The banking and finance industry is constant because we all need money of any description to live, exist, and survive. In today’s environment, the banking and finance industries continue to advance, develop, evolve, and innovate digitalized and virtual products and services that operate with real-time accuracy and alacrity, reaching more people than ever imagined. Today, the banking and financial industries include those [that have] formerly flown under their industry radar, the unbanked, underbanked, and underserved. The remaining constant in banking and finance is that the industry needs to adjust, adapt, and adopt 5IR innovations into their traditional ecosystem and evolve with these digitally dominated trends.
This Case Study examines how a generic, traditional bank can partner with a pioneering financial technology (FinTech) to ensure that they remain competitive and relevant. For the purpose of this study, the bank is identified throughout the paper as TradBank.
TradBank is a leading traditional banking and financial institution recognizing its need to embrace digital transformation and [to] offer its client base innovative financial products and services that will respond to their demands. To achieve this goal, TradBank has embarked on a partnership with Youtap, a leading FinTech company specializing in digital payments, digital wallets, and a suite of financial services solutions that provide competitive and innovative financial products and services that enhance business and consumer experiences through digitalization and virtuality.
Defining a Traditional Bank
A traditional bank is the original [type of] commercial bank, an institution that handles customer deposits and makes investment loans to businesses. Traditional banks are chartered at the national, state, and /or local level and have historically been the only entities legally able to issue checking accounts before the 1980s.
Moreover, traditional banks have a physical, brick-and-mortar presence, a headquarters, a domestic banking license, face-to-face customer service, dedicated account managers, and own-branded ATMs. Many customers loyal to their traditional banks find it challenging to trust the emerging modern digitized banking models because the physical presence of an actual bank building communicates [to them] a semblance of safety and security for their money. In contrast, the virtuality of the modern bank, or neo-bank, offers many traditional customers confusion, mistrust, and misunderstanding.
While traditional banks still dominate today’s banking and financial industry environment and maintain some relevance, they are as singular in importance and integrity as they historically have been. Credit unions, mutual savings banks, and savings and loan associations join traditional banks as a collective. However, to preserve their status, [t]raditional banks have had to adapt to keep up with the rapid evolution of online, mobile, and neobanking, an issue exacerbated by the physicality and tangibility of traditional banking and its methodology. Whereas traditional banking has control of its customers’ finances, modern banking empowers their customer in a primarily digitalized, efficient, and virtual way.
As traditional banks continue to navigate their industry’s digitalized innovations, they must explore the [numerous] options they availed with FinTech, information technology (IT), and the IoT for versatility and retention.
Tradbank
TradBank is a central, prominent New Zealand bank and Australasia’s largest by total assets. They have established themselves as the region’s most reputable bank with an extensive network of branches based on a legacy of trust and industry savvy.
TradBank is the leading provider of corporate finance and small-to-medium enterprise (SME) lending, with approximately 200 business centers and business desks and the region’s most extensive retail customer base of 6 million accounts. Their large and loyal customer base is one of the critical drivers behind the banks’ success, allowing them to expand parallel to their customers’ increasing financial needs.
For the past five (5) decades, TradBank has been, and continues to be, determined by the philosophy of being a trusted partner and a reliable close friend. This dogma emphasizes TradBanks’ value on partnership, developing long-term customer relationships sustained across generations, and commitment to ESG principles and responsibilities.
Furthermore, TradBanks’ business practice of investing and implementing new technologies and developing secure digital banking and innovations that meet the ever-changing needs of their customer base in conjunction with their commitment to sustainability is a part of how they are navigating the industrial complex moving forward.
To achieve this, TradBank has partnered with FinTech Youtap moving forward into an age of ESG and Industries 4.0 and 5.0.
Youtap Background
Founded in 2007, Youtap Limited is acloud-based financial services software supplier, including digital banking, eMoney processing, and payment solutions. The company has been at the forefront of the FinTech industry, its cloud-based products and services supplying digital banking, loyalty and payment programs, and digital wallets. Youtaps advanced and innovative products and services enable traditional banks, FinTechs, telcos, and retailers to complement and transform their existing infrastructure with new digital banking, digital wallet, loyalty and rewards applications, and software.
[T]heir digital platform enables these industry verticals to offer a wide range of financial, loyalty and reward, and retail products and services, including the capacity to self-onboard with e-Know-Your-Customer (eKYC), cash management and lending, that includes account itemization, bill payment, buy now pay later (BNPL), loyalty and rewards programs, and remittances.
Today, Youtap is a global provider of contactless mobile money solutions, offering digital wallet platforms that enable convenient and secure financial transactions. Their solutions encompass loyalty programs, mobile payments, and value-added services.
These advanced and innovative digitalized solutions make them an ideal partner for traditional banks such as TradBank, as they look to embrace digital transformation and address their customer demands to remain competitive, relevant, and resilient.
The Primary Objectives of the Partnership between TradBank and Youtap
Digitization of Services
TradBank aimed to digitize its product and service offerings to provide its customer base with enhanced accessibility and convenience through digital channels. This process would transform their traditional banking services into user-friendly digital experiences managed through Smartphones and other digital devices;
Innovation in the Financial Products and Services
TradBank intended to diversify its product and service portfolio by introducing innovative products and services that cater to the demands of [their] customers’ changing banking and financial needs. This process would develop and offer innovative financial products and services that cater to [the] emerging modern demands, with products such as mobile payments, digital lending, and personalized financial management tools;
Seamless Customer Experience
TradBank aimed to provide a seamless and user-friendly digital, digitalized experience, attracting tech-savvy customers, as well as fostering customer loyalty;
Market Expansion
TradBank intends to gain a competitive edge and an industry point of difference by tapping into Australasia’s rapidly growing financial products and services marketplace and beyond. Tradbank is not only an international banking pioneer with the largest network of any other Australasian bank. Tradbank has 100 international branches, predominantly throughout Australasia. Additionally, TradBank has offices in Singapore, Shanghai, Tokyo, New York, and London. TradBank has a grand vision, one that is achievable with collaboration and innovation. Partnering with Youtap and expanding with their international connections is a business-savvy move and will help them to achieve their goals.
The Partnership and Implementation Strategy of TradBank and Youtap.
The partnership strategy between TradBank and Youtap involved close collaboration between them to leverage each other’s strengths. The critical components of their strategy included:
Strategic Alignment
Tradbank and Youtap have engaged in strategic discussions aligning their goals and visions. The partnership focuses on utilizing Youtaps’ digital wallet platform to deliver a range of financial products and services to TradBanks customers;
Customized Solutions
Youtap customized its digital wallet solution to meet TradBanks’ specific requirements. These customized requirements include incorporating the banks branding, integrating security features, and ensuring compliance and regulatory standards;
Education and Support, Training and Awareness
TradBank provides its customers with educational materials and support to facilitate the transition from physical, brick-and-mortar banks with a cash-based society to that [of] digital banking and real-time digitized transactions. To ensure the transition from traditional to digital was seamless and successful, marketing and advertising awareness campaigns were launched to inform existing customers and potential clients about TradBanks’ new [digital, digitalized, and virtual] offerings. The training sessions were conducted for bank staff as well as existing customers and potential clients to ensure that there would be a smooth transition to the new products and services when they were rolled out.
The transition tutorials focused on how to use the digital wallet, make secure transactions, ensure personal [banking] security, and access customer support;
User Experience Enhancement
The partnership between TradBank and Youtap focused on creating an intuitive and user-friendly interface, ensuring a seamless transition for customers from traditional banking channels to the digital platform;
Platform Development
Youtap worked closely with TradBanks’ IT Department to develop a scalable and secure digital wallet platform, integrating core banking systems and ensuring compatibility with various devices;
Product Development
Together, TradBank and Youtap developed a selection of innovative products and services, such as QR-based mobile payment, artificial intelligence (AI)-driven personalized financial advisory services, and digital-lending platforms;
Integration and Testing
TradBank and Youtap’s technical teams collaborated to seamlessly integrate the digital wallet platform into TradBanks’ existing infrastructure. They conducted rigorous testing to ensure that the platform’s reliability, security, and user experience;
Testing and Refinement
Further intensive testing was conducted to identify and resolve technical issues or user experience challenges before the product launch, ensuring that the products and services discussed and collaborated on were precisely what Tradbank envisaged;
Technology Integration
Youtaps’ digital wallet solution was integrated into TradBanks’ existing infrastructure, allowing customers the ability to access their accounts, make transactions, and manage their finances through the newly integrated digital platform;
Security and Compliance
Both parties worked diligently to ensure the security of the customer and that there was regulatory compliance to foster and build trust amongst their customers switching to [the] digital products and services.
The Results and the Benefits
Enhanced with Increased Customer Engagement
The collaborative partnership with Youtap enabled TradBank to engage with customers on a cloud-based digital platform, fostering deeper relationships through customized experiences and targeted offers. The user-friendly interface, personalized financial management tools, and the digital wallet solution increased customer engagement as users embraced the convenience of managing their finances on the go;
New Revenue Streams
Innovative financial products and services like digital wallets, mobile payments, and digital lending allowed TradBank to tap into, and generate, new revenue streams for them. These included transaction fees and value-added services;
Expanded Customer Base
The partnership enabled TradBank to tap into new customer domains, including the younger demographic who are tech-savvy and have a propensity and familiarity with digital banking and digital banking’s range of products and services;
Competitive Edge
By offering innovative financial products combined with a seamless digital experience, TradBank positioned itself as [being] a competitive, creative player in the emerging digital banking landscape, attracting tech-savvy customers and millennials;
Efficiency Gains
Implementing the digital wallet reduced TradBanks’ need to construct more brick-and-mortar locations and for their customers to have make physical, in-person transactions to “bank.”. This simple application has led TradBank to have operational efficiency gains and cost-savings for both themselves as a business and their customers;
Data Driven Insights
The digital wallet platform has given Tradbank (in)valuable data-driven insights into [their] customers’ behavior, spending, savings patterns, and preferences, enabling TradBank to make more targeted marketing efforts and customize future product and service development.
The Lessons Learnt
The ongoing partnership between TradBank and Youtap is thriving and has highlighted several vital lessons learned from their collaboration.
Collaboration and Communication is Critical
Close collaboration between TradBank and Youtap can be used as an illustrative benchmark for their industry contemporaries and competitors. Collaboration and transparent communication are essential to successfully combining domain expertise, industry insights, institutional experience, technological innovation, and implementation;
Customer-Centric Approach
Having a customer-centric approach is vital when designing and developing digital solutions that address customer needs and preferences;
Regulatory Compliance
Ensuring standardized regulatory compliance is crucial to building trust and credibility amongst customers and the client;
Continuous Advancement, Development, and Innovation
The digital landscape evolves rapidly. Since 2000 the world has escalated from its 4th Industrial Revolution to its 5th. The speed of the ongoing technological changes and innovations demands constant attention to detail and continuous investment into research and development to advance innovations and ideas to remain competitive and relevant in the banking and finance industries.
The Conclusion
The Case Study of TradBanks’ strategic and collaborative partnership with FinTech Youtap illustrates how a traditional bank can successfully navigate the challenges of digitization, digitalization, and virtuality through collaboration and communication with FinTech partnerships by adapting and adopting digitization and innovation.
By leveraging Youtaps’ cloud-based digital wallet platform, TradBank successfully transitioned from traditional, in-person, paper-based banking practices to a competitive, digitally empowered financial institution. Then, by offering innovative financial products and services furnished by embracing Youtaps digital wallet solutions, TradBank transformed its service offerings and positioned itself as [being] a forward-thinking, insightful player relevant in and to the digital age of the 5th Industrial Revolution.
Youtaps collaborative partnership with TradBank has enabled the bank to provide its customers with a modern and convenient banking experience, maintaining its legacy of trust and customer-centricity in an environment of modernity and relativity. The Case Study of TradBank and Youtap serves as a compelling example of how traditional banks can effectively navigate themselves from convention to the transformational digitalized landscape without losing their essence or relevance. Moreover, the Case Study exemplifies how traditional banks aiming to overhaul their archaic infrastructure through digitalization can succeed and grow, especially when they factor in the tech-savvy millennial.
