Digital Transformation and banks: the NatWest hi-tech case

Digital Transformation and banks: the NatWest hi-tech case

Up to 80% of traditional banks are expected to close down by 2030. At least according to Gartner analysts, who have pointed out something everybody already knows:  if they keep applying the same old fashioned operative models dating back to last century, banks run the risk of going bust (Digitalization Will Make Most Heritage Financial Firms Irrelevant by 2030). The Digital Transformation is the “killer” responsible for this, since it supports innovators but leads the restive ones to bankruptcy.

Physical subsidiaries are closing down. That is a fact. You may like it or not, but it is true. And turning our noses up to this process won’t stop it. Those who wish to survive and maybe grow, need to adapt and even anticipate new trends. Nowadays, traditional banks are not only competing against each other, but also against intangible rivals which have replaced the classic double-layer, safety doors with user names and passwords: i.e. online banks. Moreover, there is a third, combative player in the market: a huge quantity of start-ups devoted to  fintech offering their customers crypto-currencies. Changing is neither easy nor cheap. But it is the only way to survive in such a cut-throat market. The magic words are ” digital agenda”, that is to say the only agenda that every financial institution should have already drawn up.   

The NatWest case among AI, data analytics and digital technologies

When you are a bank with 1.600 subsidiaries scattered across the country and you find yourself operating in a revolutionized scenario, either you manage to change your approach to business or you are done.  The National Westminster Bank has decided to evolve by launching several new high-tech services to keep its own loyal customers in the UK and maybe get some new ones. Based on chatbots, AI, digital avatars and a smart app, the services offered are, at the moment, three and they are called Mimo, Cora and Mettle (Digital transformation: How one bank is using AI, big data and chatbots to create new services).

Mimo the smart app

We are talking about an AI-based app which reminds bank account holders about their financial activities and deadlines and, on the basis of a thorough analysis of their bills, also about their subscriptions and daily expenses, in addition to giving them some suggestions about how to manage their money. By using their beloved smartphones, clients can check their overall financial status. Basically, the bank uses its customers’ data to offer them several customized services (NatWest to trial new personal finance app).

At present, Mimo is being used by 5.500 selected customers which have been testing it and  NatWest has been working to implement the services offered through the app and some more such as the possibility to make restaurant reservations or buying cinema tickets. The official launch is due by the end of the year.

“Hi, my name is Cora”

It may not be cute but it looks efficient: Cora is a bot using audio-visual sensors installed on computers and smartphones.  The bank introduced it in its website in 2017. With over 100 thousand hours of conversations every month, Cora blends neurosciences, psychology and Artificial Intelligence, and can interface with customers via a computer screen, a smartphone and even a simple phone.

NatWest endorsed Soul Machines to develop it. We are talking about a tech-company from New Zealand which has already won several awards for its contributions to movies such as Avatar, King Kong and Spider-Man 2, and which has exploited some models of the human brain along with bio-based neuronal networks to give avatars a virtual nervous system transforming them into semi-human CGIs which can read human feelings and react verbally and graphically to facial expressions. Cora works 24/7, and allows blind people to use financial and bank services. Furthermore, thanks to Machine Learning, it learns from its own mistakes and evolves over time, becoming increasingly precise (NatWest Bank tests Cora, an AI bot that will answer customer questions).

Mettle, the digital-only bank for small businesses

Mettle is a fully digital bank account for SMEs which allows them to have a debit card, issue invoices, make payments and deal with their accounts. Through the app, businesses can also have extra information such as expense forecast and personalized reminders. The target is to allow entrepreneurs to use a simple tool to manage their companies’ finances (Natwest’s digital-only business current account)

That is how you look at the future, that is how you innovate: by offering new products based on customers’ specific requirements. NatWest set off on this journey and is not willing to go back: on the contrary, they are already studying some more blockchain and nano-technology based solutions. Then, we will see.

Which personalized services would you like to be offered by your bank? Which innovations do you fancy? Tweet @agostinellialdo.

To find out more about the digital world, you may read my latest book entitled: “People Are Media” If you liked this post, you may also like “Digital Transformation: the e-leadership issue