Businesses in the banking BFSI sector in India require constant and consistent communication with their customers, whether it’s for transactional, promotional, or debt-collection purposes.

Timeliness and reach are crucial. Therefore, leveraging a channel like Bulk SMS sent through an SMS API makes perfect sense, given its tremendous reach and high success rate.

Wish to know more? Here’s everything you need to know about Bulk SMS Services providers! – SMS API.

Here are some of the most frequent use cases for Bulk SMS Services in the Banking sector.

• Fraud prevention and 2-factor authentication 

Two-factor authentication, as a best practice, provides protection against fraud, hacking, and data loss.

The delivery of quickly expiring OTP codes verifies that the person in possession of the passcode is the one attempting to access the service.

Additionally, this enables the service provider to authenticate the individual’s contact information for future communications such as marketing, debt collection, or notifications.

Implementing 2FA adds a second layer of security, ensuring that only the person with the correct codes can access the account from other devices, effectively mitigating the risk of account hijacking.

Consequently, two-factor authentication is an essential security measure in the BSFI sector in India, offering enhanced protection, validating contact details, and reducing the likelihood of account compromise

Here’s an example of 2FA types of messages : 

“Hello! user Your one-time security code is: 5X2X1”

Team National Bank

• Transaction confirmations with PIN codes

The system will provide a one-time PIN code for confirmation when service users attempt to complete higher-risk transactions (such as approving loan applications, moving sizable quantities of money, or signing contracts).

As this PIN code has a short expiry time, the transaction needs to be completed at the designated time as well as only by the person having access to the phone used for message delivery.

Here’s what it looks like: 

“Hello! user your one-time security code is: 0X3X1” 

Team National Bank

• Onboarding new users 

When a new user registers for your service, the system can send them a welcome SMS with the most essential service information and contact details.

This allows users to get in touch with their service provider immediately to resolve any issues or answer initial questions that may arise, thus strengthening their relationship.

Here’s an example

Hello, Simran! Nice to have you here. Please contact our customer care at 000-000-000 for further assistance.

Team National Bank

• Nurturing inactive users

A short reminder message is an excellent idea when registered users have been idle for a while.

This way the user can be brought back to the service, sign up for additional features, or keep in touch with the advancements of the service.

Here’s one:

Hello, Priya! You haven’t been around lately. Come check out the new account balance feature that we recently implemented.

Contact our customer care at 000-000-000 if you need assistance getting started or have any other inquiries.

Team National Bank

• Loan applications acceptance or denial notifications

Consumer lending is a big industry and they are a heavy user of SMS.

A notification message with a request to proceed with the loan or an alternate offer is issued when user-requested loan applications are granted or denied.

It’s a quick way to let the customer know if the funds are on its way or if further actions are required.

One of them is as follows:

Hello, Ashish! Your loan request has been approved! To verify it, please sign into your account.

Please contact our customer care at XXX-XXX-XXX if you require further assistance.

Team National Bank

• Payment reminders

We, humans, are forgetful people, and occasionally paying our bills slips from the mind. Reminders for users whose monthly payments are pending are a quick way to nudge them in the right direction.

Also sending pre-reminders messages with payment due dates is a better way for maintaining timely payment practices and abandoning latency costs. 

This is how it appears:

“Hi, Rajat! Your current overdue payment is ₹5000. Please settle the debt as soon as possible. If you need help or have any additional questions, feel free to get in touch with our customer service via 000-000-000”

Team National Bank

• Marketing 

With a 98% open rate and 90% of arriving within the first 3 minutes, SMS is still one of the best ways to send offers and information to users for attracting them towards your business.

Lending, e-wallets, banking, money transfers, etc. use new customer acquisition or campaign-based marketing messaging extensively, and this trend does not appear to be slowing down at all. Having a message seen 98% of the time is impressive in an information-saturated world. Just make sure that you comply with GDPR.

One that we’ve seen is this:

“Hi! Loans from 5k to 20k. Check your eligibility on your phone in 30 seconds at this address (shorten URL). starting at 5%. opt-out: (shorten URL address) (shorten URL address). Please feel free to contact our customer care at 000-000-000 with any more inquiries.

Team National Bank

• Conclusion 

There you have it. There are a plethora of ways financial service providers use SMS as a crucial communication channel with the goal of swiftly and effectively selling to, verifying, assisting, and reminding the customer quickly and reliably.