Like most digitally savvy Millennials, Ms Michelle Teo’s smartphone screen is cluttered with scores of apps, from music and video streaming to ride-hailing and digital banking.
With so many different apps and only a limited amount of time in a day, what makes her spend more time on one app over another?
“There are just some that are easier to use because I can do more things through it,” says the 28-year-old teacher.
In other words, convenience is king.
Convenience is also what she expects from financial services platforms.
“It’s much more convenient to settle things on my phone than wasting time queuing at the bank, especially for straightforward transactions,” says Ms Teo. “All my bills can be paid online, and I don’t need to use cash for most places in Singapore.”
On why UOB TMRW is the banking app she uses the most, Ms Teo says: “I enjoy the personalised touch because it is easy to read at a glance and relevant to me.
“The insights show me what I’ve been spending on and tend to recommend deals I’m interested in. It also reminds me when I have bills due, which is great for avoiding late fees.”
Ms Teo’s sentiments are echoed by many others in Singapore.
UOB’s Fintech in ASEAN 2021 report, produced in partnership with PwC Singapore and the Singapore FinTech Association, found that nearly three-quarters of respondents in the region ranked “ease of use” as their top priority for digital banking.
The same report found that consumers expect more than just convenience – almost half also want more personalised services.
“If banks are able to present their information and services to customers in a personalised way,” says Mr Kevin Lam, head of TMRW and Group Digital Banking, UOB, “it can help customers easily get the information and insight they need to make the right financial decisions at the right time, in the right place.”
For UOB, that means leveraging artificial intelligence (AI) to empower customers through its mobile banking app TMRW (pronounced as “tomorrow”).
Instead of displaying a standard dashboard for everyone, the UOB TMRW app shows customers customised information based on their historical purchases and cash flow, reminders on payments, as well as subscription alerts for goods and services.
The AI-powered app also provides an extra layer of security, flagging double-charges or accidental multiple purchases and assisting customers in resolving the issue without them having to spend hours on the phone with a bank staff.
It was the first bank in Singapore to launch AI-driven personalised insights through the UOB TMRW app, says Mr Lam.
This is part of the bank’s strategy to be more engaged with customers through “digital adaptive banking”, where its UOB TMRW app adapts to customers to provide them with the right service at the right time.
“Having a nuanced understanding of our customers’ preferences is something they appreciate and accord a lot of value to,” says Mr Lam. “Less is more in this age of hyper-personalisation.”
A 2020 report by professional services firm PwC revealed that the majority of Singaporean customers (66 per cent) expressed interest in non-financial services that could be provided by digital banks, such as an integrated lifestyle e-commerce platform.
To that end, traditional banks have increased the scope of their mobile apps to cater to customers, going beyond banking transactions to offer lifestyle-related services within a single interface.
The UOB TMRW app, for one, keeps customers up to date with various deals they could be interested in, like discounts on food and groceries, cashback at select merchant outlets, and discounted holiday trips.
As part of UOB’s broader strategic focus on customer engagement and hyper-personalisation, the bank will soon launch a new carbon insights feature on the UOB TMRW platform.
It aims to empower customers with estimates of their carbon footprint based on their spending behaviours – calculated using international benchmarks and locally adapted emission standards – and insights on how they can better take action against climate change through what they spend on.
The bank has added tools to help make financial planning more accessible to customers. For example, the UOB TMRW app has the SimpleInvest feature, which lets customers start an investment plan with a minimal sum of $100.
All these features and tools are part of UOB’s goal to help customers “own their tomorrow”, says Mr Lam.
“Products used to be made according to research and studies, where we cluster people into certain demographics, whether you are a Generation Z or a Millennial.
That will not be the case moving forward, especially with technological advancements and big data. “We see a future where we will be able to hyper-personalise to the segment of one,” says Mr Lam.
“A future where our app adapts to you through your different phases of life, with a dynamic user interface and experience. We want to provide tools that can help customers create a brighter future for themselves, and make tomorrow theirs.”
Says Ms Teo, who looks forward to more of such improvements: “Personalised features have been very useful. For example, a function that could show me how to maximise my cashback or rebates if I have more than one credit card.”
What can consumers expect from digital banking services of the future? UOB’s Mr Kevin Lam identifies these top three technologies that could shape the future of the industry.
Artificial intelligence: Last year, US-based tech company Nvidia found that 83 per cent of global financial services companies view AI as integral to their companies’ future success. They are using AI to reduce the possibility of human error, decrease fraudulent activities, and even maximise investment returns.
Big data: Access to big data allows banks such as UOB to anticipate customer needs and develop solutions ahead of time. By using AI in conjunction with big data, banks can develop a better understanding of lifestyle preferences and spending habits, and offer personalised recommendations for customers.
Cloud computing: According to management consulting firm Deloitte, cloud computing can help them become more resilient to physical outages and disruption, enable more sophisticated insights and analytics and improve IT security, if implemented correctly.
Convenience may be key, but the spate of SMS spoofing scams targeted at banks in Singapore earlier this year show that additional safeguards may be needed.
As the custodians of people's money, finance is inherently about trust. “We need to always be careful and not push the boundary too much on convenience and personalisation without understanding the risks involved in dealing with people's life savings,” says Mr Kevin Lam, head of TMRW and Group Digital Banking, UOB.
He adds: “Personalisation and convenience can sometimes be in dichotomy with safety and prudence, so the industry has to find the right balance between the two sides.”
This means that online banking should have stringent security and prudent measures to help reduce the risk of scams and fraud, says Mr Lam.
Since January 31, banks in Singapore have rolled out robust measures such as implementing a cooling-off period after a new soft token is set up on a mobile device, and helping customers be more aware of bank transactions by lowering the default threshold for funds transfer notifications.
Such stringent measures may cause slight delays for online banking transactions, but they will provide an additional layer of security, said the Monetary Authority of Singapore (MAS) and The Association of Banks in Singapore (ABS) in a January press release.
The Future of Finance is a series that explores how digital solutions can empower individuals and businesses, creating a smarter, more sustainable world.
This article was originally published on The Straits Times and was written by Michael Chang, Content STudio.
Source: The Straits Times © SPH Media Limited. Permission required for reproduction
