The financial services industry has never been more complex. Traditional banks share the playing field with alternative lenders, FinTechs, neo banks, beta banks and other digital competitors. Consumers across generations are migrating to online banking alternatives. Many seek benefits like special deals, packaged offerings and discounts in return for sharing their information, balanced by a demand for digital security.
And, while countless financial transactions can be completed quickly, conveniently and securely online, customers with multi-faceted financial requirements, including businesses both large and small, still desire a more traditional, relationship-driven face-to-face banking experience tailored to their evolving needs. Whether digitally or people driven, today’s consumers, like in other areas of life, have become accustomed to the personalization of their consumer behavior and desires.
“Customers will tell you – will demonstrate with their purchasing power – where they find value,” notes OceanFirst Chairman, President and CEO Christopher Maher. “We are making investments to make sure our customers receive a quality, secure banking experience. That includes a digital/cybersecurity infrastructure that matches our branch network. There’s an equation to find the right balance between enough office locations and digital banking options.”
Frank Sorrentino III, chairman & CEO, says ConnectOne is a commercial bank with a focus on small- to mid-size business owners. “Many of these users have complex financial needs or requests and prefer to work with a banker in person – say when they want to enter a new phase in their business. They aren’t coming in as often for standard transactions,” Sorrentino states. “We still believe there is a need for brick and mortar, but the purpose is shifting. For now, we believe a hybrid approach is the best way to serve our clients.”
In its 2019 Global Financial Services Consumer Study, Accenture, a leading global professional services company, identified key points that support these observations. According to the study, consumers want integrated propositions addressing core needs, fully personalized offerings from their financial providers, and better integration across physical and digital channels. The study also found that consumers are willing to share data with their providers in return for better advice and more attractive deals, and their trust in financial institutions is increasing.
ConnectOne’s Sorrentino says the importance of innovation and developing new solutions that take advantage of data, advanced analytics, digital technologies and new delivery platforms has never been more important. “Today’s consumers expect personalized experiences,” he points out. “Companies like Netflix and Amazon are driving client expectations. While personalized service is something that we’ve always delivered in-person, data is critical to delivering the digital experiences clients demand. As banks, we house a lot of our clients’ data. Tapping into it to deliver smarter, frictionless experiences is key.”
“FinTechs are finding ways to offer better, faster, on-demand experiences to meet clients’ needs,” Sorrentino adds. “They’re forcing banks – of all sizes – to evaluate how they operate and how they deliver their products and services. Really, the products and services FinTech companies offer are no different. They are embracing digital technologies to deliver them in a better and more efficient way. For a long time, banks have been ridden with friction. FinTech companies are utilizing technologies like digital platforms and application programming interfaces (API’s) to utilize data in order to build better experiences and eliminate manual processes.”
“If we don’t innovate, someone else will. Innovation is critically important to improving customer experiences,” agrees OceanFirst Chairman, President and CEO Christopher Maher. “The definition of convenience has changed. While companies like Rocket Mortgage and Quicken Loans were out front in terms of technology, traditional banks and financial institutions are closing the gap. FinTech innovation is not going to provide that sector with a consistent advantage.”
In 2018, OceanFirst was the first bank in its marketplace to introduce a partnership with Nest Egg, a year-old Philadelphia-based start-up, to provide a tech-driven digital investment platform as part of its service offerings. OceanFirst has also invested in Nest Egg, which uses answers provided by customers to determine risk tolerance and investment goals to develop a personalized portfolio. Everything from portfolio selection to risk analysis is automatically delivered, including ongoing monitoring and rebalancing. Easy to use and easy to access, Nest Egg accepts investments of as little as $1,000, to as much as $500,000.
OceanFirst also offers AmiGo, a no-fee, interest-paying online checking account with unlimited free ATMs and mobile deposits, as well as debit card perks and a zero-liability guarantee providing protection against unauthorized debit card charges.
At ConnectOne, Sorrentino notes that “one of our most significant initiatives was the roll out of nCino across our lending time, which allowed us to digitize our entire loan workflow.” Developed specifically for the banking industry on the Salesforce platform, nCino allows financial institutions to manage all customer and employee interaction through a single cloud-based operating system.
“Today, the manual process along with paper have been removed from our loan application and booking process,” Sorrentino continues. “The nCino product allows us to remove inefficiencies that existed in our loan process while allowing us to scale our sense of urgency culture.”
“Our top priority at ConnectOne is to remove friction from our client experiences and we are utilizing technology to do that,” Sorrentino adds. “Whether through real-time mobile banking features or improving workflows and processes behind-the-scenes, our investments are focused on building a better client experience. We’ve made recent updates to improve our mobile app, cut down our account opening time, and removed paper from the process. In the past, we have launched accounts that can be opened online along with Zelle, a real-time person-to-person payments solution.”
Cybersecurity concerns remain top-of-mind at a time when millions of individuals have had their personal information exposed by data breaches at Target, Yahoo and other companies. Yet, consumers are more willing than ever to share their most personal financial information; as long as their needs are fulfilled, and their experiences are tailored to their personal choices. That can include everything from retail shopping to a wide range of financial services.
“People talk and think about privacy in the abstract,” says OceanFirst’s Maher. “Over time, consumers have come to accept that greater freedom of choice comes with a cost.”
In October, NJBankers hosted a Cybersecurity Incident Response Planning Seminar to help banks identify and address areas of concern. Workshop participants took part in real world scenario testing and worked in teams to develop appropriate responses to attacks. The interactive program focused on the six phases of a response framework – preparation, identification, containment, eradication, recovery and lessons learned – to understand the practical application of each element and learn how to build and implement an incident response program.
“Technology has created an opportunity to communicate in a different way, sending unique messages to different audiences based on their lifestyles and needs,” ConnectOne’s Sorrentino concludes. “Ultimately, this makes the bank much more effective. We have the ability to deliver a particular set of products and services based on an audience’s needs and lifestyle.”
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