The BBA is now integrated into UK Finance. Please go to www.ukfinance.org.uk for new content and updates from UK Finance.
Material published by BBA prior to 1st July 2017 is still available on this website.
From 1 July 2017, the finance and banking industry operating in the UK will be represented by a new trade association, UK Finance. It will represent around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation will take on most of the activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association.x
Perhaps more than any other factor in business, customer experience (CX) determines success. Thanks to Amazon, Uber, Apple and other CX leaders, today’s consumers expect levels of personalization and convenience that would have been unthinkable just a few years ago. And these new standards apply to nearly every kind of business – retailers and restaurants, consumer goods and electronics makers, airlines and hotels, insurers and, yes, even banks.
But what does the CX revolution mean for traditional banks? And how can they respond effectively?
First and foremost, banking leaders are coming to terms with just how fundamental the shift to CX is. In the past, banks competed primarily on price, product and scale. Now, banks must not only provide the services customers want, but also deliver them precisely how customers want them.
EY’s Global Consumer Banking Survey of more than 55,000 consumers revealed that increasing commoditization and new competition are making better experiences an imperative, not an option. Banks must be proactive in measuring and enhancing the experiences they offer their different customer segments if they are to differentiate themselves from traditional competitors and stay ahead of new ones.
The clearest way forward is to take a page out of FinTechs’ playbooks. Recent market entrants have given consumers a new vision of what to expect from financial providers. To keep up with the upstarts, traditional banks need to:
The new focus on experience means banks need to rethink the way they interact with their customers. The EY survey also provides good news. Traditional banks meet most consumers’ primary financial services needs, and in many cases have a strong digital foundation to build from. But when new entrants emerge with more convenient and personalized customer experiences, consumers’ trust and loyalty to their current bank may be threatened.
The survey results also confirm five concrete actions that banks can take to shape better experiences for their customers:
These steps represent the beginning of a long-term journey to enhanced CX. To truly reap the benefits of positive customer experiences requires not only a commitment to understanding consumers’ needs, but also dedicating the organization to delivering it and in the channels and formats they prefer.
The extent to which banks can learn from FinTechs and retain customer loyalty depends on how they tackle the challenges that the new era of consumer banking brings.
For more on EY’s findings on the state of the consumer banking industry and how banks can improve their relevance, read the full report.