Crafting Better Customer Journeys Through Digital Banking

Piggybacking on the push Covid-19 gave to digital transformation over the last two years, most banks have moved fast to strategise and establish a connect with their customers remotely via the digital medium. This has happened with such vigour that multiple financial entities from the country today conduct over 90 per cent of their transactions through digital and mobile platforms. Similar trends have been observed with other large banks, including the State Bank of India, Bank of Baroda and even HDFC Bank.

But bringing digital banking services to its customers’ fingertips comes with its own challenges and the banks have had to address them to keep up with the times and competition from the fintechs. And it has been crucial for the banks to get the basics right before delving into leveraging cutting-edge tech like AI/ML.

While big tech companies such as Microsoft and IBM along with fintechs have mobilised resources to innovate and reach the masses, banks with their old ways have had to adapt and evolve to keep up. This journey for banks began with moving away from JVM structures and web app servers and figuring out the way onto cloud-native architecture. This has been important for the banks in order to deliver experiences that the customers love. To make this happen, they have had to look into Flutter and React Native platforms amongst others.

“Digital experience and customer experience is going to be very important for banks moving forward. And they will invest in these technologies,” says Rishi Aurora, Senior Partner & Financial Services Sector Leader at IBM.

The largest private bank in India, HDFC Bank, has focused on getting the fundamentals right from the outset. While it has a set strategy when it comes to the cloud, the bank has pursued this endeavour in a controlled manner by creating a landing zone to which the applications are moved. The bank reveals that this helps it build a clear architecture that is scaling up an experience which is customer-friendly and data-rich.

“We focus on three blocks — experience, resilience, and scale —and followed by insights and analytics. If you look at these, we are making progress across the board,” says Ramesh Lakshminarayanan, CIO, Group Head IT at HDFC Bank.

Reimagining Customer Experience

Technology has forever changed the landscape of almost every industry today. In the last two years, the adaptation and the learning curve has been even steeper for the banking industry as it had to deliver services to customers wherever they were located. But that’s not all. Banks also had to step up and deliver brilliant customer experiences via digital services as they competed with the new-age fintechs.

“Today, when we compare the experience of a banking app, we don't compare it with another banking app. We look at what is the best experience available on a handphone,” says Aurora.

Hence, the process of innovation must be a constant for banks in present times that are seeing technology grow by the day. The bullseye unwaveringly needs to be set on delivering an ace customer experience. And there isn’t a better way to do this than reaching out to customers via WhatsApp, the most popular messaging platform in the country.

Digital Banking itself has gone through its own little digital transformation as it has meandered towards messaging platforms such as WhatsApp. Introducing conversational banking to its repertoire is now allowing financial entities to have a human-like interaction with their customers even over the digital medium.

Much like banks such as SBI, Bank of Baroda and PNB, HDFC Bank too rolled out its WhatsApp banking services for its customers recently. This medium for banking is completely bot-driven and goes one step beyond Interactive Voice Response (IVR) which could be quite a hassle if your call breaks halfway. With WhatsApp banking, the bots can assist bank customers with a prompt wherever they have stopped and make the process continuous.

“We are doing a lot of stuff in the areas of usage of bots at the backend,” says Lakshminarayanan.

HDFC Bank says that there are more than 90 transactions and services available 24x7 in a seamless manner through HDFC Bank Chat Banking on WhatsApp.

Modernising Legacy And Getting Future Ready

At the face of competition, banks have had to transform their operations to stay relevant. Most of them have accelerated digital transformation of their services and a crucial aspect of this is the modernisation of their core banking system.

Banks have had these systems in place for a while and they have been pointed at helping them function well operationally. But with the demands for efficiency growing, banks now have to look at how they could rewrite legacy in some areas.

“There is a lot of stress on banks to upgrade with the emergence of fintech,” says Aurora, adding, “To help the banks step up, IBM has been investing and forging partnerships to build open ecosystems that enable innovation and unlock new opportunities. Since Arvind Krishna became our CEO in April 2020, IBM has acquired more than 25 companies across software, hybrid cloud, and consulting. IBM has also invested in Client Innovation Centres that specialise in design, software engineering and analytics. In addition, they launched a cyber range command center to help clients achieve cyber preparedness”.

A lot of the banks today are looking at their net banking, mobile banking and redoing the structure in place to stay up-to-date with the times. HDFC Bank is working in partnership with an entity to figure out its net banking while on the mobile banking side, it is developing its own platform from scratch.

“We are not doing this sitting in a centralised office. In fact, we have 70-80 people to do a very solid legacy rewrite while based out of multiple cities,” says Lakshminarayanan.

HDFC Bank is also running a project in Mumbai, where it is pulling payments and customers out of core banking. This is because the bank believes that some of the payment has to move to a cloud-native technology due to the scale at which it is operating.

The Mumbai-headquartered bank's strategy regarding tech remains simple as it keeps the focus on the foundational aspects of the legacy side but takes on rapid deployment through partnerships with fintech and other entities – with an eye set on delivering a great customer experience.

“There is no overnight solution, no silver bullets. We go programme by programme, project by project to enhance customer journeys through our work,” concludes Lakshminarayanan.

Master Strokes is a series produced by BW Businessworld and Presented by IBM India. This series will recognise and present the efforts and accomplishments of technology leaders across sectors on how they use and continue to leverage technology to bring about business transformation creating a positive impact on their organisation.

Master Strokes is a series produced by BW Businessworld and Presented by IBM India. This series will present the efforts and accomplishments of technology leaders across sectors on how they use and continue to leverage technology to bring about business transformation creating a positive impact on their organisation.