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Banking & Finance

PwC's global experts discuss the future of banking

Released at: 18:06, 06/03/2019

PwC's global experts discuss the future of banking

Photo: PwC

PwC Consulting Vietnam recently organized the "The Future of Banking" seminar.

by Doanh Doanh

PwC Consulting Vietnam organized the “The Future of Banking” seminar recently, with the participation of PwC’s Global Financial Services Leader Mr. John Garvey and local bank leaders.

Together with a panel of distinguished industry experts from the US, Canada, Southeast Asia, Hong Kong, and Japan, Mr. Garvey discussed what it takes for banks to thrive in this digital age while maintaining their human relationships. “Banks will need to be on the cutting edge of technology and make sure that customers’ needs are ingrained in every offering,” he said.

According to PwC, it is imperative that banks change amid customer expectations, technological capabilities, regulatory requirements, demographics, and economics. They need to get ahead of these challenges and transform themselves for future success.

Focus on the customer

In particular, discussions identified a strong interest in building a future bank that can cater to every customer’s needs across different stages of life in a unique, personalized way.

“The future of banking is about a highly-digitized customer experience and the expansion from traditional banking services to providing ‘lifestyle’ services that cover customer needs across the whole of their lives,” Mr. Garvey said.

“Banks need to look at the lifestyle of each customer and understand what needs or ambitions they have, whether it is to buy a car, buy an apartment, or start a family,” said Mr. Grant Dennis, General Director of PwC Consulting Vietnam. “Banks should be in a position to help customers achieve these personal goals through the use of services such as savings, loans, life insurance, or third-party products like health insurance.”

Most importantly, banks should be able to envision the needs of the customer and offer respective services even before the customer knows or asks for them. This is possible through proactive data analytics-driven customer insights, enabled by smart technologies and very often by partnering with fintech companies or other solution providers.

To demonstrate the latest solutions for data-driven insights, PwC specialists introduced the Customer Insights Platform at the seminar. This data analytics solution was developed by PwC and has been implemented successfully at some of the leading financial institutions in the world.

By combining and analyzing data from different parts within the business and external sources, it helps banks answer questions like which customers are likely to be most valuable over time, what channels offer the greatest growth opportunities, what can banks do to grow their customer value through cross-sells and upsells, and what is the maximum “willingness to pay” for a certain product, among others. With such insights, banks will be able to segment their customers and understand them with greater detail than ever. This will be the basis to grow and retain highly valuable customer relationships.

Regulatory compliance

Industry experts also discussed the fact that more regulations are being established around the world to manage the complexity of the banking sector and new banking activities. In Vietnam, with the adoption of Basel II standards, local banks will need to assess their current data governance processes and adopt proper controls to raise their risk resilience.

“Vietnam has been going through an exciting time of change with higher risk management standards and best practices adopted by the banking sector,” said Ms. Dinh Hong Hanh, Financial Services Consulting Partner at PwC Consulting Vietnam. “Banks that are well-prepared and have a proper implementation strategy will have a greater chance of succeeding.”

However, while the technologies available in the market provide the opportunity for unprecedented innovation, not all of them are covered by existing regulations. Therefore, PwC experts advised banks to become more proactive in conversations with lawmakers, to develop a regulatory landscape that nurtures innovation and consumer trust.

“Despite the emergence of new competitors, we believe that traditional banks still have a bright future if they act now and make appropriate changes to be future-ready,” said Mr. Garvey. “Staying the same is not an option. The banks that will succeed are those that can best employ digital and data technologies to elevate the customer experience and improve regulatory compliance.”

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