LONDON — With consumers wanting more electronic banking services, financial institutions are placing greater importance on digital channels.
But CGI Group says that if credit unions and banks are to be successful with digital, they have to think from the outside in.
Penny Hembrow, VP, global head of banking for the IT consulting firm, told Credit Union Journal that type of thinking requires FIs to know the banking preferences of the consumers that use the financial institution.
"Going digital is more than a marketing strategy," Hembrow said. "It's a fundamental change in how banks and credit unions learn about, interact with and satisfy their customers. Based on our cross-industry experience, thinking from the outside in is the one common denominator for digital success."
Hembrow said an FI's "digital transformation" starts with that and then leads to fundamental changes within the organization that revolutionize the customer experience.
In a recent study titled "Understanding Financial Consumers in the Digital Era," CGI commissioned a survey of 1,244 consumers across the U.S., Canada and four European countries to learn about banking preferences in the digital era and steps FIs can take in response.
The following preferences are listed in order of consumer priority:
1. Reward me for my business (81% of respondents).
Being rewarded for their business is by far the top service demanded by consumers, the study explained. Consumers expect to be valued for their total spending and rewarded for their loyalty.
According to the report, reward programs are fast becoming mainstream, with loyalty cards, cash-back offers, loyalty discounts, upgrades and free nights and flights offered by retailers and credit card companies. Financial consumers want to be rewarded for all their spending.
Consumers see no difference between buying with cash, debit card, credit card, mobile wallet and PayPal, and want to be rewarded, irrespective of payment type or channel. However, they do not want to deal with multiple loyalty schemes, the study showed. Knowing their FI sees all of their spending, consumers are looking for support in receiving rewards across all of their spending activities, whether from the FI's own reward program or that of a third-party retailer.
2. Give me "anytime, anyplace" access to my balance (61%).
Consumers also want to know how much money is available at any time, regardless of where they might be, as well as help in understanding their spending patterns and how they can save money.
They want to be able to check at any time if money has been received, if payments have gone out, if they have sufficient funds, including drawing down lending, to make a purchase, and if there are better deals and offers available.
3. See me as a person (58%).
In the digital era, consumers are increasingly expecting services to be offered based on what they have done before and what other consumers like them do.
The survey highlighted that consumers recognize that a bank or credit union knows more about them than any other retailer, and they are expecting personalized offers, treatment and schemes. It is no longer acceptable to maintain an anonymous banking relationship.
4. Provide me with wealth-building advice (55%).
The survey also indicated that advice on building wealth, whatever income or age bracket, is a key want.
Consumers are demanding services that go beyond meeting basic needs to ones that enhance the quality of their lives, such as advice on building wealth, budgeting, saving and paying off debt.
5. Tell me what I am spending money on and how I can save (52%).
Providing information on consumer spending patterns, offering access to specialized discounts based on those patterns, forewarning of under- and overspending are services that financial consumers highly value from their FI.
These services are not only time, location and device agnostic, they also depend on knowing the consumer, the survey showed. A seamless and consistent omni-channel experience is a business imperative in the digital era.
And the Runner-Ups
Hembrow said the research indicated that three close consumer preferences fell just below the top five and should be noted:
- Give me access to independent experts when I need them (50%).
- Allow me to borrow up to an agreed limit at any time (49%).
- Allow me to pay for goods and services instantly using whatever device (49%).
