3 key trends transforming the customer journey in banking

If there's one industry in which new technologies have transformed the customer experience, it's banking. Between customers' expectations in terms of immediacy, personalisation and digitalisation and the arrival of fintech players and neobanks, financial institutions have been working hard to offer customers real added value and engage them. In recent years, traditional banks have undergone a profound digital transformation: they needed to rethink their banking experience to meet users’ expectations.

In this article, we discuss three key trends that are truly transforming the customer experience and journey in the banking sector, and more specifically for retail banking. The content is partly based on our panel talk webinar during our 2022 Insights by PriceHubble online conference, with Céleste Dhellemmes (formerly Head of Product at Sipios, now Program Owner at Qonto), Bertrand Tillay-Doledec, CPO at Budget Insight and Alexis Radjabi, VP Partnerships & Business Development at PriceHubble.

1. Digitalising the customer journey: a necessary transformation for banks and financial services

It's an undeniable fact: today's banking customers are ultra-connected. They can access a range of information and data, complete transactions or make a purchase within seconds on their mobile devices.

Bertrand Tillay-Doledec talks about a profound revolution in the banking sector caused by this change in user behaviour. He explains: "Internet users are accustomed to the immediacy and real-time offered by social networks and digital channels; they expect to have the same experience when using financial or banking services.

The challenge is to offer online banking services that meet these new requirements. How have the various players in the banking world tackled this? "Some worked very early in this topic and were able to offer an exceptional user experience," explains Bertrand. "I am thinking in particular of Qonto for professionals, or N26, Monzo and Revolut for private customers."

A very telling example of these UX advances is the comparison of the number of clicks required for opening a bank account. As we can see on this visual based on a test conducted in 2020, the difference is striking:

Céleste has also noticed a real appetite for the "immediacy" aspect, which has become a key differentiator for banks in 2022. She also mentions a strong need for personalisation but stresses that this point also creates a major challenge: "There is a very strong tension between the fact that users want a hyper-personalised experience and the fact that they are not ready to share too much personal information."

For banks, the challenge is to be able to offer a tailored experience, while minimising the effort when collecting data. To do this, the use of public databases or the use of external providers such as Budget Insight allow for the pre-filling of fields and the facilitation of this stage.

The onboarding stage is a phase creating challenges in the banking customer experience, but opportunities for a better UX and a higher level of personalisation are not limited to this area alone. "For wealth and investment, it's the same. New players have arrived, offering very simple and efficient solutions, making investment products normally designed for professionals available to all," explains Bertrand.

2. The expansion of open banking and open finance: A pillar for optimising the customer journey in depth

When talking about innovations transforming the digital banking customer journey, it is impossible not to mention open banking and open finance. Driven by the entry into force of the European "PSD2" directive in 2018, which encourages the collaboration between financial institutions and new players in banking and payments, the concept of open banking is proving to be a prerequisite for numerous customer journey related innovations.

Whether it is for simplifying onboarding (for example by pre-filling in fields as mentioned above) or for offering additional digital services (personalised advice depending on consumption habits, support for a real estate project, etc.), open banking is an irreplaceable component.

Its role appears even more crucial when you consider that, according to the Deloitte study "The French and new financial services", almost 43% of respondents systematically carry out their banking operations online, and almost 4 out of 5 participants say they are interested in at least one extra-financial service.

Bertrand believes that the last few years have allowed these innovations to be pushed even further: "The COVID-19 crisis has acted as a catalyst and has accelerated a lot of digitalisation initiatives that were previously difficult to implement. It truly enabled new uses to emerge."

In this context and in view of the emergence of new user behaviours, sharing data has become essential to create more intuitive, richer and user-centric customer journeys. The digitalisation of customer relationships is becoming an imperative, and some companies have understood this before others:

"This is the case with our client Finary or companies like Yomoni: you connect your financial assets, define savings or investment objectives and the app advises you, or even offers you simple financial products adapted to your profile, with an interface that you directly understand. These players have really taken part in this revolution in the customer experience in financial services," Bertrand emphasises.

3. Real estate data, a real driver of customer acquisition and retention for banks and financial services providers

Real estate also has a role to play in enhancing the banking customer experience. And for good reason: it can act as a powerful driver of customer acquisition and retention by providing real added value to users.

In the past few years, it has become essential for banks to go beyond standard banking services - the Deloitte study mentioned above highlights the fact that many users are indeed interested in extra financial services.

One of the trends that many banks are already adopting to complement their 'traditional' offerings is - you guessed it - offering real estate-related services. For example, by providing customers with a real-time overview of property assets, market dynamics or even transactions and building permits in the vicinity, banks can position themselves as a trusted third party and thus provide strategic input on all real estate-related matters. They leverage real estate data to create extra touchpoints and keep customers informed and engaged.

Alexis explains: "Providing detailed information about your customers’ properties helps create a richer customer experience. It allows a slightly more complementary view of finance, which until now has been mainly focused on highly liquid investments.”

Via an API integration, this real estate 'block' can be incorporated and configured into your existing environment to create a personalised and cohesive end-to-end journey. The user can access all the "classic" banking functions from a mobile app or the bank's website, and they can also find detailed information about their real estate investment(s), mortgages, etc. and their evolution over time.

💡 Learn how real estate data allows Finary to offer its clients a comprehensive, dynamic asset-tracking solution that allows them to differentiate from the competition. See our case study below 👇

How are banks and financial services providers making the shift to a better customer experience?

With the innovations of recent years, the need to be able to offer optimised customer journeys has increased significantly for traditional banks. Bertrand notes a change: "If you are a customer of traditional banks, just look at the updates in your mobile app: you will see that little by little, traditional banks are regaining ground.”

But how are traditional banks making this change? Some are using external companies, and others prefer to rely on internal resources. "Overall, we see that many banks are using external service providers, sometimes starting with small projects. Banks test, get inspired, learn from these experiences and then often choose to establish longer-term structural partnerships," explains Bertrand. There is a real agility and a growing interest in start-ups.

Céleste confirms this point: "Our clients call on us to accelerate the development and evolution of their products, but we also see a real willingness to change the culture from the inside, to transmit a desire for change".

The transformations the financial sector is undergoing are pushing everyone to design even more innovative and customer-centric financial services. The evidence is clear: companies that place innovation and customer needs at the top of their agenda are able to stand out by offering increasingly personalised, relevant and secure digital experiences to their audience.

Would you like to know more about our different use cases for banks, financial services providers, insurance companies and fintechs? Do not hesitate to contact us.