Increased use of technology – to be deployed to ensure convenient banking and systems security – is set to define the future of banking in the country, according to the a 2015 pwc banking survey.
The survey conducted by accounting and advisory firm PricewaterHouseCoopers (pwc) captured the views of customers and executives of banks with both sides of respondents giving high ratings to the roll technology will play to create what is termed “the future bank” from the eyes of the consumer.
Presenting the general findings of the survey to a cross-cutting audience mainly from the financial services sector, the Senior Country Partner, Mr Vish Ashiagbor, said with the reduction in customer loyalty, “One of the things that would enhance banks’ ability to deliver to customer expectation is the technology and keeping their operating models simple.”
He said, overall, banks should keep their eyes on what their consumers wanted and have a customer-centric focus, admitting however that “banks have invested a lot in technology over the years. But this survey report indicates that it will continue to be a major driver of banking into the future.”
The survey was on the theme: “Bank of the Future: What bank customers want to experience by 2020.”
Majority of customers (68 per cent) in the survey agreed that banking technology was supportive of a fully integrated distribution channel that enabled customers to have more control over their accounts. Only five per cent of the customers gave a low rating for technology as a top three driver of banking into the future.
Interestingly, 35 per cent of customers said their banks were prepared to harness the potential of technology; 53 per cent said their banks were not prepared but were likely to take advantage of it, with 12 per cent of the customers saying their banks were neither deploying such required technology nor were they likely to do so.
The survey, however, signalled hope as the bank executive themselves gave a 100 per cent rating to technology to be among the top three drivers of banking into the future. Only 64 per cent of this segment of the respondents rated technology as a top three driver of banking in last year’s survey.
Customer perspectives on channels
Majority of customers (70 per cent) believe mobile phones and similar hand-held devices, ATMs, and video teller machines are among the topmost options that banks offer for doing business with customers, putting less emphasis on branches.
Indeed, 53 per cent said their banks were also having that, 38 per cent of the respondents said although their banks did not have it, they were likely to deploy same, with only nine per cent of the customers interviewed saying they held no hope their banks would offer such an opportunity.
Bank executives
As opposed to the 82 per cent who listed competition among the top three drivers in last year’s survey, only 44 per cent of the bank executives thought that would define banking in this year’s survey. They, however, introduced sustainability of banking as 11 per cent of them rated it among the top three out of seven drivers.
Not surprisingly, 44 per cent of bank executives, a bigger chunk than last year (18 per cent), thought socio-demographics – the changing structure of the population – would be a major driver. Their choice for legislation and regulation also moved from 73 per cent to 33 per cent.
A changing landscape
The banks traditionally have been seen as insulated. The conclusion has been that they do their own thing and customers either take it or leave it. But the environment has changed with intense competition. This has brought major changes in the banking environment over the last several years.
For example, minimum deposits have virtually disappeared and people can now open a bank account with virtually no initial deposits. The use of technology has also improved and a lot of people are using automated teller machines (ATMs) and online banking, all in response to the consumer demands.
Premising high thought on findings of the survey which predicted that the banking sector would continue to grow over the next five years from the current GH¢67.46 billion to GH¢261.55 billion, Mr Ashiagbor said it would take banks which positioned themselves well to grab a chunk of the market opportunities that would be presented.
The pwc survey also estimated that for the next five years to 2020, deposits of banks would reach GH¢133.75 billion, from the GH¢37.66 billion the sector was expected to mobilise cumulatively by the close of this year.