Accelerated by the Covid-19 pandemic, digital financial services have taken the banking industry by storm. For some institutions, this resulted in a drastic decrease in customer retention, as more and more of their once-loyal customers opted for FinTechs and neobanks.
To win back customers, banks must focus on boosting their technological competitiveness with AI, partnering with FinTechs, and enabling omnichannel services.
In this article, I will discuss each of these 3 factors and why they are so important for banks to focus on in 2021 and beyond. Keep reading to learn how CPQi can help your institution enhance your digital platform and services to attract more customers.
1. Embrace AI and Other Innovative Technologies
Over the course of the Covid-19 pandemic, customers have grown increasingly expectant of digital financial services – many of which are powered with artificial intelligence.
Artificial intelligence – or AI – offers financial institutions extremely useful capabilities for creating a more customer-centric experience. From creating personalized recommendations to serving as a support waypoint for online customers, AI is a key enabler for digital banking.
Not only will embracing AI help to win back customers, but it will also help an institution to maintain its competitive edge. According to a 2021 report from Forbes:
“AI enables customer service at scale through automated systems, with the system learning over time. By reducing interruptions to the customer’s journey through automated intelligent service, brands can lower their acquisition costs and other customer-centric metrics.”
2. Partner with FinTechs
FinTechs played a major role in drawing customer attention away from traditional banks – and they will play a key part in helping to win them back as well.
Customers are showing increasing interest in third-party financial service providers, like FinTechs and neobanks. However, many customers simply want the ability to connect their various financial accounts.
According to a 2021 Plaid survey of U.S. banking consumers, 76 percent of respondents stated that the ability to connect bank accounts to apps and services is a major deciding factor when choosing a bank. A further 73 percent stated that they believe financial technology helps them “make smarter financial decisions.”
This desire for account connectivity is directly in line with the methods of open banking, which many traditional banks rely on FinTech partners to implement in their own institutions.
The reality is that FinTechs can either be partners or competitors to traditional banks. It is ultimately up to the banks to decide whether to invest in such a partnership – and with so many customers showing a growing preference for FinTech services, the advantages of a partnership are even more clear.
3. Enable Omnichannel Strategies and Services
An omnichannel strategy enables customers to find and carry out all possible services through all channels of communication. This includes physical branches, online accounts, call centers, chatbots, and more.
Omnichannel is crucial for creating a more digitally-savvy bank. Not only can it make open banking more straightforward for customers, but it also greatly boosts the efficiency of day-to-day customer services and interactions that may otherwise take a long time to complete in a traditional branch.
With the right omnichannel strategy, a bank can communicate with customers through the customer’s preferred channels, boosting satisfaction and retention along the way.
Final Thoughts
The financial industry is changing – and banks must find creative solutions to attract and retain their clientele.
To win back customers in the coming years, the true key is focusing on customer-centricity. Banking consumers search for providers who prioritize customer needs and offer personalized, digital solutions.
Here at CPQi, we provide banks and other financial institutions with the support and resources needed to enable successful implementations of artificial intelligence, omnichannel, digital transformation, and more.
To learn more about what CPQi can do for your institution, contact our team today.
