The importance of people-centric banking in the covid-19 era

By Colin Brown, CEO of the Aryza Group

The Coronavirus pandemic has impacted all industries and put thousands of people in vulnerable financial positions – often for the first time in their life. Here, Colin Brown, CEO of the Aryza Group discusses why this year, it’s never been more important for the banking and finance industry to create people-centric solutions designed to better support customers.

The pandemic has tested the nation’s financial resilience and has forced millions into financial hardship. With the number of bank branch closures increasing, experts fear this could have a detrimental impact on society’s most vulnerable.

According to a study by PwC, more bank and building society branches closed in the first half of 2020 than the whole of 2019. The data shows that 11,120 chain operator outlets closed in 2020, with some of the UK’s biggest banks closing a number of high street stores. This is almost double the number that closed in 2019.

Covid-19 restrictions and consumer trends have been a huge driving factor in this and have left the future of face-to-face banking unclear.

Combined with long waiting times on phone lines, these closures have made it virtually impossible for some consumers to receive basic banking services or advice. Those who rely on face-to-face banking, such as the elderly or those in need of more tailored support have, in many cases, been hit the hardest. The industry must now work to develop easy-to-use solutions that are inclusive of all capabilities and accessible from a range of devices.

By leveraging the huge opportunities presented by new technology, forward-thinking fintech companies are now bringing to market people-centric solutions designed to help consumers better manage their finances, even if they cannot access face-to-face advice.

No matter the wider context, for a person struggling financially the process can feel overwhelming. It’s therefore understandable – particularly in this climate, that many are reluctant to discuss their financial situation with a stranger, often expecting a digital alternative.

Globally, these technologies are becoming increasingly popular as more consumers transition to slick and easy-to-use online solutions. This is evident in the data from the Global Mobile Consumer Trends Report, showing that in the first half of 2020, downloads of mobile banking applications grew globally by 20 per cent. According to the Financial Brand, 35 per cent of customers adopted online banking and a further 30 per cent have also increased their use of mobile banking, since the start of the Covid-19 pandemic.

When dealing with their finances, it’s also important for consumers to feel in control of the process, with a clear picture of their level of affordability and the most suitable options available. Repayment plans should always feel manageable and sustainable for the consumer, and the ability to login to an intuitive platform can help bring peace of mind during times of financial difficulty.

Presenting simple breakdowns of the process can enable the information to be digested quickly, whilst also presenting the best outcome for each individual. These solutions also aid lenders in understanding the different types of vulnerability risk, enabling them to personalise debt repayment plans, automate capture of income and expenditure data and ensure the fair and responsible treatment of consumers.

The emergence of digital solutions, such as Aryza Recover, allows consumers to engage with lenders via their smartphone, tablet or PC, making the process far easier than waiting on hold for a call centre operative to answer the phone. Technology such as Open Banking helps a bank or lender run a quick and simple affordability check, which can help create a more personalised and effective service, while presenting the consumer with a range of options within a matter of seconds.

With the rise in consumers wanting to self-serve and self-manage their financial circumstances coupled with the closure of many bank branches, it’s crucial that flexible tools are made available to prevent people from falling into financial difficulty.

As we look ahead to this coming year,  we expect to see a number of exciting products launched that will enhance consumer confidence and provide them with a more personalised and reassuring journey back to financial health.