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Value creation must be ultimate object of digitisation in banking

BY: Leopold L. L. Armah

It is evident globally, that technology has in many ways altered how people interact with their environments. Largely, the way we shop and make payments have been influenced by digitisation.

Undoubtedly, financial intermediaries like banks have seen the most transformation in the wake of technological advancement and digitisation. This radical and dynamic change being experienced generally is believed to have been solely driven by the convergence of digital innovation and rising consumer expectations.

Clearly, digitisation has led to the development of new concepts, new business models and in some cases, redefinition of sectorial boundaries, like in banking.

A rejuvenated sector where consumers have the audacity to demand more convenience based on their volatile preferences. The utmost service demands have transitioned from internet banking, cards and now open banking, tokenisation, digital currencies, contactless and even to concepts such as internet-of-things (IoT), artificial intelligence, wearables, instincts.

Over a decade ago, when I entered the banking sector, smartphones were still evolving, and the means of interaction was predominantly brick-and-mortar. Concurrently, the automated teller machines (ATMs) served as the most common electronic medium of interaction between banks and their customers. Technology, back then, was largely a back-office tool with relatively little front-end presence.

However, a new range of technologies today are underpinning the digital drive, and have become a topmost priority for all financial institutions, simply because, the relationship between them and their customers has become far less physical and more automated.

Greater automation is transforming customer experience, offering new levels of speed and slickness. Invariably, the sector will continue to undergo transformation as long as technology continues to evolve.

The evolution we have witnessed so far, has significantly facilitated the development of a business model themed “banking-as-a-service”, a vehicle for driving more value-added digital solutions centered around the lifestyle of the modern consumer. Undeniably, the last decade has also witnessed the emergence of business vehicles, such as Mobile Money Issuers (MMIs) and the financial technologies providers (Fintechs) that have disrupted the traditional financial service ecosystem.

Undoubtedly, their presence has among others fueled the drive for financial inclusion globally, with Ghana not being left out. This has also led to the redefinition of who a bank’s competitor is. The upgraded banking model, sometimes referred to as Banking 2.0 is inevitably the way to go as we journey into the future. This drive that we have been on for some time now is envisaged to be riding on seamless digital infrastructure as the means of delivering excellent services to customers.

Digital banking

Clearly, the emergence of digital banking has created a ripe environment for meeting the expectations of the customer. More than ever, the average customer is continuously equipped with the right knowledge and tools to facilitate access to services without any human intervention.

Truly, the customer is dictating the pace and the banks are expected to appreciate the immediacy of the needs, and importantly respond appropriately – often before they even realise they need them. It is believed that the introduction of artificial intelligence tools would lead to effective decision making on how to better meet the growing needs of customers, whilst aiding the process of personalizing solutions according to the demands.

Additionally, the latest digital dimension is the regularization and regulation of the use of cryptocurrencies which seems to be gaining ground across the globe.

The beauty of this emerging solution within the ecosystem is that, it is not driven by a single entity, but by the convergence of various services in the interest of the customer. This convergence of services is perceived by some experts as being at the maturing point of the digital ecosystem. This is considered as the lead to several initiatives at the bank level, industry, regulatory, national and even region levels geared toward the development of a true digital ecosystem.

In a rapidly changing world, however, one thing that remains constant throughout the changing scenes of technology is continuous delivery of utmost services to customers. In any case, the purpose and ultimate object of every technological and digitisation pursuit in banking must aim to create value for customers and clients.

Admittedly, the biggest challenge of every entity is translating digital into meaningful value for customers. This should therefore be on top-of-the-minds of all digital transformers, and of course financial intermediaries. That is what we must seek to achieve, because that is how we will know we have succeeded. Certainly, it is truly the expectation of a modern stakeholder like the customer.

In view of that, we must continuously strive towards understanding the needs of customers and businesses better – a 360-degree view of the present and every changing lifestyle. Furthermore, we must seek to extend varied and more interactive services to the customer.

In addition, a deeper segmentation of the portfolio and not relegating to a single point of service delivery are key parts of value creation.

These would essentially lead to the deployment of personalized offerings. Sustained value creation is therefore undeniably the catalyst for retaining and attracting customers, and notably an avenue for rewarding all stakeholders. Evidently, this is what is rooted in the transformation agenda of the Prudential Bank.

Prudential Bank journey

At Prudential Bank, we continue to work towards remaining trustworthy and credible to our loyal customers. The bank continuously works towards striking the balance by ensuring that both our technology and human capital are optimized at all times. Our investments over the years have focused on both technology and our human capital. While investing in technology, we also invest in human beings to build their capacity to be able to manage the technological tools. The Bank is at a threshold with a service assurance promise of delivering an end-to-end e-relationship with our customers. We have adopted a digital-first mindset to attract and retain new customers, and also to leverage on our digital assets to increase the banks deposit and loan portfolios.

With over 25 years of banking experience behind us, our understanding of the needs of Ghanaians has earned us their trust and confidence. For us also, digitization is about leveraging technology and innovative tools to improve the efficiency and efficacy of a given process. Marrying these two makes Prudential Bank the bank of choice now and in the future for every Ghanaian.