The rapid pace of digital innovation in consumers’ lives and the continued growth of mobile-first banking choices have combined to change the banking industry’s face completely.

In-branch, face-to-face customer interactions are now passé; today’s tech-savvy customers expect seamless digital interactions and banking products and services that adapt to their changing needs and preferences. Customer expectations are shaped by the elegant, elevated, and easy digital experiences the other products they use provide them. Because of these changes, most banks that have long served customers through traditional modes are now pressured to revamp business models and prioritize customer experience over everything else.

It would be apt to see this as the revenge of the account holder for the many years of being saddled with clunky systems, cumbersome banking channels and processes, and hard-to-comprehend rules and directions.

Customer experience – the top priority for banks today

Despite using becomes used to extremely advanced and sophisticated gadgets and apps in their personal lives, customers have been forced to “live with” the traditional, in-branch banking experiences – until now. But all that has changed. The era of banks having the upper hand over their customers is long gone. Today, the account holder holds the reins of the banking industry – expecting the same level of tech-savviness and novelty in banking products and services as they enjoy in their personal lives.

It’s difficult for incumbent banks to deliver the same level of digital prowess. But it is now essential. Not just to retain their existing customer base but also to attract the tech-obsessed, digital-only Gen-Z. This real problem will only become more pressing by the day.

Here’s what’s making customer experience a top priority for banks today:

  1. Changing customer preferences: The digital banking landscape is getting increasingly versatile and fast-evolving. There is a sudden and widespread transformation in customer behavior. Even older customers have evolved to demand easy access to banking services across various devices and channels. They now also expect these services to be personalized for their unique banking needs while ensuring high data security levels. At the same time, they want to get real-time assistance with their issues and queries and expect banks to provide instant support via live assistance and chatbots. They demand digital functionality but expect an elevated digital experience because this is how the Netflix and Uber of the world have conditioned them.
  2. New types of digital customers: In addition to changing customer preferences, the banking industry is also witnessing a sudden and massive rise in the number of new digital-native customers with extremely high expectations of their digital experiences with banks. These new-age customers want banks to take a mobile-first approach to banking and offer them digital experiences that are carefully curated as per their level of technology maturity. In the post-COVID world, these digital customers expect banks to use modern technology and provide seamless virtual onboarding experiences, contactless transactions, advanced digital wallets, and more – so they can enjoy the same level of in-branch experiences – even while sitting at home.
  3. The emergence of new-age digital banks: Another major factor driving the focus on customer experience is the emergence of Neo banks. These new-age digital banks are threatening to hit traditional banks in the wallet. They look attractive to new and old customers with innovative approaches and new offerings, integrated value chains, competitive pricing, and state-of-the-art banking services. Targeting niche micro-segments like the Gen-Z because of their higher transaction volumes, Neo banks are making the most of modern tech innovations and delivering innovative solutions to help the latest generation keep better track of their finances. Operating with customized tech stacks, these futuristic banks are cross-selling products and offering customized products – generating new (and massive) revenue streams.

Modern technology adoption – the key to a fulfilling banking experience

The continuously evolving technology landscape, cutting-edge competition, and rising customer expectations have become a constant in the banking industry – compelling traditional banks to finally prioritize customer experience. These market makers are now turning slowly but surely to deliver products and services that keep up with these changing needs and preferences. The emergence of new-age digital banks and a new breed of digital customers means banks now have no choice but to move away from traditional, in-branch, face-to-face interactions towards intuitive, personalized, and digital-first ones.
To deliver a genuinely gratifying banking experience, banks must embrace modern technology innovations like cloud, RPA, and analytics to automate back-office operations, unearth deeper business insights, mitigate organizational risks and challenges, and improve decision-making. Simply put, banking organizations today need to leverage the latest tech innovations to drive easy subscription and access to banking services, deliver seamless continuity across devices and locations, and provide a greater choice of banking services and data-driven recommendations.

Emergys Blog

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