The Next Norm in Banking

In today’s socio-economic uncertainty, this is the time to become a true financial partner.

Banks must also consider entirely transforming their physical channels to improve their productivity Incorporating digital channels and analysis wherever possible will foster significant leverage.

The new world

Not unexpectedly, the banking industry has seen a huge increase in digital banking; customers are not in a hurry to go to in-person branches to complete their transactions. In fact, in markets such as the United States, Spain, and Italy, there has been a 15%-20% increase in digital banking; Western European customers even prefer digital channels at an overwhelming rate of 60%-85%.

In addition to the rising significance of digital banking channels, there has been a steep rise in call volumes for customer support; in the period between December 2019 and April 2020, banks saw a 29% increase in call volumes and a quarter-fold increase in waiting times. People are no longer comfortable interacting with other people face-to-face to get their money sorted, so they have taken to call lines, opting instead for phone conversations.

Of course, the trend of people hesitating from visiting in-person branches has had a heavy impact on the branches themselves. In March 2020, 25% of bank branches globally were closed, and in May 2020, 15% of those branches were still closed. Banks have had to take a serious look at the branches and the question of whether or not they should remain open. 

To provide next-gen customer engagement, banks can leverage new analytics tools to personalize user experiences, making every customer’s experience unique.  

Looking forward

Moving forward, in the next normal, banks will have to address advancements in three different categories: human-run virtual channels, physical channels, and digital channels.

With call volumes drastically increasing, human-run virtual channels cannot be optimized without bringing the volumes back down to a semblance of pre-crisis normalcy. Improving the efficiency of the customer-agent experience is the first step, and the adoption of new technologies, such as chatbots, remote advisory models, and voice-to-text transcription feeds, can move this process along

Banks must also consider entirely transforming their physical channels to improve their productivity, especially with fewer and fewer customers visiting branches. Reducing locations by 30% can increase sales productivity by more than 20%, and improve customer satisfaction by 25%. However, the process will require more than merely trimming locations; the bank industry will have to go deeper to take advantage of the moment and boost efficiency. This might entail studying customer patterns and staff time spent to identify rough patches and find areas for digitization. Incorporating digital channels and analysis wherever possible will foster significant leverage. The industry can also consider adapting job profiles to be more universal and providing workers with more customer knowledge, in order to improve the value of every individual employee.

For existing digital channels, banks must take advantage of the increased usage and new preferences for online financial activity, to cater to customers and optimize their experiences. They can do so by improving the actual function of their apps, adding new features, and improving customer experiences overall. To take this process to the next level, banks can use new analytic tools to personalize the user experience, altering every customer’s experience to that particular customer. Not only will this reassure customers using digital platforms or switching to digital platforms, but this will also increase digital sales.

Strategies that can help win customers in 2021

Following are some examples of tactics that worked well for some leading banks, and will work well for the industry during the pandemic and beyond: 

Digital Services

Overall, extend digital sales to more complex products, boost digital self-service, and promote online payments.

Personalized Reminders

Send personalized reminders through in-app/push notifications, SMS, or email to support the adoption of digital tools.

Educational Information

Share new products and policies that are helpful for customers in financial distress.

Real-Time Actions

Show personalized offers at timely events, based on historical information, recent behavior, and current behavior.

Omnichannel Transparency

Provide clear information across all channels regarding queue lengths, adjusted branch, and contact center hours. safety precautions, etc.

Help with Transaction Completion

Send contextual reminders and alerts when forms or applications are not fully completed/submitted.