Why Banks Need to Embrace Digitalization to Survive this Pandemic-Stricken Era

The pandemic affected all customer segments, and one of the most impacted areas of digital banking development was mobile deposits, with customers from all demographic groups using this feature to deposit stimulus checks.

Fremont, CA: Consumer adoption of digital banking has increased in the last year, as customers worldwide have been forced to move from in-person banking to digital alternatives. Some financial institutions were prepared for this transition, while others had to rapidly adapt to the "new reality" of helping customers handle their budgets, pay bills, send money, deposit a check or open a new account.

The pandemic affected all customer segments. One of the most impacted areas of digital banking development was mobile deposits, with customers from all demographic groups using this feature to deposit stimulus checks. The ability to open a new account or get a loan quickly and conveniently using online or mobile banking has become a significant differentiator between digitally progressive organizations and those lagging behind.

Larger financial institutions had already shifted to offer improved digital banking options for the general public before the pandemic. Investments were made to move from the physical to the digital, from simple new account opening features to voice banking solutions. At the same time, several smaller businesses were complacent, satisfied with delivering excellent in-person experiences while being slow to react to a growing segment of customers who preferred to do their banking online.

Smaller businesses were caught off guard when the COVID pandemic happened, eliminating all in-person banking. But they quickly responded by providing digital capabilities and creating new opportunities. This pace to respond cannot stop despite advances made. Smaller financial institutions must now, more than ever, find ways to match the digital sophistication of larger companies.

The good news is that third-party solution providers and fintech companies will accelerate innovation and growth if the current leadership is willing to accept change, take risks, and challenge the status quo. The procedure entails much more than just pushing a button. To become digital, companies need to move in the same direction.