In this era of digitization and technological advancements, this question is itself answered. If you are resisting flow with the current you will vanish. Digital channels should support the retail banking strategy. Consumer banking is a synonym to retail banking in which the customers are offered services like mortgages, debit/credit card generation, savings, etc. and these services can be accessed through a bank or a nearby branch of a bank.
Now, these services are day-to-day services. I mean who doesn’t want to check his account balance and if these services are offered through digital channels, it would save time and service of an institution.
The electronic way of offering services helps in reducing the gap between customers and the bank. If you are able to communicate about any discount, bank holidays, etc through a notification, then tell me why not it is good? It happens a lot that there is not a branch nearby of our bank. In that case, retail banking services offered via a mobile app or any digital platform would be a blessing. It is not only good for the customer but will also help the financial institution.
They can find out the number of people using their digital services and can do a checksum through data analysis. They can get suggestions from consumers and can work on the loopholes. It will reduce the workload from the employees and they can contribute towards effective services. The manual way of determining things may take time sometimes, effective real-time computation thorough digital channels will not only reduce the time taken, but it will also satisfy customers to a greater length.
You can see easily how countries are shifting from cash to cashless economies and why would anyone want to be left behind. But offering retail strategy through digital channels should not affect the customer-firm relationship. There must not be any gap in the services offered at the physical locations compared to those offered at the digital platforms.
There are currently over 55 million active users on Google pay, Phonepe has already crossed the 100 million user mark. You can see that people have started shifting. In this case, the Retail Banking strategy is required to undergo a lot of changes and they must break their traditional way of working otherwise they are on the edge of being extinct. Customer problems and FAQs can be easily dealt with by online applications. Financial institutions can also increase their market share through digital transformation.
You could see that even a local vendor or a street shopkeeper accepts payments through UPI. It implies that no one is willing to lag behind in this digital age, it doesn’t take a lot of time for big firms to take a toll and fall into bankruptcy.
Everyone has a mobile phone nowadays and if they can access Retail Banking through their cells, why would they prefer going to a physical location again and again. It doesn’t matter what happened in the past, it is a new era, if you are not accepting the change, you will have to come up with something more reliable and if you cannot, then be ready to accept your downfall.
Look around you for a while, how many people go to a banking institution for day to day transactions? Many of them just do it through Amazon pay, Google pay or other platforms. It is not a choice anymore, it’s a compulsion, a need in this era.
Many of the financial institutions are already undergoing digital transformation to cope up with the changes. A strict yes would be the answer if the question is should digital channels support retail banking strategy. Hope this article helps you in understanding the effect of digitization in today's era and how the financial institutions need to adapt.