The shift toward digital banking has intensified in recent years. So have customer expectations. Banks need to focus on developing digital solutions that may improve the customer banking experience and ensure they remain competitive in a crowded market. In our opinion, interactive banking is the future of financial institutions that starts now. Are you ready for it?
More digital opportunities, less personal contact
According to a 2023 global study by Accenture, the majority of consumers only use their bank’s digital channels for quick tasks. Approximately 63% of respondents stated they mostly logged into mobile banking to check their account balance.
The study also shows how digitalization has limited personal touch between banks and customers: 44% of consumers aged between 18 and 44 had difficulty obtaining human assistance when they needed it.
What do these findings implicate? Digital channels are functionally correct, but they lack the emotional aspect. They do not help to develop a personal connection between the bank and the customer that extends beyond the transactional relationship. Only 25% of people stated their bank performs ‘very well’ in terms of being aware of significant changes in their financial and personal situations.
Interactive banking closes the gap
Online banking platforms were built to engage with customers in a very basic way—check balances, transfer money, pay bills etc. People log in, find what they need, and leave.
The human touch disappeared from many interactions, and banks risk being perceived as commodities. In other words, customers may look for the lowest-cost providers rather than trustworthy consultants for their financial matters.
Interactive banking refers to the use of technology and personalized services to create a more engaging, responsive, and convenient banking experience for customers.
It returns that human touch and helps to create the connection between the individual and the financial institution that is often lacking in today’s digital environment.
Creating digital products and services with that in mind contributes to what people valued about visiting the branch: having a personal conversation, discussing their needs, and receiving advice about products, services and their finances.
Interactive banking features make a difference
It involves facilitating real-time communication and providing tailored solutions to meet individual client needs. As a bank, you can create this personal connection or conversation with your clients through various strategies. Here are some examples:
1. Seamless integration across channels
According to a PwC report, 61% of customers interacted weekly on digital channels and 32% used only digital channels for their banking in 2021. Therefore, ensuring that the banking app is well-integrated with other channels, such as online banking, social media, and in-branch services will provide customers with a consistent and connected experience.
2. Customization and personalization
According to a 2022 study by Forrester Consulting, 72% of consumers think product recommendations from banks and financial institutions are more valuable when they are personalized. Built features that allow customers to tailor their app experience based on their preferences, including customizable dashboards that display their financial accounts, goal-setting tools, and personalized product recommendations help you get closer to customers.
3. AI-driven chatbots and virtual assistants
Grand View Research predicts that the global chatbot market will grow at a CAGR of 23.3% from 2023 to 2030 with the financial segment experiencing the fastest CAGR of 24.0%. Implementing AI-powered chatbots and virtual assistants can help you engage with your customers in real-time, providing immediate support, answering queries, and offering personalized financial advice.
4. Gamification
The gamification market is expected to grow at a CAGR of 26.5% through 2027, according to Mordor Intelligence. Incorporating gamification elements, such as rewards, badges, and challenges, can encourage user engagement and foster a personal connection with the banking app. An example of this are customizable goals and automated savings rules to motivate users to save money and reach their financial objectives.
5. Financial education and resources
Integrating financial education tools, tutorials, and resources within the app can help banks demonstrate their commitment to their customers' financial wellbeing, fostering a sense of personal connection. A 2021 report by EPAM Continuum found that more than half of banking customers aged between 18 and 44 were interested in receiving financial education and resources from their banks.
To become or remain a market leader, you need to rethink your approach to customer experience. If you respond to shifting preferences in this digital era, you have a chance to re-establish long-term relationships that benefit both you and your consumers.
Do you consider adding interactive banking features to provide your customers with a more personalized experience? Our expert team will be happy to discover opportunities for your digital solutions. Contact us or find out more about our No Blocker Policy.