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7 Ways to Improve Customer Experience in Banks & Credit Unions

Assistant Marketing Manager

I write about fintech, data, and everything around it

An article detailing the meaning of a good banking experience, key areas to focus on for customer experience, and our top 3 examples of banks providing an exceptional customer experience. 

Gone are those days when people used to stay longer with their bank than their life partner.  

Today we shop where we trust and feel valued. We, as a customer, are willing to pay for exceptional service and good experience.  And the same goes with our banking service providers.  

But what is a good banking experience? Is there such a thing? What’s the difference between an okay banking experience and a great one? To be honest, banks will offer many different reasons why they are better than their competitors, but customers vote with their feet.  

That’s right – actions speak louder than words! Have doubts? Check Apple Store or Google Play Store reviews of your bank or credit union app. We see, on average, the customer rating of banking experience is below 2.5 (out of 5).  

Therefore, we have tried to address the most crucial customer experience issues and help you understand the significance of providing a good banking experience at your bank or credit union. 

Then this article is for you. Let’s get started.   

What is a good banking experience? 

 The question may seem easy to answer, but you’ll realize that the answer is not as clear if you stop and think about it. Banking is no different from any other service industry because customer perception of the quality of the service they receive depends on their expectations. One customer may be satisfied with an encounter with a bank employee while another may find it anything but satisfactory. Still, we tried to define a good banking experience.   

Here it goes. 

 

A good customer experience is a single view of your customers across channels. You provide the same level of customer service, along with the same experience, whether that’s in-branch, on the phone, or online.”

A good banking experience might be hard to define, but it is easy to recognize. When you have a great bank or credit union that makes your life easier through digital channels (e.g., mobile banking), you will recognize this as a good banking experience. 

How Is Data Analytics Used In Finance And Banking Sector

Why is good customer experience crucial for banks and credit unions? 

Banks used to be the most trusted institutions, and people trusted them with their money and their lives. But now, things have changed a lot. The rise of technology, online shopping, and mobile apps has created new competition for banks and financial institutions, affecting their public popularity and profits.  

Why?  

Because customers are more connected than ever before — they’re more empowered, and there are more options for them to choose from.   

Here are 5 main reasons why your bank or credit union is lacking a good customer experience: 

  1. Banks are not in touch with their customers. They rarely talk with their customers and lack data-driven banking insights on what makes them happy or unhappy with the bank.  
  2. Banks rely on a one-size-fits-all approach. Because of the lack of personal touch, banks tend to use the same approach for all customers, regardless of their financial situation or personality.  
  3. Banks are not providing relevant information at the right time. If you don’t know your client’s needs, you can’t offer them relevant information.  
  4. Banks fail to recognize individuals’ preferences. Some clients want to visit a branch office when they have a problem and others prefer to resolve them virtually.  
  5. Banks want everything ASAP! They want something done yesterday, while they can still remember that they wanted it yesterday!  

Looking at customer experience from a wider perspective can be a little overwhelming. However, it’s important to start somewhere. You can’t fix the whole problem at once, but you can tackle one or two small pieces of it at a time. 

Watch this video from our Technical Solution Architect & Product Manager, Sridevi Ramasamy (Shri), explaining why banks need to use their customer experience as a competitive differentiator and how banks can achieve that. 

5 Ways to Improve Customer Experience in Banks & Credit Unions   

As banks rush to transform their customer experience now than ever after how the banking customer journey has transformed post the pandemic, it’s easy to miss out on a few areas. Besides, banking as an industry has its own customer experience trends and challenges – from the regulatory landscape to security best practices.  

Here are 5 ways to improve the customer experience in banks and credit unions:  

  1. Simplify & expedite the account opening process

One of the key factors in delivering a better customer experience is to allow for a speedy and hassle-free onboarding process 

In many cases, banks’ inability to offer a fully online account opening process prevents them from eliminating the need for customers to visit a branch during account opening. To achieve this, banks and credit unions must consider the steps below.   

  • Create a memorable account opening experience  
  • Enable account opening through the mobile app  
  • Reduce the number of clicks to open an account 
  • Digital KYC & verification  
  • Minimized data collection  
  1. Provide a fast online payment experience

The last time I paid someone in cash was two years back. Sending money through net banking and mobile apps is the new norm today.  

It is important to make sure you are ready to compete with mobile-only companies that follow these practices.  

  • Faster & secure payment processing  
  • Consistent & well-designed UI for better UX  
  • Gamification of payment process with offers  
  • Instant notifications for every transaction  
  • 24/7 built-in chat support 
  • Handling errors well 
  1. Make the card/account blocking process smooth and easy 

With everyone going digital, the threat of attackers and banking fraud amplifies. It becomes more critical for banks and credit unions to be proactive in helping the customer block or freeze the card/account before the threat.  

 Banks and credit unions should give confidence and safeguard their customers by  

  • Educating customers on when to block card/account  
  • Easy accessibility of functions 
  • Dynamically suggesting the next steps  
  • More pro-active anti-fraud notifications 
  1. Integrate live customer support with employee feedback

Customer feedback is one of the greatest tools to help businesses improve their customer experience. By integrating live chat with employee performance reviews, organizations understand how to support their customers better.  

For instance, if an employee is rated poorly for missing a key product feature request from a customer, the company can then pull up that particular chat transcript and assess exactly where the breakdown occurred and what could be done to improve it. This allows companies to address their customers’ concerns more effectively. Here are a few things that banks, and credit unions can adapt to for the future.  

  • Stop using the Stone Age methods such as IVR to guide customers through the process   
  • Allow direct options in-app to connect to support staff  
  • Get rid of the hold music & personalize it as per the customer  
  • Show customers where they are in the queue 

5. Develop a truly omnichannel customer experience  

 The customer journey is a different experience for every bank, with the customer taking a different path depending on where they are and what they’re doing. For example, an affluent customer might visit the branch to meet with a financial advisor to plan a new investment portfolio, while an average-earning consumer might do all of their banking online. One thing is certain today, though: Banks and credit unions need to have a truly omnichannel customer experience.  

For banks, an omnichannel customer experience requires significant investment. However, by using intelligent technology to manage interactions across all channels, financial institutions can deliver a consistent experience that builds trust and loyalty.  

For your further reading on why an omnichannel customer solution makes sense for banks? When to consider omnichannel banking for your financial institution? How to select & measure an Omnichannel Banking Solution? Read our blog here on omnichannel banking. 

While these 5 ways can help you pave the way for an incredible experience for your banking and credit union customers, we are listing below 2 more avenues to exceed their expectations. 

  1. Monitor and provide personalized end-to-end customer journeys   

Each customer has a different preference and expectation. As a bank, you need to deliver the best strategies for building a personalized banking experience. The only way to do this is by understanding your customers’ journey.  

To do this effectively, you need to monitor customer touchpoints across your branches, call centres, ATMs, and online banking system – while providing personalization at every step of the way. With this in mind, here are some tips for monitoring your end-to-end journeys:  

  • Conduct a regular review of your digital channels  
  • Immerse yourself in customer feedback, both positive and negative  
  • Focus on the needs of your customers first  
  • Use data to measure your customer experience performance against industry benchmarks  
  • Use data to identify opportunities to improve your customer experience  
  • Work with internal stakeholders to make the improvements you’ve identified  
  • Measure the impact of those improvements  

2. Be flexible to change, update, and add open banking technologies   

As a customer-centric model, open banking catalyzes individuals to take back control of their financial lives and start asking questions. The open banking revolution is focused on empowering customers with direct access to their data, giving them unprecedented choice and flexibility in how they interact with their banks.  

The traditional banking model will soon be obsolete if banks fail to respond to the new demands of customers who want total transparency in their finances and expect their banks to connect with third-party products and services seamlessly. Here are a few key steps that will help you transform your bank or credit union into an open banking leader that leads its industry in customer experience:  

  • Put customers at the heart of your business: Let them know what you do with their data and how they can take control of this data by creating an account on your open banking platform.  
  • Keep it simple: Communicate with clear information that helps customers understand what they can do with your product or service and how it works.  
  • Don’t lose sight of security: Consider security risks when connecting with external providers, such as fraud alerts and data privacy concerns, and make sure you’re prepared for all aspects of security. 

 

Start today and position yourself on top of the heap. Download our eBook on Personalized Banking. 

 

Customer Experience Trends for Banks & Credit Unions in 2024

Let us look at some of the recent banking customer experience trends from industry experts.

Examples of Exceptional Banking Experience 

 

Chime 

Chime is an American technology neobank company that provides fee-free financial services through a mobile app. 

In contrast with traditional consumer firms, Chime has no physical branches and does not charge monthly or overdraft fees. Account-holders are issued Visa debit cards and have access to an online banking system accessible through chime.com or via the mobile app for Android or iOS. 

 

Revolut 

Revolut Ltd is a British financial technology company headquartered in London, United Kingdom, that offers banking services. Revolut provides banking services, including GBP and EUR bank accounts, debit cards, fee-free currency exchange, stock trading, cryptocurrency exchange, and peer-to-peer payments. 

Revolut’s mobile app supports spending and ATM withdrawals in 120 currencies and sends 29 currencies directly from the app. It also provides customers access to cryptocurrencies such as Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and XRP by exchanging with 25 fiat currencies. 

 

Monzo 

Monzo Bank Ltd is an online bank based in the United Kingdom. Monzo was one of the earliest of a few new app-based challenger banks in the UK. 

Initially operating through a mobile app and a prepaid debit card, in April 2017, its UK banking license restrictions were lifted, enabling it to offer a deposit account. As of March 2020, Monzo had over 4 million customers. 

Conclusion 

Being customer-centric should go beyond lip service. It is how you build better, long-lasting relationships with your customers. To deliver a delightful customer experience, it is significant to meet the expectations of a customer by providing a frictionless experience across channels by being 

  • Highly contextual and relevant to the customer 
  • Realtime analytics to provide products & services 
  • Distributed Omnichannel presence 
  • Highly scalable to create defining moments 
  • 24/7 open for customer queries 

Whether your bank is big or small, invest in making an exceptional customer experience to attract more customers and help keep your existing customers around longer. 

Schedule a 30-minute call with our digital engineers to identify and fix your customer experience issues and keep up with customer demands. Sign-up and get your customized roadmap for free.   

Frequently Asked Questions:

1. What is customer experience in banking?

Customer experience in banking refers to the sum total of interactions and perceptions that a customer has with a bank throughout their entire journey, from initial contact to ongoing engagement. It encompasses every touchpoint, whether in-branch, online, or via mobile, and extends to the quality of service, ease of use, responsiveness, and personalization of offerings. A positive customer experience in banking is characterized by seamless transactions, intuitive digital interfaces, timely assistance, tailored recommendations, and a sense of trust and security. It’s about understanding and meeting the diverse needs and preferences of customers to create lasting relationships and drive satisfaction and loyalty.

2. How to improve customer experience in banking?

  • Offer seamless omnichannel service.
  • Personalize interactions based on customer data.
  • Streamline processes for convenience.
  • Provide responsive customer support.
  • Prioritize security measures.
  • Gather feedback for continuous improvement.
  • Promote financial literacy.
  • Engage with the community for a positive impact.

3. Will digital transformation in banking improve customer experience?

Customer experience in banking refers to the overall impression and satisfaction a customer derives from their interactions with a bank across various touchpoints, including in-person visits, digital channels, customer service interactions, and product usage. It encompasses every aspect of the customer’s journey, from opening an account to resolving issues or seeking financial advice. A positive customer experience in banking involves seamless transactions, personalized services, efficient problem resolution, and proactive communication, ultimately fostering trust, loyalty, and long-term relationships between the customer and the bank.

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