In May, nCino hosted its annual nSight conference, which drew more than 1,700 financial industry professionals as well as representatives of nCino’s partner financial technology firms. For three days in Charlotte, company officials listened to their guests discuss industry trends, best practices and innovations. Attendees also shared their concerns and what they see as opportunities.
In the weeks since, Will Cameron has thought about what he and his colleagues heard at the conference: what’s on the minds of nCino customers and how the company can respond.
First, the concerns:
“First thing, the market has been pretty tough on financial institutions,” said Cameron, nCino’s senior vice president of community and regional banking. “Their valuations are representative of margin compression concerns about a potential recession, which has led into these financial institutions being valued as they are.
“The good thing,” he continued, “is that more industry leaders are stepping out to change their tune, saying there’s no impending recession; it’s more of an economic slowdown. They expect more of a slow growth phase but still supported by continued growth. That’s at the 30,000-foot level. As you get into the day-to-day, there are concerns about liquidity. The three failures [of regional banks] caused an emotional response within the banking industry, although those failures seemed to be specific to their unique deposits rather than a general [problem] across the industry.”
“People are really leaning in on how to optimize their technology strategy; how they can change the way they interact with their customers for the better,” Cameron said. “It’s a good time to focus, now that we have emerged from the PPP craziness and loan surge. It’s time to focus on transformational technology projects, leaning into the next chapter in their bank’s life cycle.
Speaking of PPP – the SBA’s Paycheck Protection Program loans during the COVID pandemic – Cameron sees that period as technologically transformative. To apply for a PPP loan, small business owners who might previously have visited their banker and filled out an application with a pen were forced to navigate an online process.
“The adoption of that remote application process was much higher than anybody anticipated,” Cameron said. “When people are forced to figure things out, they do. Now that [process] has turned into the expected. A perfect example is Live Oak Bank, which gained from its investment in technology. They had the means of accepting online applications and could leverage that in a meaningful way to a bigger audience. They gained customers, which they would not have otherwise.”
The greater familiarity with online lending has “leveled the playing field somewhat,” Cameron said, for small businesspeople in rural and small-town settings, for whom banking traditionally is heavily based on relationships with local financial institutions.
“We see that on a regular basis in conversations we are having with customers,” he continued, explaining that nCino’s customer financial institutions had the ability to take loan applications online pre-pandemic, but many bank and credit union customers just weren’t ready to take that step.
“Now it’s table stakes,” he said. “All that PPP stuff was a catalyst for everyone using the technology.”
So the further challenge becomes developing and using technology to increase efficiencies but also to forge real relationships between the financial institution and customer and enhance the customer’s experience.
“People want the rest of their life to work like [the ease and speed of] ordering online,” Cameron said. “They want to engage in using mobile devices and technology. The biggest need for banks is to stay competitive. Financial institutions have to invest in technology that will keep them at the forefront: a platform that is living and breathing. To not only engage with customers but to have a whole integration of information that informs credit decisions. To have a technology strategy on an ongoing basis to be nimble and adapt to ever-changing customer expectations.”