Enhancing savings platforms for peak periods: how banks can stay ahead during ISA season

In today's era of seamless technology integration, the management of savings is ripe for evolution.

Platforms like Hargreaves Lansdown’s Active Savings, which allow customers to manage their money across various banks and building societies from a single interface, are revolutionising how savers interact with their funds.

The driving forces behind these technological advancements are choice and convenience, now crucial factors for customers evaluating financial products. Notably, more than half (52%) of 25-34-year-olds prefer challenger brands over traditional banks for financial management, as these brands often provide more tailored, agile services.

To thrive in this environment, banks and building societies must further invest in digital adaptation or risk losing customers due to inefficient onboarding processes. With fluctuating base rates, now is the ideal time to refine digital infrastructures and enhance offerings. This isn’t just about keeping up but about leveraging technology to handle high volumes of applications efficiently, delivering swift, customer-centric solutions that meet the needs of today’s savers.

Eliminating paper-based applications

The necessity of digital application processes has reached a tipping point. In an increasingly digital world, banks must provide seamless online experiences to remain relevant. The expectation for such experiences has become the norm, especially among the growing demographic of “digital natives.” Although many banks have expanded their digital offerings, these efforts often fall short at crucial moments, like account opening. It's estimated that nearly 50% of digital applications are abandoned due to outdated, paper-intensive procedures that disrupt the digital journey, such as requiring physical documents for identity verification.

To address this bottleneck, banks need to adopt technologies that enable a truly digital experience. Integrating solutions for biometric verification and leveraging Open Banking for fund transfers can eliminate the friction associated with rigorous KYC (Know Your Customer) processes. These advancements not only improve application processing efficiency but also align with modern customers' expectations for speed and convenience. Embracing digital fluency in the application process is vital for banks aiming to reduce drop-off rates and attract tech-savvy savers.

Harnessing API-driven benefits

Adopting API-driven services offers banks and building societies significant benefits, especially during high-demand periods like the ISA season. APIs provide the backbone for a symbiotic relationship with aggregators, which consolidate the best financial deals and enable savers to explore a wide array of savings accounts under one umbrella. However, many institutions miss out on this potential due to inadequate onboarding processes. This gap limits market reach and competitive edge in a landscape where accessibility and visibility are crucial.

Beyond visibility, APIs facilitate smoother, more secure onboarding through automated ID checks and fraud prevention tools. Technologies like LexisNexis’s RiskNarrative, which offers no-code solutions for analytics-based onboarding, can streamline customer acquisition and enhance conversion rates. Moreover, features like mobile banking apps and self-service portals, enabled by these technologies, empower savers to manage their accounts independently, fostering autonomy and control. This comprehensive approach to digital banking, from acquisition to retention, highlights the critical role of API-driven services in modernising the banking experience.

Embracing the future

The journey towards digital transformation in banking is marked by both progress and potential. While many banks and building societies have made strides in incorporating digital processes for onboarding savers, gaps remain, particularly with outdated paper processes and complex onboarding channels. Addressing these issues is crucial not just for staying competitive but for thriving during peak periods like the ISA season. By embracing API-driven services, Open Banking, and cutting-edge technology, banks can streamline operations, enhance customer satisfaction, and solidify their market position. This strategic pivot is essential for attracting and retaining a modern, savvy customer base, ensuring relevance and success in the digital age.

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