The digital age has redefined what consumers expect from their financial institutions and established accessibility, speed and transparency as the status quo for digital banking and lending. Unfortunately, traditional bank and credit union infrastructure and workflows no longer meet these new requirements.
Through a series of blog posts featuring a hypothetical customer named Diane, we will explore how these banking challenges play out, and the importance of implementing a streamlined, digital platform for all consumer banking and lending.
Today’s Banking Consumers Demand Seamless Digital Services
Diane has a lot on her mind. Between starting a new job and planning for her wedding, she is facing some significant financial decisions. The excitement around these big events is dimmed by looming student loans, stress around wedding expenses, and the prospect of one day buying a home with her partner.
She wants to be responsible and start planning for all her future endeavors, so she decides to contact her current bank, Big Little Bank, about opening a savings account in addition to the checking account she already has with them. Further down the road, she imagines she could apply online for a mortgage or a personal loan to consolidate her debt.
Diane is busy with the wedding and her full-time job, so she would like to open a savings account from her smartphone. It would it save her a trip to the bank and ensure a single source of information she could tap into to see funds across her accounts.
Since Diane’s sister was easily able to do this with her bank, Diane was looking forward to the same. “It takes ten...fifteen minutes, tops!” she remembered her sister saying. Unfortunately, her experience with Big Little Bank was nothing like this.
While the website was supposed to be “mobile-friendly,” Big Little Bank’s application to open a new account took more than five minutes to load on her smartphone. Once loaded, the form fields were so tiny, she could hardly enter her information. Each time she attempted to submit her info, she received an error message telling her to call her bank or come into a branch – precisely what she was trying to avoid.
The option to apply for or even inquire about a loan, let alone apply for one, wasn’t even possible through the online app, frustrating Diane even more.
Diane, like many banking customers, wants what has become standard in the post-pandemic era: a seamless digital experience. Unfortunately, many banks and credit unions are missing the infrastructure and workflows to offer this experience to customers, frustrated them and driving them to better alternatives.
Financial Institutions Face Pressure to Optimize Digital Experiences
Traditional, in-person, paper-based account opening, and lending processes have left many financial institutions (FIs) hamstrung when it comes to the ability to provide optimized digital banking experiences.
One of the biggest challenges for FIs is the rock-and-a-hard-place scenario: spend a fortune to rip and replace legacy systems (with a high risk of the new system not working properly) or continue to piecemeal solutions together and risk a terrible customer experience. It’s a lose-lose proposition.
Winning the Digital Game
The winners are banks and credit unions that choose an alternative route: one that enables them to streamline digital products and services without the need to replace all current systems. Between core, loan origination software (LOS), mortgage origination software, point of sale (POS) systems, and other applications, a complete overhaul is complex and expensive. The better option is to utilize a platform that allows FIs to streamline digital experiences for customers — and employees — without breaking the bank, so to speak.
This includes empowering customers to open accounts and apply for loans and mortgages online — from submitting sensitive personal information to receiving and sending communications, updates and funds.
With the right cross-selling capabilities, FIs can also provide personalized offers to customers in real-time, allowing them to see interest rates for refinancing their homes and to determine if they can afford that new car.
FIs will not get to this level by building an entirely new tech stack from scratch or via a hodgepodge of incompatible programs and apps. A platform that is clean and simple, eliminates silos, is easy to navigate, and enables borrowers to get what they want, when they want it is the path forward into the future.
That is why we created MeridianLink One: a platform that provides you with whatever combination of digital account opening, loan and mortgage origination, collections, analytics, and reporting software your organization needs—with the addition of the ability to cross-sell consumer loans to mortgage customers and vice versa.
Diane didn’t need anything complicated; she simply wanted to do a few things online. She’s not alone, and FIs need to determine if they will serve customers effectively in the digital era or lose them to competitors and be left behind.
Diane’s Saga Continues…
In our next blog, we’ll explore how Diane’s financial story continues to unfold — and if Big Little Bank can handle her requests gracefully and seamlessly, so stay tuned.