- Deniz Guven
By looking at the title of the article, don’t think that you are reading the wrong magazine. You are reading the right magazine, and yes, I do miss it. Last week, I sat down and checked the last time I went to the bank. I’ve heard it around a lot, but the last time I went to the branch was once in 2006! I’ve been using many banking products and services for 9 years, but I have not visited any branch for my banking transactions. So is this good or bad? Your customers no longer come to the branch, should you be worried? 15 years ago, when I first started banking, there were two sentences we always heard. “You shouldn’t become this much digitalized, you’ll put us out of jobs…”
“After all, even though digital is good, our customers always visit us to have tea/coffee.”
With the changing of your users and the differentiation of the services they use, what they expect from your brand also changes. It is hard to conclude that the branches are becoming empty based on the what I have mentioned at the beginning of the article, because we can say that physical branches still have great important in customer touch. The only thing we need to feel now is that the role of the physical points has changed.
Let me give an example from myself; I have made an experiment for a week. Every morning, as soon as I wake up, I closed all the applications and services on my phone, and checked how many I used when I go to bed at night. On average, I am using around 20–25 different services on a daily basis, and more than half of these services are paid services. And what is even more interesting is that, half of these have never had a physical point of sale or a branch, and it seems like that they will never have one.
So what happens at this very moment, what awaits us? Since I have started with banks in this article, I want to continue with banks. I am anticipating a market disruption in 4 important areas in the finance sector over the course of the next 2–3 years;
1. Will banking transactions change hands?
We perform our daily financial transactions through bank branches and digital channels. We think that it is easy, as it is the most secure way which we have gotten used to. But what if a new service comes out and makes user experience a lot easier? With the Payment Systems Law in Turkey and many regulations that are being developed around it, we will start to see non-bank services that suit the lives of new users very soon. While some of them will collaborate with banks and provide a different experience in bill payments, others will aim to make your life easier in money transfers.
2. Taking out a Loan or Borrowing?
It is a subject we have been discussing for years; Who do people call first when they need money? They call their family, friends, and as a last resort the banks. What if there comes a service that finds the way to change this, and makes borrowing easier, not only as a process but conceptually as well. It looks like “P2P Lending”, in other words services for lending-borrowing between individuals, which we have been talking about in the recent years, will become more popular in parallel with the regulation permissions of countries. These platforms, which especially enable the lender to adopt an investment perspective, look like they will draw interest in Turkey as well. Foreign examples such as Lending Club and OnDeck seem like they have already started to establish this model for both business needs of SME’s and personal needs.
3. Wallet or Payment?
Many financial and non-financial institutions have tried out wallets in the last 6–7 years. When we look at the efforts to copy the physical wallet into the digital world, it is very hard to speak of a significant success yet. When we get to the reason behind the lack of widespread presence, it is obvious that the basic need is to perform the payment transaction more easily and quickly, not copying the wallet. Therefore, we have started to see changes in the trends regarding this matter. Examples in the world such as Apple Pay are trying to change payment habits instead of developing wallets. From Venmo and Dwolla to Square, we see global examples that have come a long way in this area. I think that, with the new payment law, we will start to see liberalized services specific to Turkey that create a difference in this subject.
4. What will I do with my money?
Who can I ask? Personal financial management and consulting is one of the most important trends of the last 10 years. With the impact of digitalization, many companies have provided various services embel lished with beautiful graphs, and are continuing to do so. So, can these graphs really make me decide what I will do with my money, or do they just serve as a guiding basis? When we look at the viewing rate of these graphs, we see that less than 10% of the users use these graphs.
Two important changes are expected here. Branches will turn into terminal points that can provide consultancy for their customers by offering digitally integrated services. Not just a place that you call to consult, like it is today, but a service that perhaps is available through video calls, or sends notifications to your mobile phone.
The other part is the “intuitive inquiry based services”, in other words the development of services that enable you to make inquiries in anyway you like. If you can get an answer and subsequently directions when you make an inquiry asking how much money you spent in Ankara last year in May, it means that platforms that can manage your money are being created. Instead of tracking your financial state and income / expenditures to save, if there was an application that do this for you, and which transfers amounts that won’t bother you to your savings account at the right time, would you look for another financial consultant? While examples such as Digit, Mint, Moven and Simple occupy an important place in the world as first generation examples of these services, we will start to see more advanced versions in the upcoming period.
These four areas incorporate important opportunities that can change especially the behavioral structure of banking. Before I finish, I also have to mention Cryptocurrency — new generation digital currencies. Normally, this can be considered as a fifth area in terms of importance, but for now I think it is worth following. This concept should not be regarded as just payments and money transfers. New generation currencies which I believe will become an important part of marketing activities that trigger instant gains will come into our lives by differentiating.
As a result, all these trends will rapidly increase the use of digital services in our lives, but I will still be missing my long and romantic walks to my bank branch…
Read more articles of Deniz Guven
Source: https://medium.com/@denizguven/i-miss-my-longand- romantic-walks-to-my-bank-branch-april-15-digital -age-magazine-1afbfed8c516#.97jlnv979