The financial services industry has come a long way in terms of customer experience during the past decade, but that doesn't mean there isn't still a lot to accomplish.
Banks, credit card companies, and credit unions face an uphill battle: Their products are complex, they are highly regulated, and money is a sensitive topic for many people. Still, these issues aren’t customers’ problems, so financial institutions must double down on customer centricity and ease of interactions.
And since so many financial transactions have moved online, the digital experience has become crucial to success. Overcomplicating steps, using complex language, and forcing people to use other channels are quick ways to lose customers to a competitor.
Here are three examples of companies that failed their customers and what other financial institutions can learn from their mistakes. (Company names are anonymized to protect the guilty.)
Activating a gift card
Recently I opened up my mailbox to find one of those envelopes that feels like there’s a credit card inside. I wasn’t expecting a new card, so I was intrigued. It turns out I received a prepaid visa card worth $20.
The attached generic letter explained all of the policies and procedures relating to the gift card; what it didn’t explain was who sent it. And although there was a brand name on the card, I didn’t recognize it. I assumed it was likely a rebate form I had filled out weeks earlier, but noted with some curiosity that the company providing the rebate didn’t want to be recognized.
I went to the website noted on the card’s activation sticker, and clicked on “Activate My Card.” It asked for the card number, expiration date, and the three-digit security code – all pretty standard. I clicked “Submit” and received an error message: “Invalid expiration date.”
I looked again at the card. The expiration date was clearly embossed: 04/21. I typed it again and got the same error message. What in the world was wrong?
After some trial and error, I realized that the website wanted me to enter the expiration date in a MM/YYYY format: 04/2021. But number one, I’ve never seen an expiration date on a credit or debit or prepaid card that has four digits. And number two, that’s not what the card actually says!
So there are two user experience (UX) problems for this company to fix:
- The site’s programmer doesn’t know the product well enough, or he/she would have never asked for the expiration date in a different format than what was printed on the card. And the product team doesn’t know the activation process well enough either. This is what happens when companies are too siloed; one department doesn’t know what the other is doing. Unfortunately, the one who always suffers in these situations is the customer.
- When there is an error message on a website or mobile app, it is critical that it tells users what the error means. In this case, the error message should have said, “Please enter the expiration date in MM/YYYY format” instead of “Invalid expiration date.”
Applying for a Paycheck Protection Program (PPP) Loan
Many small business owners applied for a forgivable business loan through the U.S. government’s Paycheck Protection Program. The program was designed to help small businesses stay afloat during the COVID-19 pandemic and keep more people employed. Unfortunately, it was hastily announced and it thus took many banks by surprise; many were not prepared for the onslaught of loan applications.
One particular online bank with a great reputation was actually one of the first banks to set up a digital application for the PPP loans. The process was fast and easy – until it was time to submit the bank information.
The process was familiar – the online bank deposited a few cents into the user’s account and asked the user to verify the small amounts to prove the account is theirs. After confirming the amounts, the user’s account was added. But the next time the user logged in, the account was gone. Trying to add a new one didn’t work, and the user received – you guessed it – another generic error message.
The loan was then approved, but the bank couldn’t deposit it because there was no longer a bank account associated with the loan. So instead, the user got this error message: “The Small Business Association requires that Paycheck Protection Program loans be dispersed within 20 days of approval. Since we did not receive signed loan documentation from you during this time, we had to suspend your loan for the time being.”
Fed up, the user sent an email. After no answer for a week, he called the online bank. But the bank’s contact center was overwhelmed, so wait times were extremely long, and the friendly hold message told customers to… go to the website. He decided to wait on hold to talk to a human, but after 10 minutes the recorded message said “your time in queue has expired” and it hung up on him!
There are several problems for this online bank to fix:
- If you’re going to tell people to go to the website, make sure the website works
- Don’t ask customers to switch customer service channels; always serve them in the channel of their choice, not the company’s choice. In this case, the user wanted to self-serve on the website but was unable to; when he then had to call, he was sent right back to the website.
- Never, ever hang up on a customer. This was either being done intentionally to artificially reduce average handle time metrics, or it was done accidentally and a bank employee should have tested the system in real-time to discover the error.
Applying for a new credit card
Several years ago, the three major credit bureaus in the United States started offering the ability to freeze a credit file in order to prevent fraud and identity theft. While this is a useful feature, it can cause problems when someone legitimately wants to apply for credit.
I recently applied for a business credit card for my small business, and forgot that my credit report was frozen. I submitted the application online and received an instant decision: Rejected. The bank wouldn't explain why the application was rejected, even though I knew it was because they couldn't access my frozen credit report. Still, the website told me I had to wait for a letter that would be mailed to my home in seven to 10 business days.
When I received the letter, it was just as I had expected: I was declined because the bank couldn’t access my credit report.
The bank should have done two simple things to make this process easier:
- Instead of rejecting the application, tell the applicant that their credit file cannot be accessed, likely because it is frozen. Encourage them to unfreeze their report and try again.
- Don’t make the customer wait seven to 10 business days for a written explanation. We live in a digital world and in seven to 10 business days, that customer can unfreeze their credit report, apply for a competitor’s credit card, receive it, and begin using it. By then, the letter of explanation is too late; the customer is already gone.
Confusing error messages, siloed companies, obscenely long hold times, and unnecessary hassles continue to plague the financial services industry and give it a negative reputation. But by focusing on the little things – the micro-experiences – financial institutions can quickly regain customer trust and “Do Simple Better.”