Disrupting the customer experience in Financial Services

Whether you’re a fast-growing fintech or an established bank, insurance provider, credit agency, payment processor, or you provide corporate financing your customers today have higher expectations and more financial options than ever before.

While the industry embraces the idea behind CX strategy, it’s not always easy for financial institutions to move quickly, despite threats from newer and more agile financial brands.

Organisations are feeling the pressure to innovate or risk losing their customer base – and their financial foundation along with it. According to a 2019 PWC study, 80% of financial organisations believe their business is at risk to innovators.

Now more than ever, it is critical for organisations to embrace a true CX focus and drive innovation in their customer experience – even when it feels risky to make those changes.

It is now much more than simply 'keeping up'. For financial services firms, it is about continually experimenting and innovating all aspects of their customer experience. And it all begins with understanding the trends.

The new fundamentals

Eliminate pain points.

Whether it is call centres not being able to deal with high volume, mobile deposit limits being insufficient for many businesses, or paper-intensive application processes, the current crisis has shown a light on how these policies, procedures and technologies can get in the way of seamlessly serving customers. Many financial services rose to the challenge to quickly modify policies or staffing, or have identified the need to prioritise more automated processes that permit account opening or loan applications without wet signatures and human intervention.

Delivering true personalisation

The financial services sector — banking institutions in particular — has been looking for ways to use data to tackle customer needs on a more personal level for the past decade.

Data has helped drive marketing initiatives like customised offers. The next step in the personalisation will be the ability to have relevant conversations with customers appropriate to the type of relationship they have with the company.

Organisations need to be able to create 360-degree profiles of consumers from the pool of client data made up of current products, call history, and customer analytics and deliver relevant experiences that allude to “hidden links." That context will help personalise the experience.

It could be a sales call with a real person, or it could be a completely automated process. Regardless of the channel, the interaction will take different avenues and angles based on what the customer says and who the customer is and adjust the language and the tone and the content of the conversation accordingly.

Digital wallets will move to the forefront

Mobile has become an inevitable and indispensable part of our routine. Smartphones are transforming the way we transact in our day to day lives. From paying utility bills to purchasing clothes online and transferring money to our friends in need, digital wallets

have made online transaction breezy.

  • Digital wallets are all about consumer convenience.

  • Businesses have instantaneous access to funds. They can save money by eliminating third parties or spending over an expensive Point of Sale (POS) system.

  • They facilitate real-time data, enhanced consumer experience by enabling quick and secure payment methods.

While every mobile-savvy consumer continues to use digital wallet solutions and business make it a vital part of their strategy, it is safe to say that the digital wallet revolution will stick around for several years to come.

Automate and augment

As tasks related to loans, financial advice and teller services become automated and augmented by improvements in AI and machine learning, humans will be free to focus on the higher-value, personal touch elements of CX.

Robotic process automation will help banks slash the time it takes to tackle things like compliance, credit card applications and mortgage processing, making it almost immediate.

This advanced technology can help streamline "the hand-off" moments when the customer is being transferred across departments or being transferred from human to machine and vice-versa.

AI and voice banking

There are companies constantly developing new technologies to help improve the customer experience in the financial industry. Voice-controlled banking is among those, and it’s expected to take the banking industry by storm.

We all know the pains in the financial sector from a customer’s point of view. Communication involves long wait times and a frustrating calling process. Banking fees are known to be extravagant, and service can be a pain at times. 

However, tech companies and banks alike are working diligently to implement AI and interactive voice banking technologies to change both the experience and efficiency of banking. 

There are three main pillars of improvement that can be expected from AI and interactive voice banking: 

  • Improving both back-office and customer-facing processes behind the scenes

  • Improving overall customer experience - Learning each user’s preferences and incorporating them into service through machine learning

  • Improving security of customers while they work with their banking providers 

According to several different survey's approximately 65% of smart-speaker owners said they are comfortable using conversational interfaces for banking transactions. Banks are already responding to the trend. Bank of America, for instance, launched an AI-empowered digital helper in mid-2019. Within six months it had six million users, doubling the bank's daily client engagement.

What we see now are pioneering attempts at making voice augmentation both effective and secure. For now, these attempts may be reserved only for the institutions with the biggest pool of resources; however, with more agile startups and open-source projects coming up in this niche, we can expect the technology to get significantly democratised.

The sharing economy

On the whole, the same sharing economy model that disrupted the travel and transportation industries is poised to impact banking.

“By 2020, consumers will need banking services, but they may not turn to a bank to get them. Or, at least maybe not what we think of as a bank today," writes PwC in its report Financial Services Technology 2020 and Beyond: Embracing disruption.

Uber, for example, is building out financial services and products for drivers and customers via its Uber Money division. This will include everything from bank accounts and debit cards to a mobile banking app.

It's not just the sharing economy companies that are inching into financial services. A throng of fintech newcomers and tech giants alike are offering services like robo-advising, payment transfers via social media and P2P lending to match providers with users of capital.

Rather than losing market share, financial institutions will likely capitalise on the up-welling by finding ways to reinvent the CX around borrowing, and partnering with investing upstarts.

Transparency is trust

The past 10 years have largely been spent grappling with cybersecurity and trying to keep up with the influx of new technology, analytics, personal data and the security concerns that it creates. Trust is a keystone in CX, which makes security a key component of any CX strategy conversations.

Where consumers used to wish for complete transparency about how their data is being used, in the future it will be expected. There is a growing consumer trend that shows consumers dealing exclusively with transparent companies.

This could help drive the adoption of blockchain-type solutions as part of major financial services firms' strategies. The technology could also help eliminate processing hiccups and lower transaction costs to further improve the overall CX.

For example: As property titles become blockchain-ised, that'll help speed the process by which your mortgage is determined. It could help cut weeks of interaction into an immediate exchange.

However, it might be a little premature, from a retail banking perspective to customer experience, we're still 10 to 15 years out before we're going to really start to see its impacts.

How to position your organisation for success

There's no question that the “Age of CX" is in full swing. Between evolving client expectations, advancements in machine learning, Robotic Process Automation (RPA), AI, voice technology, data and personalisation, the industry will look completely different by the end of the 2020s. While the future is never 100% certain, there is little doubt that these trends will provide exciting avenues for the financial sector to better connect with their customers.

Some of the roadblocks to implementing successful CX strategies in financial services include:

· Lack of executive leadership and alignment.

· Inability to align internal organisations.

· Cohesive view of the customer with real customer data.

· Commitment to a long-term strategy for customer experience.

The first step in taking on a customer-centric approach in financial services is to create alignment across the organisation and ensure that executive leadership agrees that embracing a customer-first mindset is critical to long-term financial success.

This alignment is a major factor in ensuring that customer data collected in day-to-day operations of the business will be shared within the organisation in a way that is actionable and valuable for all involved – especially the customer.

Embracing a CX focus is a commitment that needs to be made for the long haul. The industry disruption felt today has only just begun. While many financial organisations are investing in CX initiatives and modern digital platforms, only 37% have a formal CX plan. (PWC 2019) You can’t address this disruption with a few CX projects every couple of months – you must develop a multi-year roadmap with quick wins and long-term milestones.

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