Regulation, fintech, customer experience: 3 lessons from CBA LIVE 2017

Deep in the heart of Texas, a consortium of professionals from the retail banking industry met last week for the seventh annual Consumer Bankers Association (CBA) LIVE conference. While a majority of the conference’s 1,400 attendees represent organizations across the financial services industry, they appear to share similar challenges, interests, and concerns. Specifically, keynotes and highly-attended track sessions focused on key themes, including what the current political climate means for regulatory bodies such as the Consumer Financial Protection Bureau (CFPB), how the relationship between banks and fintech companies is evolving, and how banks should be leveraging digital channels to create engaging customer experiences. Here are my three key takeaways from this year’s CBA LIVE conference:

Regulation: Here today, here tomorrow.

While the general sentiment among conference goers was that current regulation as it stands is an excessive burden on banks, the keynote speakers also recognize that regulatory change—while inevitable—would be slow to happen. Much of this is political, as securing the votes to overturn regulation has proven to be a divisive and partisan issue. As the keynote speakers addressed, there is the possibility for monumental change regarding regulation, but much of it will need to happen through incremental changes by way of legislative efforts. In addition, CBA speakers posit that while the CFPB will remain in existence, the move to replace its director puts the organization in uncertain territory. Will the President reserve the right to replace the CFPB director at will? We’ll have to wait and see. In the meantime, the consumer protection agency continues its vital work, business as usual.

Fintech or banks: Who will survive?

A big topic at this year’s conference surrounded the relationship between traditional banks and innovative financial technology companies (collectively known as fintech). While traditional banks are well entrenched in their markets, have boat loads of money to pour into marketing, and have rock-solid reputations for reliability and fraud prevention, every day they cede customers to small Fintech companies that offer superior customer experiences. While fintech companies often specialize in a specific area of banking, like investing (such as Acorns) or P2P money transfers (such as Venmo), consumers are willing to abandon their old-school banks for the convenience of these new platforms. While research shows 55 percent of millennials prefer to use fintech over traditional banks, a real-time poll of the audience reveals that 75 percent believe that banks will weather the fintech storm and come out on top.

Customer experience: Let’s get digital.

Ninety-six percent of banks agree that the industry is going digital. What does this mean? While conference speakers agree that the brick-and-mortar bank isn’t going away anytime soon, they believe that a shift in service offerings is due. For instance, retail banks will begin to transition all of their transactional services, like deposits and cash transfers, to digital mediums. We’ve already seen banks embrace mobile apps to allow mobile check deposits, whereby a consumer simply snaps a photo of their signed check and submits it through the app. In the coming year, we expect to see more transactional services transition to mobile and online platforms, through which the bank can offer a more personalized experience and offer additional products to meet a consumers’ specific needs. Traditional brick-and-mortar locations will serve as a point of education for customers who are interested in more complex services, such as discussing wealth management options with a trusted advisor.

Throughout CBA LIVE, this idea of the customer experience was omnipresent. As an industry that is seeing a massive paradigm shift due to increasingly mobile customers and fintech competitors, retail bankers are scrambling to provide their customers with the services they need, on the platform they choose, and at the right time. This necessitates reimagining the way a bank’s front-end and back-end operations work. And, furthermore, this shift to digital really demands access to big data that is not only accurate but also fast. How can banks ensure their data is ready to take on the modern era? By ensuring that the data they capture is high-quality, integrated, and standardized.

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