On July 10, the Federal Association of German Banks, together with the Wall Street Journal, organized a panel discussion about “Next banking: Who will operate the banking business of tomorrow?” as part of the “Discussions in Burgstraße” series in Berlin. Panel speakers with different relations to banking explained their views on the future of the banking business in keynotes of 5-10 minutes, which were followed by a moderated discussion.
What does the situation of banks look like?
The participants agreed on the fact that the banking sector was going through the beginning of an evolution and that “old times” have irrevocably gone, due to a loss of confidence during the financial crisis in combination with progressing digitalization. However, the representatives of banks were sure that it will persist in the future, but in a different way than today. The statement from Bill Gates that “banking is necessary, banks are not” was clearly rejected. Further efforts in the battle for a direct interface to the customer are to be made in order to not give bank services the notion of a commodity. Against this backdrop, regulatory requirements were considered to be a protection against attacks from FinTechs, as they want to avoid conflict with BaFin and the like. Additionally, banks have a benefit of the doubt, that has been proven by all participants, in comparison to other service providers.
Customer relations as key
The branch, which seems to be declining for some, is key for maintaining the existing customer interfaces and/or becoming attractive for the customer (again) as a bank. It is a place with a direct contact opportunity to the customers of the bank, combined with the long-term goal to further develop the customer relationship in a sustainable way. Thus, it is of paramount importance. Furthermore, the digitalization of consulting services by e.g. video consulting was seen as a way to more customer proximity. All in all, one has to “be there, where the customer is”. This requires a rethink—the customer doesn’t mind if he/she has contact to the unit online or in the branch. From a customer perspective, all processes should be as simple as possible and friction-free. In addition, they want to be able to initiate and complete the processes on every mobile device. However, organizational structures of many banks still stand in the way.
To sum it up, the discussion didn’t deliver tangible results for what has to be done in future and which priority it should take. But at this event, like in discussions about future developments, the following could be observed: People always refer to their own needs when making predictions, and they are convinced that they represent the majority. Thus, many define “the customer needs of the future” with reference to their own needs and wishes. But asking the customer isn’t a solution either, as already Henry Ford knew: “If I had asked people what they wanted, they would have said faster horses.”
(Many thanks to the Federal Association of German Banks for the photo)