Going From Transactional to Transformational: The Growth Mindset of Capital One

Going From Transactional to Transformational: The Growth Mindset of Capital One

By Amanda Elliott

Banks are changing the way that consumers bank by investing in Fintech. One bank that’s taking the lead in innovation is Capital One. In a recent lecture that PreScouter attended at the Chicago tech conference, Techweek, the Chicago VP of Technology at Capital One addressed top-down innovation, crafting services and applications that empower their customers, and most of all, changing the physical look and feel of banks.

Top-Down Innovation:

Capital One has embraced change and started making new technologies part of its strategy to provide more secure and more personalized banking.

“We’re creating a growth mindset,” Sairam Rangachari, Chicago VP of Technology at Capital One, said, “We had to change that from within.”

One of the technologies that Capital One is embracing is open source. “We took some of the pain points we had and we are open sourcing that for the community,”  Rangachari shared.

Rangachari addressed Capital One’s great migration through innovation. Another area that Capital One is looking at is the cloud. “We are investing huge in the public cloud. We are on a multi-cloud journey,” Rangachari  shared.

Another area that Capital One is investing in is Machine Learning – an area that banks and investment firms including Goldman Sachs are also investing in. At the 2017 CSE Symposium hosted by Harvard,  Marty Chavez, Chief Financial Office at Goldman Sachs, shared that “Goldman’s new consumer lending platform, Marcus, aimed at consolidation of credit card balances, is entirely run by software, with no human intervention.”

Capital One is using Machine Learning in areas such as cybersecurity – an area that Mayor Rahm Emanuel sees as a growing field and talked about making Chicago the capital of cybersecurity later that day at the Chicago Techweek conference.

One of the services Capital One created, Second Look, which is used for fraud prevention is being furthered to make holiday shopping and travel a more enjoyable experience.

Finovate covered the Capital One Labs, where Capital One works on to make new innovations like Second Look, and how getting notifications about increases in spending and on bills demonstrates that this bank is taking “a more proactive approach to helping customers deal with day-to-day finances.”

Empowering Customers Through Technology:

Another area that Capital One is interested in is empowering both their customers and their employees.

Capital One created an on the go credit score app so that customers can be knowledgeable and empowered instead of going through a third party to check-in on their credit score. Customers can readily know their credit score and leverage to get financing and negotiate consumer purchases like buying a car.

While technology is important, Rangachari, made the point that, “We all crave human interaction.” Capital One empowers their employees from within through their surprise and delight program – adding the human connection by looking for opportunities to practice random acts of kindness. One story that Rangachari shared was when a customer had just called off her wedding and was starting again on her own. This led to a flag on her account due to her different spending habits. One of Capital One’s employees spoke with the client about her credit card activity and then upon hearing her story, decided to give her points towards a vacation.

Personal Banking with Coffee Shops and AI:

Banking began with a personalized approach, but with personalization also comes scarcity. Over the past couple of decades, banks have worked to make banking more convenient than personal – by extending hours to Sunday, having secure ATMs, offering online banking, creating bank deposits from ATMs, and more.

“We think the next step is humanizing banking,” said Rangachari, “What does a deep and meaningful relationship mean? It means that we live in the on-demand and real-time culture.”

Capital One’s solution to face-to-face banking in the digital world is it’s cafe, which removes the serious look of financial institutions and gives baking a more modern, approachable look. These cafes have advisors on staff to answer questions and help clients with financial investments and everyday banking. These new branches also have meeting rooms and power outlets, so banking feels like a place where customers can relax and recharge. In Chicago, there’s a Lincoln Park location.

Capital One is also testing a gender-neutral chatbot named “Eno” (one spelled backwards) that uses artificial intelligence (AI) to chat with customers through text messaging. It allows clients to pay bills and check their accounts in a more interactive way.

Rangachari said this is expected to rollout later this year.

Image courtesy of pixabay.com

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