Big banks are fighting for a slice of their customers’ pie

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Banks are enhancing their mobile applications with virtual marketplaces of discounted products and services, in order to retain them and, in so doing, gain insight into their purchasing preferences.

Banks such as Kotak Mahindra Bank, ICICI Bank, Axis Bank and State Bank of India (SBI) already offer such features, some of them also providing them through online banking.

These lenders allow customers to access e-commerce websites such as Amazon and Flipkart through their in-house apps and earn discounts.

Experts believe such super apps would help banks track and analyze their customers’ spending habits and sell more products.

The KayMall section of the Kotak Mahindra Bank app guides users to travel and hotel reservations, e-commerce websites for grocery, fashion, home appliance and electronics, and membership subscriptions. magazines.

“Over 80% of our customers are active in mobile banking, which means they have used the mobile banking app at least once in the last 60 days. That said, over 25% of the active mobile banking base has visited KayMall in the past three months, ”said Deepak Sharma, President and Chief Digital Officer of Kotak Mahindra Bank.

Sharma added that this is part of Kotak’s strategy to become a one-stop super app that meets all customer requirements including banking, lifestyle and investing.

Private lender Axis Bank has an online marketplace called Grab Deals which has exclusive offers for debit and credit cardholders. Last month, the bank hosted a 10-day sale called Grab Deals Fest offering 15% cashback on online purchases.

“These offers are in addition to all other offers offered to customers through other channels. The bank believes that offering these discounts will strengthen the bank’s relationship with the customer and be a win-win for both over time, ”said Sameer Shetty, President and CEO (Digital Business and Transformation) of Axis Bank.

Industry experts have said that the big banks will continue with this strategy and more are likely to join as benefits such as customer loyalty improve. As customers get more discounts than they would through a regular ecommerce portal, banks can get their hands on one thing all retail lenders are looking for these days: data.

“The bank has greater visibility on the finances of its customers and will be able to grant credit more easily. But for many players, especially the smaller ones, it may not be seen as a primary function and rather as a distraction from the core business, ”said Raj Khosla, Founder and Managing Director of the Services Marketplace. financial MyMoneyMantra.

Admittedly, the journey will not be easy for lenders as the big fintech players such as Google Pay have already established their presence with big bouquets of such services.

A PwC report released in December said that in addition to allowing users to make digital payments, these apps provide services such as ticket booking, gaming, online shopping, banking, and home credit. consumption.

“The emergence of super apps is one of the main reasons why Unified Payment Interface (UPI) transactions have increased since demonetization,” the report said, referring to the government’s decision in November 2016 to withdraw high value banknotes from ₹1,000 and ₹500.

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