Albert Naffah is the general manager of payments development and strategy at the Commonwealth Bank. His team is at the cutting edge of changes in the way the banking system handles and transacts customer payments. This included the commencement of the New Payments Platform in 2018 allowing the instantaneous transfer of money between customers. His experiences have given him unique insights into the processes and pitfalls of innovation, digitalisation, and meeting customer expectations.
Banking, financial services, and payment processes have been at the cutting edge of the technological revolution that is redefining the relationship between businesses and their customers.
The evolution of customer preferences and expectations in the digital environment has highlighted that there are a few simple rules to follow when a business is looking to digitise its processes or customer offerings.
Understand your customer
Businesses first have to understand how their existing and prospective customers interact with them: what their current practices are, and perhaps how they can be improved.
What flows from that is a straightforward hypothesis-building and testing framework, which enables a business to understand the potential changes it wants to make.
Simplicity is key. Any changes to the customer offer — or indeed, internal processes — need to be better, easier and simpler, otherwise why would you change? Change is always difficult.
Don’t overcomplicate the process
Paying at the point of sale has gone through an evolution as opposed to a revolution. In the space of several years, we’ve gone from swiping a card to dipping it, and now to tapping it at the point of sale.
And the periods between those changes have become shorter and shorter. We were on the zip zap — the click-clack credit-card copying machine for a couple of decades. We were swiping for a couple of decades. And then we basically went from swipe, to dip, to tap within five years.
We know that our customers are increasingly turning to their mobiles to make payments. At CommBank, we’ve seen this most recently following our announcement that we’re now providing our customers with the ability to pay with Apple Pay.
Be wary of form over function
The expectation that smartphones were going to be transformative for payments was driven by the customisation options of the phone versus the card. A user can configure their phone to have their own smart control such as a PIN or biometric authentication. As consumers come to understand the benefits of mobile payments, such as access to an easy, secure and private way to pay, that’s fast and convenient, you can expect to see displacement of the more conventional tap-and-pay methods.
Apple Pay is just one example of CommBank’s leadership in digital and the delivery of technology enabled payment solutions. It comes on the heels of recently launched products and solutions including Simplify, Alipay, CommBank Health Claim, and our partnership with Transport for NSW allowing Sydney-siders to tap on and off trains, ferries and light rail using their credit card or digital wallet.
Of course, as wearables – such as smart watches, rings and other form factors – become available as payment methods, digital payment technology is likely to overtake plastic.
But there’s a lesson. What must flow from any change is the customer experience. That’s critical. At CommBank it’s something we talk to our customers about when they are looking to make changes to the way they do business.
In digitising customer experiences, changes have to deliver an efficiency gain either for the provider of that service or for the user. Ideally, it’s both.
That begs the question of how you should measure those improvements. The answer is relatively straightforward: experiment and test.
Customers are incredibly diverse and have different needs so businesses must ensure that they’re testing these digital experiences with their customers regularly, whether it be through market research and or through putting new ideas through a lab for customer experience testing.
They have to iterate, test and re-iterate before actually releasing the solution at scale into the market.
It sounds daunting. But failing to pursue the change is not an option.
Everything that customers are doing — increasingly so – is to interact with family, friends, and of course businesses via a smart device — phone, tablet, watch — or on the web. The path to digitisation is not a matter of if, but when.
Things you should know: This article has been prepared by Business Insider solely for information purposes and is not to be construed as a solicitation, an offer or a recommendation by the Commonwealth Bank of Australia. The information may be incomplete or not up to date and may contain errors and omissions. Any projections and forecasts are based on a number of assumptions and estimates, including future events and contingencies, which may be inaccurate. It must not be relied upon as financial product advice and is not Investment Research. As this information has been prepared without considering your objectives, financial situation or needs, you should, before acting on this information, consider its appropriateness to your circumstances and if necessary, seek the appropriate professional, including taxation advice. We believe that this information is correct and any opinions, conclusions or recommendations are reasonably held based on the information available at the time of its compilation but no representation or warranty, either expressed or implied, is made or provided as to accuracy, reliability or completeness of any statement made. Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian credit licence 234945.
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