How tech advances are transforming the way banking does business

Digital transformation and e-commerce are changing the way companies — including banks — do business. 

And, despite the banking sector being conservative and highly regulated, technology is changing how banks interact with their customers and even the type of services they offer. 

Digital trends 

Pascalle Albrecht, national head of sales acquisition at Nedbank, says that among the most notable digital trends is the focus on client centricity. “The pandemic changed the way customers perceive value, requiring businesses to pivot their offerings or avoid becoming irrelevant,” says Albrecht.

She says small businesses, in particular, understand what their customers want and ensure they deliver what customers expect from an experiential point of view. 

Another trend is the rise of the platform economy, which is helping small businesses access a larger customer base. 

“Many small businesses want to participate in the digital economy and e-commerce but don’t have the resources to do so, with the result that they are accessing the platform economy to facilitate e-commerce more affordably,” she says. 

A third trend is the prominence of data. “Data rules everything.” The data and insights e-commerce provides is assisting brands to tailor their products and offering to customers. 

And, as technology has evolved, so have payments — becoming quicker, more efficient and cost effective.  

Albrecht says banks are under significant pressure from fintechs, who have disrupted the payment space. One of the biggest benefits of fintech solutions is that they allow for faster and easier payments, allowing businesses to transact sooner.

When it comes to digital banking, financial institutions are guided by clients who manage their financial activities via a digital portal from wherever they are, says Albrecht. 

“Digital platforms have created more convenient links between financial institutions and their customers, making it possible for banks to service people even when they're situated in remote areas,” she says. 

The Covid-19 pandemic enhanced the need for online banking facilities, says Albrecht, and more than half the global population are now using online banking platforms and apps. 

“Increasingly, an online presence and seamless digital capabilities are becoming a hygiene factor for customers, with end-to-end integration key to keeping customers engaged in the financial sector.”

Nedbank Avo 

Nedbank Avo, a super app that connects consumers and businesses on one digital platform, was launched during the Covid-19 pandemic in 2020. Super apps are still a new phenomenon in SA, offering a range of services on one platform, with a single login.

Nedbank’s Avo, which is free to download for all iPhone and Android users (not only Nedbank customers) offers a range of online shopping experiences in multiple product categories including groceries, takeaways and home services. 

Businesses are also able to list on Avo Business for free. By signing up as a merchant, businesses can connect and communicate easily with new customers, send quotations, and receive secure payments through the app with no signup fees.

Avo’s business-to-business marketplace allows companies of all sizes to connect securely to source raw materials or stock more efficiently, while a dedicated “buy from small businesses” section aims to support small businesses.

“Avo allows buyers and sellers to meet on the app where buyers can compare prices and arrange delivery.”

Tech advances driving innovation 

It’s expected that artificial intelligence (AI) will play an increasingly bigger role in the way banks and their customers interact in the future.

“By 2030, technology will be more advanced, which will drive innovation in the banking sector. We expect banks will have a big role to play in the enablement of digital technologies with digital currencies, for example, allowing for greater financial inclusion and real time transaction processing. AI and facial recognition may replace physical pins and cards.” 

Despite these expected advances, Albrecht says banks must still anticipate their customers’ needs if they expect to remain relevant. 

This article was sponsored by Nedbank.