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Online banking Redefining trends

Raja Venkateswar | June 15, 2010
The different stages of online banking

In this blog post, I want to continue my discussion on online banking trends that I started in my previous post (Online banking A paradigm shift?).

I saw a couple of comments left on my last blog post. One of them from Sudhir was especially interesting he is asking banks to stay away and let him lead his own life. This is a different perspective I would think in most of the discussions and interactions I have had so far with banks and technology providers for banks, the topic has always been on how the banks can utilise the social networks to become closer to their customers and prospective customers. Now we seem to have folks around us who just want to be left alone well, can the banks then consider such divergent views too when developing the processes and platforms for efficient online interactions?

So what is happening out there? What are the trends that are defining the way we use the online channel for our banking interactions? What are the trends that would redefine the way we banked? I believe that since the days when ATMs were rolled out, there has been a limited set of inflexion points that has changed the way we banked.  

Well, many of us would claim that Bill Payment on the net or other simple transactions we normally do should also be considered as inflexion points but really all it did was extend the reach of the bank beyond the branch and the ATM to our desktop and we were able to accomplish the tasks which we could do at an ATM, it didnt redefine the way we banked in a sense.  Thus the basic transactions that the banks would provide on an ATM (often remotely located from a branch), could now be accessed on the Net (except cash out and cash in of course). We could perhaps call this Stage 1.

However, the moment the online channel is able to reconcile and address the various banking products to render the entire assets and liabilities as one entity and when this then is used to manage assets, there is a paradigm shift. I call this Online Banking Stage 2. Obviously this extended the power of channel banking and one could complete most of his transactions, wealth management, asset management, loan management etc all available to him bundled in one readymade package on a Web 2.0 enabled system.

The minute a few early starters added taxation calculators and mortgage calculators, a new opening and a paradigm shift was first noticeable and the war to engage customers effectively on the online channel began in right earnest. However, the entire potential of Web 2.0 remains rather under-utilised.


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