Banks have never been known for being at the forefront of customer experience. But with the explosion in data and digital banking technology, they can finally compete with other sectors on CX.

We've written the playbook on how to monetise customers through meaningful engagement

In return for a superior customer experience (CX), banks can expect greater loyalty, deeper engagement and higher revenues.

Customers say they are prepared to pay up to 16% more for products and services if it means great customer experience, as per PwC research. In order to get an optimal experience, nearly two-thirds (63%) say they are willing to share more personal data.

The incentive for banks to make CX a priority in 2022 is clear – particularly when you factor in the pandemic which has only served to put a greater emphasis on digital CX, with record amounts of banking customers logging into mobile banking apps for the first time.

A number of digital CX trends are beginning to define banking. The banks that adopt them fastest and to best effect stand to not only capture more customers, but also connect with them on a more meaningful level than their competitors.

It feels like we’ve been talking about hyper-personalization in the banking industry for a long time already – but big banks are struggling to make it happen, regardless of how much they’d like to.

A 2020 report by CapGemini and Efma revealed that digital banks find it 1.8 times easier to innovate, develop proof of concepts and offer personalized, differentiated products and services than traditional banks.

As a result, only 6% of financial institutions say they are deploying advanced personalization technology.

The big banks able to realize the true value of their data the quickest will be the first to deliver hyper-personalization at scale. The race is on.

51% of bankers agree that financial digital advisors that help customers save will increase engagement

Consumers increasingly want to make decisions and manage money on their own. This might explain why fewer consumers report consulting financial professionals.

However, there is also recognition they need to be doing more for themselves to ensure they reach their financial goals, with just 39% of people feeling they have some sense of financial freedom, according to a Barclays survey.

The onus is on banks to harness their transactional data to provide personalized advice for customers, improving their financial lives by creating healthy financial habits over time.

Artificial intelligence (AI) is going to be the fulcrum of banking for years to come. But so far, banks have struggled to move from experimentation around select use cases to scaling AI technologies across the organization, McKinsey reports.

There has been some progress, with nearly 60% of financial services firms having embedded at least one AI capability, as per McKinsey’s Global AI Survey

The most commonly used AI technologies are: robotic process automation (36%) for structured operational tasks; virtual assistants or conversational interfaces (32%) for customer service divisions; and machine learning techniques (25%) to detect fraud and support underwriting and risk management.

However, those incumbent banks that want to truly innovate in the sector must become “AI-first” institutions, adopting AI technologies as the foundation for distinctive customer experiences.

The beauty of advanced analytics is that banks no longer have to wait for customers to tell them something in order to engage and add value to their lives.

Ultimately, it’s only with proactive customer engagement in banking that people are going to be able to meet their longer-term financial goals, such as being mortgage- and debt-free.

Utilizing digital capabilities, banks can send customers notifications and messages ahead of time, providing them with the insight and advice they need to make better financial decisions. Is there any better CX than showing customers you have their best interests in mind, at all times?

With 36% of consumers trusting banks to work in their customers' best interests, this is clearly an area that banks can differentiate themselves.

Meniga is an innovation partner to banks, committed to giving our clients’ customers a digital experience that includes deeper insights and a better overview of their finances. We utilize AI and machine learning to deliver digital banking technology which drives deep engagement, boosts customer loyalty and increases revenue streams.

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