The emergence of online and mobile banking after the pandemic

The COVID-19 pandemic unexpectedly affected the world. Apart from killing almost 63 lakh and infecting more than 52.8 crore people worldwide (as of 1 June 2022), it impacted the livelihood of many and even forced some into extreme poverty. With 'work from home' and 'lockdown' becoming the new normal, most of us were confined to our homes for nearly two years.

The pandemic also impacted various industries in different ways. Every industry was affected in some way, from banking to insurance to information technology (IT) to the FMCG (Fast-Moving Consumer Goods) segment. As a result, these industries were forced to take various measures to address the impact of COVID-19 and counter the fear among people.

For example, insurance companies started including specialised COVID-19 coverage in their policies, IT companies started offering permanent work-for-home facilities to their employees, and food companies started focusing on creating hygienic, sustainable packaging.

Changes in the banking industry post-pandemic

Like other industries, the banking sector also witnessed several transformations in the last two years. In fact, a few changes have the potential to be more permanent in the banking industry than in any other sector. As people feared the spread of the deadly coronavirus and were forced to stay indoors, they conducted their banking activities through digital means, i.e., their laptops and smartphones.

Internet banking, or digital banking, was already gaining prominence in India during the pre-pandemic era. However, its popularity shot up after the pandemic struck. And now, as we move towards post-pandemic times, it is estimated that this digital revolution could last forever. Most banking customers now prioritise online and mobile banking; very few physically visit a bank branch for banking activities.

Let's see how the COVID-19 pandemic has effected a digital transformation of the banking industry.

Digitalisation of the day-to-day banking activities

Earlier, people used to visit bank branches for their day-to-day banking activities, such as checking account balance, payments, money transfers, applying for a new cheque book, etc. However, in the post-pandemic era, you would hardly see anyone do so. The emergence of mobile banking apps has allowed people to conduct their day-to-day banking activities from the convenience of their homes or office. You can download these apps on your smartphones and use your internet banking ID and password to avail of all digital banking services.

The IDFC FIRST Bank, for instance, offers several services online - with robust cyber security - that provide a seamless banking experience without visiting a branch. 

Steep reduction of physical visits to a bank branch

As banking customers prefer to use mobile banking apps for their day-to-day banking activities, their visits to bank branches are limited to the most crucial things. For example, depositing cash of more than a certain amount, physical verification for account opening or loan, etc. However, several banks allow customers to complete the verification process through videoconferencing, further reducing the need for physical visits to bank branches. 

Transformation of bank branches into 'service lounges'

The appearance of bank branches is also changing slowly in the post-pandemic era. They are now less about tellers managing daily transactions and more about bank employees guiding the customers to conduct their transactions through their smartphones. Banking spaces or branches are slowly developing into casual seating spaces where you can converse with bank representatives. One could say that the bank branches have now become a place where you get customer service rather than complete financial transactions.

The emergence of third-party banking apps

The emergence of third-party banking apps – or fintech apps – has been one of the cover stories of the pandemic. As most people preferred to stay indoors to protect themselves from the virus, they started trusting these fintech apps for their day-to-day financial transactions. Through such apps, you can check your savings account balance, invest in shares and mutual funds, transfer money to others, recharge your phone/D2H, etc. These apps also allow you to make payments to vendors, reducing your dependence on cash transactions. Even after the pandemic is seemingly over, there are no signs of a decline in the usage of fintech apps.

How has the banking industry reacted to these changes?

As the adoption of digital banking grew during and after the pandemic, the banking industry has taken this shift in customer behaviour with very positive intent. The COVID-19 pandemic made it clear that mobile banking or internet banking will be the future, and most banks have either taken or started taking adequate steps to promote it with a renewed focus.

Here are some of the measures taken by the banks to support this shift,

The launch of online banking

Although the concept of online banking or internet banking is not new to Indians, it gained prominence only after demonetisation and, subsequently, the pandemic. Several small banks that did not provide internet banking facilities earlier have now started offering them. Almost all banks today have launched their mobile banking applications.

Redefining customer experience

Providing customers with a rich online banking experience has become a top priority for banks. They are trying to put customers and their requirements at the forefront while developing their mobile banking apps. For example, IDFC FIRST Bank's mobile app is designed with a very simple user interface to ensure an effortless customer experience.

Promoting a mobile-first approach

Most banking customers today rely on their smartphones to complete financial transactions. This has prompted banks to take the mobile-first approach while preparing their online banking platforms. Their websites and apps are made to be mobile-friendly as well. 

Heavy investment in cybersecurity

As most banking customers have started preferring online banking, the risk of cyber threats has also increased. Even a small glitch can result in huge financial losses. That is why banks have started investing heavily in cybersecurity to boost confidence among their customers.

Conclusion

Although the digitalisation of banking services started long ago, it gained prominence only during the pandemic. And in the post-pandemic era, it is evolving into a trend. 

If you are on the fence, now is the time to adopt the trend. There are various benefits of online and mobile banking, and the biggest of them is that you can complete your financial transactions from the comfort of your home or office.

With IDFC FIRST Bank's mobile banking app, you can instantly add funds to your account, invest in mutual funds, pay your utility bills, download account statements, and much more.

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.