Driving digital in rural banking

Technology has the potential to transform agriculture by helping agricultural business owners to work towards a more accurate, efficient and sustainable way of doing business. From traditional banks to digital banks, many financial institutions are reaching out to rural communities with the help of technology.

What is rural banking?

Technology allows a higher level of accessibility to services, and many consumers are now taking advantage of this. As the world is evolving and people in rural communities are becoming more connected, these functions are becoming more available in remote regions.

Data-driven insights can improve decision-making and practices and help increase environmental performance. With real-time decisions and unified data, this can improve customer experience. Digital onboarding can also optimize customer satisfaction and engagement and save time.

Onboarding of rural banks

Onboarding consists of multiple individual processes which familiarize new customers with the bank’s services.

End2end process

The process begins with between the customer and the banks representative at the Discovery stage, which involves searching with comparison simulation. Digital simulations can provide an opportunity to replicate real external factors and conditions to best equip the customer with the knowledge they need to move forward with the process. The search and discovery stage will also involve a needs analysis, which means identifying the person’s financial commitments and requirements and putting solutions in place. Each customers’ needs are different, and thus personalization is key to success.

The next stage is product onboarding, after needs have been agreed and the customer is joining the bank. The subscribe stage involves identification, documentation, and signature. Essentially, confirming and agreeing to the terms, providing your identity, and signing where appropriate. Much of this process can be done digitally; with remote access, it can be completed in a percentage of the time and removes the need for face-to-face interactions at local rural bank branches. Other forms such as eligibility forms can be engaged with online and even electronic signatures with document digitalisation.

The final stage is engagement services looking at the valued services such as Agri Finance Solutions – providing a range of financial advice to the rural customer, using banking and agricultural expertise that offer solutions to banking and cash flow management issues. This final stage also involves customer moments of truth. This considers crops and livestock, investments, seasonal overdrafts, scholarship, and health, to help develop an impression of the service and bank after interaction and experience.

Challenges to address in Rural Banking

There are challenges to address regarding the onboarding process, including process needs, digital acceptance, and regulation.

Corporate loans require different eligibility process as well as steps, then a merger and acquisition. It is important to note that the same type of loan will consume different forms and generate different contracts depending on the territory we are covering.

The territories’ maturity level is a key factor in the Digital Transformation, directly impacting the innovation level to introduce in each territory. This requires the ability to take a step back and observe the organisation’s situation, seeing if it makes sense from the holistic perspective and if it leads to changes across the board (such as culture, working systems, and longer-term goals.) 

Culture associations must be considered when implementing global solutions. It is crucial to know your customer (KYC), including their territory, digital maturity and culture. 

Significantly, the regulation establishes the framework for global solution implementation. Countries do not allow data cloud storage. There are different security measures for data treatment in the USA than in the EU and different eligibility forms and transparency advisory requirements in the EU and America.

Onboarding success factors

1.Regulatory Compliance:

With rapidly updated business rules, flexible KYC applications manage updates on one global platform while accounting for differences (such as money laundering – AML, Dodd-Frank, FACTA, CRS, and EMIR) based on customer type, data, product, and location allow for rapid compliance.

2.Digital Signatures:

Entire contracts can be sent online. Significantly, digital signatures (support scanned physical ones to secure digital acceptance.)

3.Real-Time – effectiveness:

Flexible and Automated Validation workflows are taken within seconds. As well as filling in required information through forms, allowing more to be included if necessary.

4.Easy to use. Omnichannel:

With Omnichannel experience and multidevice, it is easy and user friendly.

5.Data protection/Privacy:

Due to Latin American countries enacting data protection laws prior to the emergence of the GDPR (tailored against the European Data Protection Directive 1995), they no longer address present-day data protection concerns. This must be updated for Latin American data subjects and the facilitation of cross-border data transfers to and from the EU.

6. Document Collection:

Electronic validation (ID’s, Driving licenses, tax documents)

From a VASS perspective

At VASS, we cope with the end to end of the initiative: from the conceptualization and initial design of the banking platform backend/frontend, to the current backing and evolution. We use technology to simplify the process.

We make sure that business and IT are aware of customer-centricity’s strategic importance, translating business strategy into applications that employee and customers not only adopt, but ultimately embrace.