Improving the overall consumer experience of digital banking channels

Credit unions lead banks in terms of new software contracts signed with non-core vendors for provisioning consumer online banking technology. Sixty-eight percent of new contracts were signed by credit unions in 2013. This contrasts with the 70% of new online banking contracts signed by banks with U.S. core vendors.

 

Boston, July 29, 2014 –

Aite Group forecasts in a new report, U.S. Online Banking Vendors and Their Consumer Online Banking Solutions, that the increase in new consumer online banking solutions will be driven primarily by pent-up demand, dissatisfaction with existing solutions, and smaller institutions' desire to enhance their online banking capabilities and meet customer expectations.

 

This is based on the results of an in-depth Aite Group request for information (RFI) process with U.S.-based online banking vendors regarding their consumer online banking solutions.

 

The report is the second in a series of reports. The first report, published in March 2014, examined the consumer online banking trends from the perspective of the leading U.S. core vendors.

 

Consumers' technology needs

  • Most consumer online banking contracts signed in 2013 were for solutions in a software-as-a-service (SaaS)/hosted environment. The industry has seen an increased preference for hosted environments across many technologies over the last few years.

 

  • Key market trends include a sharp increase in mobile banking growth in terms of adoption and usage—the number of mobile logins is now greater than the number of online logins—and a continued focus on usability and customer experience for the digital channels.

 

  • The market is leaning toward a blended digital experience: a seamless, integrated online banking solution across desktops, smartphones, and tablets.

 

Vendors' objectives

  • Many vendors are significantly transforming solution workflows and overall usability. Financial institutions should help vendors to understand their needs and, more importantly, their customers' needs.

 

  • Many vendors struggle to get greater participation in user-group meetings or, more broadly, financial institutions' involvement in and contribution to product roadmaps.

 

Financial institutions' objectives

  • Aite Group believes all financial institutions should look for a consistent channel experience and should partner with a vendor that offers mobile banking capabilities through both smartphone and tablet devices with functionality and a user experience similar to that which is experienced online.
  • Smaller financial institutions should look for a solution that they can manage with limited resources and without increasing the complexity of their delivery channel infrastructure.
  • Larger financial institutions should look for a solution that can offer them an open architecture based on interoperability standards and that can facilitate both front-end and back-end integration.

 

Quotes

  • "U.S. banks and credit unions are looking to provide their customers with a simplified experience across all channels, with the goal of a single look and feel across their digital properties," says David Albertazzi, senior analyst in Retail Banking at Aite Group.

 

  • "Financial institutions have aggressive goals for their online banking with 82% of financial institutions having goals to "be stellar" with their consumer online banking solutions. Progress is being made, but some technology vendors aren't enhancing their solutions as quickly as financial institutions expect, while others have large numbers of financial institution clients continuing to run older versions of their solution because platform conversion remains a risky endeavor," says David Albertazzi, senior analyst in Retail Banking at Aite Group.