Is real-time video engagement the key to digital banking success?

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Digital banking on mobileDigital platforms are gradually overtaking branch networks as the preferred channel for day-to-day banking. Bain Capital reports that banking customers now handle 50 percent of their banking interactions through digital channels. Accessing statements and account balances, initiating transactions and transferring funds are just some of the daily operations which are already proving far more popular online than offline, and this trend is expected to escalate over the next few years.

With transactions in branches costing as much as 50% more than those processed online, leading banks are wasting no time in slashing the numbers of branches they operate, especially in rural and remote areas, where profits are significantly lower than in towns or cities. Bank of America has so far closed 1,400 of its american branches – a fifth of all branches in the US-  and British bank HSBC recently announced that it was planning to cut 25,000 jobs worldwide as it looks to reduce costs and remain competitive in the digital age.

But digital channels aren’t just making routine transactions faster and easier. By reducing the costs and time associated with handling these transactions, banks are able to focus their digital efforts on selling higher-margin products and services online. In December last year, Barclays introduced 24-hour video banking, a Premium service allowing select Premier customers to talk face-to-face with a financial advisor via computer, smartphone or tablet. Other banks and institutions such as Nationwide or IndusInd provide specific video access to mortgage, loan and wealth management experts via video banking installations set up at key branches. The aim is to offer customers across the country unified access to the human expertise they need when purchasing high-consideration products and services.

Providing video access to centralized expertise is more economically viable than deploying dedicated mortgage, loan, insurance and credit card experts in branches nation-wide, and also means banks can offer premium digital offerings to their most affluent customers, such as the ability to schedule face-to-face video meetings with a specific adviser at the click of a button or round-the-clock service for customers travelling abroad.

Video engagement is not only about cost savings; it is an important tool for improving customer experience and satisfaction. Connecting with an advisor through a real-time audio or video conversation helps to convey transparency and trustworthiness, and supports the personal relationships banks must develop to build brand loyalty and propose additional products. With the ability to hear emotions and see facial expressions, financial advisors can bring the human-factor online needed to reassure customers that they are making the right choices, as well as prevent fraud and identity theft. It opens up the ability to offer more sophisticated support, as well as expanded languages and time zones. And it’s a great way to differentiate your offering and demonstrate innovation. Imagine confirming a wire transfer digitally in seconds! American Express, one of the top 20 most admired companies in the world,  is making mobile video chat available to its valued gold and platinum members. USAA is using video chat to better serve its military member base.

Video engagement software vendors are wasting no time in seizing this opportunity to spruce up their products and adapt them to the changing needs of American and European financial institutions. And it’s not only for banks; investment management firms, insurance providers and wealth management companies would all benefit from offering richer, more interactive conversations that bring the human factor online. Market leader videodesk’s rich features now go way beyond the basic video chat functionalities many banks had been using to date, and are helping institutions reproduce the physical banking experience online, down to the smallest details. Simple options and techniques such as live document and video-sharing mean advisers can share electronic documents and information in real-time, thus greatly reducing the processing times typically associated with email and postal exchanges. Other features such as co-browsing and screen-sharing have an educational purpose and are frequently used to educate users on how to use online banking tools to manage their finances. With the click of a button, advisers can remotely guide users through the use of online tools such as loan calculators or wire-transfer processes.

Use of these tools in the context of a rich audio or video conversation provides a superior real-time digital experience that customers remember. The strategic development and democratization of such tools should only further help digitize banking in the near future.

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