Customers are now more informed than ever and their needs from banks are changing rapidly. Since catering to customer needs is important, banks need to innovate and bring to the fore technology led innovation which makes services more personalized in order to attract and retain customers.
Changing customer behaviour
Customers are more informed than ever before and have confidence in choosing products and service providers for themselves. Customers are banking with multiple providers other thank banks due to the recent crisis and the reduced trust in banks, customers are now much more willing to purchase products and services from various banks than they were in the past. Managing different banking relationships and comparing products and services between different providers is becoming easier for customers through direct channels, Internet blogs, and forums, and social networks. Consequently, customers have increased the number of their banking relationships.
Multi Channel Banking
According to a study by top IT services provider 67% of customers prefer to interact with their bank through multiple channels. The study also mentions that almost one third of customers (34%) rate the availability of banking services through the branch, Internet, and mobile channels as very important. Only 21% of customers still prefer to interact with their bank through a single channel such as through branch, Internet, or mobile banking.
The following banking services and innovative technologies rank highly among customer preferences:
  • Branch: Multi-functional ATM’s, (cash points) information and transaction terminals, as well as interactive media in the branch
  • Internet: Banking portals, brokerage portals, peer-to-peer platforms, and social media
  • Mobile: Information and notification services, mobile money transfers, payments with mobile devices, and mobile brokerage platforms
Customers use internet banking as the primary channel for banking
Many of the customers (81%) conduct their main banking relationship through Internet banking. Customers request direct and simple access to information on the internet and and use direct channels to obtain greater transparency and control. In addition, 83% of the customers have their Internet account with a retail bank. This emphasizes the trend that Internet banking needs to be an integral part of a bank’s mix of services. More customers use Internet (50%) than mobile banking services (8%, However the latter is strongly emerging as an alternative banking channel with a projected usage growth of 25% during the next 12 months, compared to a projected growth of 6% for Internet banking services. ( The percentage figures have been borrowed by a study conducted by Accenture services)
Innovation is the greatest value proposition of all times
Innovation in banking channels can be considered a strong value proposition across all age groups. In general, a higher percentage of the younger generation – compared to the older one – considers innovative channel technologies to be important. This holds true for each channel – branch, Internet and mobile.
Services offered through the branch are still considered more important across all age groups than services offered through the Internet and mobile banking channels, nevertheless, customers across all generations are embracing services through the Internet and mobile channels and expect banks to offer services through these channels.
Posted on Nov 11, 2014
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