The banking industry is at a turning point where delivering personalized services at speed is essential to meet customer demands. And that just covers current expectations. Here are three predictions of how customer experience in banking and credit unions will evolve in the next few years.
1. Banks will be defined by connected experiences
Consumers expect connected experiences between multiple brands. This includes banking— customers demand end-to-end experiences that seamlessly connect to other brands for greater convenience. Consider WhatsApp Pay, through partnerships with several major banks in India, users on the messaging app can transfer money from their bank accounts to their contact list.
Google initially floated the idea of offering checking accounts to its users in partnership with banks and credit unions before shifting its focus to “delivering digital enablement for banks and other financial services providers rather than serving as the provider of these services,” reported BankingDive. Google’s change in plans demonstrates how shifting financial business models to adopt to new processes takes time and could rapidly change, but the pressure is on banks and credit unions to move quickly to meet customer expectations.
2. Personalization becomes the de facto approach
The pandemic has made consumers more aware than ever of personalized experiences from organizations such as Netflix, Instacart, Spotify and others that leverage data, marketing analytics, and automation to humanize their approach, in addition to saving customers time and effort.
Leading financial institutions will do the same by providing associates with intelligent decisioning in real-time, personalization at scale, and understand the entire customer journey. If a long-time customer, for instance, contacts the bank, the contact center associate should be aware of that and at the very least, thank the customer for their loyalty (in addition to mentioning relevant offers.)
The result will be engagement and communication that is more customer-centric and builds a higher level of trust. Demonstrating to customers that bank representatives understand their particular financial interests through a personalized approach with relevant services and products is also critical to building back the trust and confidence that eroded over the course of the pandemic.
3. The line between fintech firms and traditional banks will grow even blurrier
Banks will continue to seek the flexibility and agility of fintech companies and fintechs will utilize the scale and experience of traditional financial institutions, as people seek new and innovative solutions to financial demands. JP Morgan Chase, for example, recently acquired OpenInvest, a platform that allows customers to customize their investment portfolios based on environmental social governance (ESG) metrics.
ESG investments are considered an enormous growth sector and according to Joshua Levin, co-founder and chief strategy officer of OpenInvest, “our partnership with J.P. Morgan combines leading ESG technologies with America’s largest bank and the ability to reach nearly half of all American households.”
The payments space is another hot area for M&A activity that is adding momentum to blurred lines between fintechs and traditional banks. Goldman Sachs agreed to acquire the buy now, pay later (BNPL) fintech GreenSky for $2.2 billion. This follows Square’s announcement that it would acquire BNPL firm Afterpay for $29 billion. It’s also worth noting that the customer experience is often overlooked in the midst of M&A activity, which is something companies can’t afford to do if they claim to be customer-centric. Financial firms can expect to be held to higher standards as they seek new partnerships in the name of improving the customer experience.
The bottom line is that these are not radically new predictions, but financial firms must act now before these predictions mature to not only be differentiators but also customer requirements in the near future.