Next Gen Banking is the new frontier

Nations Trust Bank CEO Renuka Fernando speaks on Next Gen Banking and the challenges the industry faces to adapt to tech-driven consumer trends  

Nations Trust Bank PLC is one of Sri Lanka’s fastest growing licensed commercial banks, offering a wide, comprehensive range of solutions to individuals, SMEs, corporates and institutions. The bank strongly believes that change is needed within the organisation and the financial services sector as a whole for it to survive and thrive in the future.

We sat down with Renuka Fernando, the CEO of Nations Trust Bank, as she discussed her thoughts about the future of the financial services sector and the bank’s plans to secure a place for itself in that future. 

Q: What is the future of financial services? 

A: Globally there is significant disruption happening in the financial services industry especially in the commercial banking sector because of innovative technology. This is happening with new players such as the Fintechs and the Telcos entering into the industry, with a particular product or services which are in direct competition with the banks, and which are offered to the consumer on a standalone basis. We also see various third party platforms coming into the financial services ecosystem such as the payment wallets and mobile payment platforms. 

These new entrants don’t have to battle through legacy systems that the banks have and don’t have the intensity of compliance to the financial services regulatory framework which the banks are under.  So banks are now beginning to realise that they will need to disrupt their own business models and think different if they are to keep pace with these trends. 

Q: How has the advent of digital affected the future of financial services?

A: The digital era has impacted industries like retailing and travel or even healthcare, in a big way. Today in some countries like the USA the bricks and mortar retail stores are being closed as more and more purchases go digital, similar to the travel industry.    

Although by and large banks have been pretty slow to adapt to the digital environment, perhaps due to legacy systems and the regulatory framework in which they operate, you are now seeing that a lot of transactions that happened through manual processes at branches and back offices are now being automated rapidly. Technologies in financial transactions have brought enormous customer convenience and ease, through mobile and online channels as well as speed and accuracy which we could not have achieved manually.  

Of course it has been debated for many years whether bricks and mortar branches will survive. But we really haven’t seen them disappearing yet, although the role of the branch and the look and feel has changed dramatically.  

The exciting trend is that with technology advancement on robotics, biometrics, and data analytics, functions like account opening, loan underwriting and customer servicing can be digitalised. We have banks like Atom in the UK and a platform like Mundo who were born in the digital era and offers their customers a completely digital financial services experience. 

In Sri Lanka I’m really proud to say that Nations Trust Bank has introduced the first fully digital banking proposition through our recently  launched ‘FriMi’ which is in fact a fully fledged bank account which is also a direct mobile payment and money transfer platform available for your day to day transactions and purchases. We will continue to enhance this digital offer with other banking products being added in the future. 

Q: What is the transformation you wish to see in your organisation in the future?

A: Today the world is in the ‘experience era’. This means that consumers are demanding ‘an exceptional experience’ in any product or service offer from the time they consider the purchase to the final fulfilment of it. This change has come about mainly as a result of the vast strides made by technology, which has made it possible for organisations to engage, personalise and manage their customer experiences in a far more effective way.  Technology is literally reshaping the way we interact and engage with our customers, and some industries have managed to embrace these changes far more effectively than others.   

The financial services industry must recognise that customers, particularly the younger generations, are very willing to look to getting their financial products from even non traditional providers as long as they have a great experience. This means that the considerations that drive loyalty have changed. 

The bank that completely understands the importance of providing this experience will win in the market place. Banks need to leverage the use of new technology which can be plugged in without changing entire legacy systems and use the information and customer data they have access to bring about a paradigm shift in customer experiences which the traditional ecosystem cannot provide.       

We feel that the bank that manages to understand and crack this has a real disruptive story to tell. 

We want to be this bank. 

Q: How will you deliver this experience you are talking about?

A: We have always considered customer service as the key to our success and have woven our entire proposition based on brining convenience to our customers and understanding them better.

But now we are determined to take this to a whole new level, using data analytics and technology to help us to understand our customers intimately and design their experience with the bank based on their personal preferences and requirements. We are converting our bank to change the way we understand and service our customers from a product and channel based experience to a holistic seamless experience across our entire bank.   

We are focused on building a value adding financial ecosystem for our customers with multiple channels, proactive customer interactions and personalisation of their delivery and product offers to bring a unique and hereto unmatched experience. 

Today we can give a lot of choice to the customers in how they interact with us, from traditional channels such as the branch or call centre to electronic channels and digital channels like mobile, online and social media.  But it’s questionable that we can really say that the experience across all these channels is uniform and seamless.  Customers should be able to choose a mix of channels they are comfortable with and be able to have an omni channel experience which will enable them to start  the interaction  with one channel and end it with another, absolutely seamlessly.  

We also need to be able to anticipate our customer requirements and service preferences based on their historical interactions with us. This comes through a thorough understanding and analysis of our data which enables our service offer to be much more proactive to the needs of the customer and to design more personalised products, tailor make offers and provide far more value adding advice based on the customer information we have.       

This can’t be done in isolation without transforming the way we work internally. So we have already started re-engineering our processes which include brining robotics into some of our processes and bringing innovative, collaborative technology which will help us to integrate the way we service and manage our customers. It also means that we will need to re-skill our staff to think and work differently and more proactively, using these technology tools.     

Q: Any final words about the future of financial services?

A: We and the sector as a whole need a change in our operating model. In the past we were heavy on product intensity and light on knowing our customer. We have to flip this. We need an intimate understanding of our customer and offer simple yet personalised product and interactions. 

Technology brought to your customer in a simple, intuitive and easy to use manner and the way we personalise our customer experience will be the keys to succeeding in the future.