How Crucial is Customer Experience for Financial Businesses in the Digitised World?

How-crucial-is-customer-experience-for-financial-businesses-in-the-digitized-world
  • 09 Aug 2023

The rapid digitization of the fintech industry worldwide has highlighted the crucial need for a strong customer support system. When your business revolves around finance, there’s no room for gaps in your support desk.

With the rise of digital transactions and mobile banking, a larger portion of customers fall into the tech-savvy category. Naturally, they expect higher standards of customer service compared to a decade ago.

In an era where banking and financial processes are entirely digital, having a technically capable customer support department is essential. This is advantageous for financial businesses as well, allowing them to extend their services beyond regular office hours. Customers now prefer reaching out to support agents through mobiles and laptops rather than visiting in person.

EU Directive PSD2 of 2015 The EU Directive PSD2 was introduced in 2015 to regulate online payments and promote ‘open banking.’ It mandated that banks use APIs to share payment and customer data with authorized third parties. This increased transparency, providing customers with a consolidated view of their banking records.

Banks like Monzo embraced digital infrastructure in the late 2010s, allowing real-time balance updates via digital means. This simplicity and transparency contributed to their success even with less competitive interest rates. Customers could easily check balances and make transactions with a single button push, appealing to the tech-savvy generation. Monzo now boasts over five million customers, with its easy smartphone-based account opening process being a key factor.

Traditional banks followed suit, focusing on digital experiences and innovative UX features to quickly resolve customer issues. As most European banks now offer highly digitized and customized user experiences, customers can even freeze their cards using their smartphones.

Aligning Banks and Customers In a mobile banking-driven world, banks must communicate on the same channels as their customers. In 2020, 64% of European financial service companies explored new communication channels with clients, with 78% seeking innovative ways to engage customers.

Instant messaging has become a preferred communication method for many customers. Banks integrated APIs to gain instant insight into customer inquiries, avoiding the hassle of transferring between agents. Automation technology ensures that customer support agents are equipped with the latest information when assisting customers, leading to better support experiences.

Customer engagement at EU call centers saw a 19% increase, especially during the pandemic. Banks investing in omnichannel communication tend to have happier customers, as clients can communicate through their preferred channels. This fosters trust and peace of mind, knowing their finances are well-managed.

Beyond Retail Banking The evolution of customer support and omnichannel communication extends beyond retail banking. Financial service companies have embraced technologies like blockchain, digital ledgers, AI, and big data to enhance customer experience.

By deploying digital ledgers and blockchains, banks have developed secure, transparent accounting systems that respond swiftly to customer needs. In 2018, 22 EU countries agreed to a blockchain partnership, further digitizing banking transactions and strengthening centralized databases.

This technological progress enables financial service providers to respond faster, making them more competitive. Banks are increasingly focused on improving customer experience, with 49% aiming to enhance communication agility. Those capable of resolving customer issues are 2.2 times more likely to deploy advanced workflow tools.

The widespread adoption of smartphones for digital transactions and communication has driven the fintech industry’s digital transformation. Banks recognise the importance of offering robust customer support through digital means, ultimately leading to a rewarding experience for their valued clients.

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