How to Improve Customer Experience in Banking

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Banks face more competition than ever before to attract and retain new customers. A new era of online retail experiences means customers have elevated expectations traditional banks often fail to meet.

Customers are accustomed to the simplicity of shopping online, so why do banking customers still face frustration when opening a bank account or getting a credit card.

This wouldn’t be such an issue for banks if they didn’t also face increasing competition from non-traditional players in the financial services industry. These players focus on the customer experience, while banks fail to do so.

New industry research shows where banks have failed in the attempt to improve customer experience, and where they have fallen behind. These tales are instructive for those financial instutitions that want to remain industry leaders.

Customer Experience as the Differentiator

Across industries, customer experience is what makes or breaks a company. According to Gartner, two-thirds of marketers responsible for their company’s CX claim to compete mostly on CX. That number is set to rise, as 81 percent expect to compete largely on this factor by 2020. From the perspective of these marketers, it’s not enough to offer the best products or services: it is about client interactions with the company.

In banking, the need to elevate customer experience has gone largely unrecognized by mainstream banks. Some have tried to improve online capabilities and give customers more options to complete transactions outside of branches.

But these attempts have been largely flawed, with recent studies finding that new customers are put off by the onboarding experience. Those most affected by problematic CX are those who value it most highly: millennials and generation Z, who have grown up in a world driven by digital responsiveness.
Millennial CX in banking report results
Reproduced with permission from Lightico

Missing the Mark on Customer Experience in Banking

Of course, these frustrations have not gone unnoticed by traditional banks. Many have tried to move forward in their attempts to satisfy a new generation of banking customers. However, although improving CX may be the goal, many institutions often fail to make improvements that have a direct impact on the consumer. Failure to listen to the voice of the client has resulted in misguided attempts to create a more online-friendly, responsive CX banking experience.

McKinsey found several examples where the best intentions of mainstream banks fell flat when it came to execution. Some banks tried to do too much all at once. One institution tried to revamp its entire mortgage process in one fell swoop, but the implementation was too complicated to complete.

Other banks didn’t listen to the customer. One institution made several changes to its dispute resolution process in order to make it shorter, only to discover that customers’ real area of dissatisfaction was the lack of status updates. In essence, this bank put a lot of work into fixing something that wasn’t the real problem.

Banks Doing it Right

So, who’s making real impacts when it comes to improving the customer experience in banking? Forbes recently compiled a list of innovations made by global banks. These brands are not just focusing on making things better online; they are listening to their clientele and bringing excellence to all aspects of the customer experience.

    BBVA has an advanced app that not only assists with transactions, but allows clients to set financial goals and compare prices on groceries and other non-banking products;
    Chase has banking kiosks to make the walk-in experience more expedient and intuitive for digital consumers;
    Capital One has a chatbot that allows customers to get information through simple text-based commands and even emojis; and
    Barclaycard has a digital bank card that allows clients to scan and pay for items using their phone.

These are just a few examples of how banks can be creative and user-friendly. New technology helps banks get away from outdated, paper-based systems. Digital identification verification, smart forms, and e-signatures are just some ways banks can reach the digital natives who are the latest generation of financial consumers.

The Last Word on Banking Innovation & CX

By making the banking experience closer to other kinds of online consumer experiences, banks can recover some ground they may have lost during the digital revolution. Those banks find it’s easier to compete with others in the industry, including new players who develop CX solutions based on what customers are telling them. Hearing those voices is key; responding to their needs is easier than ever.

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