The last two decades have witnessed a paradigm shift in the way people bank. While the shift from branches to ATM based cash withdrawals and from there on to internet banking was slow, it has been a different story in the case of mobile banking. The growth in adoption of mobile banking over the last three years has been tremendous. Many banks have rolled out internet banking, mobile banking, call centers, ATM based transactions and video banking. But, have banks moved from multiple channels to true multi-channel banking with seamless cross channel experiences? Here we explore a five point strategy that would empower banks and financial institutions to define a robust multi-channel offering.

1. Multi-Channel Banking: A Five Point Strategy
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2. The last two decades have witnessed a
paradigm shift in the way people bank. While
the shift from branches to ATM based cash
withdrawals and from there on to internet
banking was slow, it has been a different story
in the case of mobile banking. The growth in
adoption of mobile banking over the last three
years has been tremendous. Undoubtedly, the
changing needs of the digital generation and
the advances in internet and communication
technologies have jointly played a key role
in the evolution of channel banking. The
contribution of social media has been significant
too. The innovation agenda of solution providers
and financial institutions has further spurred
this evolution.
Many banks have rolled out internet banking,
mobile banking, call centers, ATM based
transactions and video banking. But, have
banks moved from multiple channels to true
multi-channel banking with seamless cross
channel experiences? Have banks been
successful in defining their multi-channel strategy?
Is self-service the sole consideration for multi-
channel banking? What is the future of the
branch in the multi-channel scenario?
Here we explore a five point strategy that would
empower banks and financial institutions to
define a robust multi-channel offering.
The first priority would be to recognize
customer needs. Banks need to understand
what products customers want, what services
they expect and also when and how they
expect the service to be delivered. For
example, try to understand as to which
segment of customers would prefer making
payments via mobile devices, which segment
through internet banking and which segment
through branches? Check if customers would
be delighted to have accounts opened online
instead of visiting the branch?
Engage with customers and let them know
you care by personalizing services to suit
their specific needs, right from the onboarding
process. Web 2.0 and social media have
opened up a plethora of options to stay
connected with customers and to know
exactly what they think about the services
offered. Leverage the capabilities of web
1. Recognize your customers’needs
2.0 and social media, understand customers,
and also allow them to choose required
services through channels or let them design
the products they need.
Banks and Financial Institutions embarking
on a multi-channel banking journey should
identify and define the role of each channel.
Define the products and services that could
be offered via different channels and their
convergence across multiple channels and
devices. Customer segmentation plays a key
role here too. For example, a digital consumer
might prefer getting a two way alert on their
mobile to make a bill payment, whereas
someone from an older generation might
prefer getting a telephone call reminding
them to write a check for the bill payment.
Open up certain channels to selected customer
segments as a pilot phase - maybe video
banking for the digital generation and TV
banking for home makers. This would help
in defining the right channel to meet the
expectations of different customer segments.
The investment priority of banks and financial
institutions should be based on their current
customer segments and projected customer
segments. A public sector bank, with minimal
Gen Y customers, targeting to increase their
Gen Y customer base may launch video
banking to attract more Gen Y customers.
It is also advisable to go with a phased
approach, rather than launching multiple new
channels at the same time. Allow customers
to use one new channel and get acquainted
with it, before the next one is launched.
Ensure that customers appreciate the
benefits of using different channels than
using traditional branches for all banking
related services and operations. Concerns
about “security” and “user experience” are the
major reasons which prevent customers from
moving away from branches.
Deploy robust security frameworks,
authentication mechanisms, and fraud
detection and prevention methods and
reassure customers that their identity and
savings are secure. Use multi-channel alerts
2. Define the role of channels
3. Promote channels usage
Multi-Channel Banking: A Five Point Strategy

3. Authors
Arunnima B S
Sudha Annie Saigal
Principal Consultant, Finacle Product Strategy
Infosys
Senior Associate Consultant,
Finacle Product Strategy
Infosys
to keep customers informed about every key
transaction taking place in their accounts.
Let them chose what event they want to be
alerted about, when and through which
channel. Increase security awareness through
video demonstrations and face to face
interactions wherever possible.
Research indicates that persona based user
experience enhances the usability of channel
solutions. Redesign channel user experience
to include rich internet applications and web
2.0 elements to engage the social media
savvy young generation and to make it
simple and intuitive for other generations.
Ensure that the experience across channels
is consistent; so that customers do not feel
lost when they navigate across channels.
Seamless and contextual cross channel
experience is absolutely necessary for the
success of multi-channel banking. Incentivize
customers for using different channels and
shorten the queues in branches. Provide
online assistance to customers to familiarize
them with the usage of different channels.
While doing so, it is also important to ensure
that channel solutions continue to offer the
human touch which customers are accustomed
to while banking through branches.
Banks and Financial Institutions should
continuously innovate and differentiate
themselves in the hypercompetitive financial
services industry. Digital wallets, personal
financial management, contactless payments,
social banking, remote check and cash
deposits are the buzz-words in multi-channel
banking today. An innovative way to instill
savings habit in teens is to create a gaming like
experience in online banking.
Innovate incrementally. Banks need to come
up with innovative ideas that can solve
common problems faced by customers. Take
the example of payment alerts. These were
being sent to customers to remind them about
pending payments. But busy customers
missed the reminders and still ended up
paying late fees. Banks then began delivering
actionable or two way alerts which reminded
customers about pending payments and
also allowed them to make instant payments
4. Innovate
by replying YES or NO. This innovation, while
being simple, was the solution for a very
common problem faced by customers and
went a long way in delighting customers.
Video based interaction with relationship
manager while banking through digital
channels is another example of innovative
steps taken to ensure customer satisfaction.
It is important to define relevant metrics to
evaluate the performance of multi-channel
banking. These could be based on revenue,
increase in customer base, increase in
conversion rates or even reduction in branch
based transactions. Banks can invest in
layered analytical solutions that provide
actionable insights by combining data from
multiple sources and channels. These
insights can be used to enhance customer
experience. Continuous evaluation of metrics
and taking preventive measures are required
to ensure that customer satisfaction is
never compromised.
Smarter devices, newer modes of communication
and a techno savvy digital generation - all indicate
a bright future for multi-channel banking. The
internet channel is a catalyst for multi-channel
banking adoption. As technology vendors and
solution providers continue to innovate, banks
and financial institutions should collaborate with
them to offer banking services innovatively
through newer channels for keeping customers
delighted. The goal should be to deliver the
right products and services to the right customer,
through the right channel, in a personalized
manner without compromising on the human
touch inherent in bank branches. After all, as with
any business, loyal customers are the ultimate
testimonial to the success of a bank.
5. Measure
What lies ahead?
Multi-Channel Banking: A Five Point Strategy