As part of its 10-year, $1.1 billion NextGen core systems replacement program, National Australia Bank (ASX: NAB) will unveil a new customer account designed to improve efficiency and make better use of data analytics.
Whilst it is a common occurrence for the banks to release new products, the new 'USaver Ultra' account is being flagged as 'hugely significant in the context of the bank's evolution', according to The Australian Financial Review.
The account is applied for, verified and originated without any human interaction and will use the bank's new internal system referred to as "Know Your Customer", which will perform all of the necessary security checks required to open an account, such as the checking of passports or driver's licenses.
In regards to the costs that will be saved with the new product (which is the first product of NAB's new series) Adam Bennett, the bank's executive general manager of IT transformation said "over time, we think the marginal cost of opening a new account will become very low."
The dominance of the big four banks has climbed to a new level since the global financial crisis, and each are delivering record-breaking profits. In order to continue this trend, cost-cutting has been one of the primary focuses amongst the group. Earlier this year, Cameron Clyne, the bank's CEO, advised that an enormous amount of money would be saved as a result of more efficient processes – an amount he estimated would be worth around $800 million annually.
Aside from cost-cutting and being able to deliver a better service and experience to the end customer, technology investments are now more important than ever to investors – particularly with the growing threat of technology behemoths such as Apple (Nasdaq: AAPL) or Google (Nasdaq: GOOG) stealing the banks' market share.
The new services will aim to provide customers with a better service and will hopefully assist the bank in growing market share. Currently, the bank is only a third of the way through its 10-year technology advancement program.
Foolish takeaway
NAB's investments into new technology systems is quite advanced compared to Westpac (ASX: WBC) and ANZ (ASX: ANZ), but many analysts have suggested its investments are still significantly behind those made by Commonwealth Bank (ASX: CBA). On the other hand, the bank itself has claimed that its IT work is far more ambitious than the work conducted by any of its key rivals.
Are you interested in our #1 dividend-paying stock? Discover The Motley Fool's favourite income idea for 2013-2014 in our brand-new, FREE research report, including a full investment analysis! Simply click here for your FREE copy of "The Motley Fool's Top Dividend Stock for 2013-2014."
More reading
- NAB to do business in Asia
- Westpac in 'aggressive pursuit' for Lloyds' Australian operations
- Commonwealth Bank's profits set to surge
Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned in this article.
