The future is giving way to a new normal where banking continues to become easier, safer and more customer-centric. Here are seven glimpses into the not-so-distant future.
1. Your ATM card will become obsolete
As more retail and business customers switch to digital platforms for banking, physical bank branches staffed by bank tellers will grow smaller or increasingly rare. Today, advanced ATMs equipped with video teller services and automated teller functions are offering extended or round-the-clock branch services for added convenience. And if you’re always misplacing your ATM card, you can expect future ATMs to forego the need for cards altogether. Instead, they will use digital banking apps or mobile-enabled near field communication for access.
2. Cash will no longer be king
Are we headed towards a cashless world? It certainly seems possible. In addition to debit and credit cards, digital payment services, such as Android Pay and Apple Pay, have made cashless transactions possible via a mobile phone or smartwatch. Countries leading the way include Belgium (93 per cent of consumer payments are cashless), Australia (86 per cent) and South Korea (70 per cent). In China, mobile payments are growing faster compared to Western counterparts. According to the Financial Times, Chinese mobile transactions last year were valued at USD5.5 trillion – 50 times greater than that in the US.
3. You will only need your eyes
Almost every digital service we use, from social media to banking apps, demand unique logins and passwords to verify our identity. With increased security comes added inconvenience, with the average internet user having to recall passwords to 92 accounts, according to Dashlane, the password management service. Leading banks are simplifying user authentication using fingerprints, voice biometrics and other options to replace passwords as a way to verify a user’s identity.
4. Real-time recommendations will become reality
Big data and sophisticated analytics have transformed how banks mine and understand customer data. Coupled with advancements in artificial intelligence and machine learning, banks are increasingly equipped to provide predictive personalisation, from tailored products and services for anticipated life events, such as a mortgage or a child’s university education, to real-time recommendations and financial advice.
5. Chatbots will be at your service 24/7
On-demand customer service has long been provided through a bank’s telephone hotlines, but leading financial institutions are currently training a new kind of service staff: chatbots. These artificial intelligence-enabled computer programmes that mimic human conversation and messaging apps are ushering in the era of on-demand mobile banking, where you can speak to your own personal finance manager any time, from anywhere, in any language.
6. Pay for purchases via your car or fridge
The Internet of Things – machine-to-machine communication – has already enabled our smartphones and watches to ‘speak’ to point-of-sale devices for payments. With more smart devices entering the market, such as the Amazon Echo, the smart speaker that can make online Amazon purchases; Samsung’s Family Hub refrigerator, which connects to local retailers to place grocery orders, as well as the connected car fast becoming a reality, your transactions will no longer be limited to your computer, smartphone or tablet.
7. Robo-advice will be the new norm
Relationship or wealth managers have traditionally been responsible for advising clients on ways to grow and maximise their investments and assets. Today, robo-advisers are becoming increasingly popular, particularly with a younger and more digitally-savvy audience. Putting to use computer algorithms, the automated technology can assess a client’s financial situation, future goals and risk appetite and automatically allocate his or her wealth across different asset classes, from stocks to bonds, with minimal human intervention. According to Cerulli Associates, a financial services research firm, assets under management of robo-advisers will rise by 2,500 per cent to USD489 billion in 2020 from USD18.7 billion in 2015.