This content is provided by our sponsor, and neither is written by nor provides endorsement from ICBA.
The pandemic forced us to find new ways to interact with customers. As a result, expectations for engagement have significantly increased. Apps like GrubHub and Instacart have become wildly successful because of their convenience factor. Now, consumers expect that from every company in which they do business.
Many of today’s banks have recognized this shift and are looking for new ways to attract, engage, and retain their customers, all while providing a great experience.
Increasing role of technology
50% of consumers now interact with their bank through mobile apps or websites weekly – up from 32% two years ago. Additionally, a recent survey by FIS shows that 37% of consumers began a new banking relationship with a major national or global bank that had a well-established online portal in the past 12 months. 18% of these consumers opened an account with an online-only direct bank.
For community banks who are known for putting their customers first, this could be an area of concern. However, data from PwC shows that community banks are finding complementary partnerships that evolve their operations and the service they provide customers.
Over the next 3-5 years, 82% of financial institutions expect to increase their partnerships with FinTechs, with an average return on investment of 20%.
Benefits of FinTech partnerships
- Offer additional online services– Consider a partner who can help expand your digital capabilities, such as allowing customers to apply for a loan right from your website with digital lending.
- Diversifying your portfolio – Go beyond your local borrower base and ensure your excess cash strengthens your bottom line with a partner that can originate a variety of high-quality loans.
- Protecting your business and customer base – Investing in a partner with a strong focus on risk, compliance, and identity fraud prevention can give you peace of mind that your Know Your Customer (KYC) procedures are compliant, along with other regulatory guidelines.
- Generating supplemental income – Tap into new sources of revenue for your bank, including referral opportunities and loan sources that drive fee income.
How to choose the right FinTech partner
Make sure that you’re protecting your customer experience and driving your bottom line. These characteristics are key when vetting potential FinTech partners.
- A track record of success, including navigating economic downturns
- A strong focus on data and quality, with the ability to determine which loans will perform best in your portfolio
- A streamlined process, making it easy to implement new solutions and not slow down your business
- A commitment to providing best-in-class service, with quality solutions to enhance your customer’s experience
If you’re looking for all of the above, BHG is the answer. In addition to offering collection services, risk management services, and point-of-sale financing, BHG also gives community banks the opportunity to purchase over $10MM in high-quality loans daily via a state-of-the-art online loan delivery platform. Join over 1,350 banks that have partnered with BHG to date. To learn more visit bhgloanhub.com/ICBA