By Adam Oldfield, Head of Sales & Account Management at Phoebus Software Limited
In my last article I wrote about the digital journey many banks and building societies have embarked upon, and how the advent of the pandemic has, for a number of them, accelerated this work. To be digital and ‘digitising internal activities’ are equally two very different initiatives and we see several organisations missing the necessary internal aspects.
As organisations seek to become digital it is easy to focus just on future business and future customers, but they still need to reflect the wishes of all of their existing customers today, as well as the customers of the future they wish to attract.
There is arguably no greater example of this fine balancing act than in the building society arena. The vast majority of the existing customers today manage their affairs via the traditional passbook approach. This passbook not only serves as the customer’s record of their account and balance, but also provides building society staff with the ability to assist with identification of the account holder at the counter in branch.
As the varying building societies seek to attract new customers, will those customers want to engage via a Passbook? As a father to four children under the age of 11, all of whom have digital accounts with cards, it is already an alien concept to think that they need a book and to go in to a branch to withdraw some of their money.
That said, for some the trip to the branch is not just about accessing their banking needs, it is also a social occasion; they crave that interaction in the branch, they often know the branch staff by first name, and who have become very friendly faces they enjoy engaging with as part of their trip.
So how then do you ensure that for those customers who still wish to have this face-to-face engagement, you can still provide a service that facilitates this? And how do you do this as well as providing a digital capability to those that crave the automated services they receive elsewhere? The challenge is also ensuring, from a society perspective, that you can deliver on your vital internal drivers, such as cost, productivity and of course not forgetting environmental and social Governance (ESG).
As with many problems there are a multitude of answers. One of the answers we are discussing with our partners at PSL, is a digital account, not to be confused with a traditional current account. That said, societies still want a current account they can do both from the same platform. But in terms of the digital offering that replaces the passbook, a digital card for those that want to remain online or on an app, but also the option of a physical card for those that still wish to visit the branch for all the aforementioned reasons. The physical card, via chip and pin could also help facilitate the identification as done in many mainstream banks today.
As building societies, as well as all other institutions, grapple with the choices, they must make to facilitate the current and future clients, it yet again re-emphasizes the need to find the right partner to collaborate with.