The Revenge of The Account Holder – Why Banks Never Had to Prioritize Customer Experience, Until Now!
The rapid pace of digital innovation in the lives of consumers coupled with the continued growth of mobile-first banking choices have combined to completely change the face of the banking industry.
In-branch, face-to-face customer interactions are now passé; today’s tech-savvy customers not only expect seamless digital interactions, but they also expect banking products and services that adapt to their changing needs and preferences. Customer expectations are shaped by the elegant, elevated, and easy digital experiences the other products they use provide them. Because of these changes, most banks who have long served customers through traditional modes are now feeling the pressure of revamping business models and prioritizing customer experience – over everything else.
It would be apt to see this as the revenge of the account holder for the many years of being saddled with clunky systems, cumbersome banking channels and processes, and hard-to-comprehend rules and directions.
Customer experience – the top priority for banks today
Despite using becomes used to extremely advanced and sophisticated gadgets and apps in their personal lives, customers have been forced to “live with” the traditional, in-branch banking experiences – until now. But all that has changed. The era of banks having the upper hand over their customers is long gone. Today, it is the account holder that holds the reins of the banking industry – expecting the same level of tech-savviness and novelty in banking products and services as they enjoy in their personal lives.
And given the pace of technological change and the speed at which new-age, digital-savvy banks are mushrooming in the market, it is extremely easy for customers to move on and start to engage with these technodexterous banks who meet their digital expectations to the T.
It’s difficult for incumbent banks to deliver the same level of digital prowess. But it is now essential. Not just to retain their existing customer base but also to attract the tech-obsessed, digital-only Gen-Z. This is a real problem that will only become more pressing by the day.
Here’s what’s making customer experience a top priority for banks today:
- Changing customer preferences: The digital banking landscape is getting increasingly versatile and fast-evolving. There is a sudden and widespread transformation in customer behavior. Even older customers have evolved to demand easy access to banking services – across a range of devices and channels. They now also expect these services to be personalized for their unique banking needs while also ensuring high levels of data security. At the same time, they want to be able to get real-time assistance to their issues and queries and expect banks to provide instant support via live assistance and chatbots. They demand digital functionality, but they also expect an elevated digital experience because this is how the Netflix’s and Uber’s of the world have conditioned them.
- New types of digital customers: In addition to changing customer preferences, the banking industry is also witnessing a sudden and massive rise in the number of new digital-native customers that have extremely high expectations of the digital experiences they have with banks. These new-age customers want banks to take a mobile-first approach to banking and offer them digital experiences that are carefully curated as per their level of technology maturity. In the post-COVID world, these digital customers expect banks to make use of modern technology and provide seamless virtual onboarding experiences, contactless transactions, advanced digital wallets, and more – so they can enjoy the same level of in-branch experiences – even while sitting at home.
- The emergence of new-age digital banks: Another major factor driving the focus on customer experience is the emergence of Neo banks. These new-age digital banks are threatening to hit traditional banks in the wallet. They are looking attractive to new and old customers with innovative approaches and new offerings, integrated value chains, competitive pricing, and state-of-the-art banking services. Targeting niche micro-segments like the Gen-Z because of their higher transaction volumes, Neo banks are making the most of modern tech innovations and delivering innovative solutions to help the latest generation keep better track of their finances. Operating with customized tech stacks, these futuristic banks are cross-selling products and offering customized products – generating new (and massive) revenue streams.
Modern technology adoption – the key to a fulfilling banking experience
The continuously evolving technology landscape, cutting-edge competition, and rising customer expectations have become a constant in the banking industry – compelling traditional banks to finally prioritize customer experience. These market makers are now turning slowly but surely to deliver products and services that keep up with these changing needs and preferences. The emergence of new-age digital banks and the advent of a new breed of digital customers means banks now have no choice but to move away from traditional, in-branch, face-to-face interactions towards intuitive, personalized, and digital-first ones.
To deliver a truly gratifying banking experience, it is about time banks embraced modern technology innovations like cloud, RPA, and analytics to automate back-office operations, unearth deeper business insights, mitigate organizational risks and challenges, and improve decision-making. Simply put, banking organizations today need to leverage the latest tech innovations to drive easy subscription and access to banking services, deliver seamless continuity across devices and locations, and provide a greater choice of banking services and data-driven recommendations.