Banking is possibly the most rapidly changing industry in the world at present. New banks are entering the market with customer-centric services that are shaking the foundations of the incumbent banks. But those big traditional banks are not rolling over and letting the world change around them. They have millions of customers and they have decades, or even hundreds of years, of experience. With new startups, new technologies, and innovation from the majors, it is an exciting place to be, but which technologies and trends will be changing the customer experience for bank customers in 2018?
A recent focus on banking customer experience in Forbes magazine listed several areas to watch in 2018. Here is my take on the most important areas Forbes mentioned, in my view:
- New competition; most Americans think of a bank as a trusted place for their money, but attitudes are changing. The next wave of competition to banks will be technology companies launching financial services based on apps. They may not have the consumer trust of traditional banks, but when the big names in tech (Apple, Amazon, Google, Facebook etc) think about launching a bank then it is likely that there will be major disruption as these brands are trusted – can they win over customers engaging in financial services – I think so.
Millennials rule; 70% to 80% of American bank customers access financial services on their phone. The majority of working age Americans are now millennials. The attitudes of younger consumers will become mainstream, not innovative or unusual. Banks need to try managing more traditional customers, but to really win they need to keep millennials happy today.
Explore innovation; banks can no longer rest on their large customer base and earn revenue doing the same thing year after year. In a more competitive environment with constant market entrants it is important to always be exploring, always offering something new to the customer.
Overcoming regulation; your IT and compliance team may be scrambling to keep up with the change. Customers demand new services and yet banking is highly regulated, how can you balance this? Can you cope in an environment where every text and online chat with a customer has to be filed so a record of the conversation is maintained?
Focus on CX; with new competition all around, it becomes more important than ever to make banking easy. Can you use video-calls instead of asking customers to visit a branch? Think clearly about your processes and how they can be improved to be closer to what a customer expects in 2018.
These are five major trends shaping banking in the year ahead. If you believe there are other trends that will impact the industry next year then please leave a comment here or get in touch via my LinkedIn.