Front-end Retail Banking Applications (and more)

In this day of financial crisis and extreme competition between banks in the Retail sector, a financial institution needs to have the ability to serve its customers at a new level.

When the customer goes into the Branch, he needs to feel important. He needs to sit down in a nice office and a bank officer to come, sit with him, discuss anything that the customer is thinking about, give him advice and immediately issue offers for various banking products. “What? You don’t have a savings account with us! Let me just apply for one and then we continue our discussion”. This is how it should be. Forget about lines of people standing and waiting for their turn.

This is pretty important but… is that all? No, the bank must look farther: customers that “voluntarily” go inside the Branch are OK but what if the bank were able to go to the customer, itself? Consider the following examples:

  • How would you like to go and buy a new car from your local car dealer and get instant credit?

  • What about the new big screen TV that you were thinking about? If you don’t have the money, don’t worry; you can get credit if you just ask the floor manager. He will take you to a nice office and you will have a chat…

  • And while you are at the super market, doing the week’s shopping, why don’t you get the new branded Credit Card of the store? It will give you significant discounts.

    You see where this is going? No? I’ll tell you: All these retail POS’es need to have the bank’s front-end system, to immediately post a loan or credit card application and get a response in a matter of minutes (or seconds). And if things are positive, the POS will actually print the loan contract and you will sign it.

    Some of you may have already seen it, but not all of you. I happen to know banks that either do not have this kind of capability or they have it through a mediator, who receives Applications and then forwards them to the bank. Therefore, it is the mediator who has the reach-to-the-POS capability and not the bank!

    Remedy? Yes: the banks need to deploy front-end systems in order to reach out to the POS. In addition, the bank Branches must be converted to POS’es of the new era. Here are the basic characteristics of such a system:

    1) Web enabled. And I will not take “no” for an answer on that one!

    2) Unified customer database. Everybody in the network should be able to see the customer’s history.

    3) The entire arsenal of products in the hands of the salesperson. See customer analytics and cross-sell.

    4) Customer behavior data and black lists. You need to identify “faulty” cases immediately.

    5) On-line connection with the back-office system. Loan disbursement must be feasible in real-time.

    6) CRM capabilities must be included.

    One more thing: It is my strong belief that in an ideal world, all these front-end tools should be integrated with the rest of the system. In fact, I believe that the bank should only have ONE system. Front and Back, it doesn’t matter. Everything is part of the bigger picture. Maybe, this is very difficult for big Institutions where the complexity of the business if high. But when we are talking about small or medium banks (Car manufacturer captive banks, partnership banks with local-only presence etc.), then it’s much easier. If you want to know how this is possible, contact me!
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