Can AI-Powered Solutions Help Boost “Cross-Selling” In Financial Institutions?

Financial technology aims to improve user experience and the easy availability of financial services. But it is not just limited to online banking and transactions.??

??Imagine a system that can intelligently analyze a customer's financial patterns and recommend tailored products and services that suit their requirements.?

AI and automation hold great potential to change how financial institutions cater to customers completely. In the FinTech and FinServ domain ‘relationships’ and providing ‘personalized solutions’ are what matters most now. Fulfilling these demands a strong workforce involved at every stage. AI and automation with smart data analysis can tailor product recommendations based on customers’ information.?

Current competition in the Indian financial market??

The banking landscape in India comprises 12 public sector banks, 22 private sector banks, 46 foreign banks, 56 regional rural banks, 1485 urban cooperative banks, and a network of 96,000 rural cooperative banks, along with other cooperative credit institutions.

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India's financial sector consists mainly of public and private banks along with NBFCs. As of October 2022, 9,500 NBFCs were registered with the Reserve Bank of India (RBI) with a total asset size of ?42.05 lakh crore. They provide loans to individuals, households, and infrastructure projects, playing a crucial role in the Indian economy and helping to boost the country's economic growth.?

Various players, including traditional banks to emerging fintech startups, are all competing for the attention of customers looking for financial services.??

In 2022-23, assets of public sector banks accounted for 59.24% of the total banking assets (including public, private sector and foreign banks). So, there's a great gap that can be filled.

And, this is where small financial institutions come into play to acquire that market share.

According to the BCG Banking Sector Roundup Report of 9M FY23, credit growth is expected to hit 18.1% in 2022-23 which will be a double-digit growth in eight years.

So, the question is...

How can smaller financial institutions win against large organizations?

Filling the credit gap

According to an ICICI Securities report, analysts expect NBFCs to earn a profit of 15-20% and to see strong demand over the next five years.?

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Large institutions have stricter criteria while offering loans to individuals and businesses so small financial institutions and NBFCs can fill that gap says Bhanu Pathak, an Associate Finance Consultant at Wipro.?

While, smaller players such as non-banking financial companies (NBFCs) and local cooperative banks, are uniquely positioned to bridge this gap. Their more flexible lending practices, personalized assessment approaches, and regional expertise allow them to extend credit to a broader spectrum of customers and also cross-sell their different financial products.

Selling and Cross-Selling in financial institutions in India??

Acquisition cost is 5 times greater than the retention cost’. (CA Manish Mishra on TOI)

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??This means an existing happy customer can give you more business than a new one.

Cross-selling, or offering additional products or services to existing customers, can significantly increase revenue.?

Think of it like this: When a customer is satisfied with how you handle their money, provide them with loans, or assist them in investing, they trust you. So, they are more likely to buy or try your other products.??

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A new customer who has never worked with you before does not know you as well. They may be hesitant and require more time to build trust, especially for small financial institutions.?

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Winning customers is not easy even for large organizations, but a strategic cycle can be followed to build trust and win customers.?

1. Focus on transparency: Clarifying the benefits and terms of financial products increases credibility and trust.
2. Providing personalized experiences and solutions based on individual financial goals demonstrates genuine concern for the needs of customers.?
3. Nurture the relationship over time by checking in periodically and offering relevant updates.?

The digital space has changed and has opened new possibilities for financial institutions with the right strategies and going beyond the same old marketing mantras.

Intelligent Data Analysis: Every financial institution is trying to deepen customer relationships.??

However, the future of lending demands an intelligent data analysis system that can recommend products based on individual financial needs.?

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Omni channel single portal: Where the bankers and the customers can connect on a single portal and can access anytime, anywhere, from any device-?

Ensuring "Customer Engagement" and "Satisfaction"?

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Both are at the heart of customer success in every successful organization in the ever-changing financial industry.?

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With automation, you can?

• Identify the customer's needs?
• Personalize the offer?
• Maintain transparency?

So that each individual feels special and connected, resulting in an increase in 'customer loyalty' - 'retention rate' - 'more cross-selling opportunities' - 'increasing revenue'.

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FinTechs are transforming financial services across sectors, including credit, payment systems, wealth management, investment advice, insurance, financial inclusion, and even financial sector supervision. RBI & Fintech: The Road Ahead?

Looking to scale up and reshape your Lending Solutions with AI-Powered solutions??

We at ezee.ai are not just transforming customer experiences; we aim to cultivate loyalty and pave the way for long-term success by building genuine relationships and providing personalized solutions for financial institutions with smart data analysis tailoring product recommendations based on customer information.

Learn more about lend.ezee at: https://bit.ly/3KVaIVV