By Matt Phillips, VP, Head of Financial Services UK & Ireland, Diebold Nixdorf
Our everyday lives are now embedded with personalised products, services and experiences. Whether it is what appears on our social media feeds, the new series Netflix suggests to us, clothing suppliers which will curate a new wardrobe selection, or supermarkets providing offers based on your previous purchases; personalisation now reaches almost every sector.
The banking industry is no stranger to utilising innovative techniques to attract customers. Personally, I look back to the 1980s in the UK market, when the original Natwest ‘piggy bank’ was introduced and the competition to attract customers really began. Now with cutting edge technology installed in mobile devices and present across the banking infrastructure, we have reached a tipping point where customers’ journeys and experiences are key to attracting and retaining them. Those who don’t stay ahead of customer expectations risk losing out in an increasingly competitive market.
Gauging the opportunity
The evolving nature of banking technology and the wide adoption of mobile banking apps presents the banking industry with an avenue to provide a more personalised service. Our research recently told us that for UK adults, digital banking has been the most common way of banking in the last year with three-in-five (63%) consumers using online banking and two in-five (43%) using banking apps.
When it comes to how customers use these services, it distinctly varies with age. 18 to 34-year-olds are equally likely to use an app or online banking services (both 55%). But those aged over 55 are much more likely to use online banking (71%) compared with just 27% using an app. The opportunity presented by digital banking is clear: it provides an opportunity to reach a lot of customers and provides a platform for bespoke interaction. This is enabled by data and analytics and also gives the opportunity to build integration across all services.
The past year has seen an increased focus on digital banking due to the pandemic and the industry now has the opportunity to come out of the pandemic offering a fully integrated service. And in an ideal world an interface presenting a bespoke, personalised, multi-channel platform. For customers, a multi-channel platform offers standardisation of touchpoints across the services they use, being able to interact with the same user interface on different devices or to be able to take a transaction from a digital service to an ATM. Ultimately this type of functionality leads to familiarisation with the customer’s bank and an increased understanding of the products and services offered. Delivering this type of service might sound complicated, but the technology is already in use with customers able to pre-stage transactions through digital banking before executing the physical transaction at a branch or ATM.
The customer journey
Whilst the industry is already embarking on this journey, customers need to be on it too. Our survey found that despite multiple lockdowns coming to an end and the recent easing of social distancing restrictions, the same proportion of consumers plan to continue using digital banking services. Over the past two decades digital services have been a focus for the banking industry and the user experience advancement we have seen is exceptional. However, there are customers that do not have the means or the ability to utilise these services. These customers should not be overlooked or seen as a diminishing customer base. There will always be those who are unable to, or do not wish to bank this way. This may be because of accessibility challenges, security worries or the desire to interact with their banks physically. Regardless of how customers interact with the services, the integration of the technology behind them is the foundation for delivering excellent customer service and building a future-proof banking system.
As bank branch numbers reduce, it is clear that the industry needs to support ALL customers to access the services they need. Banking services have evolved and with that the physical banking experience needs to evolve too. Ensuring it is not only providing a service that is reflective of the digital capabilities in the background, but delivers excellence for customers wherever and however they choose to interact. Providing customer choice should remain front and centre. It is key to ensure that all customers are able to access the services they require in a form they are most comfortable with, be it at an ATM, through an app or with an adviser, either in person or over video link.
Protecting for the future
Access to cash has long been one of the most basic concepts of our banking system. But how do we protect this for future generations? As cash usage shifts over time, so will how, where and who provides it. The Treasury has opened a consultation, with a view to legislate to protect the access to cash services for the public within “a reasonable distance” of their home or business premises. This is an important and welcome development that will ensure access to cash, a vital component in the lives of many people and businesses across the country, is guaranteed for the future. Organisations such as Age UK and the Post Office are also supporting the call for the continued availability of cash and easily accessible banking.
To ensure the availability of cash long into the future I expect to see a proliferation in who provides access to it and the provision of other basic banking services alongside it. Recently we have undertaken a trial with a well known high street bank, that enabled customers to complete banking services such as making deposits of up to £450, in different community settings such as local shops or supermarkets. The partnership has created a network of locations that offer basic cash-centric banking services at the convenience of the customer, enabling them to tailor and personalise their banking journey to suit their lives and needs. This industry innovation and collaboration is what will safeguard access to banking services for all.
Driving better outcomes
The industry is embracing technological solutions; however, it is key to ensure that customers are taken on that journey too. The most important aspect of banking services is meeting the customers’ needs. This means that technology needs to be utilised in the right way for each and every customer. This emphasis on the customer journey will breed loyal customers and increase customer satisfaction.
The opportunity brought to the industry by technology and innovation, whether it is through fintechs, challenger and neo banks or traditional banks, is the biggest the industry has seen in decades. Through focusing on a personalised service, banks now have the ability to provide the supportive experience customers desire through a convenient single platform. In turn the platform will grow our understanding of these customers and over time help us to ever more closely meet their needs. As an industry, we have built a clear path that means through technology, we can offer a personalised banking experience that will meet the needs of customers and open new opportunities to deepen our relationships with them.