Customer service is the single most important factor in deciding whether a customer will stay with your bank or switch to another. Research suggests that as much as 89% of customers could switch their service providers after a bad experience.
This clearly indicates how important it is to offer good customer service if you want to retain your customers. Though it is important, banks still face numerous challenges in serving their customers on a day-to-day basis.
If you fail to meet service standards and customer expectations, they may abandon your services. Moreover, they may also share their bad experiences with their friends and family.
We’re sure you don’t want to lose customers to bad service. So, let’s discuss some of the biggest customer service challenges that banks face and how you can overcome them.
Not Being Able to Provide a Personalized Experience
Most people see banks as these big, non-human entities that do not care about individual problems of their customers. While the staff at local bank branches might still know most regular customers by name and provide personalized services, doing so via online and mobile banking is the main challenge.
The online and mobile banking apps of most banks are, to a certain extent, standardized and sort of machine-like. For a question that is as simple as “am I eligible for a personal loan?,” you get a whole resource guide about how to find that out, instead of getting a direct answer. People these days are impatient and expect instant answers to such questions.
Banks need to incorporate personalization to cater to the specific needs and preferences of each of their customers. Using some form of artificial intelligence (AI) or machine learning on your website and mobile apps can help you deliver personalized experiences.
AI chatbots are the simplest way to get started with this as they can meet your customers’ needs and can evolve and grow with each interaction. Aivo provides free content packs that can help you quickly get started with your chatbot by feeding it a banking-specific pack.
And it’s not just limited to knowing a customer’s name and providing tailored advice. Customers also want to be rewarded for being loyal to your bank. An Accenture Strategy study found that 48% of people want special treatment for being loyal customers.
This level of personalization can be achieved by starting a loyalty program that rewards customers for specific actions and their relationships with the bank.
Falling Short When Resolving Customer Problems
One of the biggest customer service challenges for banks is when their service executives are not able to resolve a problem, at least, not instantly. Unlike most B2C businesses, customer problems in banking are not always simple. They may face a broad range of problems, which include both simple and complex ones.
Customer service executives are often loaded with too many requests and they fail to provide the required attention to each customer. This often leads to bad experiences and may even cause them to leave.
To solve this issue, you can use an automated solution like a chatbot that can handle all simple queries. With a chatbot handling all of the simple customer requests, you could take the load off your employees. This, in turn, will provide your employees the time to tackle more complex queries.
Prioritizing customer service requests in order of complexity can go a long way in improving your customers’ experience with your bank. We all know that a happy customer is more likely to remain loyal to your bank, which will help you improve your retention rate as well.
Slow Service Delivery and Long Waiting Times
Another common customer service challenge that banks face is long turnaround service time. Most banks rely on their customer support teams to cater to their customers’ requests and problems.
This may work well for startups that don’t have a big demand, but for most financial companies, it is almost impossible to resolve every customer query instantly.
More often than not, when a customer calls a bank’s customer care number, they have to wait in line to be able to talk to an executive. And, sometimes, the executives need to transfer their call to some specialized department that can handle the query better.
This delay in customer service delivery can cause unpleasant experiences for a lot of customers. And, most customers won’t give you another chance after a bad experience. They might simply switch their bank.
To avoid losing customers due to slow or poor customer service, you should use technology to speed up the process. A digital banking assistant or chatbot can tackle a significant share of customer queries for you. This will free up some time for your customer care executives.
Your executives can use this time to effectively handle complex issues as they no longer need to answer repetitive, mundane questions that can be answered by a chatbot.
A Juniper Research study concluded that banking industry chatbots can reduce the time taken per interaction by 4 minutes. This translates into a $0.70 cost-saving per interaction. This can be a big incentive for banks who use chatbots to provide better customer service.
Limited Channels and Separate Strategies
When we combine all of the customer service challenges for banks mentioned above, it translates into a poor customer experience. Today’s customers are spoilt for choice and don’t think twice before switching service providers, including banks. They expect high-quality service every single time they interact with a bank via any channel.
As such, it has become crucial for banks to provide great customer experiences via all channels and in all instances to keep their customers satisfied. This means that you need to provide a good experience and instantly resolve their problems, regardless of the channel a customer reaches you through.
This is not humanly possible and is too much to ask for, if you rely only on human resources. No matter how well-trained your employees are, there is always scope for error. However, technology can help you achieve higher success rate (if not 100%) in providing consistently good customer experiences across channels.
Using chatbots can help you handle online queries via your website or mobile app instantly. As these bots run on preset algorithms, they can help you deliver omnichannel customer service solutions to keep your customers happy.
These bots can then forward or redirect complex customer requests to your human executives.
Low Customer Retention
As mentioned earlier, customers can switch to another bank if they don’t get the expected level of service. In fact, most people are more likely to leave a bank due to poor service rather than poor products. That’s why it is crucial for you to meet their expectations if you don’t want to lose them.
As we all know, loyal customers are more profitable for any business and retaining existing customers costs less than acquiring new ones. The same holds true for banks as well. In fact, loyal customers are 12.2X more likely to try new offerings from the bank.
If you want to maintain a profitable business in the long run, you need to focus on customer retention. Providing good customer service is pivotal to achieving that. And you can do this by incorporating technology into your day-to-day service operations.
These are some of the most prominent customer service challenges that can cause your customers to leave your bank. The good part is that you can overcome a lot of these challenges in the banking industry by leveraging the right technology.
Using AI chatbots, for example, can help you take the load off your customer service team. Your executives can focus on handling more complex queries and improving overall customer experience.