For more visit: www.infosys.com/finacle Online customer experience is set to become bigger and better Banks have come a long way from brick and mortar structures to the realms of the Internet. So what’s next in their journey?

1. Online Retail Banking Customer
Experience: The Road Ahead
Universal Banking Solution System Integration Consulting Business Process Outsourcing

2. Customer experience is a key differentiator other channel whose importance cannot be
in banking understated, and that is the branch.
In recent years, customer experience has In a recent global study of retail banking,
caught the imagination of banking, as it reinvents respondents ranked the branch and the Internet
itself from a utility business to one that is based as the most important channels. Over the years,
on service and enduring relationships. This is a banks have tried to move customers away from
far cry from the banking scenario of 15 to 20 the branch towards a number of self-service
years ago, when the branch was the only channels, even offering them incentives to do
available channel and pricing, the sole plank of so. Despite these attempts, the branch remains
differentiation. With products, prices and even the channel of choice for a significant proportion
channels becoming uniform, the only way that of customers. There are several reasons for
one bank can differentiate itself from the this, not the least of which is psychological
others while trying to woo customers and retain comfort. The physical environs of the branch
them is by offering superior and innovative and the availability of staff and advisors inspire
service – which forms the backbone of positive trust and confidence in banking customers.
customer experience. When they walk into a branch, they are sure of
finding someone to attend to their queries; they
There are several definitions of customer take service for granted. This feeling of
experience, and as many dimensions. Academic, reassurance is so important to them that they
consulting and business organizations including don’t mind taking the trouble of visiting the
banks have evolved frameworks to formalize branch or waiting in line to be served.
the process of improving customer experience.
Line managers tasked with implementing the Not surprisingly, another recent study showed
same have added their insights, gathered over that customer engagement in retail banking – a
years of experience. The objective of this paper major determinant of quality of experience – was
is not to revisit or add to those excellent driven more by emotional, rather than functional
frameworks, but rather to explore where the factors. At the top of this list was customers’
banking industry is headed in its attempt to need to be valued, followed by their perception
enhance customer experience. of the engagement level of bank employees.
Simply put, customers wanted bank employees
Customers value the human element of the to show them that they valued their business,
branch experience and when required, go the extra mile to fulfill
their expectations.
Internet banking has been around for quite
some time now and there is no doubt that it Another analysis said that retail banking
has made banking a lot more efficient and brands must be emotionally aligned with their
simple. Adoption of internet banking continues customers to win them over. This means that
to grow day by day. Research shows that the banks must try to understand their customers’
number of transactions happening through the needs better by asking relevant questions,
internet is expected to cross 33 billion by 2012. listening carefully and offering a sympathetic ear
The number of online transactions is growing to genuine problems.
at a rate of nearly 13%, much higher than that
for any other channel. By 2013, banks expect Moving from the subject of drivers to barriers,
nearly 20% of sales to be made through this past studies have repeatedly indicated that
channel. Banking through the internet is definitely concern regarding security is one of the biggest
more affordable and there is a segment of obstacles to Internet banking adoption. While
customers who prefer the convenience and easy this has certainly come down in recent years
accessibility that it offers. Personal financial with security systems becoming more robust,
management tools have empowered customers the fact remains that people – even Internet
and taught them to handle their finances banking users – are not at ease sharing sensitive
themselves. While all this is true, there is one financial information over a website, and
Online Retail Banking Customer
Experience: The Road Ahead

3. therefore restrict their activity to basic transactions. There are many ways that banks can improve
Another reason why customers don’t do more online customer experience
through Internet banking is that most banks don’t
offer advisory services over this channel, further Owing to the progress in information and
limiting its role. On the other hand, the branch communication technology, it is now possible to
has always been the go-to option for customers bridge the gap between the branch experience
seeking to make a key financial decision and that provided online, easily. Banks can bring
requiring advisory input, such as availing a interactivity to their online channel by setting up
mortgage or planning an investment portfolio. a video, audio or text chat facility to support
Internet banking; they can also put expert
These facts explain why, despite the convenience financial advisors within the reach of customers,
and accessibility of Internet banking and other anywhere, anytime, and thereby increase their
online channels, many customers still prefer confidence in the channel. Banks can apply
the branch as a channel for banking. And so, analytics and set rules to provide contextual
it would seem that replicating the branch help to customers who are facing difficulty with
experience through other channels such as the product applications and also proactively offer
Internet, is a good strategy that would go a long chat services to customers who are likely to
way in providing positive customer experience. abandon the product applications. Co-browsing,
The good news is that banks can, with some where the customer can share his screen with
effort, replicate the branch experience – which a bank representative is one step further in
has been successful so far, and continues to interactivity and goes a long way in providing
sustain – in other channels, including the Internet. quick help to customers. Blogs and online
communities are becoming increasingly common
Bringing the branch banking experience to on most banking sites. These enable customers
other channels to interact with each other and share their opinion
and concerns.
But how is it possible to infuse the human
element into channels that are self-service by That’s not all. Banks can leverage social media
definition? Also, how can banks recreate the to make Internet banking and other online
experience of banking in the physical world, channels even more interactive and personal.
in the virtual one? And where should they Some have already started out on this path by
start, given that customer experience has so assigning an identifiable person to represent
many dimensions? their institution on popular social networking
sites, participate in various banking-related
Let us clarify. When we talk of replicating a discussions, resolve queries and gather feedback
branch-like experience, what we’re really firsthand. In a recent survey conducted among
focusing on, is its one key principle, which is, that executives from top retail banks in EMEA, only
a customer facing a problem must not be left to 37% of the respondents said that they did not
cope on his own. There are no dead-ends in have any presence in the social media.
branch interaction to leave a customer feeling
lost and helpless. Help is but a window away. It There are several examples of innovative steps
must be the same online. taken by banks to encourage customers to move
to the online channel and to improve the online
The ready availability of support, preferably in customer experience. A leading bank has
the form of human assistance, is common to launched an ‘Assisted Internet Service’ wherein
every customer’s definition of good experience, the bank first asks the customers what activity
whereas most other elements are personal they want to carry out in the branch and offers
preferences, unique to the individual. Obviously, the help of trained staff to assist them to carry it
It is futile for banks to try to deliver the perfect out through internet banking instead. Many
experience to each and every customer. Instead, banks incorporate scenario based video demos
they must aim to create an experience that will of products in their banking pages to make it
be received favorably by the most number. easily comprehensible for customers. Even the
Online Retail Banking Customer
Experience: The Road Ahead

4. process of applying for products has been made Advances in online gaming and virtual reality
a lot simpler by intelligent systems which pull have opened up unimaginable possibilities for other
out the customers’ data, prefill application forms sectors seeking to create a more impactful and
and provide instant quotes to customers. There lifelike experience outside the physical
are also banks which provide personal web world. From where banks stand today, it’s not a
portals which allow the customers to access big leap to a future in which the entire branch is
account information and to get queries answered replicated in the virtual realm to create the
by sales and service personnel via a personal ultimate customer experience. This means that
web portal. some day, not too far away, a customer should
be able to log in to his bank’s portal to enter a
A point to note is that it isn’t enough to create virtual environment replete with tellers, sales
memorable ‘islands of experience’ on different people, managers and advisors, just like in a
channels. Today, a significant proportion of physical branch, ‘walk though’ its halls, ask for
customers bank over multiple channels, at times assistance and complete a transaction, without
even use more than one channel to fulfill a single missing out on any of the advantages of the
transaction; it is quite frustrating for them to ‘real thing’. Maybe this is where online banking
encounter different service levels, lead times, customer experience is headed.
processes, choice or complexity on each. Hence,
banks must pursue a unified multi-channel Reference:
strategy to ensure that customers enjoy a
uniform and seamless experience across all 1. The 2011 World Retail Banking Report
touch points.
2. Enhancing the Customer Experience and
But while recreating the branch experience Engagement in Retail Banking
online by adding interactivity and social media 3. Improving Customer Satisfaction In Retail
elements is a good start, is it enough? Or is there Banking
an ultimate customer experience, beyond this,
which we can envision? 4. Next-Generation Digital Financial Services
Online customer experience is set to become
Author
bigger and better
Sudha Annie Saigal
Banks have come a long way from brick and
Senior Associate Consultant – Finacle
mortar structures to the realms of the Internet.
Infosys Limited
So what’s next in their journey?
Online Retail Banking Customer
Experience: The Road Ahead