Daily Management Review

BCG: personalisation is the new black in the banking industry


06/07/2018


The Boston Consulting Group presented a study in which it named the personalization and introduction of digital technologies the main trends of retail banking in the world.



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The Boston Consulting Group (BCG) came up with a study "Global Retail Banking 2018: The Power of Personalization", which analyzed the main trends of this year in retail banking. Analysts of BCG came to the conclusion that the main trends are personalization and active implementation of digital technologies.

Regarding digital technologies, banks use them in a wide range of areas, from mobile and online banking and automation of call center operations to calculating specific financial behavior of a particular client and preparing individual offers based on such analysis. Already now, three quarters of all transactions in some banks are performed online, from a computer or smartphone. In addition, banks have begun to closely cooperate with financial and technology companies and invest in them. Analysts of BCG identified two main areas. The first one is "digitalization to reduce costs" (for example, transferring simple transactions into the Internet to lower costs) and the second is "digitalization to create value" (it primarily concerns using technology to improve the quality of service).

"Personalization is quickly becoming the primary mechanism in banking both in terms of meeting customer needs, and in terms of economic benefits," the study said. Increased personalization is also possible thanks to modern technology. Now it is easier for banks to assess the individual circumstances of a particular client, the specifics of his financial behavior and, on the basis of this, prepare a personalized offer, develop an appropriate advertisement or more accurately assess the risks.

According to BCG forecasts, the revenue in retail banking in the world will grow by an average of 5.3% per year until 2021 and reach $ 2.5 trillion. Retail banking account brings about half of all the proceeds of banks in the world. The most significant growth will be shown by banks from the Asia-Pacific region - 8%, and by 2021 this region will come out on top in revenue, surpassing North America.

source: bcg.com






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