Customer Experience in Digital Banking: Best Practices

Customers expect an excellent customer experience, regardless of the industry they are dealing with. The banking sector is no exception.

They demand faster, smoother, more convenient, and more personalized experiences from their financial service providers. If you’re in digital banking, you have an advantage. Because more customers are increasingly shifting to digital banking. Digital banks that consistently optimize customer experience and keep up with these demands, grow 3.2 times faster than their competitors.

In this post, we’ve identified some digital banking best practices you shouldn’t ignore. If you want to enhance your customer experience, create lasting customer relationships, and succeed in the digital world.

So, let’s begin!

Get conversational banking

Customers want to talk or message their digital banks.

Instead of sending mobile notifications customers can’t reply to, it’s now time to switch to two-way conversations. A survey by SInch reported that 53% of their respondents say they’re frustrated if they can’t reply to mobile messages [2]. Banks can solve this by implementing conversational banking.

(Source: Sinch)

NOTE: Conversational banking is about serving customers through natural conversations. It streamlines the customer journey, by enabling them to ask questions through various channels in real-time [3]. These channels include text messaging apps, voice assistants, human agents via live chats, chatbots, etc.

Here are some tips and best practices that can get you moving on that path:

- Select the right AI vendor: with a solid track record and experience in the banking sector. For example, Erica from Bran of America or Amex Bot from American Express [5].
- Automate your customer service/support: For customer questions that don’t require a human touch. For customers who need more support, the app can instantly re-route the customer from messaging to a live call.
- Support secure conversations: Give customers options to chat with representatives through a secure banking app or using a verified phone number over messaging apps.

Make the conversation channel agnostic: so customers can choose which channel they prefer – whether it’s in-app messaging, SMS, email, voice, or love call.

Also, consider implementing conversational AI that provides customers with personalized solutions and push-based financial news.

The main reason behind using conversational banking is to guide customers through your app/website. They are less likely to get overwhelmed or lost in a sea of information. For instance, during defining moments like opening an account or applying for a home loan.

Improving security and customer privacy should be a top priority

Your customer banking experience isn’t complete unless you make it feel safe and secure. That’s non-negotiable [4]. The following are some of the standard security features you should use to secure your customer banking experience:

Use top-notch data encryption (128-bit or 256-bit) to safeguard your data.
After you’ve opened the door for two-way conversations, encrypt all digital communication channels, including emails, online chats, and customer service/support.
Implement timed logouts: the deactivation of login details after several incorrect attempts.
- Enable automatic logouts after a period of inactivity.
Enable multi-factor authentication. Go beyond passwords only. Implement features like two-factor authentication, multifactor authentication, or even biometric verification so that user identity is confirmed twice or thrice.

Send secure transaction alerts. For example, send protected SMS or emails for each transaction. Even better, allow one-time passwords to validate transactions.
Monitor for suspicious activity to prevent fraud
Use Cyber Threat Intelligence (CTI) to identify potential cyber threats and take proactive measures to address them.

A study by Sinch also shows that part of delivering a secure banking experience is to make your security visible. In the sense that users are aware that certain security checks are in process [2].

Make it easier for new customers to open an account

One of the biggest challenges for digital banks is account creation and onboarding. Infact, research shows that 68% of consumers in Europe abandoned a digital application to a bank because of lengthy processes. Or, too much information was required from them. required were among the top reasons why people abandoned the application process.

We’ll not go into the details of the onboarding process. But, as a bank, ensure the process of opening a new account isn’t too complicated. This could deter would-be customers from signing up. Reduce the barriers to entering your banking onboarding process by making signing up for a new account easy [7].

Other best practices include:

Provide clear and concise Instructions: that guide customers through the onboarding process.

(Source: KMS)

- Minimize the amount of documentation required during the onboarding process. Only collect essential information necessary to comply with regulatory requirements and assess the customer’s eligibility for banking products.

Use personalized welcome messages. The onboarding process is an opportunity to add customer-specific messages — especially early on. This can help you create memorable customer onboarding experiences.

Incorporate online ID verification systems: Customers want the convenience of digital-first onboarding — including the ability to verify their identity online. Digitally verifying your customer’s identity will also protect your bank from fraud, scammers, and associated penalties and fees.

NOTE: Another way to improve the user experience during the registration process is by applying electronic Know Your Customer (eKYC).

Design fast and easy-to-fill-out forms: to reduce manual data entry and speed up the onboarding process.

Provide personalized guidance, assistance, or support to customers: throughout the onboarding journey.

Emphasize the product design

Some 34% of customers have switched financial service providers because of a poorly designed app interface. Because of this, it’s also important for banks to concentrate on the design of their platforms to ensure they are user-friendly and feature-rich [6].

Make application registration simple: by reducing the number of unnecessary or duplicated steps and creating a straightforward design that releases stress for users while registering.

Show customers their progress during registration/onboarding. For this, you can use a progress bar that clearly shows customers the remaining steps to finish the process.

The application should display instructions when and where users need them. This will help your customers navigate your applications quickly because they know what to do next.

Design clear transaction history: Customers should have an easy time checking their account balances when using their mobile apps. So, it’s vital to make this section clear and easy to understand.
Choose actions that are appropriate to actions.

(Source: KMS)

Offer financial education

Banks can take on the role of a mentor by providing valuable assistance or advice to their customers. For instance, you can offer resources such as blogs, research, online workshops, or sessions that cover topics like budgeting and saving strategies. By doing this, you can forge deeper connections with customers and increase their profitability. Not to mention, Moreover, this proactive approach can gradually improve customers’ financial well-being, benefiting both the bank and the customer [8].

Provide a consistent omnichannel digital banking experience

Customers expect the banking experience on your website to be the same as the mobile app. The interface should be the same. If they started an onboarding process on the web, they should be able to continue it on their mobile phone. If their journey is disjointed, it can result in a poor experience which will drive customers away.

So, if you’re one of the many banks that are struggling with disjointed customer journeys, we have a few best practices to help. Your real focus, however, should be on providing a consistent experience across all of your digital platforms [1].

So, start by harmonizing your design as we explained in earlier steps.

Integrate your systems to maintain consistent customer data. Integrate your back-end systems and let them synchronize data on the fly. When you engage a customer, ensure you have all the up-to-date information and data from previous contact moments so the customer experiences consistency throughout their journey.
Prioritize better handoffs. For instance, if a customer starts an application process on the website and switches to the mobile app, they should be able to resume their progress without starting over.

NOTE: The same should apply to what devices customers use. Anticipate situations where a customer switches devices during a workflow or process and make that handoff seamless. Allow your customers to pick up where they left off, no matter what device or operating system they switch to.

Take into account that loading times affect the customer experience. If it’s longer than 3 seconds, customers can leave your site. Simply put, on a mobile phone, customers expect similar performance as on a desktop.

Offer your customers with self-service opportunities

Up to this point, things like banking chatbots, conversational interfaces, and resource portals empower your customers to get the information they need when they need it. Make sure to invest in these tools and more to improve the self-banking customer experience for users.

Ask customers for feedback and use it to improve

Ask customers for feedback on how to improve their banking customer experience. Use simple surveys to assess customer satisfaction. Additionally, ask open-ended questions as well. Open-ended questions enable banks to use things from the customer’s viewpoint, rather than receiving canned responses. Although acquiring and acting upon such feedback may be more challenging, it remains a vital aspect of enhancing CX in financial services.

Conclusion

Improving your CX isn’t just another option. It’s a necessity for digital banks that want to cultivate lasting relationships with their customers and be successful. Our post highlights some of the best practices you need to implement for an exceptional banking experience. So, provide customers with personalized interactions, seamless omnichannel experiences, robust security measures, and proactive customer support — things will change for the better.