Why a Digital Banking Transformation Is Crucial

April 4, 2023   -  

Why Digital Banking Transformation is Critical The Postage Blog

There are many anachronisms in society that have retained their value for today’s customers. Mechanical watches, for instance, are completely unnecessary now that everyone has a cell phone, but nonetheless, there are enthusiasts and consumers who will pay thousands of dollars for the pleasure of wearing a luxury antique. 

Unfortunately, there is nothing nostalgic or fascinating about driving twenty minutes across town to deposit a check in your bank branch. The power and freedom digital banking provides the modern customer is not a luxurious perk at a few high-end financial boutiques. Depositing that check from your kitchen table with a cell phone has become an every day—and expected—occurrence for the average customer. 

If you don’t have a robust portfolio of services to offer your clients, you’re going to be ticking off the days until your doors close, because the world of online banking is here to stay. If you’re still waiting in the wings, it’s time for a digital banking transformation to bring your institution into the 21st century.

Online Accounts

Online savings accounts hit the banking scene in the mid 90s, and by the mid 2000s, they were all the rage. Companies like ING were offering unheard-of interest rates from 3-5% just for letting them hold your cash. Other than having no walls or a roof, online savings accounts behaved exactly like regular savings accounts, except customers didn’t need to find a teller or an ATM to access their funds. 

The popularity of these accounts wrote the story for the financial industry: online banking was here to stay. Like the self-checkout line at the grocery store, human beings are perfectly willing to do a teller’s job for themselves if they get speed and convenience in return, and brick-and-mortar banks today have had to adapt.

A traditional bank will never be able to generate the interest rate of a virtual account, but they can offer all the online services that make them appealing. Customers expect to be able to deposit checks online, transfer money instantly, pay off their credit cards, and link their accounts to all sorts of secondary services with the press of a button. 

If you’re not part of the online banking craze, it’s time to get on board. These are not perks, they are competitive basics, and within a generation, they will be mandatory. 

Saving Money While Saving Money

The reason those online savings accounts were (and still are) able to offer impressive rates is because they don’t have to pay for lights, water, and extra personnel to keep the business running. In-person banks are counteracting this with relationship banking strategies that boost customer loyalty, but there are still a lot of places a digital banking transformation can save on overhead. 

The more people doing a teller’s work for you, the fewer real tellers you have to pay. Online banking also allows people to take care of business 24/7, so your bank can keep working even when your employees are fast asleep. Also, all those machines crunching numbers? They almost never miscount anything, their handwriting is crystal clear, and they work at the speed of light. 

And all without that burnt pot of coffee in the lobby. 

Develop Better Relationships

It seems counterintuitive, but digital banking actually allows you to nurture better relationships with your customers. When they use your online platform, they build familiarity and comfort with your brand. The more time they spend with it, the more switching to a new platform with a different layout and processes to learn seems like a hassle.

Customers actually develop an impressively deep set of skills for handling their own finances online. They can link services with apps like Venmo and Mint, find their account and routing numbers, manage and apply for credit cards, and even check for fraud and report it. When you already know how to do all the things you need to do, the idea of having to learn it all over again makes looking for a competitor with a 0.12% better interest prohibitive. 

Finally, online banking makes handling the more complicated transactions a snap. If you have an in-house mortgage, for instance, customers can manage it online, and banks often offer perks for other accounts. Online services also instantly generate statements and allow you to flag and search for particular transactions when doing things like taxes. And speaking of which, all that tax paperwork is generated online, so no more requests, repeat mailings, or hands-on time during tax season. 

Create Lasting Ties

A digital banking transformation doesn’t just update existing services. It opens up a world of opportunities to connect customers with a range of other valuable services that can be integrated into the traditional banking relationship. 

Mortgages and legacy planning are two examples of services that tie people closer to a financial institution. Both of them represent a commitment that is measured in decades, not years, and they are hugely personally meaningful and life-changing for the families who use them. 

Also, 61% of customers use online banking services at least once a week, and all of those screen moments are an opportunity to reinforce a golden narrative for your bank: 

Banking means interacting with your company. 

Well-designed platforms can feel like a warm handshake every time the customer visits your site, and chatbots and AI can make the experience both helpful and familiar. 

These are the banking interactions that build trust and encourage clients to make banking with your institution a family commitment. The most coveted banking relationships of all are the ones that are passed from one generation to the next, and online banking can be a big part of creating and nurturing them. 

Expanding Digital Banking Transformation With The Postage

Digital banking experiences are reshaping the banking landscape, and they are opening up possibilities for more valuable, longer-lasting relationships between customers and financial institutions than ever before.

The Postage is committed to helping families develop easy, secure, and meaningful connections with their financial institutions, with services like online will creation, legacy planning, a digital vault, and preservation and delivery of important memories and messages 

Let us help imbue your digital banking transformation with longevity, security, and peace of mind.