Etvas for banks

For many years, it was possible to make a lot of money with cross-financing and high-risk mortgages with high interest rates. High risks and the persistent low interest rate reduce the achieved stomach enormously. Learn how etvas can help you generate additional profits and significantly increase customer loyalty.

For many years, there was plenty of money to be made in cross-financing and high-risk, high-interest mortgages, a strategy that may have worked in the 1990s but proved risky over the years. The needs of the customer were greatly neglected, because what was the bank if not just an ATM machine.

Everything changed when the mortgages burst and no one was able to pay back the money borrowed in the ensuing financial crisis. Governments had to pump a lot of money into the market to revive it. That was the point at which interest rates were lowered. At that time, little was invested in digital transformation. To date, the banking ecosystem is still very analog and all services offered are regulatory-driven, rather than customer-driven.

The rise of fintechs

The banking industry is undergoing a radical change. Customers today expect personalized, compelling experiences via user-friendly, intuitive interfaces that are available anytime, from any device. The cost of acquiring a new customer is estimated at $200, while the revenue generated by that customer is only $150. On average, a bank only makes 2. Year a profit. Given that 80% of customers are willing to switch banks for a better customer experience, the entire industry should understand that the battle for monopoly is real. 69% of customers planning to leave their current bank said their decision was based on poor customer service rather than poor products.

According to accenture's 2019 global financial services customer study, 50% of consumers expect financial services providers to offer offerings that address their core needs, not just traditional financial services.

Given the above challenges, new market entrants such as revolut, N26, transferwise and others – also known as fintech/payment startups – have recognized the problems and decided to turn them into fully digitalized solutions. One of the core needs of customers is no hidden fees and high interbank rates. To address these concerns, revolut has built a smooth global platform capable of managing assets without such hidden fees while offering excellent exchange rates.

How banks are adapting to these changes

Some long-established banks are trying to adapt to change. In fact, 80% have indicated the importance of having a digital transformation program in place to manage risk, increase efficiency, and benefit from additional opportunities to achieve sustainable results. To protect against the impact of a future collapse in business continuity and performance, it's important to move from a regulatory-driven transformation to an innovation-driven transformation. (ernst & young – global banking outlook)

The time for digitization is now. By investing in infrastructure that can increase efficiency across the value chain, banks can mature digitally. Deutsche bank, for example, wants to accelerate innovation with its dedicated innovation labs and digital factory to compete with neobanks by deploying new tech stacks and letting customers benefit from open banking.

Inflexible IT infrastructure of banks

If we look at the industry, banks want to drive digital transformation. To strengthen their competitive advantage and develop a strong market share, 70% of banks will invest in advanced technology over the next 3 years. However, only 37% are expected to develop their own technology. Generally, adoption is slow because most legacy banks do not have the IT infrastructure of a digital bank. In this scenario, a partnership with the fintechs is a smart decision.

Benefit from a platform economy

Building ecosystems with technology startups helps banks manage their digital transformation and reduce their huge cost base. Considering this fact, banks can cooperate with ETVAS.

ETVAS is a digital market for add-on services that add value to banks' core products, thereby increasing customer satisfaction and revenue. ETVAS connects all ancillary service providers with retail or SME bank customers on a single platform.

In the past, it took banks up to two years to integrate new value-added services. The complex technical integration and associated high costs posed a major challenge in this respect. In contrast, the integration of a new additional service with ETVAS takes only one month.

To meet the needs of banks in digitization, ETVAS will become an overarching marketplace where all ancillary services are available in one place. With the ETVAS platform, the cost of running service programs is cut in half.

Value-added services: a chance for banks to thrive again!

The importance of digitizing the customer journey

Value-added services will allow banks to focus more on providing outstanding customer experiences. Digitalization is about delighting the customer, and fintechs have proven they have what it takes to excel in this segment.

Today's modern customer has become accustomed to buying and managing everything online at the push of a button. Everyone is connected 24/7, which means that if banks don't add value, they will eventually be replaced by the customer. Nearly 60% of active bank customers like to use digital channels (mobile and online) and 80% of all interactions take place online (mckinsey analysis of 200 global banks). And yet, customers are not being targeted because they are not properly segmented and the offerings are not yet personalized enough.

In banking, understanding customers must be done on a granular level. According to the mckinsey global institute, most banks have experience in adding value to customer data. But even though 70% use at least one type of AI-based technology, they still lack experience in developing scalable solutions that can deliver value to their customers.

When supported by AI and machine learning, segmentation can reveal insights that current legacy systems miss. When customers know, think, or feel that a bank cares about them (integration of self-segmentation, which allows the bank customer to feel special), a sense of trust and caring is immediately created, which in turn increases loyalty and satisfaction.

Given the many options, customers today can afford to have high expectations; they want to be spoiled. Reducing costs, improving the customer experience and taking the omnichannel approach of providing the same services both online and offline are goals banks want to achieve with digital transformation.

ETVAS helps monetize customer relationships by building a service ecosystem and community around the end customer.

Where ETVAS comes in?

Integrate a value-added service in 1 month, rather than 18

Today, every single insurer and bank has to go through the same process to offer value-added services to the end customer. The time a bank or insurance company now spends on search, legal contract negotiations and integration is often up to 18 months. With our marketplace, all you have to do is choose the right services, followed by a 10x faster go-live.

In our open, API-driven cloud platform, we offer the largest catalog of customized value-added services. Our business partners configure the right products for their target groups from a huge range; integrating ETVAS is as easy as a plugin (or z.B. Paypal) to integrate. Integrating additional services for banks and insurance companies has never been easier, faster or more cost-effective.

Costs down

We save our business partners expensive and lengthy processes such as the search, or due diligence of service partners. We also save on expensive contractual arrangements and also enable better purchasing prices through economies of scale. ETVAS is so easy to use that it does not require expensive experts to manage the program.

More revenue through higher premiums and more customers.

Example use case:

Bank X chooses a value-added service directly on the ETVAS marketplace at 5 EUR.

Bank X sets a price tag for this service at 7.50 EUR.

Bank X sells this service after certain customer events or as part of other transactions.

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