16 Feb 2024

| By

Sreedhar Tatavarthi

2024 banking outlook: Essential highlights and strategic insights

This article is part of our series Gen Z Banking Trends, where we uncover the ins and outs of Gen-Z banking preferences.

Here is the TL;DR of the BAI 2024 Banking Outlook, your quick guide to the key trends shaping the future of banking amidst economic fluctuations and technological progress. This brief captures the summary of essential strategies for banks to succeed in the evolving landscape of 2024.

1. Deposit Growth is High Priority:

The emphasis on increasing deposits has become more pronounced due to inflation and economic difficulties, making it a primary goal for 2024. Notably, 67% of Generation Z and Millennials are choosing to open new deposit accounts via online platforms.

2. Digital Customer Experience is Paramount:

Customers expect their banks to mirror the digital experience offered by leading online retailers. Investing in digital experience ranks as the second highest priority for the coming two years. There has been a noticeable drop in consumer satisfaction with the digital customer experience provided by banks.

3. Fraud Mitigation vs. Customer Convenience:

Both customers and banks are highly concerned about fraud, yet maintaining a balance between fraud prevention and customer experience is essential. 60% of the financial institutions surveyed are allocating resources to new technologies to combat fraud.

4. Technology Transformation is Inevitable:

Banks need to concentrate on developing streamlined, updated technology infrastructures that enhance the vital connection between insights and actions. This includes, notably, providing highly personalized messages to the appropriate customers exactly when needed, and doing so extensively. 83% of banks are expanding their technology budgets to support these initiatives.

5. Gen AI is Here to Stay:

Generative AI is poised to substantially benefit the banking sector, potentially enhancing its annual revenues by 2.8% to 4.7%, equivalent to an extra $200 billion to $340 billion, as per McKinsey's findings. It's time for banks to adopt Generative AI. Rather than fearing job loss, employees should view this as an opportunity to work more efficiently in manners that advantage both themselves and the organization.

6. 24X7 Support with Virtual Assistants:

The surge in Conversational AI (CAI) in customer service is attributed to 60% of Generation Z favoring enhanced digital functionalities and allows for 24x7 support. CAI excels in dynamic and informal conversations, recognizing not merely specific words but the true intent of the customer. This capability stems from sophisticated linguistic and semantic technologies capable of understanding natural, human-like language, including a variety of languages, regional dialects, colloquialisms, emojis, and even voice recordings.

Source: BAI

7. AI for Identity Verification:

The application of AI in identity verification and fraud prevention is growing, with many banks intending to implement it in the near future. The challenge of smoothly approving legitimate customers while identifying fraud and upholding regulatory compliance in an ever-evolving digital environment is significant. AI offers a solution to effectively address this challenge.

Want to unlock the power of personalization for your financial institution. Book a consult.

Are digital hurdles slowing your deposit growth? Symphonize helps banking institutions elevate their digital customer experience to match Gen Z's expectations. Click here to book a quick 30-min discovery call and let's tackle it together!

About the Author

Sreedhar Tatavarthi

Sreedhar Tatavarthi is an accomplished IT executive with a robust 20-year career, predominantly in the banking sector. He specializes in leveraging technology to revolutionize banking experiences, particularly for Gen Z customers. His work encompasses digital transformation, enhancing customer service, and implementing strategic tech initiatives to foster growth and innovation in the banking industry.

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