10 Modern Capabilities Traditional Financial Institutions Need To Serve Contemporary Clients

As businesses and consumers become increasingly dependent on technology, traditional banks, and credit unions need to keep up with modern capabilities to meet the needs of contemporary clients. Without incorporating modern technologies, traditional financial institutions risk becoming outdated and irrelevant. Jeff Althaus, founder, and CEO of Mozrt, said, "The world is changing fast, and so must banking. The traditional banking model is no longer sustainable; banks and credit unions need to be nimble and adaptive to serve the needs of modern businesses."

NOTE: For the purpose of this article, we’ll be using the blanked term Financial Institutions (FIs) when talking about banks and/or credit unions.

Here are 10 modern capabilities that traditional financial institutions need to adopt to remain relevant in the modern era.

24/7 Banking

Traditional FIs have strict business hours, which can be a limitation for clients who require access to banking services outside of those hours. We are consistently approached by financial institutions that are in desperate need of expanded service hours, and offering this capability has really helped our banking partners stand out from the rest. Modern clients need to move fast, and they need to act at the drop of a hat. As Jeff Althaus explains, "24/7 banking is a must-have in today's fast-paced business environment. Clients expect to have access to their accounts and banking services whenever they need them."

Another key component of 24/7 banking is contingency planning. If an FI offers 24/7 services but experiences outages, that sure doesn’t serve the needs of their customers who need to make time-sensitive transactions. Mozrt’s micro-core offers readily available service and 24/7 processing, but on top of that, the micro-core can act as a backup to a FI’s existing core for contingency planning. If the FI’s core goes down, they don’t need to let down every customer at that moment, they can rely on our always-available backup core.

Real-Time Payments

In today's world, clients want their payments to be processed quickly and efficiently. With real-time payments, financial institutions can offer their clients the ability to make and receive payments instantly, without any delays. Jeff Althaus notes, "Real-time payments are critical for businesses that need to move quickly and efficiently. By offering this capability, financial institutions can provide their clients with a competitive advantage."

For example, an employer may be looking for a financial institute that can allow them to pay employees instantly at the end of a shift. This offers employers an incredible way to attract new staff and keep team members long-term. Currently, FIs are beholden to the limited hours and days the federal reserve is open, this is soon to change with FedNow. The FRB will soon be open 24/7 and capable of settling payments in real-time. This will be a huge opportunity for FIs to offer its tech-savvy clients with advanced capabilities. The Mozrt core is real-time! We don’t have cut-off times and our system isn’t batch, so it doesn’t go offline at the end of the working day. Our core enables FIs to offer FedNow and RTP.

Real-Time Account Opening & Deposits

On top of that, efficient account opening is a modern capability that banks need to suit the needs of more tech-focused potential retail and corporate clients. Traditionally, opening new accounts has required in-person procedures, and that’s simply not the way tech-forward clients expect to transact these modern days. Financial institutions partner with Mozrt to onboard new clients online 24 hours a day. This includes gathering customer information, running KYC & KYB, assigning an account number, and leveraging open banking to fund the account, all within a few minutes.

With high-interest rates, most financial institutions are looking for ways to increase deposits. They are looking to offer real-time account opening capabilities for the various products and services they offer. Immediately funding those accounts is critical! It’s wildly common for accounts to sit dormant if a client encounters barriers to depositing money into that new account. Make the experience easy and increase your deposits.

Domestic & International Banking Capabilities

In today's global business environment, clients need banking solutions that can handle domestic and international transactions. By offering a comprehensive suite of banking services–both domestic and international–financial institutions can meet the needs of their clients wherever they are. There aren’t many businesses in today’s economy that haven’t stretched beyond borders in some way. Therefore, cross-border capabilities are becoming more important than ever before. Mozart enables the FI to increase non-interest revenue through payment transactions and FX.

White-labeled, Fully-Integrated Solutions

Jeff Althaus explains, "White-labeled UX and fully-integrated solutions are essential for banks and credit unions that want to offer a modern, personalized banking experience. By providing a customized user interface and seamless integration, banks can differentiate themselves in the marketplace."

Seamless Onboarding

Onboarding new clients can be a complex process that involves identity verification, KYC, and other regulatory requirements. With seamless onboarding, FIs can offer their clients a smooth and hassle-free experience that meets all regulatory requirements. Jeff Althaus notes, "Seamless onboarding is a critical capability for banks that want to attract new clients and provide a positive experience. By streamlining the onboarding process, FIs can reduce friction and improve client satisfaction." As we said, time is one of the key factors in a modern company’s decision-making, so modern financial institutions need to prove that they can move fast while checking all of the necessary regulatory boxes.

Automated Solutions

Automation is crucial for streamlining banking operations and reducing manual errors. By automating processes such as traditional banking wires, FIs can increase straight-thru processing and eliminate bottlenecks in their operations. When most people are used to having to physically go to a bank or credit union to send a wire transfer, for example, offering an automated solution can really offer a unique selling capability.

Sophisticated & Easy-to-Use Online Banking Experience

Gone are the days when customers would go to a physical bank branch to handle all their banking needs. Today, customers expect to be able to manage their accounts online, whether that's through a desktop computer or a mobile app. As a result, it is crucial for financial institutions to offer an online banking experience that is sophisticated, easy to use, and meets the needs of their customers. Simply offering online banking is no longer a selling point, your FI’s online banking experience needs to stand out and fully enable all types of services including international payments. Younger, more modern clients are looking for virtual, one-stop-shop experiences, and that includes their banking.

API-Based Card Issuing

At Mozrt, we’re currently working towards the rollout of our new API-based card issuing service that our partner banks and credit unions will be empowered to use. As we’ve said, it’s important to move fast, and that goes for every part of the onboarding and day-to-day procedures, including card issuing. Very few FIs have the ability to offer expedited, tech-forward card issuing and we’re confident that this capability will offer a modern, competitive advantage.

API-First Approach

Finally, one of the most important modern capabilities that traditional banks need is an API-first approach. According to Althaus, "At Mozrt, we believe in an API-first approach. This allows our clients to very quickly embed banking products and services that are most important to them. It also means that the financial institution can offer a more seamless and integrated experience for their clients."

As the business landscape continues to evolve, it is becoming increasingly clear that traditional banks and credit unions need to embrace modern capabilities if they want to remain relevant and serve tech-savvy clients.

At Mozrt, we are committed to helping traditional banks and credit unions embrace these modern capabilities. As Althaus says, "Our mission is to provide our clients with the tools they need to succeed in the modern banking landscape. Whether it's offering easy ways to open accounts or enable cross-border and real-time-payments, we are constantly working to improve our platform and provide our clients (and theirs) with the best possible banking experience."