Scaling with purpose: 4 ways to future-proof banking

The importance of customer experience has increased exponentially over the past few years as people bring more aspects of their lives online. This year, more than 65% of Americans are using digital banking as their preferred banking method, according to a May 2022 survey published by Statista. So, what does this mean? Financial institutions must adapt and follow suit by prioritizing a digital customer experience in order to thrive.

With an accelerating shift to a digitized world, customers are increasingly foregoing the traditional bank branches and are instead conducting transactions, depositing checks, opening accounts and more online. There are even some banks that provide an online-only experience, eliminating physical branches entirely.

As the popularity of digital banking rises, financial institutions must consider how they can stand out in a crowded market to not only attract new customers, but also retain old ones with an experience-led approach.

To maintain their competitive edge, banks must prioritize a tech-driven experience for their customers. By implementing enhanced connectivity, security and intelligence across their infrastructure, financial institutions will be able to future-proof their business and improve the customer experience.

1. Cloud-first approach for unified, connected experiences

For the financial services industry, digital transformation calls for end-to-end augmentation of processes, business practices and methodologies for financial service delivery. In fact, some may say it’s essential for financial institutions to take a cloud-first approach to unify the physical and digital worlds. This is due to the fact that greater visibility can be achieved into all aspects of a network, not to mention the physical aspects of a business when IoT and cameras are introduced, providing valuable business insights into customer behaviors.

With those insights, a cloud-first approach then helps businesses iterate faster on new customer experiences and quickly pivot as the behaviors of customers change over time. It also becomes easier to rapidly implement updates to address newly detected cybersecurity threats while prioritizing and securing application experiences, as more and more customers transition to a purely digital banking experience.

One important strength of a cloud-first approach is the ability to scale a business in near real-time to meet customer needs as they happen. Whether it’s adding new branches, features or applications, a cloud network can implement these in minutes without disrupting other operations on the network. Because of this, cloud migration has become a priority.

2. Enhance experiences with machine learning

Customers have a near infinite choice of banking options and expect a secure digital experience every time they make a transaction; they need it to be executed quickly and completed with greater accuracy than ever before. Machine learning has the ability to see how a network is behaving and transform that information into insights and recommendations to make a network run at its best, so customers get the most reliable and consistent experience.

For a financial institution, it takes the guesswork out of optimizing a network to create the most efficient network possible. This not only saves money by making the best use of resources available, but also provides the insights needed to better plan for the future. In many cases, machine learning can be automated for the network to make the recommended changes itself.

Automation can be taken one step further by leveraging APIs to automate many of the manual tasks within a network such as deploying new locations and features, or to gain specialized information regarding how customers use certain banking assets such as ATMs. The point is to provide staff with the ability to accomplish more in less time while gaining the information needed to make intelligent decisions about future network needs.

3. The internet of things powers branch transformation

While many financial institutions may already implement technology-driven aspects into the in-person banking experience, banks on the laggard side of the digital divide are losing customers and managed assets. This has resulted in a tremendous push to bring digital banking to life inside the branch to accommodate evolved banking expectations.

Banks are leveraging Wi-Fi connectivity and the internet of things (IoT) to enhance in-person customer experiences. Upon walking in and signing into the check-in kiosk, customers are transported to a customized app-like experience in the branch.

Bank managers are utilizing heatmaps and people-counting capabilities within cloud-based smart cameras to optimize staffing and reduce queue wait times. Smart cameras outside can optimize the drive-thru experience for customers, keeping track of the number of cars and wait times, and alerting banks when additional staffing is required to speed service and improve the customer experience. Behind the scenes, environmental sensors are monitoring and protecting the critical IT infrastructure powering these outcomes. As physical security is also automatically monitored by the aforementioned cloud-based smart cameras, the bank has become a welcoming and safe environment.

4. SD-WAN network protection

With cybersecurity attacks on the rise, financial institutions are allocating upwards of 10% of IT spend in order to deliver best-in-class security for their stakeholders and customers alike, according to Deloitte. According to the U.S. Federal Reserve, cybersecurity events are one of the top risks to financial stability. As financial institutions are entrusted with sensitive customer information, and the quantified costs of security incidents is high and growing, endpoint and network security becomes even more important.

Endpoint and network security are poised to become the largest components of cybersecurity spend in the industry, having grown in share over the last several years. As such, firms need a converged security and SD-WAN approach that can scale security, performance and resiliency across regions, devices and technologies in the simplest manner—one that leverages the power of the cloud.

A cloud-managed SD-WAN architecture keeps customer and institutional data secure across networks. Cloud-managed SD-WAN also facilitates the commensurate data flow and communication that enables financial services organizations to serve their customers’ rapidly evolving needs. With networks touching more nodes than ever before, it becomes paramount to leverage the cloud in order to manage devices, flows and policies from a common decision-making platform.

Cloud-managed SD-WAN architecture also adds context-specific visibility into operations, employee locations and data flows that help IT leaders act on new insights while continuing to optimize for security, accessibility and performance that help improve employee and customer satisfaction. As financial institutions increasingly advance in their respective digital transformations, they’re also now storing information across regions, devices and storage centers that span on-premises and the public cloud. A cloud-managed SD-WAN architecture enables IT leaders to deploy common security policies across networks in order to thwart cyberattacks and maintain security across both private and public clouds.

Enhancing security both within an organization and at the service edge will require a strong cloud-managed SD-WAN architecture capable of handling increases in connected networks, regions, physical sites, applications and devices. With this in mind, financial institutions will not only stand out from the competition and develop differentiation built on security, but also future-proof their business by building in flexibility and scalability with common, deployable cloud-managed policy.

Juan Vela is the Global Head of Market Strategy at Cisco Meraki.