Digital platforms are the differentiator in today's banking landscape

As the banking customer experience tilts further toward interaction through digital channels, financial institutions face critical challenges when delivering their differentiated brand through this lens. The digital era demands experiences that are data-enabled, authentic to brand, technologically advanced, and capable of integrating the digital and in-person experience—none of which can be readily achieved with standard off-the-shelf digital banking solutions.

Institutions that hope to compete and attract new deposits, lending relationships, and treasury management clients need to make a strategic investment in a digital banking platform that will accelerate them into a modern digital feel—all while allowing them the freedom to create the experience that fits their brand and speaks to their target customers.

In our view, financial institutions that fail to modernize their operations and systems risk losing relevance in an increasingly fragmented market.

Digital platforms are critical for better banking experiences

Digital banking platforms are often the primary interface for customers. Market trends and consumer sentiment continue to press for a seamless, modern, and comprehensive online banking experience as essential to customer satisfaction.

While legacy platform providers provide requisite capabilities, they lack in their ability to flex and provide the level of customization required by today’s commercial and retail banking customers. Digital banking platforms offer flexibility and scalability to retail and commercial financial institutions, empowering them to modernize their online banking customer experience with a level of co-creation not widely available in the traditional landscape. The result is a better customer and member experience, operational efficiencies, and the ability to bring products to market quickly.

Without an effective digital platform—that can grow and flex with an institution’s roadmap and strategy—banks will not be able to keep and expand needed customer bases on both the commercial and consumer sides.

Digital platforms offer scalability and innovation for banks

These platforms are characterized by key features and differentiators from legacy solutions:

Cloud-native architecture

Built to leverage the scalability, flexibility, and cost-effectiveness of cloud computing.

• Lower infrastructure costs: Cloud-based solutions eliminate the need for extensive on-premises hardware, reducing capital expenditure and maintenance costs.
• Faster innovation: Modern platforms allow for rapid development and deployment of new features and products, helping banks stay competitive.
• Increased agility and adaptability: Cloud-native architectures allow banks to scale resources up or down based on demand and quickly adapt to market changes.
• Enhanced customer experience: Digital platforms enable banks to offer seamless, omnichannel experiences that meet the expectations of today's tech-savvy customers.

API-first approach

Designed with open APIs that facilitate seamless integration with third-party services and enable open banking initiatives.

• Ecosystem partnerships and open banking: API-driven architectures allow banks to participate in broader financial ecosystems and create new value propositions through partnerships.
• Modular and scalable design: Composed of independent, interoperable modules that can be updated or replaced without disrupting the entire system.

Advanced analytics capabilities

Equipped with powerful data processing and analysis tools to derive actionable insights from vast amounts of customer data.

• Better data analytics and decision-making: Unified data models and advanced analytics tools enable banks to gain deeper customer insights and make data-driven decisions.
• New revenue streams from data monetization: With improved data capabilities, banks can explore new revenue models based on data insights and analytics services.
• Personalized offerings and cross-selling: Advanced data analytics enable banks to offer highly personalized products and services, increasing cross-selling opportunities.

Choosing the right banking platform to drive digital success

As banks contemplate this critical step toward modernization, many are finding themselves in a delicate balancing act—fully understanding the investments and urgency required in keeping pace while recognizing their internal limitations in available skillets and resources to deliver a modern experience. For many, the rapid adoption of digital technologies is outpacing financial institutions' ability to keep up.

Banks contemplating an upgrade to a digital banking platform are likely after some combination of the following benefits:

• Target key functionality to take control of what matters: Identifying the right digital banking platform hinges on finding the platform that will support the institution’s desired digital differentiation—while limiting the need to custom-build and configure, avoiding excess costs
• Invest in the people critical to delivering your primary value proposition: The desired outcomes from a digital banking platform will vary by institution, and the mix of permanent and outsourced staffing that surrounds it should reflect those desired outcomes. Some institutions will seek service staff with high digital proficiency, some will invest in product and UX, while still others will invest in integration. In any of these cases, it’s critical to build internal proficiency where it counts, without overextending the institution with new digital roles to cover all bases permanently.
• Recognize the strengths of your chosen platform and design processes accordingly: Successful institutions will identify where their digital banking platform can enhance or replace legacy processes and maximize these advantages without dragging the platform back to comfortable processes and rebuilding their old failed system along the way.

Conclusion

The shift to new digital banking platforms is no longer optional for banks that wish to thrive in the digital era. While the transition presents challenges, the long-term benefits in terms of cost reduction, improved customer experience, and new growth opportunities far outweigh the initial investment.

Banks that fail to embrace this digital imperative risk falling behind more agile competitors and losing relevance in an increasingly digital financial ecosystem. By leveraging modern digital banking platforms, banks can not only survive but thrive in the face of disruption.