Building a Powerful Digital Customer Channel: Why the time is right for financial institutions to act now

October 26, 2023
Min read

Earlier this year, Mobey Forum (the global, non-profit industry association empowering banks and other financial institutions to shape the future of digital financial services) posed a challenging and very topical question in their report The Rise of Digital Identity Wallets: Will Banks be Left Behind? While there are clearly other providers who could step in to fill the role of trusted data and identity custodian, the report concludes that financial institutions are ideally suited to take up this role. In the final paragraphs the report has a call to arms pinpointing that “it is the responsibility of the banking sector to elevate its role and contribute to the Digital Identity system. Digital Identity holds great promise for society at large. Without banks, it’s going to be very difficult for society to stand up a Digital Identity system. So, it’s not just about a business case, it’s about driving positive, real, and long-lasting change.”

This sentiment is core to the Meeco ethos, and we were delighted when Meeco CEO and Founder Katryna Dow was invited to join NAB’s Executive Brad Carr in discussion on NAB Digital Next, National Australia Bank’s podcast on the rise of the digital economy, to talk about digital identity and data. The podcast explores key themes that will lead to success for financial institutions as they continue to build trust with their customers across digital channels. We’ve highlighted some of the key discussion points below and strongly encourage you to listen to the podcast in full on your favourite platform. Beyond the interview with Katryna, there’s some great content on success factors for a digital economy.

Financial Institutions as trusted custodians

For decades we’ve trusted financial institutions with our money. And now, as not only our financial services but a wide range of other activity from transport and healthcare to dating and travel move online to our phone, the time is right to trust them with our data and digital identity.

Financial institutions are uniquely placed to embrace digital wallets as a powerful customer channel, with some thoughtful repositioning and consideration of language. What if we don’t use the term wallet? What if we thought more broadly about a trusted and secure container, avoiding the weighted terminology that sparks potentially paralysing conversations about competition with BigTech wallet providers.

Collaboration over competition

Collaboration among financial service providers is key and Katryna and Brad discuss the pivotal role that collaboration among competing organisations has played in the Nordics and in Belgium, underpinned by robust trust frameworks. Katryna makes a powerful point that competition is still hugely important – and indeed possible. Despite being participants in Belgium’s digital identity service itsme, banks compete very successfully on the customer experience and value-added services, and Brad reflects on some key takeaways for the recently launched ConnectID scheme in the Australian market.

Collaboration across industry is also important and Katryna shares Meeco’s role in the current pilot in which Howest University is issuing Verifiable Credentials to its students that are held in KBC bank’s Trustbox. There’s more about Meeco’s role in this pilot here.

Picking a cross industry use case for experimentation also helps participants to explore how portable identity can create new value, reduce time to value and stimulate a data network, as the different parties evaluate and share the benefits. For more detail on commercial opportunities and business models, we’ve taken a deeper dive in the resources section on our website.

Standards drive interoperability and scale

Another important theme in the discussion is the role of standards, which drive interoperability and deliver scale. Europe is currently at the forefront of this having made significant investments in standards-based infrastructure and tools that enable competing providers to test interoperability compliance.

Experimentation – it’s time to get started

With trust frameworks, standards and toolkits readily available, the time to start experimentation is now. Katryna and Brad invite providers of financial services to imagine where they want to be in 2026 and to work back from there. If a financial institution has the strategic intention to evolve their role of trusted custodian, they need to start experimenting now.

With something as complex as data and identity, it is entirely understandable that large organisations spend a significant amount of time debating legal issues relating to potential new exposure to risk. It’s tempting to wait until everything is perfectly aligned, but with greater clarity around the commercial opportunities and technical standards, the time is right to pick a low risk use case and start. If it’s too early to pick a network partner, there are a number of use cases  - such as employee onboarding – that can be controlled entirely within a single organisation.

Get in touch if you’d like to explore use cases. The Meeco sandbox lets you simulate a network and validate the customer experience and commercial value, before you take it to potential partners. It can take as little as a few days to build out your idea and we have all the tools for you to evolve it into a trial with real customers.

Meeco Team
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