Page 47 - Banking Finance November 2021

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branch despite using mobile banking. However a hybrid of visiting branch and number of transaction using physical
offline and online engagement is the best way forward. mode have reduced substantially. It has automated
repetitive backend and frontend tasks, and it has also helped
Though the online payment platforms like GPay, PayTM and in reducing the time to process documents or even in
many others have acquired a good market share in online opening a bank account.
payment industry but they do not have a robust grievance
redressal mechanism and many customers are not happy Retained Trust
with the way the failed transactions are being addressed. Another advantage of Phygital is that it allows traditional
As they do not have any physical presence to go to, it adds visits to a bank branch for those customers who cannot keep
to the misery of the customers and people started to loose up with digitization in banking, and in this way, banks ensure
trust in them. trust and comfort that ultimately leads to customer
satisfaction.
So there is a need for this form of banking to run a successful
banking business and to gain a more extensive market share. Access to a wider market
Phygital is making its inroads into banking operations
Digital banking is not widely adopted by people in rural
because banks have realized that it is a lever that connects areas. This is due to a lack of knowledge and faith. Phygital
two essential aspects of banking that is customer confidence
and experience. The success of this baking depends on can be the solution to it, especially at a time when the world
consolidating the experiences of traditional banking and is discussing open banking regulations so that banks can be
more transparent and secure. Phygital banks build a
modern banking to make the journey of customers seamless
connected ecosystem that helps them in finding prospective
and complete.
customers and in giving them access to a wider market.
Advantage of Phygital Banking:
The Pandemic and Phygital Banking:
Enhanced customer experiences The pandemic has accelerated most banks' digitalization
Tech savvy customers who are used to with quick process initiatives. If the 2008 recession caused a boost in financial
want instant and easy access to all the options, whether technology innovation, appetite for experimentation, and
digital or physical. Phygital banking provides them with a a wave of fintech start-ups, then this time around it is more
viable solution in which they can easily shift their choice of about delivering real change.
engagement with banks. They can use digital facilities or talk
to bank staff to resolve their queries. In order to retain this prestige and their important link with
communities, the model of branch banking will have to be
Engaged Customer-Banker relationship turned completely on its head in the post-COVID-19 era.
It provides facilities that strengthen the relationship with
customers. It ensures the existence of branches and builds In the new normal, consumers will carefully pick and choose
trust and facilitates the experience that makes the how to spend their time interacting. Bank branches, already
customers satisfied.

Increased customer value
Banks continue to invest in raising new capabilities, and the
phygital mode of banking has increased customer value
many fold. Birthday wishes, notification and information
through SMS and other personalized services will definitely
take the banking experience for customers to a new level.

Reduced costs
The transaction cost for banks using physical mode is almost
10 times more than the digital mode. Phygital mode of
banking have reduced costs as the number of customers

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