility for banking executives on the move.

Get to know how to utilize a high-speed banking platform to provide an advanced highway to run customer payments services, receivables management, cash management, liquidity management, trade finance and supply chain finance in an integrated set, through a single platform. Find out more in this year’s annual conference of Sibos, where iGTB will be showcasing its core comprehensive products.

For Corporate Banking On The Go, Adopt Mobility with Innovative Banking Technology 

SIBOS

3 Ways to Use Predictive Analytics for Customer Centricity in Transaction Banking

Customer Cetricity

Customers’ expectations have undergone a 360 change. They no longer expect real-time service and information. They expect companies to predict what they need. Predictive analytics technology has become a game changer in utilizing big data and business intelligence to enable companies make better informed decisions. 

 

Ride the new wave of Predictive Technology Using Big Data Analytics

Regulations are ever changing

Volumes are ever expanding

Competition is ever growing

Customer demands are getting more complex

Financial crimes are getting more sophisticated

In this M2M (machine-to-machine) market, real-time service, action and decision making is required to provide exclusive service and products. In the business banking space, challenges such as increasing transaction costs, higher liquidity requirements and managing decreasing margins make it inevitable for enterprises to adopt predictive analytics.

More Insight, Less Hindsight – Personalize with Predictive Analytics

To keep up with the new man-and-machine interaction, adoption of innovative business approaches is necessary. The core essence of predictive analytics is focused more on insight rather than on hindsight.

With new technologies, devices and channels used by customers, transaction patterns are not only becoming more complex, but constantly changing over time.  Predictive analytics uses business intelligence and big data analytics to provide companies with real-time, actionable intelligence to personalize their service and products.  Here are 3 ways you could use predictive analytics to become customer centric in transaction banking:

  1. Assess your customer landscape – Integrate customer experience across channels and deliver real-time insights to stakeholders in order to promote better informed decision making.
  2. Envision your future – Identify and define your future vision, how your banking products and services need to be offered and through which channels in order to sync with changing customer needs.
  3. Implement a phased transformation – Use a real-time banking data platform and social sentiment analysis to integrate new social channels in your multi-channel strategy.

Capitalize on a high-speed transaction banking platform

Innovative and new transaction banking platforms need to be adopted in order to respond to the changing landscape of customer demands, interaction and transaction patterns, and evolving expectations. iGTB’s Global Transaction Banking platform enables corporate customers to have all their transaction needs seamlessly integrated through a consolidated next generation portal for the corporate user, leveraging the Customer Business Exchange.

Capitalize on predictive analytics and use an advanced highway to run customer payments services, receivables management, cash management, liquidity management, trade finance and supply chain finance in an integrated set, through a single, high-speed banking platform. Find out more in this year’s annual conference of Sibos, where iGTB will be showcasing its core comprehensive products, from Corporate Banking Exchange, Customer Onboarding, Payments Services Hub to Liquidity Management.

Get to Know How to Personalize with Predictive Technology 

SIBOS

Top 3 Trends in Digital Banking

 

op 3 Trends in Digital Banking

The digital era has changed the entire landscape of the banking industry, and has provided new opportunities to improve customer experience. Customers are increasingly using smartphones, tablets and PCs to access financial information and perform transactions.

With evolving technology and customer landscapes, it is important for businesses to keep up with the trends in digital banking:

  1. Mobile banking: The major trend in digital banking includes mobile banking. The average financial servicers witnessed a significant amount of audiences coming in exclusively from mobile platforms. Smartphones have facilitated quick adoption of technology, enabling simple and immediate transactions from phones.
  2. Omnichannel banking: Omnichannel banking has enabled customers to have a holistic transaction experience, while the bank can leverage a unified view of customers. Customers today can carry out their banking transactions from any place, at any time; be it a bank branch, a kiosk, an ATM, or phones, tablets and websites.
  3. Leveraging contextual data: individual user behavior is tracked and Contextual data is leveraged within digital channels, in order to customize the portal to the customer needs. Furthermore, online channels are optimized to up-sell campaigns. A seamless customer journey can be possible only when relevant information is collected and mapped as per the personal preferences of customers.

Banking strategies have changed over time to suit the evolving needs of various customers; with no room for ‘one size fits all’. Planning is integral to counterbalance device and platform differences.

In this digital world, keep up with what’s hot and happening. Expect the extraordinary and experience “Digital Banking 360” showcased by iGTB for the tenth consecutive year at the Sibos annual conference.

Are you ready to take banking to next level? Visit us at – booth H30. Schedule a meeting today!

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The Beautiful Game – Transaction Product Aesthetics

Transaction Banking by D Sign

 A Blog by Professor Michael Mainelli

The Beautiful Game – Transaction Product Aesthetics

Another football World Cup reminds us of the good, the bad, the ugly, and the beautiful game, prompting a great question – “what makes a beautiful transaction product?”  Aesthetics is a branch of philosophy dealing with the nature of art, beauty, and the senses.  Aesthetic theories attempt to derive principles of good taste.  Our question can be rephrased, “what are the aesthetics of a good transaction product?”  Can we set out a set of principles for a good product?  This is harder than it might appear.

Take website aesthetics as a relevant example.  In the past two decades we have seen an evolution in website aesthetics comparable to two millennia of art.  Our early website scratchings were flat, two dimensional presentations of Byzantine text.  We moved through a Renaissance of experimentation and new techniques, culminating with some Baroque Flash-based websites.  Our Enlightenment and Modernist period were full of predictive analytics and scientific reconfigurations of websites.  Google reinitiated a Minimalist tradition with its deceptively simple initial site.  Today, our post-Modern aesthetic encompasses a smorgasbord of styles, as long as they work on a tablet or smartphone.  Robert M Pirsig’s classic work on the metaphysics of quality was the book Zen and the Art of Motorcycle Maintenance: An Inquiry into Values.   He mused, “I think there is such a thing as Quality, but that as soon as you try to define it, something goes haywire.  You can’t do it.” [Bantam Books, 1974, page 184]. 

Simple Is Good And Good Is Fit

But as businesspeople we have to do it.  We have to decide what is good or bad about our websites and our products.  One aesthetic approach has been to say that good design exists when you don’t notice the product.  Simplicity is paramount.  Philips, the Netherlands consumer products firm, tries to focus on the aesthetic principle of simplicity, with variable results.  It’s not easy, particularly when you span their wide range of products.  Apple is widely considered to be a design-led company.  Its products are not the most innovative, though often close.  Its simple designs and intuitive interfaces draw exclamations of delight, as systems built for idiots.  Apple has many emulators, few of whom manage to comprehend and replicate the simplicity.  Doubters question whether Apple can keep up the wonder for the next product line. 

Yet a Swiss army knife is both complex and simple.  Another aesthetic approach has been to say that good design is evidently fit for purpose.  Form follows function.  The Swiss army knife provides a single survival tool, perhaps now in conjunction with a Swiss army smartphone.  The form follows function school draws on a wealth of management work on quality systems.  However, a primitive website that works is as fit for purpose as a well-designed website.  How can we tell the difference?  User experience is one test.  Far too many sites work, but remain confusing and unclear. 

My personal differentiator for banking products is the security regime.  Banking products need not just to be secure, but to be seen to be secure, so my tolerance for onerous redundant checks in systems built by idiots is high.  That said, one of my commercial banks seems to revel in confusion over its own terminology.  A security number is at times a PIN, a password, and a security code, intermingled with a few challenge numbers.  Combined with their confusion about customer identification numbers, account numbers and usernames, all inconsistently referenced, I’m flummoxed at some points about what number they want me to enter when, particularly as they ask me to enter some numbers multiple times.  I get worked up and worried.  I don’t have something to hide, do I?  Yet, well beyond websites, what makes a good transaction product design?

From Swords To Egg Cartons To Locks To Safety

I had hoped to illustrate this article with talk of wonderful Japanese designs, e.g. katana, wakizashi, or tachi swords, but when I spoke with people about transaction banking design metaphors they came up with ideas such as egg cartons or locks.  The egg carton is perhaps somewhat inelegant, but fit for purpose in so many ways, stackable, protective, cheap, recyclable.  Locks are particularly interesting as we have both analogue and digital locking systems now.  The traditional lock-and-key still works well and is probably what you will take out of your pocket at home tonight.  Digital keys are widely used for apartment blocks and hotels.

In fact, safety seems to be the overriding principle for transaction banking, more than simplicity or fit-for-purpose.  Safety is why I’m so much more tolerant of my bank’s ludicrously inept checks than I would be for other websites.  Notwithstanding banks claiming they’ve been very safe about transaction banking, the clients want more.  The clients want trust and safety.  With admirable honesty Ross McEwan, CEO of RBS, pins the current situation down hard – “We are the least trusted industry and we are the least trusted bank”.

Defining Trust

Trust is also not easy to evaluate.  The Old English ‘tr’owe’ and Old Norse ‘troust’ are both about faithfulness.  Trust as a noun is defined as ‘a relationship of reliance’, but also a dependence on some future contingency, credit (buying something on trust), holding property on behalf of another, as well as a charge or duty, for example a child committed to your trust.  Further, as a noun it often means a legal or business structure for third-party beneficiaries, but equally a cartel to reduce competition, e.g. anti-trust laws.  As a verb, trust means relying on someone or something, but also to entrust into care, believe someone or extend credit. 

Trust is when we leverage on a history of relationships to extend credit and benefit-of-the-doubt to someone.  In risky environments trust enables cooperation and permits voluntary participation in mutually beneficial transactions which are otherwise costly to enforce or cannot be enforced by third parties.  By taking a risk on trust, we increase the amount of cooperation throughout society while simultaneously reducing the costs.  Trust is not a simple concept, nor is it necessarily an unmitigated good.  A too-trusting society is its own worst enemy.

Trusting In Long-Term Aesthetics

Probably the hardest aesthetic to achieve is a simple, fit-for-purpose, trust-based product for the long-term.  The financial crises since 2007 have been the reason that Ross McEwan’s customers have so little trust.  The products we proffer in transaction banking should be those that avoid boom and bust.  A range of longer-term products from payment protection insurance to rate swaps to LIBOR-based contracts have undermined customer trust.  Oddly, complex products correlated too well with failure.  At the time these products were proffered, the banks involved gave little thought to their ‘legacy’ or ‘future heritage’.  Now they reap what they sowed.  The relationship is what matters – “…eventually he saw that Quality couldn’t be independently related with either the subject or the object but could be found only in the relationship of the two with each other. … Quality is not a thing.  It is an event.” [Pirsig, page 215] 

Ultimately, an aesthetically good transaction product can fulfil many principles, but the overriding principle is whether it contributes to trust in the relationship between bank and client.  William McChesney Martin Jr, Federal Reserve Chairman in the 1950s and 1960s, said that the job of a central bank is “to take away the punch bowl just as the party gets going”.  Transaction banks have a choice.  They can offer clean and simple products with no leverage or fancy footwork that are the equivalent of alcohol-free fruit juice.  Equally, they ‘spike’ the punch bowl with products full of leverage and special conditions.  I know which one looks more beautiful.

 

Professor Michael Mainelli is Executive Chairman of Z/Yen Group and Principal Advisor to Long Finance.  His latest book, The Price of Fish: A New Approach to Wicked Economics and Better Decisions, written with Ian Harris, won the 2012 Independent Publisher Book Awards Finance, Investment & Economics Gold Prize.  

 

Omnichannel Banking – Transformative Technology For Evolving Customers

Take a look around, there’s an interesting transformation happening today.
Customers are getting digitized
Whereas customer touch points are getting humanized

Welcome to the age of Customer 3.0. The type of customers who are not defined demographically, geographically or economically, but by their evolution to adopt new technology to meet their banking and transacting needs. To serve the evolving customer landscape, the omnichannel approach is the need of the hour.

The focus of the omnichannel approach is on contextual banking to create a holistic experience to enable customers seamlessly transact. The omnichannel concept of engagement banking refers to providing a single experience for banks’ customers across multiple channels. In this approach, irrespective of the channel chosen by the customer, the functions, services, capabilities and experience should be the same. The omnichannel approach also supports bankers on the go, by providing agility, flexibility and secure access to information and systems anytime, anywhere, through any device.

For instance, if a customer wishes to open a new bank account, the banking representative could use an app to fill in customer details, an e-signature could be captured, digital documents could be securely uploaded and verified, and a new account could be opened within minutes using minimal paper work. This is what omnichannel integration facilitates.

What is required is an intuitive, real-time omnichannel interface that uses transformative distribution technology to provide an exclusive business banking software to create that seamless experience that the customers desire.

At this year’s Sibos, iGTB’s core comprehensive products are being showcased, from Corporate Banking Exchange, Customer Onboarding, Payments Services Hub to Liquidity Management. All these modules are available, through intuitive real-time omnichannel interface, renowned Corporate Banking Exchange (CBX), powered by Canvas Technology – a transformative distribution technology.

Get to Know How You Can Engage ‘Customer 3.0’ with Omnichannel Banking

SIBOS

Transaction Banking by D Sign

A Blog by Professor Michael Mainelli

June 2014

Travelling Is Infectious

A friend recently flew to a Commonwealth country.  On entry, his mobile phone alerted him to local apps for insurance and payments.  After asking around and checking out local opinion, positive, he took one of each.  The insurance app was designed for some local health cover which he fortunately didn’t need.  The payment app was designed for remittances.  He used the remittance service to change some money, and then to make local payments.  He was impressed at how simple it was, how good the exchange rates were, and how little the payments cost him in fees.  For the past few weeks he’s been seeing how much he can save using his overseas app for payments in Europe.  So far, the app’s European coverage is patchy, but still saving him some money.  With increasing penetration of standardised technology, and increasing globalisation, many more people will be bringing home infectious transaction apps from foreign climes.

There is no shortage of things to keep transaction bankers awake at night – a nightmare list of regulation, capital ratios, non-bank competitors, dis-intermediaries, cyber-threats, cost pressures, shrinking margins, and the perpetual trio of market, credit, and operational risk.  Beneath all of these nightmares lurk the denizens of globalisation and technology.  Customer experiences are transforming expectations.  Newly minted tourists from Asia return home with higher expectations.  As do old Western hands who return from Asian trips with experiences of superior service.  Technology travellers bring tales of adventure from other online markets.  They roam an internet of easy-to-navigate systems with accurate records and helpful apps and bring legends back to a home country full of hidebound, creaking Western banking systems.  Like my friend, customers are visiting new lands and new devices where transactions work faster, better, and cheaper.  Customers experience consumer-based technology dissonance in so many sectors, clashes between what they’ve come to expect on their phones and what they experience in commercial practice.

Expectation Experience Dissonance

The technology dissonance between experience and expectation in transaction banking is perhaps highest in the corporate market.  Here, corporate workers try to make antiquated payment systems work, but sigh while remembering what they can do out-of-office worldwide on their mobile phones swiftly and accurately.  Dig deeper into the architecture of new transactions and we see again the Scylla and Charybdis of globalisation and technology.  New systems are being built that bypass national payment systems, that bypass SWIFT.  High on our list of disruptive technologies for both consumers and corporates has to be the global blockchains that drive bitcoin and other cryptocurrencies.

A blockchain is a distributed transaction database shared by participating nodes – a public ledger that prevents making the same transaction twice, and is nearly indestructible.  Every new block of transactions contains a hash of the previous block, creating a chain of blocks from the ‘genesis’ block to the current block.    A full copy of a blockchain contains every transaction ever executed.  You can keep a paranoid copy of everything, or naively entrust a record of your transaction history to the internet.  The consumer experience of cryptocurrencies is variable, but the blockchains have proved robust.  Working since 2009, forged in a global furnace of libertarian money, trade, avarice, criminality, espionage, and law enforcement, Bitcoin and other cryptocurrency experiments provide increasing confidence that blockchains are robust in harsh environments and have a bright future.

Block To The Future

Regulatory announcements from some jurisdictions, such as the Isle of Man or Alderney, show they realise blockchains are about much more than coins.  At a recent Long Finance event in London over 50 financiers examined what blockchain technology might mean for traditional financial services.  For consumer interaction, there might be identity blockchains to prevent fraud, preserve insurance contracts, or share health records.  For corporate transactions, suggestions ranged from asset registries for ships, aircraft and art to wholesale market trade reporting, consolidated tapes, corporate voting, tax registries, accounting registries, or multi-entity contracting and deal rooms.  Some start-ups are building new financial exchanges using blockchains and it is only a short while before some established players will use them to replace rickety systems that need a robust, semi-open transaction ledger at their core.  So both consumer experiences of money and corporate experiences of new information technology are transforming expectations.

Whenever we hand goods or services over for consideration, there is risk.  The buyer may not get what he or she wants or needs.  The seller may not get paid.  These problems may not be due to deception or delusion, perhaps just miscommunication.  So commercial transactions frequently introduce a trusted third party.  With what the third party is trusted varies.  In commodities trading, certain standards specify how a third party defines a commodity or the delivery of a commodity.  In trade finance, the third party typically releases funds when goods or services of an appropriate quality have been exchanged.  Blockchains are picking away at the ‘trusted third party’ concept, particularly by preventing contradictory transactions and providing an historic ledger. 

Transactions Are Infectious

By lowering trust and technology problems, blockchains are likely to increase transaction volume and frequency.  The first, ‘identity’ introduction to any blockchain will be crucial, and an excellent role for a bank.  Moreover, blockchains need to fund their consumption of processing power as they ‘forge’ or ‘mine’ the chain.  Cryptocurrencies have a bootstrapping approach, paying in their own specie.  Bitcoin miners are paid in bitcoin.  For more traditional transactions, banks have a key role in taking fees to organise the processing.

A few transaction bankers might pursue a strategy of introducing blockchains rapidly, perhaps becoming more systems suppliers than bankers.  Most will pursue a technology of adapting.  Reminiscent of Giuseppe Tomasi di Lampedusa, “If you want things to stay as they are, things will have to change”, transaction bankers have no choice but to embrace the new technology as it arrives.  Is there a more strategic response for the adaptive?

For transaction banks not pursuing a technology-based strategy, one clear strategic response is to get even closer to the customers.  Be the bank that facilitates access to blockchains by providing excellent service on confirmation of identity.  Be the bank that enables ‘single log-on’ type access to multiple blockchains.  Be the bank that provides the best dashboard and analytics for blockchain management.  Be infectively enthusiastic about the future of new trusted third party technology for the sake of your customers.  Or as the children’s Smiling Is Infectious poem concludes, “Start an epidemic, And get the world infected.”

Professor Michael Mainelli is Executive Chairman of Z/Yen Group and Principal Advisor to Long Finance.  His latest book, The Price of Fish: A New Approach to Wicked Economics and Better Decisions, written with Ian Harris, won the 2012 Independent Publisher Book Awards Finance, Investment & Economics Gold Prize.