Reflections from FinXTech — Reinventing Banking

Industry Trends

This week I had the opportunity to attend BankDirector’s FinXTech conference with several hundred likeminded bankers and fintech professionals, and if I had to define the theme in my eyes, it is reinvention!

When you look at definitions for the word “reinvent,” the one that I like the most is to “change something so much that it appears to be completely new.” Great reinvention often requires a powerful catalyst for it to take effect. I have been in banking for my entire career, and in my opinion, the following things set the stage for reinvention in banking: the digitalization that the pandemic forced everyone into, the advancement of the technology, and the acceptance by customers of that digitalization.

Now before I touch on the reinvention points that I saw at FinXTech, I want to challenge you to measure the level of reinvention on two things. The first is the intensity of reinvention, which ranges from the mildest of incremental changes to radical changes. The second is the scope of reinvention; in other words, are we changing just a minor process at your bank, or are we changing banking (and let’s go big and say the world) as we know it? I want you to be in the elite category and think about how you can radically change banking! Dream big and take advantage of these ingredients for change to mix together something special!

Reinventing Customers

Generations are a funny thing — they just naturally create change and some components of that culture lead to people and generations reinventing humankind. Think bell bottoms, parachute pants, and skinny jeans for a simple example. But when it comes to banking, I think, it is dramatically different. 

We have all seen the stats on a dozen different PowerPoint presentations:

  • 83% of GenZers are frustrated with the current banking process and will be likely to flip banks for a smoother experience.
  • 56% of Millennials live paycheck to paycheck and expect banks and credit unions to help them better manage their financial health.
  • 64% of GenZers and Millennials will be more likely to turn to YouTube versus a banker for financial advice.

And it goes on and on. But the point I want to get across is that your customers today (and, yes, that even includes those Baby Boomers and GenXers) want a better experience. When my dad (who is 88 years young) is unhappy about the experience of banking easily on his phone (he doesn’t think that the remote deposit capture experience is that great), you better be sure that his grandkids are thinking the same thing.

Also, “who” your customers are is changing. Small businesses are no longer just those nice little shops on Main Street anymore. Now they include the mom who works all day as a nurse and then all night as a side-hustle entrepreneur shipping out high-dollar versions of the next best trend via her Etsy store as she gets ready for her appearance on “Shark Tank” in six months to sell 25% for a cool $2 million to Mark Cuban and friends. But you only know her as the consumer who has a checking account and a credit card that for some reason is getting a lot of use. There is a big opportunity that you are going to miss! Think about the consumers and small businesses and how you can reach out to them differently.

Reinventing Process

When you know that your customers are different, you better reach out to them differently too. Consider how you can reinvent engagement via the customer experience. For example, think about channels and how you can personalize those channels, just like those ads you see on your Facebook or Instagram feeds. How cool would it be to see a promotion for a car loan when your kid turns 16 (an opportunity that my banks have missed for the last 4 of my 5 kids)?

Also, what about the time that your customers spend with the bank (and I am not talking about the branch)? Gamification (think leader boards, badges, and awards) in banking can draw in your customers and encourage them to spend more time on your digital platforms. What if you got a badge for making 100 remote deposits and became a “Super Depositor” and if you ever walked into a branch, there was a line for those Super Depositor customers? How could that change processes at your bank for the better?

Reinventing Technology

Thankfully we also have the foundation of technology in place to support all this change! Blockchain, Open Banking, and AI . . . oh my! There are so many things that can be overwhelming or welcoming! It really is how you look at it. At FinXTech, Fiserv showed a study that called out how many bank executives have a strategy for FinTech and Open Banking. Terrifyingly, over 80 percent of the executives in the study did not have a strategy to take advantage of these technologies.

I love events like FinXTech because they give me a chance to sit with likeminded people and discover big ideas to radically change how we do banking. Do you have the right person on your team (and give them time and access) to help you define your strategy?

Reinventing You

When I heard one of the most intriguing things at FinXTech, I had to do a double take. During a session, All America Bank talked about how they were rebranding a digital branch under the DBA of “Redneck Bank.” Yep, Redneck Bank, where the tagline is “Where Bankin’ is funner!”

With just a couple of billboards, a mule as their spokes-animal, along with other farm animals, All America Bank was able to open a channel that gave them more access to new deposit customers unlike they have ever seen. In fact, they were getting so many phone calls, the phone company was wondering if they were running something illegal at first. That is a great problem to have!

While the bank as a whole continues to serve their base, they have a “bank” that is offering a brand experience that is unique and very different.

In conclusion, think big, dream wild, and let’s reinvent and change banking for the better!