Tech-savvy consumers are making financial institutions rethink the experiences and features they offer. Millennial banking trends and emerging Gen-Z banking trends largely drive this. These customers expect a new level of convenience, innovation, and trust. If traditional banks want to thrive, they need to adapt quickly to these new consumer behavior trends in banking.
But let’s take a moment and think about what makes a banking experience great. To answer that question, we’ve gathered insights about top consumer behavior trends in the banking and financial services industry. Below, we have discussed what makes a best-in-class banking experience and what actions they take to meet rising expectations.
Top Banking Features Driven by Changing Consumer Behavior Trends
Let’s take a closer look at the changing consumer behavior trends in banking that are defining customer experience in the retail banking and financial services industries.
1. Convenience via Digital Channels
The number of customers who want to visit a bank’s physical branches in person has decreased. And those who want to engage with banking services digitally have increased tremendously over the past years. In the past, digital customer interaction benefits in banking were thought to be limited to cost savings and increased operational efficiency. Today, it’s clear that digital engagement is, most importantly, a tool to improve customers’ user experiences and satisfaction scores.
The use of mobile banking apps has gone up since the COVID pandemic hit, a clear sign of new consumer behavior trends in banking. Many Fintechs and neobanks have come up with asynchronous messaging-based customer service and automation to address customer needs. This approach is paying off, as customer satisfaction has increased with the help of these digital channels.
2. Intuitive Interfaces
As customers rely more on digital channels, the interfaces of these platforms are becoming more significant. Customers have become accustomed to instant access and seamless digital experiences, and they are more critical of old-fashioned user interfaces.
Banks are increasingly focusing on intuitive and conversational interface initiatives in response to evolving consumer behavior trends in banking. An insightful interface should include features like digital account opening, real-time product recommendations, the ability to apply for loans, credit cards, deposit accounts, and other online banking services.
3. Empowered Contact Centres
The experience customers have with contact centres is directly linked to overall customer satisfaction, and it is not always positive. Contact centres remain the primary spots for negative moments that matter, often shaping consumer behavior trends in banking.
Customer satisfaction with contact centres is the lowest among all bank channels. The never-ending interactive voice response (IVR), the need to authenticate oneself and explain the problem repeatedly, and the long issue-resolution time were among the top reasons for dissatisfaction.
Banks need to enhance their focus on the human touch and position contact centres as ‘experience centres’ with a relentless focus on customer centricity. Humanising the contact centre experience will require banks to make bigger, bolder changes to the way they operate this channel. These are the first steps towards building the contact centre of the future.
4. Human Connection
Another element that the best banking experiences have in common is the focus on human connection. Leading banks and credit unions understand that they must embrace technology that offers a human touch, a direct reflection of customer behavior trends in banking.
The way that the best brands get a differentiated product out there is to make everything about the product feel unique, from how you articulate the value proposition to the experience you deliver from awareness through onboarding. It’s not about the product, it’s about that human connection.
5. Financial Wellness Assistance
Banks are becoming more proactive in helping customers manage their finances. While most banks today have budgeting apps or financial tools, banks that personalise this information can become even more relevant to their customers' daily lives and improve the banking customer experience.
Thanks to data and technology, banking consumers can now make better decisions with their money through financial health features that offer personalised and proactive advice. This is a direct result of evolving consumer behavior trends in banking.
6. Build Customer Trust
According to Accenture, only 29% of consumers trusted their banking provider to look after their long-term financial well-being in 2020, compared to 43% two years before. Banks should rebuild trust by being more transparent about fees and helping customers make better decisions. This theme was identified in 2020 and continues to be a factor today.
Rebuilding trust will pay off for banks willing to invest. Accenture predicts that incumbent banks could increase their retail revenue by an average of 9% by rebuilding customer trust and introducing innovative advisory services, both of which are in response to consumer behavior trends in banking.
7. A Solid Technological Foundation
It’s no surprise that a solid technological foundation is necessary to keep up with the consumer behavior trends in banking. To provide best-in-class banking experiences, banks should bring their data ecosystem together in a more organised way across all lines of business. Using artificial intelligence and AI-powered data centres can help improve banks’ operations and digital channels to achieve better customer engagement.
Legacy systems and outdated software continue to pose one of the greatest obstacles to innovation. The best banking experiences will begin with the modernisation of these systems.
8. A Super-App Strategy
The mention of super-apps in banks’ annual reports and other public communications has suddenly increased. Super apps accelerate the need for omnichannel experiences as they bundle online messaging, social media, payments, and marketplaces in response to changing consumer behavior trends in banking.
The rise of super apps, like WeChat, in China and Eastern markets shows how powerful they can become. Banks, tech companies, and messaging platforms all play an important role in the development of a super-app, and each stands to gain from becoming the next big hit. Banks will need a strategy to compete in a super-app world, either by creating their own super-app or by collaborating with one.
9. Good Talent Management Processes
The digital transformation in banking also requires banks to have a good handle on their human resources and talent. As new digital channels emerge, they’ll need people in place to operate and manage them, in line with consumer behavior trends in banking.
Banks that want to be very successful in meeting customer expectations will need to make the most of their employees’ talent and strong internal operations and workforce management.
10. Ethical and Social Responsibility
Social responsibility and ethical practice are increasingly influencing consumer behavior trends in banking. Customers of today, especially the younger generations, expect banks not only to offer seamless financial services but also to work actively towards environmental sustainability. This includes sustainable investment, offering green financial products, and influencing community development.
Demonstrating real commitment to such principles can instill confidence and reaffirm loyalty among customers. It is not a matter of minimizing harm, but of doing well. Banks that are attuned to such consumer behavior trends in banking have the opportunity to differentiate themselves in this competitive market.
Conclusion
The best banking experiences can be methodically designed to meet the evolving expectations of today’s consumers. These expectations are continuously being shaped by evolving consumer behavior trends in banking. From intuitive interfaces to personalised financial guidance, top banks are setting new standards for convenience, trust, and innovation. As technology continues to reshape the banking industry, financial institutions that embrace change strategically, balancing automation with human connection, will be the ones that thrive.
The banks that will come out on top are those that will provide strong digital channels and a unique product offering. By providing a mix of mobile banking apps and AI-powered data centers that cater to the entire customer journey, financial sectors will be better positioned to drive revenue growth while avoiding bad customer experiences.
Speak with a Banking Innovation Expert Today!
FAQs about Consumer Behavior Trends in Banking
1. What do customers look for most in a bank today?
Customers mainly want digital convenience, easy-to-use mobile apps, tools to help manage their finances, and a smooth process for opening accounts online. They also appreciate having a human touch for more complicated issues and expect their banks to be trustworthy and ethical.
2. Why does human connection still matter in digital banking?
Even though customers want quick and efficient digital services for daily tasks, they still value the empathy, comfort, and personalized advice that only a person can offer, especially for important financial decisions. Combining automation with a human touch helps build long-term trust and loyalty.
3. How are younger generations shaping consumer behavior trends in banking?
The younger generation is tech-savvy, and they are setting new consumer behavior trends in banking. They look for seamless mobile experiences, fast service, personalized financial advice, and prefer banks that show strong ethical values and social responsibility.
4. What can banks do to gain trust and increase deposit growth?
Banks can drive their deposit growth by being open about fees, giving useful financial advice, and having helpful people available when customers need them. Showing customers that the bank cares about their financial health is key to building the loyalty and trust needed for them to deposit more money.
5. How do easy-to-use interfaces affect customer satisfaction?
Easy-to-use interfaces are very important since customers have become used to personalized experiences. A banking app that is clumsy and hard to use can frustrate customers and make them switch to another bank. A simple and intuitive interface for tasks such as opening accounts or applying for loans can significantly improve customer satisfaction.
