Financial services is experiencing a surge of innovation across the sector. Retail banks have realised that today’s customers demand greater convenience and access – to their accounts as well as more complex services – than just a few years ago.
Few banks exemplify this trend as well as Royal Bank of Scotland Group (RBS), owner of NatWest and Royal Bank of Scotland, and the leading electronic payments provider in the UK.
But with the number of electronic payments in the UK market now exceeding cash payments (52% versus 48%), and more than half of digital sales now being made through mobile devices, RBS needed to address customer "pain points" and undergo a programme of internal change in order to remain competitive in the midst of sustained disruption.
So RBS has transformed its organisation to focus on the customer experience. Guided by the promise of "helpful banking", the company has been building a digitally led culture, overhauling internal structures in a bid to improve its customers’ lives.
The reimagining of RBS’ digital business started with its people – more specifically, its product managers.
Previously, product managers across the group worked in company silos, focusing on individual products such as checking accounts, savings accounts and mort-gages. They rarely communicated across silos and customer feedback suggested that their requests were, at times, getting lost in the "handoff" between specialists.
Furthermore, customers reported that they were not getting holistic "life advice".
RBS reached the conclusion that a new role needed to be created that would drive business transformation and help improve the customer experience.
This role was required to disrupt traditional mindsets within the business, look across products and services, and collaborate with those who would continue to manage and "own" existing products.
To serve this purpose, RBS created the position of "journey manager".
Journey managers are individuals who are concerned with supporting customers in the pursuit of their aspirations and goals.
They are oriented not around products, but rather around customers and their major financial moments – including opening their first account, saving money for university, and buying a home.
In 2012, RBS had five journey managers. Within three years, there were 60.
Simplified user experience and digital culture
Over the years, RBS has, like many banks, developed multiple websites and platforms to support its business needs at specific moments.
When reimagining its business, however, RBS saw an opportunity to focus on the simplification of its digital estates. Over the past 18 months, the group has consolidated more than 200 distinct web platforms into a single one, thereby increasing collaboration between the business teams and simplifying the user experience.
In addition, RBS introduced an initiative aimed at increasing the overall "digital IQ" of the organisation and helping it transform into a digitally led company.
To achieve this, two major steps were taken:
First RBS developed agency-like digital studios in London and Edinburgh. These studios began transforming the company’s culture and technology systems from the inside-out, via collaborative development areas, cross-functional teams and the mindset of a more nimble enterprise start-up.
The second step was running Bank of APIs events, a series of hackathons open to staff and external participants. Spanning its three major geographies (London, Edinburgh and India), this further communi-cated RBS’ new way of working and dedication to innovation.
The innovation imperative
Refining the product mix and focusing on consumers’ needs was just the beginning of
the process. To effectively transform the business, RBS’ leaders needed to reinvent the customer journey across all channels and address the customer experience holistically.
SapientRazorfish helped RBS to realise that innovation requires an end-to-end view of the customer experience.
Reimagining business step-by-step
John Montgomery, head of digital sales at RBS, who worked with SapientRazorfish to deliver the transformation, said: "We’re working hard to position ourselves as a customer-obsessed bank and empowering staff to own and optimise a wide range of customer journeys has been key."
He added: "Our customers tell us that making it simple and easy to manage their day-to-day finances or help them make financial decisions is really important to them, and working with partners to thoughtfully use technology, not [just] for technology’s sake, has allowed us to
deliver capabilities that have been UK firsts."
By embracing digital business transformation, the organisation has not only set the bar for financial institutions, but has proved to other industries the value of designing with the customer in mind. RBS has recorded strong results for its initiatives, and developed a culture of innovation and change to maintain momentum.
Here are the six key services they launched in order to transform the business.
Service One: Intention to Lend
The challenge: nobody should have to wait long for a mortgage approval.
The UK housing market is notoriously competitive, and tighter standards are creating further uncertainty for those looking to borrow.
In most cases, mortgage closures are a race against the clock to get bank approval. In fact, RBS journey managers supplied and confirmed these insights via consumer feedback.
This prompted RBS to ask: how can we use digital innovation to ease this process?
The solution: create a frictionless lending process via the Intention to Lend digital tool.
Intention to Lend gives consumers a personalised mortgage quote within five minutes –
allowing them to show their estate agents the bank’s "Agreement in Principle" for a specific property on the same day.
This provides a better chance for users to put in an offer for their dream home without any
impact on their credit scores.
Intention to Lend has delivered £5bn-worth of lending potential to 32,000 users. Moreover, RBS recorded a 20% increase in first-time buyers, with 60% of Intention to Lend users being first-time buyers – a proportion that surpasses the market’s 40% average. If that wasn’t enough, more than 9,000 working hours of mortgage-application processing have been saved each year by automating the process via this web tool.
Service Two: Auto Identification
The challenge: removing the barriers to opening an account.
RBS and its busy customers were aware that opening checking and savings accounts in the UK can be difficult experiences.
Nearly half of all applicants in the UK are required to bring physical ID into a bank branch, after which they wait an average of 11 days for approval. SapientRazorfish, in an effort to further deliver on RBS’ "helpful banking" commitment, devised an innovative solution.
The solution: an end-to-end digital experience.
Exclusive to RBS, and the first of its kind in the UK, Auto ID is an innovative digital-identification tool that enables customers to scan or photograph the necessary documents to open an account. The tool was created using the utmost level of efficiency and security: image-scanning ensures that images are not fraudulent, after which they are checked and approved by RBS employees.
With simple transactions being carried out at home, bank employees can dedicate additional time to customers’ more complex issues. Moreover, busy people no longer have to present their identification documents in-branch, but rather can submit them digitally, at their convenience.
RBS’ Auto ID has increased account-opening conversion rates by 37% across the product range, including a 300% increase in First Saver accounts opened by parents for their children. Topping all that, though, were students – their account openings increased by 550%.
Service Three: The Overdraft Calculator
The challenge: simplifying overdraft coverage.
Checking accounts remain one of the key product types in any bank, but can also be one of the most puzzling. In this case, RBS realised overdrafts remained confusing for many customers, and wanted to simplify the experience.
The solution: A simple overdraft calculator.
The group introduced a tool to help its customers understand and differentiate between the costs of the two different overdraft types – arranged and unarranged – for NatWest and Royal Bank of Scotland, each of which has significantly different fees and terms.
The tool explains the options clearly and helps customers make good choices between fees,
interest rates and loan lengths.
Traffic to the site continues to increase, while the Net Promoter Score (an industry measurement for customer satisfaction and loyalty) for RBS’ Personal Banking services has jumped 50% in just one year.
Service Four: Access to Emergency Cash via Get Cash
The challenge: to transform the smartphone into a tool for withdrawing cash from ATMs.
RBS found that it was common for consumers to either misplace their bank cards or simply leave them at home before a big night out. But people misplace a smartphone far less often and almost never leave home without it – creating a huge opportunity to transform it into a banking tool.
RBS and SapientRazorfish developed and launched Get Cash, which enables ATM withdrawals using a short-duration, five-digit PIN that users can access via their phone.
This feature allows customers to send and receive money from any of more than 8,000 RBS, NatWest, and Tesco ATMs without the need for a bank card, lessening the immediate pain of
losing a card, simplifying the process for sending money to family members .
In its first year, Get Cash generated more than 161,900 requests (averaging 7,000 per week and growing) and £5.5m-worth of withdrawals.
Service Five: Touch ID
The challenge: mobile log-in as a point of entry.
While the number of electronic payments now exceeds cash payments in the UK, the process remains cumbersome. With an increase in security concerns and precautions, logging in has become more complex. RBS realised it could not boast about "helpful banking" if this main point of customer entry was not simplified.
Partnering Apple, RBS used Touch ID to become the first UK-based bank to offer log-in solely with biometric identification, speeding up customers’ access to their accounts.
The decision to roll out Touch ID was driven in part by customer comments on RBS’ Ideas Bank, the bank’s online community forum. The biometric enablement allowed customers’ most unique features – their fingerprints – to become their most convenient security keys.
In just five days, 72% of all capable iOS log-ins were via Touch ID. Not only was the feature adopted, it was applauded. Ratings on Apple’s App Store went up from three to four stars after the update. In addition, there were more than 8,000 references to RBS and NatWest on Twitter in the first 24 hours after launch, including recognition from both industry and traditional media of this new display of helpful banking.
Service Six: Helpful Banking on your Wrist
The challenge: to define the on-the-go (and wearable) customer experience.
With the introduction of the Apple Watch, RBS recognised an opportunity. With iOS
innovation at the core, RBS created tangible value for busy, savvy consumers who expect their banking environments to evolve at the speed of tech.
RBS and SapientRazorfish introduced an Apple Watch experience that did more than just check balances. Unlike its contemporaries, RBS’ NatWest for Apple Watch app allows users to access the popular Get Cash feature to pay for items without a debit/credit card.
Since its launch, more than 15,000 Apple Watch users have installed the NatWest app – easily surpassing the target of 1,000. More so, 10% of regular users are using the award-winning Get Cash feature, thus maintaining a market-leading NPS score for mobile and delivering on the promise of "Helpful Banking". IQ
Pawan Udernani is client partner, financial services, at SapientRazorfish.