The trend toward consumers’ preference for digital banking was established well before 2020. As branches temporarily closed during the pandemic, the essential nature of digital services for supporting new and existing customers became abundantly clear. Although many clients had already grown accustomed to engaging with their banks and credit unions via their mobile phone or desktop, suddenly all varieties of transactions needed to be completed without in-person interaction.
As branches reopened, certain customer segments and activities migrated back to branch settings. There’s little doubt, however, that the longstanding trend toward digital will continue- and in all likelihood, has received a permanent jolt forward.
Financial institutions must be prepared to meet digital banking expectations, which are aligned with customer experiences established in sectors like e-commerce. One danger comes in settling for a “mostly digital” process, requiring some remnant of an old-school approach to complete the cycle. In our view, there is no such thing as “mostly digital”- a process is either digital or it isn’t.
Eliminating the Last Mile (to the Branch)
Think about it: consumer expectations for immediate gratification and “anytime, anywhere” convenience is set by service levels in other industries, not just by financial services competitors. Banking customers have the same expectations.
Opening a new account, adding an authorized signatory or applying for a line of credit are all core banking activities that remain central to relationship management and require a signature before the desired product or service can be delivered. A current or prospective customer who elects to engage through a digital interface is most likely signaling a desire for a seamless remote or online experience and to avoid a trip to the branch.
Suppose the final step of that process still requires a branch visit to complete account opening or lending documents, for example. In that case, the fundamental convenience of the digital channel is lost. Moreover, as the number of branch locations declines and the radius of prospective customers expands, a “quick trip to the branch” may no longer be so quick. Considering the proportion of younger consumers who claim to have never visited a bank branch and/or express no desire to do so, such a requirement may jeopardize your institution’s ability to attract or maintain your customer base.
Conveying an Omnichannel Image
Even in cases where in-person interaction may be necessary or desired by the customer, the convenience of completing the preliminary paperwork prior to the visit should be clear- think of medical forms as a common analogy familiar to consumers. In these cases, the ability to switch seamlessly between channels is essential. There’s nothing more frustrating than being asked to repeat a task already completed online. In a medical office, this probably leads to an unhappy patient, but at a bank or credit union, it could easily translate to lost business.
A fully digital in-branch process, performed on FI-provided tablets, also delivers multiple benefits. It eliminates the need for the institution to support redundant processes and conveys a tech-forward image to customers- potentially speeding decision times too.
In short, it’s hard to devise an argument against fully digitizing most FI processes.
