Hosted by top 5 banking and fintech influencer, Jim Marous, Banking Transformed highlights the challenges facing the banking industry. Featuring some of the top minds in business, this podcast explores how financial institutions can prepare for the future of banking.
The Power of Sharing the ‘Why’ for Digital Banking Success
A digital-first account opening and onboarding platform is becoming increasingly important in banking, as customers increasingly expect a seamless, digital experience when opening and managing bank accounts.
A fully integrated digital platform streamlines processes, reducing the risk of errors, improving compliance, and increasing the ability to offer personalized products and services. For customers, a digital-first approach provides convenience, speed, and the ability to open and manage accounts from anywhere, at any time.
We are very fortunate to have Cindy Blackstone, Chief Retail Officer for Southside Bank on the Banking Transformed podcast. She will discuss how a digital-first platform has resulted in a superior customer experience, reduced costs, and driven growth in a highly competitive marketplace.
This episode of Banking Transformed Solutions is sponsored by NCR Terafina
NCR Terafina provides digital onboarding and omnichannel sales solutions that are simple and secure to banks and credit unions. Terafina’s omnichannel sales platform is a multichannel product suite with the broadest spectrum of products, including consumer deposits and lending, real estate, small business deposits and lending, commercial deposits, and cryptocurrency account opening—across digital, branch, and call center channels.
Hello, and welcome to Banking Transformed, the top podcast in retail banking. I'm your host, Jim Marous, Owner and CEO of the Digital Banking Report and Co-publisher of The Financial Brand.
Jim Marous (00:20):
A digital first account opening and onboarding platform is becoming increasingly important in banking as consumers increasingly expect a seamless digital experience when opening and managing their accounts.
Jim Marous (00:33):
A fully integrated digital platform streamlines processes, reduces the risk of errors, improves compliance, and increases the ability to offer personalized products and services going forward. For consumers, a digital first approach provides convenience, speed, and the ability to open and manage accounts from anywhere at any time.
Jim Marous (00:56):
We are fortunate to have Cindy Blackstone, Chief Retail Officer for Southside Bank on the Banking Transformed Podcast. She will discuss how a digital-first platform has resulted in superior customer experience, reduced costs, and growth in a highly competitive marketplace.
Jim Marous (01:12):
By providing a modern digital platform, banks of all sizes can level the playing field and offer customers the same level of convenience and accessibility as the largest banks. Moreover, a unified digital first platform can enable banks to better understand their customers, offer personalized products and services, support continuous innovation, and deploy compliance solutions at speed and scale.
Jim Marous (01:43):
So, Cindy, first of all, thanks for joining us today. Can you provide a brief overview of Southside Bank as well as your role within the organization?
Cindy Blackstone (01:54):
Sure, thanks, Jim. So, Southside Bank is based out of Tyler, Texas, we're a little over 7 billion in assets. We have 55 branches across the state, and my role is Chief Retail Officer and I'm the one who headed up this platform of introducing Terafina to our customers and to our employees.
Jim Marous (02:17):
It's interesting, before we got on the podcast today, we discussed the fact that at under 10-billion-dollar financial institutions, you're not really big but you're certainly not small with as many branches as you have. In the research we've done for the Digital Banking Report, we found that organization of all sizes really ranked themselves relatively low from a digital transformation maturity perspective when they look at where they are in answering the needs of the consumer from a digital perspective.
Jim Marous (02:50):
Everybody knows what they need to do but very few financial institutions feel like they're keeping up with the pace of what the consumer's asking for. So, where do you place Southside Bank on this scale of this digital maturity continuum?
Cindy Blackstone (03:06):
I would place Southside as middle of the road right now. We've made a lot of progress this last year, we had a lot of initiatives, Terafina being one with the new account opening platform, and then we have several others that are going to go live this year. And so, I think by the end of this year we'll be closer to the high-end of maturity.
Jim Marous (03:26):
It's interesting because to be at the high-end of maturity, you not only have to catch up to where the consumer is, but you actually have to keep pace with how fast the consumers transform themselves. We talk about it on the podcast quite a bit that the consumer is not comparing you to another financial institution. They're comparing you to the experience they have with Netflix, with Hulu, with Instacart, with Amazon, with even Uber.
Jim Marous (03:59):
What's interesting is to keep up, you've got to overdeliver because the consumer's going to be there fast and we know it. Given your focus and knowledge of digital expectations, how are you trying to differentiate Southside Bank in a marketplace in Texas that's filled with organizations trying to accomplish the same thing you are?
Cindy Blackstone (04:24):
The first thing we're doing is listening to what the customers want. The customers want the digital experience. You're right they want the experience that they're having with all these other vendors but they also want the ability to come see someone in person if that's an option.
Cindy Blackstone (04:41):
So, we have to listen to what they want and we've done a good job of listening to what they want, and they want ease of use. They want something that is comfortable to use, not complex, that is easy for them to have the same experience that they're having with some of those vendors that you listed.
Jim Marous (04:57):
It's interesting when we talk to financial institutions and even talk outside the financial services industry, we've really come to a new definition of convenience. Location is kind of important but it's not nearly as important as what it used to be.
Jim Marous (05:13):
But speed, ease of use, and empathy, which is what you talked about I think when you talked about the importance of the human element of digital banking, really play a major role in making this little consumers feel comfortable in using your finance institution over another.
Jim Marous (05:31):
So, when you look at the prioritization of what you did, you've mentioned that you've been going at this for a little bit over a year. How did Southside prioritize what was needed in this rapidly changing marketplace? Where do you start and what are your priorities today?
Cindy Blackstone (05:52):
So, we started with digital account opening because we knew that was a need that we needed to meet and other priorities that we have on our radar by year end we're rolling out an online loan platform as well, and then electronic payments.
Cindy Blackstone (06:08):
We're constantly looking at what businesses need as well as consumers because electronic payments are such a big — it's important to consumers right now. And so, that's how we looked at prioritizing what we were going to do, starting with the account opening just because we knew that that was the first need that we needed to meet.
Jim Marous (06:30):
I clapped because when somebody asked me where do we start with digital transformation, I always say digital account opening for a couple reasons.
Jim Marous (06:40):
Number one, it's not easy but it's the lowest hanging fruit from a revenue and from a growth perspective that we have found in our research that 60% of people who try to start a process in digital account opening stop it because it's way too hard.
Jim Marous (06:59):
And in our research, it takes still on average, about 15 minutes to open a new account digitally. And when we do research, we ask, "Do you allow customers to do digital account opening?" And the ratio is around 80% of financial institutions say they do. But when we dig to what exactly does that mean, we find that extraordinarily small percentage actually enable consumer to do that in an easy and seamless way.
Jim Marous (07:27):
What changed in your new account opening process? What did you actually do to change maybe the speed, the involvement, the back office, the front office? What actually changed in the new account opening process?
Cindy Blackstone (07:43):
I think the biggest change was selecting the vendor that had the ability to deliver what we were looking for. We wanted a customizable solution that can meet the needs of our customers and our back office, Terafina offered that. The ease of use, they offered the shopping cart environment. Customers are used to that, they see that in almost every other application they use on their phone.
Cindy Blackstone (08:08):
So, when we started talking to them and talking to their references, one of their references told me they're just excellent at integration. And that was such a good definition of who they are because the integration that they offer, the API that they offer to make this a true digital experience is far beyond anything else that we've ever been able to offer to our consumers.
Jim Marous (08:37):
So, if I came to Southside right now — and I'm sorry, I won't even have to come to Southside. If I try to open an account digitally right now, how long does that process usually take the consumer?
Cindy Blackstone (08:50):
If you go to our website and you pull up the option to open an account, you can even choose the most common option which is a checking and a savings account at the same time. So, it's going to preload your information to both — you could do it in probably less than five minutes.
Cindy Blackstone (09:05):
It's a very easy process and that means order a debit card, set up your online banking — all of that is integration that's already built into the system. So, it's not only a win for the customer, it's a win for our back office because it's not a manual request that's coming to them, it's integration into those systems that's already ordering the card, setting up the online banking.
Jim Marous (09:28):
I'm smiling, that sounds so good. It's interesting too because organizations like Terafina, many of the organizations out there offer a digital new account opening process that is extraordinarily efficient. What we find though is there's a difference in implementation between the time we say yes, we want to use your capabilities, and actually the implementation.
Jim Marous (09:54):
A lot of financial institutions as we do research can't get out of their own way and immediately put constraints on the vendor that say, "Well, you say you want to do it this way but we're so used to doing it this other way, we won't let go of that," and in effect, you break the process before it's even changed.
Jim Marous (10:13):
How did you work with your internal teams to have them embrace what is going to be a brand new process of opening a new account without them feeling threatened for what they do on a daily basis?
Cindy Blackstone (10:28):
Just a lot of honest conversations and our goal has been to create efficiencies for them and for the customer. We just had to keep reminding them that the customer is the main goal, we want to please the customer, we want to create these efficiencies.
Cindy Blackstone (10:45):
As we got further into the project and the back office became more comfortable with seeing how things were going, they started to realize, okay, this is a win for us as well. There's not so many manual tasks that have to be done after the online piece was done.
Cindy Blackstone (11:03):
And so, just a lot of conversations walking them through what it would look like for them in the new environment versus what they were currently doing. And eventually, that gave them the comfort level that they needed to adjust to the change because it was a big change for them.
Jim Marous (11:21):
So, let's get down to the bottom line here a little bit. Compared to what you were doing in new account openings before you implemented the new process through Terafina, what has been the change in new account opening? What's the impact been?
Cindy Blackstone (11:34):
The impact's been incredible, we rolled this out early December of last year on average. So, it's only been a few months that we've been live on the system. On average, we've seen 150% increase in new accounts. Additionally, 48% of those have been customers that were not Southside customers previously, and we're seeing our customers use it as well.
Cindy Blackstone (11:58):
So, it's been incredible to watch and be a part of. We get so excited every day to see how many new accounts are being opened. And then addition to that, the funding because of all the APIs that were available and we added funding options that we didn't have before, we've seen an increase in funding.
Cindy Blackstone (12:19):
So, customers are able to open those bigger accounts that they wanted to open and do it at their own time when it's convenient to them. So, it's just been exciting to be a part of.
Jim Marous (12:29):
This is interesting, this is like the case study that I've been looking for for so long because you're showing what we know is true. We tend to as bankers (and I'm a banker), we tend to use the same excuses we've always used even in the digital world.
Jim Marous (12:47):
So, we say, "Well, that's not going to work, we've tried that before or you know what what we need to hold onto this one process longer because the government's requiring this."
Jim Marous (12:58):
I only have to go into a branch that I have back home and realize that those big brown wood containers that are behind the teller line that look like they can only hold an index card were where we used to store a bunch of signature cards. And that was when we thought the government required this, when really, all they had said was, "You have to know your customer."
Jim Marous (13:21):
And we just thought that was the way to do it. What you're showing is as you mentioned, we're getting higher funding. You have 150% growth which means from my perspective, all these organizations that say our customers want to open account in a branch or are demanding this, it's not really true.
Jim Marous (13:41):
What's true is you're not only getting the people that are knocking on your door and saying, "Can you open it digitally," but you're getting people that have tried it elsewhere and have given up, and then tried yours and found it successful.
Jim Marous (13:56):
So, kudos to you and your team for accomplishing this because you're my go-to case study now that I can actually put a name behind what we've been talking about forever.
Jim Marous (14:05):
It's interesting, our research at the Digital Bank Report indicates that while consumers are not closing accounts at traditional banks and credit unions, they certainly are diversifying their relationships. In other words, the old measurement of number of accounts lost against the entire portfolio equals attrition really isn't true anymore because consumers don't have to close accounts to open accounts elsewhere and diversify their holdings.
Jim Marous (14:29):
How is Southside Bank trying to minimize this silent attrition that is really impacting every organization as consumers are kicking the wheels of let's say Acorns and Robinhood and SoFi and other organizations?
Cindy Blackstone (14:44):
I think the biggest thing that we've done is listen to our consumers and educate them. We've had a great opportunity the last few months to do that, explain to them that we can diversify things for them. We have a wealth management team, we have teams on site that they may not be aware of that we can meet those needs as well.
Cindy Blackstone (15:03):
And that's been a lot of what we've done the last few months and honestly, since we opened our doors in 1960, is to listen to our customers and try to meet them and meet the needs that they have.
Jim Marous (15:15):
It's interesting, the education component we sometimes take for granted but really, the education component's going to really rise to the top as we look at the capabilities of things like ChatGPT and conversational AI and things of this nature, it's going to be really an important component of everything we do.
Jim Marous (15:36):
You talked about the fact that when you have a digital new account opening process, you bundle a lot of the initial onboarding in the process. You open a checking and savings account at the same time, you work at direct deposit things of this nature.
Jim Marous (15:52):
But beyond that initial engagement, how do you stay engaged with the consumer and onboard them so that they even expand their relationship more?
Cindy Blackstone (16:04):
We reach out to them after accounts are open, we follow up, we make sure, did you get your debit card in the mail? Have you had success logging into online banking? We do that with all our consumers, whether they open an account online or in a branch.
Cindy Blackstone (16:17):
We do that follow up, we take that extra step to have that personal touch to make sure, "Hey, do you have any other needs?" Because through those conversations, you're going to uncover things that they need — maybe moving they may have a need for a real estate loan. And so, we still believe in relationships even though we've moved consumers or given them an option for an online platform for account opening.
Jim Marous (16:42):
How important is it to build a partnership with solution providers that can bring what I'm going to call compartmentalized solutions at scale, such as you've done with Terafina, and what benefits do this collaboration provide, but just importantly, what do you look for in a partner and especially a partner who maybe you haven't used in the past, so you're kind of kicking the tires and you're hoping it's going to work out well.
Cindy Blackstone (17:11):
I think the key that you just said is partnership. We were looking for a partner — not a vendor, a partner. Somebody that was going to walk alongside us and make sure that whatever we purchased was going to be customizable and delivered to our end user and our back office user.
Cindy Blackstone (17:28):
We didn't want to plug and play out of the box solution, we knew we had specific needs that we wanted to meet and Terafina was willing to do that. And they showed that early on by the involvement of who they brought on the calls and the presentations, walking through the entire project management of how they managed their projects.
Cindy Blackstone (17:47):
It was very impressive to watch and they have delivered that every meeting that we've had with them. It's really been exciting to be a part of. But I think the key is it's a partnership, we have just as much work to do as they have to get it to be that customizable solution that we desire.
Jim Marous (18:09):
So, on that front and I kind of touched upon it a little bit earlier; how do you as a leader at Southside make sure that you and other people within the organizations don't get in the way of the process? Because it's really easy to talk about change it's really easy to find a solution provider that can help make that happen.
Jim Marous (18:31):
But at least in our experience and looking at financial institutions across the entire world, actually, we tend to see that bankers have a hard time getting out of their own way. We're talking about changing in many ways, and change sucks for most people.
Jim Marous (18:50):
How do you as a leader make it so that it's comfortable and that people don't get in the way of the process even to the degree of saying, how do you get compliance on the front end of these solutions so that they don't burn it up at the back end?
Jim Marous (19:07):
And I know I'm putting something out against compliance, but I've been involved in banking long enough to know that everybody's got a job to do and sometimes, you just got to set the table in such a way that makes it so everybody can win and nobody feels threatened. But how do you do it at Southside?
Cindy Blackstone (19:24):
My retail team, we have a saying that says, we explain the why. And a lot of times if you explain the why, people are a lot more willing to come on board. And so, I think putting an internal team together that consists of a very strong employee from IT, your retail team, your back office team, our compliance and our audit teams, there's been this massive involvement across the bank in this project.
Cindy Blackstone (19:54):
Each call, each meeting, and it's getting the right people on board and explaining the why and how we're going to do it has helped them get all their questions answered and develop that comfort level that they're needing to sign off on whatever the project is which in this case, was Terafina.
Jim Marous (20:16):
Boy, that is so key. It's interesting, we interviewed somebody from Synovus, Liz Wolverton, and she said very similar things. She says, "The only way we can get transformation to happen fast, easily and with people all on board, is to explain to our own team upfront how it's going to impact them, why it's important for them, and how it's going to benefit everybody. Because at the end of the day, we all want to be part of a team that's moving forward."
Jim Marous (20:46):
Well, that's sometimes easier said than done. So, it's great to hear you say that because I think it's the missing link that we sometimes just try to do it the way that we intended to do in the past, which was, "This is what we have to do, we're going to get it done," without doing the soft stuff of management, which is so much more important today, especially when we still have a lot of people that are working remotely.
Jim Marous (21:09):
It's interesting as you look at this that you are also looking at something much grander than simply a new account opening or a new lending process digitally. You're in the process of (if I'm not mistaken0 building a digital branch. Can you discuss the importance of this initiative and the challenges you may have seen in building this process?
Cindy Blackstone (21:33):
In taking anything online, we want the experience for the consumer to be the same as if they were in a branch. If they're opening something or doing something online, we want them to feel like they're getting the same needs met, they're getting met with the same level of service.
Cindy Blackstone (21:51):
I think consistency is probably the biggest thing that we've seen, that it doesn't feel different when they go online, versus if they were to go into a branch, the experience should be just as good whether it's online or in person.
Jim Marous (22:05):
That said, if I went into one of your branches, going back to opening a new account — if I went into one of your new branches, can I open an account as fast as I could digitally now?
Cindy Blackstone (22:16):
By year end, you will be able to do that. Currently, it is not that fast but by year end, when we roll out Terafina and this omnichannel solution in branch, it will be just as fast.
Cindy Blackstone (22:28):
Now, obviously, if you're opening up a business account, something more complex, those are going to take a little longer anyways. But if it's just a regular consumer account, by year end, we will be there.
Jim Marous (22:40):
So, that's interesting because I kind of set you up for that, I didn't mean to that way, but it's interesting because as we build new digital experiences, we sometimes forget, "Oh geez, we got to make it work in-person as well, and we're almost working differently than we've ever worked before."
Jim Marous (22:55):
We used to work with a branch, and then we build it digitally, now we're building it digitally and working it backwards to the web and to the branch. What's your process? How are you going to make it so that a consumer, if they want to come to the branch, can open it as easily as they can if they just went right to their phone or their computer?
Cindy Blackstone (23:15):
So, we're implementing the same processes with Terafina that we have digitally. So, as we work through this phase two of this project, the branding looks the same, everything should look identical to what it is online. And so, we're making sure as we work through each step of this second phase of the project, that what you're going to experience in branch is exactly what you would've experienced online.
Jim Marous (23:40):
That's exciting. So, not everything is peaches and and cream as we all well know. What is the biggest challenge or hurdle that you've seen when collaborating on digital transformation niches? Where do we usually get off course?
Cindy Blackstone (23:57):
I think probably one of the biggest challenges for banks, if they want a customizable solution and not a out-of-the box solution, is the amount of work and commitment it's going to take from their resources. And it's not just one person, it's going to take a team that is committed to see it through the end, and it's going to take a lot of input from different areas within the bank to make sure you're meeting everyone's needs.
Cindy Blackstone (24:25):
I think that's probably one of the biggest challenges, is it's not just you buy it and you install it, and use it. If you want customizable, you're going to have to do some lifting on your own to get the solution you desire.
Jim Marous (24:40):
How important is senior leadership and executive leadership in making this all happen? I ask that kind of knowing the answer because what we've seen in the podcast and in interviews we've done across the globe, is that if the top of the management team wants change to happen, it's a lot easier than if it's more talk than action. But how important has it been to Southside to have senior management not only on board, but leading the process?
Cindy Blackstone (25:16):
It's extremely important and again, it goes back to communication. When our strategic initiatives are shared at the beginning of every year — again, the employees know the why. They know this is a team effort, they understand why we're moving down this path.
Cindy Blackstone (25:33):
And having that support, you get automatic buy-in because you've explained to them this is why we're doing that. And I think that that's what makes that component of change so hard is when they don't understand why they're doing it.
Cindy Blackstone (25:47):
And so, our CEO has done a great job of every year, explaining these are our initiatives for the year and the whys behind that. And I think that that automatically gives you buy-in when you explain that, and you explain the benefit to the consumer and to our staff as well.
Jim Marous (26:06):
So, if I marked my calendar for one year from now, what will you say you've accomplished in the past year looking back? Or going forward and saying, what's on your list of to-dos in the next year?
Cindy Blackstone (26:22):
So, rolling out Terafina in branch is top on my priority list. We are so excited about that. We plan to have that rolled out by the end of the year, and we have a couple of other projects going on with the loan solution that'll be rolled out online.
Cindy Blackstone (26:38):
And then looking just into what's going on in the realm of payments as well. So, I hope if we look back in a year, we will have accomplished quite a few other tasks that are just ideas right now.
Jim Marous (26:52):
It's interesting, I've worked with a very few number of financial institutions, I really think have gotten it. Not just from talking what's important but actually doing what's important. And sometimes, the gap becomes, geez, we take it for granted our own customers and our prospects are going to understand and see the difference we make.
Jim Marous (27:13):
I'm just going to put this out there to our listeners that just as important as knowing your why and finding out the why from the consumer is then to tell consumers when you've accomplished what they've told you they wanted.
Jim Marous (27:27):
And so, I'm not going to bring it up here in this normal sense of asking a question, but I'm asking you put it there as a challenge to the industry and saying, if you're moving down the path, don't be silent with your victories. You don't see that from Hulu, you don't see that from Netflix, you don't see that from Google, you don't see that from Apple, you don't see that from Amazon, you don't see that from Instacart.
Jim Marous (27:50):
When they bring something new online, they are the first to promote it, and make sure that all the customers and prospects know that they're different.
Jim Marous (28:00):
Thank you so much for being on the podcast today, it's been exciting. It is always great to hear a success story like this. It's also great to see a partnership or a collaboration between a solution provider and a financial institution that is going as planned from both sides of the equation.
Jim Marous (28:19):
As I mentioned earlier, sometimes the vendors falls down, sometimes the financial institution falls down, but it's obvious here, both sides have worked together to build a really successful platform for the future. Thank you so much for being on the show today.
Cindy Blackstone (28:35):
Jim Marous (28:37):
Thanks for listening to Banking Transformed, rated the top five banking podcast and winner of three international awards for podcasts excellence. We appreciate the support we have receive to make this endeavor a success. If you enjoy what we're doing, please provide us a five-star rating on your favorite podcast app.
Jim Marous (28:54):
Finally, be sure to catch my recent articles I've written for The Financial Brand and the research we're doing for the Digital Banking Report.
Jim Marous (29:02):
This has been a production of Evergreen Podcasts. A special thank you to our senior producer, Leah Haslage; audio engineer, Sean Rule-Hoffman, and video producer, Will Pritts, I'm your host, Jim Marous.
Jim Marous (29:14):
Remember, digital banking is no longer an option, it's a necessity.