How can Europe’s banks achieve truly personalised customer experiences?

Application programming interfaces (APIs) can be a “powerful tool” to both win new customers and retain existing ones, by helping to create more “individualised” products, according to speakers taking part in an Open Banking Expo Live Panel Debate.

During the panel debate, in association with CRIF, panellists discussed how banks are reacting to the digital transformation shift and whether they perceived it as an opportunity to improve customer management and personalisation.

Daniel Skiba, senior manager at CRIF, said it has taken banks “years to make the transformation”, and that the “first wave” of the digital transformation was about moving customers from branches to other channels.

Skiba said that, in talking to bank branch employees “they really knew their customers and what are the needs of those customers” but that, after the shift from the branch channel to omni-channels “we actually lost this individual touchpoint with customers”.

“What’s happening is we are coming back to this old approach… ‘segment of one’. Thanks to the data and the regulatory landscape, PSD2 and now PSD3, we get a chance to get a lot of unstructured data and, based on that data, to offer more individualised products to the customer,” he said.

Koen Adolfs, head of API portfolio, future customer and payments domain at ABN AMRO, added: “What the customer experience was in our physical channels, that’s also what it needs to be in our digital channels.”

“The interesting part with API technology is really how do you create an organisation that is offering API with all kinds of functionalities and how you can create those specialised experiences for customers,” Adolfs said.

HSBC’s Sharada Khanna

They were joined on the live panel, titled ‘Segmentation secrets + API-first strategy = Next level customer experience’, by Joris Hensen, founder and co-lead of Deutsche Bank API program and Sharada Khanna, global originations and credit bureau strategy at HSBC.

“As a company, you want to win new customers and to retain existing customers, and APIs are a very powerful tool in this process,” Hensen said.

He cited using APIs to “make the process of opening an account easier and more seamless” as an example.

When asked about whether demand for an enhanced customer experience needs to come from the customers, or be driven by the banks, HSBC’s Khanna said: “With the move into a more digital space in the past five to 10 years, we’ve seen segments that traditionally banks wouldn’t have invested in – I’m not just talking about the underbanked, but the segments where traditional data isn’t typically available.

“As the world is getting more digitised… financial information is becoming more available and, therefore, those new products are coming into existence.”

The panellists also identified the blockers for a consumer to use Open Banking and offered their views on what developments in customer management and API-first strategy are in store for banks and lenders in the coming years.

Watch the Live Panel Debate on demand here.