A fundamental change in banking has occurred in a relatively short period of time: power has shifted from large financial institutions to consumers. In response, banks need to rethink how they serve their customers.

That’s the view of Marnie Baker, managing director, Bendigo and Adelaide Bank.   

“The times are gone now where the power sits with the financial institution. The power is absolutely in consumers hands and they are dictating what they expect to see in an experience,” Baker told Which-50.

Notably, the days of going to see a bank in their time and at their instruction have passed, Baker said, and today financial services need to be embedded into consumers’ everyday lives.

Marnie Baker MD, Bendigo and Adelaide Bank and Anthony Baum, founder and CEO, Tic:Toc

To do that Bendigo Bank has partnered with fintechs as a way of providing best-of-breed solutions for its customers.

Rather than viewing them as competitors, Bendigo Bank has worked closely with South Melbourne-based technology developer Ferocia, which created the the new digital bank Up, and automated home loan application platform Tic:Toc, which launched in 2017.

“If you look at fintechs across all of the different things they are doing at the moment, they’re picking off parts of the customer journey that they believe they can add or enhance the experience of, and are doing that really well,” Baker said.

“From our perspective we don’t need to own everything to be able to get good results for our customers. We saw it as a way to partner with these fintechs that were doing terrific stuff to actually be able to enhance the experience for our own customers.”

This week the bank launched an online home loans platform, Bendigo Express, powered by Tic:Toc.

Bendigo and Adelaide Bank shared its IP and home loan experience with Tic:Toc to build the solution and the bank is also a shareholder in the fintech and underwrites the loans provided through the platform.

The white label partnership, announced in November 2018, means Bendigo Bank can offer a digital home loan application and assessment process under its own brand.

“We’re excited Bendigo and Adelaide Bank is embracing this innovation to improve the customer experience when it can be done digitally and conveniently for more home owners and home buyers,” said Anthony Baum, Founder and CEO, Tic:Toc.

“Offering our technology platform as a service for Bendigo and Adelaide Bank is our first enterprise partnership that will benefit from our automated assessment and approval technology.”

It’s not the first time the bank has offered an online home loan, back in 2002 it developed an online portal in partnership with a start-up that which offered a range of services including home loans.

It was a little too early, Baker says. But today Tic:Toc has proven there is demand for credit online. Since it launched in mid-2017 Tic:Toc has received $2.1 billion worth of loan applications.

“Now with Tic:Toc I think the volumes actually speak for themselves, there really is an appetite there for consumers to access credit online, in their time,” Baker said.

Transforming bank branches into community hubs

The increasing digitisation of banking services as well as the rise of the digital-only banks which aren’t opening physical branches is causing banks to reevaluate how they use their real estate.

Baker argues digital and physical channels aren’t mutually exclusive and they serve “different customer needs and cohorts”.

While digital delivers a great experience by making transactions quicker and easier, there a still times when humans need face-to-face advice or assistance with a new process or help during a difficult time.

“If something bad happens and you are not able to meet a repayment on your loan you want some empathy from your financial institution, and a chatbot may not do that for you,” Baker said.

Bendigo is unique because it has a large number of community bank branches in regional areas which play a more fulsome role as a “community hub,” Baker says. Those locations aren’t just a place to perform transactions but also supporting the local community.

Norwood branch of Bendigo Bank. Image: Public Design Group

For example, the bank recently refurbished a branch in Norwood, South Australia which has given space to the bank’s local business customers to open pop-up shops on a rotational basis to boost their brand’s presence. There is also a community space for meetings, art exhibitions and business presentations.

“It’s not just about banking and transactions it really is about supporting the local community and providing support and services,” Baker said.   

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