Eastern banking institutions are no longer looking to the West for innovation, focusing instead on the specific needs of the Asian market.
|The global economic downturn, combined with the higher expectations and more sophisticated banking needs of customers in Asian markets, have seen Eastern banking institutions break from the past trend of following Western innovation. Consequently, their focus has shifted to the specific needs of the Asian population, as well as away from expensive, large-scale technology projects towards the efficiency and efficacy of existing processes and technologies.
The specific needs of the Asian population
Shifts in the Asian banking sector are being driven by two major trends: a rise in the proportion of the population that require banking services, and a rise in the expectations and sophisticated financial needs of those customers. The hands-on mentality of many customers has meant banks must invest in comprehensive transactional capabilities, whilst the typical personal relationship in branches is being transformed by customer demand for more digital interaction. Further characteristics of the Asian market include an aversion against fees and high-price sensitivity, and a need for personalisation and differentiation from others.
The importance of banking channels
These same trends have further cemented channels as a key area in Asian retail banking innovation, with physical and digital channels being fine-tuned to better reflect the needs of the market. Internet and mobile banking are becoming increasingly intuitive tools to help customers manage their finances, with progressive digitisation and automation impacting the design of some branches, where the high counter has been removed.
A shift in innovation
Although they fared better than their Western counterparts, the global economic crisis did impact Asian retail banking institutions, consequently moving their focus away from expensive, large-scale technology projects that were failing to meet expectations. Instead, their focus has turned to ensuring the efficiency and efficacy of existing processes and technologies.
This shift has seen significant business value added to organisations that have revisited crucial customer-facing processes, such as account opening, loan approval and business continuity, as well as dealt with the surge of new know your customer (KYC) requirements.