Banks Face Tougher Customer Demands as Digital Frustrations Rise

Watch more: Making Digital Resilience a Banking Priority

Almost every banking interaction is digital at some point, relying on APIs and cloud services.

As a result, the concept of digital resilience has expanded. No longer solely about ensuring infrastructure uptime, resilience in modern finance now encompasses the ability to deliver a service that users can trust and consistently meet critical business objectives.

This shift means banks must rethink their approach to monitoring and maintaining their digital ecosystems, Gerardo Dada, field chief technology officer at Catchpoint, told PYMNTS as part of the “Summer School Series.”

The Digital Transformation of Banking Interactions

The nature of banking interactions has undergone a metamorphosis, Dada said. The familiar experience of visiting a physical bank branch, once marked by amenities like coffee or lollipops, has largely given way to digital engagements.

Speed matters, he said.

“You try to make payments via Venmo, you check your balance on an ATM — it used to take eight seconds when I started working with digital banking some 20-something years ago,” Dada said. “Now it’s down to three seconds. You request something, and in three seconds, you start thinking like something’s wrong. And after about six seconds, people think: ‘Whoa, this thing doesn’t work.’”

Keeping all the pieces moving is no easy task. This digital evolution has shattered the traditional notion of an insular banking IT environment. Gone are the days of a single server room or IT professional managing a local network within one building, reminiscent of scenes from “Office Space.”

Instead, the modern banking infrastructure is a complex web, with authentication systems, APIs, transfer systems, security systems and customer relationship management (CRM) systems often hosted “across different clouds and different networks, accessed through different technologies,” Dada said.

This intricate distributed environment means hundreds of connections must occur seamlessly for a single transaction.

The implication is that a bad digital experience is now the primary reason customers switch financial institutions. If a company’s chief financial officer cannot make payroll due to a system incident, the company may seek another banking relationship, Dada said.

Distributed Workforces and the Pervasive Digital Fabric of Banking

The shift to digital is not confined to customer-facing services; it deeply impacts internal operations and distributed workforces. The acceleration of remote work means employees are now located in different offices, relying entirely on digital systems to perform their duties.

Even a seemingly simple task like a bank teller depositing a check in person is undergirded by a digital system that must connect to hundreds of other digital systems.

In response to this pervasive digital reality, financial institutions are rethinking their operational frameworks.

“Many enterprises in general, not only banks … are adopting a company-wide observability practice,” Dada said.

This involves integrating traditional application performance monitoring (APM) tools with newer solutions focused on Internet Performance Monitoring (IPM).

This philosophical shift entails “transforming the IT department from being system-centric to being the operations center of the company,” with customer experience — not system metrics — as its KPI, he said.

The objective is proactive detection and rapid response, building best practices around this new operational paradigm. Catchpoint assists companies in this transformation through a structured maturity model that guides client firms through the process, he said.

The Impatient Consumer and the Fragility of Complexity

Consumer expectations for speed and seamlessness are higher than ever. Heightened impatience is driving the need for impeccable digital performance.

To effectively manage this complexity and meet stricter expectations, Dada outlined four components of digital resilience that banks must prioritize:

Reachability: The foundational element. This refers to whether users can access the digital system.

Functionality: Once reachable, the system must be functional, with all digital capabilities of the bank operating as expected.

Performance: Customers or employees seeking to make a transfer or check a balance get near-instantaneous feedback as they navigate the bank’s offerings.

Continuous Availability: A measure of trust and reliability over time. Can users depend on the system to work consistently when needed?

Banks must adopt the rigorous, constant monitoring practices prevalent in eCommerce to track these four factors and make digital resilience a priority, Dada said.

The shift is to an “outside-in” concept, which means monitoring from the user’s perspective, he said. This approach ensures banks “understand the actual, real-world experience that your users are having, and you are aware of everything in the entire internet that is impacting your business.”

Catchpoint addresses these four tenets by providing global coverage, with 3,000 intelligent agents around the world and the ability to deploy tech-driven intelligent agents in offices.

“Let’s say an office loses connectivity or a branch or a city loses connectivity to some of the key systems you need,” Dada said. “You get alerted the moment it happens… and not when you open the doors and you’re waiting for people to show up.”

“If you catch it at 3 a.m.,” there’s time to fix the problem, he added. “By 3:15 a.m., no one even noticed that something happened. That’s the ultimate goal of being able to detect all those issues ahead of time.”

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