Digitization strategies in the finance sector: Robot-assisted consultation that is right on the mark

The image of digitization appears inconsistent in the German finance sector. According to the latest KPMG study on “Turning Data into Value,” banks in the German economy are among the pioneers when it comes to data analysis. In fact, one out of every three banks has adapted its business model within the past two years due to the availability of data and the possibility for analyzing it. However, 51 percent are still having trouble identifying suitable fields of application. This could be because only 41 percent of the surveyed finance companies actually trust the data analyses being used, in terms of their precision.

The advantages are clear. Banks that analyze their customer data in greater detail are in a better position to increase their level of customer loyalty, because their digital data analyses enable them to develop customized offers for the individual customers. This is done, for example, with the help of machine learning. The process takes into account all historical data, including customer master data, all of the transactions the customer has conducted in the past, and all of the offers that have been made to the customer. On this basis, predictive analytics solutions calculate which offers the customer might be most likely to respond to positively. Several hundred parameters come together in this process, enabling bank advisors to make sound decisions when addressing the customer – in a much better and more specific way than just trusting their gut. And the customers benefit here, too. They no longer have to be bothered with offers that don’t correspond to their needs and wishes. KPMG banking specialist Thomas Lechte summarizes the importance of this differentiation: “Due to the highly competitive market and the pressure on profit margins, banks will increase their use of big data solutions for the analysis of customer needs, enabling them to identify business opportunities at an earlier stage and to utilize them successfully. The implementation of big data applications in banks will also significantly increase in order to respond flexibly to new regulatory requirements.”

But big data is not nearly everything. The digital future of the finance industry will require more. Sebastian Steger, of the Roland Berger consulting firm, explains why: “Banks and insurance companies have some of the greatest potential for digitization, since they have always collected, processed and linked customer data and transaction data. Yet many financial service providers have a hard time digitizing their business processes consistently and comprehensively – that is, from the frontend to the backend. As a result, customers are still confronted with paper applications, manual processes and procedures – along with the corresponding waiting times – and their concerns are not addressed in a timely manner.” This is where automation solutions come in, facilitating an increase in efficiency of up to 80 percent. The support of robotic process automation (RPA) can considerably accelerate back office processes, for example, and reduce the burden on employees. In the future, text robots will take over many routine tasks and automate them. For instance, robotic software can create standardized letters in a matter of seconds – a task that a human would need several minutes to perform.

The pressure on German banks to implement more digital solutions is rapidly increasing, since young fintech startups generally employ smart technology in their customer-focused offers. That’s why Deutsche Bank has decided on an agile strategy that automatically includes cooperation with fintech startups, thereby responding to the needs of today’s customers. The bank has established a digital factory in which its own IT staff cooperates with external partners. Multibank aggregation is a key project in this strategy. At the heart of the project is an app that customers can use to conduct their financial transactions entirely by mobile means – even through accounts held with competitors. This shows that Deutsche Bank has clearly identified an important digitization trend. Customers utilize financial services from a range of different providers and are no longer bound 100 percent to their “principal bank” – a term that the digital age has practically rendered obsolete, since, in the future, individual customers will decide for themselves which bank provides the most convenient platform for their purposes.

Author: Editorial team Future. Customer.
Image: agcreativelab – Adobe Stock