Financial institutions are operating in uncharted territory as the spread of coronavirus continues to greatly impact the way we bank in many ways, such as the physical delivery of retail banking, the financial lives of consumers, and relationships with employees. Adapting new processes to address the potential risks prevalent in the current business environment is not an option, but a necessity. And while some sources speculated that branch banking would soon disappear altogether, demand for banking services has not wavered; just 3 percent of Americans say they would stop using branch banking entirely in the aftermath of the pandemic. Now, financial institutions are facing the complex task of reopening with the challenge of building a security and health safety plan that instills confidence that the organization is ready to ensure a safe return, while maintaining compliance with government and regional regulations.
Necessary Steps to Reopening
With 38 percent of U.S. employees uncomfortable with the idea of returning to work, there are many things to be considered; and while the checklist will likely look different for everyone, three key protocols are non-negotiable: employee health screening procedures, temperature checks, and a robust PPE supply. Every region will have its requirements, but a health safety program that integrates with security efforts is critical. Additionally, banks must have a response plan if exposure occurs that includes containment and contact tracing procedures, stay-at-home requirements, and a comprehensive communication strategy. Neglecting to stay aware of compliance requirements could open the door to liability issues; ensure your team has reviewed COVID-19 guidance as well as regulations related to openings and closings provided by the Equal Credit Opportunity Act (ECOA) and Community Reinvestment Act (CRA).
While some banks might consider limiting the services they offer right now, we must remember that it is not so much about specific services as it about accessibility. Banking is an essential service, and many financial institutions are offering programs to help individual and business customers affected by the pandemic. We’ve seen a drive to create new and flexible solutions and services to ensure their customers have access to what they need when they need it, and looking towards how you can help them achieve financial success moving forward is crucial.
Banks also need to be looking at the future and what the pandemic has meant for the growth of the industry. It’s clear that coronavirus will continue to influence bank transformations and customer service for years to come; some of those changes are already becoming apparent. We’ve seen much news about digital payments in the last few years, but the reality is, many consumers have been hesitant to adopt them – preferring instead to use their physical cards or cash. But the pandemic, and its effect of increasing the public’s focus on health and hygiene, is fast-tracking the digital transformation. While in-person banking isn’t disappearing anytime soon, I expect to see a greater shift toward digital payments to lessen interaction and the possibility of cross-contamination.
And the U.S. is simply catching up to the curve: while 15 to 20 percent of customers expect digital channel use to increase even after the current crisis is complete, Western European markets report that 60 to 85 percent of users prefer to handle everyday transactions digitally. This growth in the U.S. market is largely due to consumers becoming more educated about how to use mobile services; once the pandemic hit, banks had to invest significant time into ensuring their customers had access to the online/mobile requirements necessary to bank remotely. Beyond the pandemic, we’re seeing increasing “tap and go” capability, largely due to Millennials and Gen Zers’ propensity to do everything from their smartphone, as well as the adoption of mobile payments apps like Zelle, Venmo and Cash App. For many of them, it’s hard to argue against the convenience of only needing to carry one device rather than sifting through physical cards in your wallet to make a payment.
The Bottom Line
With banks facing so many obstacles, from legal and compliance issues to cyber threats and economic turmoil, a flexible framework that addresses current issues and accounts for emerging concerns helps keep them adaptable as the global pandemic continues to evolve. Here’s a comprehensive pandemic checklist to increase your institutions chance of thriving post-pandemic.
About The Author
Matt Tengwall is Vice President and General Manager at Verint Fraud and Security Solutions. He is recognized in the security industry as a thought leader.