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Implementation Of NextGen Technologies In Banking

Business models have been changed drastically and it’s important for the Banks to re-align themselves

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Next Generation Banking is all about delivering customer delight by transforming the customer experience, through innovative use of technology. The days of cost based differentiation are long over. Experiential leadership, especially in a rapidly digitised world is what will deliver a sustainable edge.
Next Gen Technologies identified by banks need to be fiercely customer focused. The key to success is the ability of technology to delivery hyper-customized experiences to customers. Another dimension is ensuring customer’s trust with the highest level of security. This is crucial for customer adoption and value generation. Keeping these principles in mind, we are looking at BBC (Biometrics, Blockchain and Conversational banking - Chatbots powered by AI & ML), that will be the future of digital banking. These will hugely impact banking transactions, loans, commerce followed by social media banking, app Banking, Missed call and SMS banking and lastly, few will continue using browsers for banking transactions.

Customers in the upper half of the pyramid are mostly early adopters of technologies; with convenience being the driver. Robo advisory is one such technology that can help increase customer touch in this segment, offer consistent & unbiased advice and reduce human resource cost. Virtual and Augmented Reality will take customer experience to a new level. Internet of things (IoT) through in the nascent stage, is going to be another revolution in the making, especially with its promise to integrate into our customer’s daily life and decision making.

Customers at the bottom of the pyramid should also be part of the plan. Missed Call Commerce and banking (MCCB) developed by us will become mainstream with value and convenience seekers. This will lead to the inversion of the customer’s pyramid which is the ultimate aim of all digitally focused companies.

Optimise internal processes is also critical in an environment of cost pressure and the need for agility. Robotic Process Automation (RPA), and image processing technologies are few such developments which have brought in automation and standardisation, at lower costs, yet enhancing the customer experience significantly. Automatic signature verification, Remote Deposit Capture, Photo bill pay, scanning of forms and instant and accurate data upload from physical forms are applications of Image Processing technology which have been widely used across the industry. Humanoid, assisted and virtual banking too will emerge once the technology matures.

In credit, P2P lending has emerged as a new business model and has been growing exponentially. Regulation, social trust and security of transactions (backed by Blockchain technology) will allow banks to harness this. It has tremendous benefits to offer banks in terms of inclusion and cost of delivery, however, a combined, concerted effort is needed here.

After demonetization, digital payments volumes and corresponding innovations have increased tremendously. Proximity payments (tap & pay - NFC, Soundwave and gesture) have been emerging as a major advancement to empower mobile phones as a financial transaction tools. QR codes are widely available at small merchants; smart payments (toll etc.), UPI, Aadhaar Pay, cashless and seamless checkout have come up as new modes of payment. In midst of all these developments, digital currency will slowly gain ground as its value is same across the globe.

Globally there are an estimated 2.51 Bn users of social networks (250 Mn from India alone). Therefore, social media innovation should be a part of any Innovation Strategy to make it effective and have an impact at scale. Here an organisation needs to adopt the two-pronged approach of External Social Media Excellence built on Superior Internal Social Media Capability. This will pay rich dividends in the medium and long turn.

The way people used to bank a decade back and now is completely different. Business models too have been changed drastically and it’s important for the Banks to re-align themselves. The redefined corporate & customer strategy should drive innovation. This alone will lead to successful Implementation of NextGen Technologies in Banking.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

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digital banking banking bfsi customers

Rajnish Khare

The author is Head - Digital Transformation, Social Business & New Media and Mobility Banking, HDFC Bank

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