Get even more personal with digital banking

This article is more than 12 months old

Banks should proactively coach customers on how to get the most bang for their buck

Banks are working hard to promote digital service channels.

Online banking, mobile apps and advanced ATMs not only meet customers' demands for increased control and convenience, but they also reduce the need for physical bank branches and the number of service staff needed.

It makes sense for banks to focus on digital products that best meet customers' changing needs and behaviour, while also reducing their operational costs. But how are banks faring?

Consumers on the whole prefer digital banking to traditional forms - which comes as no surprise since there are no queues. There's also no need to explain your actions and just a simple fingerprint will identify you and allow access to a mobile banking platform.

In the financial studies that JD Power conducted on customer experience with retail banks, satisfaction with mobile banking is increasing and often is the highest rated service channel across markets and key demographics.

However, results from a recent JD Power Credit Card Study in Singapore showed that although cardholders rated their banks' mobile app highest in satisfaction, they still want more personalised services on digital.

This trend towards hyper-personalisation outlines a need for banks to work harder towards meeting changing requirements.

Data shows that customers not only want to have more information on special offers, rewards and benefits, but they also want to be able to track their expenses in more detail, review their rewards and contact their bank on the fly either via web chat or e-mail.

It is here that banks are failing customers as they push with developments in digital. More often than not, they are not proactively providing fee alerts, flagging cashback caps or helping with spending targets.


Moreover, the growth of digital wallets, such as Apple Pay or Samsung Pay, allows customers to have a series of debit, credit or loyalty cards sitting on the same device, but no bank as of yet actively uses the technology.

Whether it is through geolocation tagging or deeper merchant analytics, banks are not informing customers of the best card to choose for a specific purchase, be it related to cashback offers, minimum spending, or rewards that might be relevant to that merchant.

Given that retailers in multi-markets have learnt to use loyalty programmes to incentivise spending on categories tailored to customer preferences - a prime example being Tesco Clubcard in the UK - rewards and promotions among banks are a relatively static set of offerings, only changing to meet the banks' new partner promotions and not based on customer spending behaviours.

"Banks need to enrich customer data and exploit the digital footprint, leveraging advanced analytics and machine learning technology, to design and deliver a relevant and personalised user experience, helping each customer better anticipate his or her specific financial needs at exactly the right time," said Mr Xavier Marcillac, a fintech professional based in Singapore.

In essence, acting as a disintermediary for customers by connecting financial tools with retailers and other organisations in a way that provides a customer tangible advantages.

If the experience and relevance of the product and service offered by banks on digital platforms are not enhanced, customers are more likely to lose the inherent connection with their bank.

Banks should offer limited unique selling propositions, beyond the core product propositions. Fighting on interest rates, terms or reduced approval times, can and will help a bank sell its products, but does it really connect with customers?

Banks should consider not just chasing the new service offering or partner in the digital space, but actually gaining deeper into on customer expectations by tapping relevant universal human truths as part of efforts to innovate.

This includes being a proactive coach to customers on getting the most out of their income and savings, helping customers to take advantage of the best services across their own and competitor products, and thus using technology to build long-term and active relationships with their customers on a personal level.

Relevance is critical for sustaining long-term business growth. The question is: Are banks in Singapore or further afield really helping their customers get the most out of their digital services?

The writer is director at J D Power Singapore.