Like a sci-fi movie, the COVID-19 pandemic jostled bankers out of an enjoyable period of somewhat relaxed regulation, M&A, and increased earnings into a hard reality. Institutions learned overnight exactly how resilient they are or are not; how easily they can support workers and serve customers remotely and determine a future amid chaos. Today, many branches are locked, ATMs unstocked, and call centers overrun. Few US institutions have robust digital banking offerings, extending processes and services to remote workers and customers electronically and through digital applications and partners.
The pandemic is a Digital Ultimatum for investment in digital consumer, business and treasury services. Some institutions were ready. They invested in banking capabilities and created and infrastructure that allowed partners to extend services such as remote money movement and customer service. On days 1 and 14 of the crisis, these institutions can interact with remote bank workers, allow customers to move money to other banks, and complete and digitally sign credit and investment transactions. Their business customers were able to work with banks, business partners, vendors, and CPAs with barely a blip.
Digital-savvy institutions committed to innovation; they knew it would take more than a few years. They made strategic business decisions to invest over time in virtualized infrastructure, the ability to extend core, back and front office and API and security framework. In that way, they could provide increased remote service and digital consumer, business banking and treasury management. During and post-pandemic, their business strategies enable these institutions to better cope with negative pressure on revenue, manage material increases in credit risk, be more transparent with customers, partners and regulators.
Today, more than ever, investment in digital consumer and business banking and treasury management is strategic for institutions of all sizes. Bank workers and customers are increasingly digital natives, never having known anything except a mobile application. Adoption cycles are greatly reduced. Technologies that enable digital bank extensions are more prevalent and less costly than a decade ago. The investment is as important for business continuity as it is growth.
In order to begin the journey, institutions must move away from pure expense management by developing technology-informed growth and balance sheet strategies. This is the digital ultimatum to both bottom line and value creation. CCG Catalyst Consulting Group is the catalyst, helping banks and credit unions to develop game-changing management strategies for now into the future.