Make no mistake: retail banking is changing — and much of it is for the better. A strong economy has seen many banks and financial institutions report an increase in net interest margins, as well as the ability to grant new loans.
However, rising interest rates, a complicated tax system and a volatile stock market have created an unprecedented environment where people are looking for more ways to manage their own finances. To that end, there has been a rise in self-service banking, including loans and investments.
Consumers are obtaining loans and setting up investments on their own rather than going through a traditional bank. And banks need to face these challenges head-on in order to compete in the modern retail finance industry. Here are some other challenges facing the retail finance industry.
Traditional members of the financial industry will no doubt face new competition. In particular, expect fintech, an innovative methodology that aims to compete with traditional financial approaches, to take off as more digital banks gain ground and online lenders continue to grow.
On a per-dollar basis, online lenders already account for the supplying of 36 percent of personal loans in the United States — and there are more loans being granted every day. In some cases, you may find that a partnership is a better investment than developing your own fintech offerings.
In turn, this leads to a need for providing a better and more targeted multichannel experience to consumers.
Case in point: A Deloitte study found that retail banking customers are 36 percent more likely to visit a branch if the financial institution also extended their operating hours in providing services via websites and apps, while 34 percent said they would use an in-branch digital self-service platform if a live rep was available to assist.
Additionally, 31 percent of consumers say they would schedule a video meeting with a bank rep or visit the branch if it featured a cafe where they could work or socialize.
The times are a changin’ in the world of financial services, but that doesn’t mean everything we have come to expect from banks will see the same impacts. Indeed, the personal interactions between tellers and customers that are the hallmarks of the retail banking industry will still exist but may look different. In other words, banks will look less and less like the banks we have come to see over the years.
Video conferencing and interactive ATMs, as well as chatbots and other digital solutions, may figure into the strategies of many successful financial industry firms. In turn, many of the more routine operations will be handled by customers themselves, which will allow customer service reps, tellers and call center agents to help with onboarding, upselling and resolving support issues
It’s a transformative difference but one that creates new opportunities to build relationships with customers instead of merely handling transactions.
Financial Guidance and Support
Consumer expectations are both digital and physical; they want the perks offered through online services as well as visiting a branch in-person.
A study from PwC found that while half of all bank patrons use online banking services exclusively, 25 percent of them still prefer to visit a local branch and more than two-thirds would like their banks to have physical locations they can visit. It really comes down to offering as much convenience and speed of processing as possible, while helping customers reach their financial goals.
While chatbot solutions may provide immediate answers and automated processing can get just about anything completed faster, that’s only for the simplest of inquiries. More involved questions will require a personal touch.
One way financial institutions may help foster new customer relationships is through a cloud-based call contact center. In particular, these call centers of the future will employ agents who will be able to do more than answer the phone. Instead, they will leverage a well-developed customer relationship management platform to better provide next-level customer care.
A New Way of Doing Business
Financial institutions are seeing and experiencing some big changes. Most are due to the emergence of digital technologies that have given rise to new ways of doing business.
To that end, providing an omnichannel experience that’s centered on fostering relationships with your customers can give your bank or financial institution a competitive edge.
Finally, offering guidance and support through a well-informed call contact center will help you manage all your customer interactions and instill a sense of loyalty where it matters most.