The Future of Banking: E=mc³

Abstract

Today’s media continually claims that the key to the future of banking is new delivery technology coupled with customer relationship management (CRM) software, the next weapon in the technology arsenal to fend off new market entrants and preserve eroding market share. Technology pundits have predicted that the consumers’ appetite for gadgets that deliver convenience-driven techno-banking will reduce their sensitivity to fee rates and other financial services charges. The precognition of customer behaviour may be true in a rapidly growing economy, but, under adverse economic conditions, customers typically retreat to the fundamentals of a firm’s value proposition. The perception of value is relative to the customers and their immediate needs or long-term goals. This relativity of value can be demonstrated in the rise and fall of the stock markets during the dot-corn surge and retreat.