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Open Banking: Disruption or opportunity? How far will automation go?
1 September 2017
Mitch Armstrong is Director of Sales & Marketing at Telrock Systems, a global technology provider of solutions for digital customer engagement throughout the credit lifecycle. Along with Ashely Winton of international law firm Paul Hastings, and Freddy Kelly of alternative credit scoring provider Credit Kudos, he will be delivering a session at the CSA’s UK Credit & Collections Conference in September 2017 on open banking. Book your place here: http://ukccc.csa-uk.com/. You can visit Telrock and Credit Kudos’ stands (numbers S11 and B5 respectively) at the conference’s exhibition to find out more about their solutions.
Since industrialisation, there has been a fear of ‘automation’ replacing ‘real jobs’ and human interaction. But in 2017, the banking sector can no longer afford to put off the inevitable and there is now widespread recognition that fintech solutions are a huge opportunity, rather than a threat, when it comes to customer engagement.
Creating a more ‘people-centric’ financial system
Rather than technology ‘replacing’ people and human interaction, in the case of Open Banking, it is all about people. The Competition and Markets Authority (CMA) found that older, larger banks aren’t having to compete hard enough, meaning that customers are paying more than they should for banking services. Open Banking is designed to open up the market and enable newer banks to grow and offer customers newer, more competitive services. It will enable the secure sharing of customer data so that customers can more easily compare products based on their own requirements and manage their accounts without relying on a specific bank. Despite the fact that it is underpinned by technical APIs and digital technologies, it will actually create a more ‘people centric’ system that is about individuals rather than just financial products.
Communication is still king
Financial services, and particularly collections, has always been about communicating with customers. And this hasn’t and won’t change. It will just mean that customers are in control of the communication.
Core to Telrock’s digital engagement products is a ‘communications engine’ that enables more effective communication and interaction across a wide range of channels. We started out with SMS 10 years ago and we have kept up with how consumers are communicating and engaging across a wider and wider range of platforms. In the fintech sector, we like to think that we are the innovators and ‘disruptors’ but much of what we do is trying to meet the needs of the way consumers now live and communicate.
You can’t automate customers
No matter how far automation goes, there will always be a human element to customer engagement. For example, when it comes to monitoring, we view it as both a software application (a tool) and a process. The people operating within the processes are just as critical as the software tools. Having an alert advising someone of an issue on their account, or an alert advising a software provider that something is broken, without people and processes in place to react and properly manage the issue, is worthless. However, eyes on screens will let you down eventually and some level of automation is necessary to fix problems that could be over-looked.
One thing is for sure. Things are changing and if they are going to change for the better in terms of customer outcomes, we must come up with solutions that put the customer first. I’m looking forward to discussing the topic at UKCCC and sharing some insights into what the future holds.