Ashish Garg is CEO of Eltropy, an AI-driven digital conversations platform improving the operations of community banks and credit unions.
In my role as a CEO, I collaborate closely with community financial institutions (CFIs), such as community banks and credit unions. Video banking can help solve many of their challenges in today’s cost-conscious and automated-yet-personalized economy. When implemented properly, it can help with fraud prevention, expanding service reach and driving operational efficiency.
In this article, I will present real-world use cases to shed light on how video banking is impacting member and customer experiences. I will also explain some common challenges CFIs face when implementing video banking in order to understand how to succeed with this technology.
1. Fraud Prevention
With the rise of sophisticated fraud schemes, video banking offers an extra layer of security and verification through real-time visual interactions between members or customers and CFI representatives.
By visually confirming the identity of customers and verifying sensitive transactions through multifactor authentication, CFIs can mitigate fraud risks and protect their members. The ability to capture video recordings of interactions also provides a resource for forensic investigations in case of fraudulent activities.
2. Expanded Service Reach
Video banking allows CFIs to expand their services beyond geographical boundaries. Banks can serve members residing in different states by leveraging multiple digital channels such as text, chat and co-browsing. It also allows members and customers to access services without traveling to a branch after relocating or while on vacation.
3. Operational Efficiency
As CFIs venture into new markets, staffing new branches with loan officers can pose challenges amid a major labor shortage in the United States.
With video banking, community banks and credit unions can create dedicated video rooms within the branch premises rather than fully staffing new branches. When a member enters the branch seeking a loan, the teller can then escort them to the video room. There, they can initiate a video conversation with a loan officer who is part of the centralized lending team. This loan officer could be located at another branch, the corporate headquarters or working from home.
Overcoming Video Banking Challenges
Implementing video banking, though, can pose challenges for community banks and credit unions. To ensure successful adoption and to build customer trust, CFIs must address infrastructure and technology challenges as well as challenges related to staff training, building customer and member trust and providing user experience and support.
Let’s consider each of these challenges, as well as how to overcome them.
• Infrastructure And Technology: The biggest hurdle in video banking lies in addressing infrastructure challenges. Community financial institutions need to allocate sufficient internet bandwidth, ensure compute power for video rendering and virtual backgrounds on agent computers and carefully whitelist video access on VPNs.
• Staff Training And Adoption: Proper training is vital for successful video banking implementation. CFIs should provide comprehensive training, covering technical aspects and customer interaction skills. In these training sessions, it’s important to emphasize video etiquette, including professional body language and communication skills. Similarly, CFIs will need to instruct staff on proper lighting and backgrounds for video calls.
• Building Member And Customer Trust: Building trust requires sufficient staffing for video interactions. CFIs must ensure there are dedicated agents available for scheduled video appointments in order to provide prompt and reliable support for members and prospective members. Utilizing an appointment management tool can help.
• User Experience And Support: Because members and customers may be wary of new technology when it comes to banking, CFIs will have to ensure the experience is seamless as possible. A few ways to calm any fears include optimizing video quality, minimizing latency and providing user-friendly interfaces. They should also offer reliable and ongoing technical support.
The Future Of Digital Banking
Video banking is reshaping the landscape of community financial institutions, offering a personalized, secure and convenient banking experience with access anytime and anywhere. When implemented properly, CFIs can create authentic connections with members and customers, expand their service reach and drive operational efficiency.
As we continue to watch the evolution of the financial services industry during shaky economic times, it’s essential for CFIs, in particular, to leverage video banking and other digital banking channels as a catalyst for growth and innovation. Embracing the power of video banking in combination with other digital tools can unlock the full potential of your community bank or credit union in the modern digital world, which will continue to evolve into the foreseeable future.