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Changes to the financial landscape and customer expectations over the next 10 years will provide banks with opportunities to maintain a human touch in a large ecosystem of products and services, according to new research from Cambridge-based Forrester.
In “The Future Of Banking Is Built On Trust,” Forrester said future banks will provide products and services in different modes that could operate concurrently, including direct to consumer, as-a-service, marketplace seller and platform owner. But the research showed that banks will not act alone.
“Banks will have to selectively leverage and extend the trust they already have and will carefully select their key battlegrounds,” Forrester analysts Alyson Clarke and Jacob Morgan wrote in a blog post.
The report identities four themes that will shape banking over the next decade to meet the needs of consumers and the changing financial landscape, driven by changing customer expectations, an erosion of consumer trust and regulatory influence.
One key theme is that banking will become increasingly invisible and autonomous. While banks will use technology and customer insight to insert financial services to meet customers’ need, the brand could become invisible to consumers. Instead, distribution models will evolve that use marketplaces and technologies – such as open APIs and 5G – to connect finance with homes, machinery, vehicles and other devices.
Forrester also said that banking would become increasingly connected as technologies, partnerships, ecosystems and platforms combine across multiple industries that share data and resources to deliver financial outcomes. But even though technology will let banks integrate finance into devices and other ecosystems, consumers will still expect a blend of human and digital experiences, Forrester said. This will let banks maintain the human touch, including by repurposing branches as engagement hubs.
Banks have not yet capitalized on customer data, Forrester said, but over the next decade, banks will be able to differentiate themselves based on the quality of insights from customer data.
“Consumers, in turn, will demand greater transparency and control over the use of their data for more personalized advice and engagement,” Forrester said in a statement.
Forrester also expects consumers will prefer banks that align with their environmental and social values. This purposeful approach will see local and cooperative principles align with matters of global responsibility.
“Purposeful banks will cultivate open cultures that allow them to focus on collaborating and readily participating in – or building – values-driven ecosystems,” Forrester said.
