Digital transformation isn’t just a buzzword—it’s become a critical need that will determine winners and losers in the coming year. The delay in innovation within banking has meant that many card issuers are now rushing to catch up with the technology adoption seen in other industries.
While most banks had digital transformation plans on their roadmaps, no one could have predicted how quickly virtual behaviors would change with the pandemic.
The options for digital transformation are overwhelming, requiring issuers to prioritize digital tools that will improve everyday customer experiences and both lower costs and drive operational efficiency. That's why payments have quickly become the focus of digital transformation. Card innovation drives a better everyday customer experience, reduces costs, and improves operations.
Payments and cards are also the focus of tech giants like Google, Apple, Facebook, and Amazon. Google and Apple haven’t only changed consumer experiences, they’ve changed expectations. People now expect every interaction—online and in-person—to be simple and seamless. Hurdles of any kind are an excuse for stepping out of line or abandoning an application. And tech companies know they can provide that quick, straightforward experience—in communication, in shopping, in data, and in banking.
And, while these new standards might far exceed what issuers thought was necessary just a few years ago, they are now table stakes for retaining and attracting customers.
As of March, contactless usage was up 150% year over year. Thirty percent of consumers have tried contactless for the first time following the COVID-19 outbreak and 70 percent would continue doing so after the pandemic, according to RTi Research.
The shift to ecommerce this holiday season didn’t replicate the year-over-year growth we’ve been seeing — instead it was a perceptible move to online as a preference, not just an option. The pandemic may have been the impetus for the spike in contactless and other digital payment options, but now that consumers have had a taste of these technologies, they have formed new habits that are expected to continue after the pandemic has passed.
Customers are seeking these tools out of a need for secure, contactless payment options, and the bank that provides them has an opportunity to remain a trusted partner. The ability to fully manage cards in-app is both a convenience and safety issue for consumers. From digital account opening to transaction intelligence to self-service functionality, digital transformation in cards means that your customers have the resources they need at their fingertips.
Nearly half of consumers (43%) rank digitally managing their card as the number one driver of card choice. In order to experience both growth and retention, card modernization needs to be the focus of today’s digital innovation.
Amanda Glincher is senior marketing manager at Ondot Systems. Learn more about Ondot Systems’ digital card app.