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Frederrick Hamann

5 ways to digitize your banking customer experience

The digital revolution is here to stay. Waves of new players are entering the game at a seemingly alarming rate. The recent introduction of open banking and PSD2 accelerated the digital revolution and created new use cases.

Many established banks have shown their ability to innovate and offer a modern banking customer experience. However most traditional banks have a long way to go. So, if you are still wondering, here are five ways to digitise your banking customer experience:

1. Offer end-to-end digital account opening

10 years ago, customers who wanted to open an account at your bank had to walk into a branch with a passport. Now, one would expect that banks offer this service online. Except that they do not. 70% of global banks do not offer end-to-end account opening online, according to Deloitte.

The consumers of 2021 shop online, consume Netflix and Spotify on any of their devices, and order food delivered to their doors with a few taps on their phones. No longer will they go to your bank’s physical branch to open a bank account. Especially if the process takes hours. Banking customers expect your bank to have user-friendly digital banking channels that support online account opening. They are native users of digital technology. Hence, they will not tolerate friction in their customer experience.

2. Develop a customer-focused chatbot

Before digitisation, customers had to call your bank when they had a question. They had to make sure they call within working hours, wait in line for their turn, in order have their question answered. Today, while customers still prefer to call with complex questions, they expect to find an answer to trivial questions at all hours without waiting in line. And talking to a bot is fine as long as it gets the job done.

Despite users’ expectations, chatbots are not widespread across incumbent banks. Only 4% of incumbent banks offer a chatbot service with advanced informational capabilities, according to Deloitte. The consultancy also adds that challenger banks are differentiating themselves from traditional banks by offering customer-focused chatbot functionalities.

3. Give consumer loans digitally

In the early 2000s, when customers wanted a consumer loan, they had to print out all their payment slips, set up a meeting with their bank advisor and then ask for an offer. After a few weeks, they might have gotten a response. Today, customers can submit all their documentation online and instantly get an answer. Or can they?

The average customer would expect banks to have this kind of service. Unfortunately, this is not always the case. In reality, 65% of global banks do not provide an end-to-end digital journey for getting a consumer loan, according to Deloitte. This should make traditional banks worried as most of their customers prefer digital banking channels over physical ones. 

Interestingly, digital consumer loans seem to be a precise indicator of the maturity level of banks’ digital banking customer experience. Deloitte found that banks that do not have a digital consumer loan journey seem to fall behind the competition with other digital offerings as well. This means that most banks simply fail to use their customers’ preferred channel despite being familiar with the latest banking customer experience trends.

4. Implement subscription management

Imagine your bank customer has a subscription they no longer need or want. 5 years ago, they would have had to search for a cancellation option via the subscription’s interface. As we all know, that can often be difficult or nearly impossible. Alternatively, they could call the subscription company and ask them to cancel the subscription for them. However, all of these options are inconvenient. 

Now, your bank can provide a 1-click cancellation feature within your mobile banking app that helps customers get out of subscriptions right away. Such a service can even optimise your current consumer loans and other recurring payments.M

Even though subscription management is a user-friendly solution driving customer engagement, only 20% of the biggest European banks have it. This can become a pain point for banks in the future as the subscription economy is booming. Today, the average bank customer has between 8 to 11 subscriptions – a number that continues to increase year on year, according to data from Subaio

With 42% of bank customers finding it difficult or impossible to cancel a subscription, banks with a subscription management service save time and money for their customers . All while increasing customer engagement on their digital banking channels, according to creditcards.com.

5. Provide a customisable budgeting tool

A few decades ago, people aggregated their monthly expenses by manually writing down each transaction on a notepad. 10 years ago, your bank customers probably followed their monthly spending by creating an Excel sheet that contained all their transactions. Perhaps even an estimation of upcoming expenses. This sheet could even include different categories for expenses – easily customisable in Excel.

One would expect that by 2021, retail banks have developed a budgeting tool that does all this automatically using data aggregation. Except they haven’t. Even though 35% of global retail banks have a personal finance management functionality, most do not go further than a simple system, reports Deloitte. In fact, 83% do not have a function that allows customers to set financial goals. Additionally, a whopping 94% of global retail banks do not provide financial projections for their users, such as an average estimation of upcoming expenses. 

Implementing a customisable budgeting tool could help banks deliver much more value to customers than before. Deloitte also concludes that such a tool would function as a substantial driver of customer engagement while drastically improving the banking customer experience.

While it can be difficult for banks to build these tools themselves, partnering with a fintech could help them quickly and easily launch these new products. 

Get a personal demo of how the Subaio solution will work for your bank​