Traditional banks are facing strong competition from so-called “neobanks” and big tech firms, and are under increasing pressure to keep up with the digital-first offerings of these finance industry newcomers. While many UK banks have been successful at integrating some digitisation into their operations, many are failing to unlock the true potential of digital platforms.

Done correctly, digital sales and onboarding processes can dramatically improve the customer experience, maximise efficiency and give banks the power to customise their offering. This all paves the way to boosted growth and revenue, and to happier customers.

Backbase’s Digital-First Banking Platform is designed to help banks embrace this potential by providing a digital layer to complement and optimise legacy systems. Here, we introduce three key ways in which going digital can transform banking operations for the better.

  1. Improve the customer experience

Digital experiences offered by traditional banks often fall behind customer expectations when compared to those of digitally-led organisations like Uber and Revolut, research suggests.

Processes such as onboarding and origination are often arduous and slow. This can be due to various factors including a lack of self-service options or personalisation for customers, and the need for multiple log-ins. Customers are particularly put off when digital identification is not available, for example, because it is inconvenient and requires them to travel to a branch. These experiences can create fragmented customer journeys, which in turn can lead to high drop-out rates, making it difficult for banks to keep existing customers and attract new ones.

For three years in a row, establishing digital account opening has been a priority for mid-size financial institutions (FIs) but they have often been hampered by a lack of data or analytic capacity, customer journey design and integration. For those who do manage to optimise the process, the rewards are clear. FIs with a mature digital account opening capability outperform others in deposit growth, loan growth and product applications metrics.

Backbase’s approach puts the customer first. It helps banks to modernise customer touchpoints and create a consistent brand experience that’s easy to use and available around the clock. Backbase’s services, including facial recognition, signing of T&Cs and account access, can be accessed via any touchpoint, creating a truly seamless end-to-end customer journey.

By rebuilding digital journeys from the ground up, banks and FIs can transform how customers interact with their brand and boost conversion rates.

  1. Increase efficiency

While improvements for the customer can boost revenue growth, cost-savings can be generated by optimising back-end operations.

Traditional banks often operate siloed systems that are cumbersome to integrate, both with other systems and with new technologies and digital suppliers. In addition, these older systems often need ongoing maintenance, resulting in a greater need for IT staff and heaping further costs onto banks. Many old legacy systems still depend heavily on manual processes which demand large parts of the workforce, money and time, further reducing operational efficiencies.

Backbase helps banks to digitise their back-office processes, allowing stages like gathering and archiving customer information, managing cases and identifying cross-sell opportunities to be automated. Its offering is also pre-integrated with a fintech ecosystem that includes automated Know-Your-Customer (KYC) checks, modern AML and PEP screening and credit scoring providers, removing the burden of managing multiple digital providers.

Visibility is a key benefit of digitisation, with eight in 10 digitally mature institutions giving employees a single view of customers, and the ability to instantly view and solve bottlenecks to maintain efficiency. Speed can also be maximised because Backbase’s offering works out-of-the-box, slashing the time it takes to get to market. Furthermore, this approach allows the new system to be built around the core banking system, saving costs by avoiding the need for a complete rebuild or redesign.

  1. Customise your service

The Backbase solution offers the best of both worlds when it comes to efficiency and customisation. Traditional banking systems rely on vendors to provide services, giving the bank little control over its own users’ digital experience and slowing the development of new features and of innovation.

Backbase gives banks the option to adopt its solution out-of-the-box, to develop innovative custom solutions on top of it or to combine the two approaches. The use of open technology makes it possible to instantly innovate with turnkey apps. It also means that any third-party fintech capability can easily be integrated into operations. Backbase provides the right editing and digital marketing tools to put the bank in full control of the end-to-end customer experience, allowing them to optimise it for their own customers.

By integrating the data and functionality of both traditional core systems and new fintech players, Backbase’s digital banking software allows FIs to put together a digital customer experience with customer engagement at its heart.