The pandemic caused bank clients worldwide to shift to online usage—a boon to banks that were prepared.
The events of the past 18 months resulted in an unprecedented acceleration of digital banking usage by both consumers and businesses around the globe. For banks, this presents opportunities and challenges as they strive to meet the expectations—now piqued through increased activity—of both sets of clients.
According to a recent Boston Consulting Group retail banking survey, an average of 13% of respondents in 16 major markets used online banking for the first time during the pandemic and online banking use has risen by 23%, while mobile banking use is up by 30%.
To give an idea of the explosion of digital users, China’s Ping An Bank, the winner of our award for Best Mobile Banking App, saw users of its app exceed 100 million in 2020, as customers sought to take advantage of digital journeys, greatly enhanced by a vast application processing interface (API) library and customizations enabled by artificial intelligence (AI).
Launched in September 2020, Hong Kong’s Mox Bank, our Best Open Banking APIs winner, chalked up 100,000 customers within its first year, as it built a commercial ecosystem with several strategic partners to provide users with special deals and promotions with their favorite brands.
To keep abreast of the demand for digital services, Standard Chartered—named Best Consumer Digital Bank in Africa and Best Islamic Digital Bank in Asia Pacific—has launched digital-only banking services in nine African markets, while its Islamic finance entity, Saadiq, offers a complete range of Shariah-compliant retail products, including home finance, auto finance, personal finance, business finance, deposits and wealth management.
To help customers make the most of digital banking, Commercial Bank of Qatar was awarded Best in Social Media Marketing and Services for two social media campaigns designed to educate customers on using its digital products to bank from the comfort of their homes.
With the need to accommodate working from home, many of this year’s winners created digital solutions to make that possible. Mashreq Bank of the UAE, winner of the Best Trade Finance Services award, for example, developed E-Drop-Box—a fast and secure electronic channel for document exchanges with the bank.
Citi, which was crowned the World’s Best Digital Bank and Best Corporate/Institutional Digital Bank, expanded its electronic trade loans solution to assist with loan disbursements, enabling clients to upload documents for a one-step onboarding process.
With digital onboarding and programs to facilitate online sales for small and midsize enterprise (SME) customers, BBVA picked up the Best SME Banking award. Our Best Global and Middle East Islamic Digital Bank, Boubyan, meanwhile, launched a mobile-first bank that offers Shariah-compliant UK bank accounts and financial management services for clients in the Middle East region with international banking needs.
Open Banking Opportunities
According to global information-services company Experian, demand for open banking tripled during the pandemic. The banks that have looked beyond compliance obligations to the opportunities that open banking brings are using secure data sharing to benefit their customers.
DBS, named Best Integrated Consumer Banking Site and Most Innovative Digital Bank, currently has over 200 open banking APIs, which enabled it to build a broad range of compelling partnerships with other corporates, consumers and fintechs. “Open banking enables us to leverage our extensive range of APIs and ecosystem partnerships to embed ourselves [and our] products and services into the larger digital world,” explains Jeremy Soo, head of DBS Bank’s Consumer Banking Group in Singapore. “By creating this network effect in our ecosystem, we can unlock great value by better understanding and anticipating our customers needs, and delivering banking and financial services exactly when and where they need them. This underscores DBS’ mantra to make banking intelligent, intuitive and invisible.”
Giorgi Kintsurashvili, head of the Digital Banking Ecosystem Unit for Bank of Georgia—the winner of three awards, including Best in Lending and Best Online Product Offerings—points out the benefits of open banking to both the bank and its customers: “We have developed API services, which enable leading tech companies to provide embedded financial services to their clients, who need access to banking products such as installments and mortgage loans.”
More specifically, he says e-commerce platforms are using API services that provide fully digital user journeys, enabling customers to activate preapproved credit limits and to buy products and services through Bank of Georgia’s installment products. “Bank of Georgia is also providing mortgage loan API products, which help customers to fill out the mortgage loan applications without leaving real estate platforms. On the one hand, this service enables customers to have a simple user experience whenever and wherever they need the access to banking products. On the other hand, those services help digital platforms reach new customers and develop new business models by partnering with the bank.”
Able AI and Smart Banking
AI is increasingly being adopted to help tailor solutions to fit customer lifestyles. Sber—which won five awards, including Best Consumer Digital Bank—developed SberProfile, an integrated database of clients, which allows the aggregation of all available data to create AI models of a customer’s preferences to optimize product offers.
TD Bank, named our Best Consumer Digital Bank in North America, launched a personalized app called MyTD in December 2020 to provide customers with proactive, personal and contextual information. It includes an AI-powered account balance predictor tool, with upcoming bill prompts and tailored advice and financial suggestions, to help customers stay in the black.
Digital technology is helping banks to offer smarter banking solutions that improve the customer experience and has been a key investment area for many of this year’s winners. The Industrial and Commercial Bank of China (ICBC), for example, is working on a five-year development plan to build a smart banking ecosystem, aided by seven innovation labs. And Western Europe’s Best Consumer Digital Bank, Eurobank, updated its payments hub, providing a dashboard view with a smart search bar, which allows easy for searching of things such as frequent transactions, contacts and payments.
Working with fintechs continues to be a favored route to innovation. NBK, winner of Best Consumer Digital Bank in the Middle East, established a Digital Factory in Kuwait to engage and partner with fintechs, while Citibanamex created an API hub for fintechs to access.
Soon Chong Lim, group head of Transactions Services for DBS—the Best Corporate/Institutional Mobile App winner—says that having the banking industry’s largest library of APIs surely helps DBS clients. “With over 800 API clients to date and around 50 million API calls delivered in a single year, DBS possesses the tried-and-tested expertise that clients and prospects look for,” says Soon Chong Lim. “We are seeing increasing demand by corporates to collaborate with us on their digitalization and transformation journeys.”
The digitalization efforts carried out by banks since the early 1990s have brought convenience to consumers and helped businesses adapt to the stresses, be they financial or operational, caused by Covid-19. It raised the bar as corporates look to their banking partners to help them navigate the mounting fallout for supply chains and rising inflation, which are the latest threats to growth. Having responded so well during the pandemic, all eyes will be on how banks use their digitalization efforts to solve such problems—and whether they can use technology to take the lead in encouraging a push toward decarbonized economies and the promotion of sustainability.