How Financial Services Can Thrive Post COVID-19
It seems like COVID-19 will unfortunately be with us for a while, but that doesn’t mean retail banks, asset management firms, credit card companies, and other financial brands shouldn’t look to the future. The post-pandemic world will be a very different place than the world before, which means brands in all industries need to be prepared for the next steps, especially when it comes to customer experience (CX).
Today’s discussion focuses on what the world of financial services will look like after the coronavirus pandemic and how it needs to adapt from a CX perspective. These predictions are based on my years of advice and collaboration with finserv brands and will address three types of organizations:
- Retail banks
- Asset management company
- Credit card company
Today, retail banks can do a lot to create a viable and attractive financial services company. First, banks should pay close attention to how their customers behaved during the pandemic – what transactions or account activities more or less took place during this crisis? What surprises were there and was your brand able to master the challenge? Has your bank also implemented security standards to offer customers a safe experience?
When it comes to customer behavior, it should also be noted that the pandemic has significantly increased bank customers’ dependence on digital media. Therefore, retail banks should rethink digital channels and make sure they have adapted to new expectations and behaviors. This pandemic hasn’t marked the end of bank branches, but physical bank locations are being repurposed to focus solely on advisory interactions such as advice and financial wellbeing support. In the meantime, these brands should expect digital transaction methods such as online banking, ATMs, mobile apps, and other self-sufficient channels to become even faster.
Ultimately, as we learned from the 2008 economic downturn, banks need to develop new products that meet customer needs after the pandemic. Given the impact of the crisis on the economy, products and services related to debt consolidation, financial health, saving, and retirement are likely to be the new preferred areas of interest for customers. Banks that focus on innovation, differentiation, and a greater focus on customer and market intelligence will make or break banking hegemony after the pandemic.
Asset management company
COVID-19 has left no customer group untouched – the affluent public is also suffering financial setbacks from this pandemic. These setbacks will have a direct impact on what to expect from wealth management brands in the wake of the coronavirus.
The data and trends I’ve seen suggest that wealth management clients come to these firms primarily for advice. The pandemic has created tremendous uncertainty, especially when it comes to savings and investment opportunities, and these customers will crave financial advice. Asset management companies should be proactive in advising clients to allay their concerns and fears.
Accordingly, wealth management clients will also expect greater interactivity from their businesses, including more active account management, more frequent business reviews, and other proactive measures. Customers will also be more interested in aggressively protecting their assets, as well as improved digital access to resources and increased self-reliance. The bottom line here is that if you are a wealth management advisor, brush up on your tech and invest in that extra coffee maker because your clients will need more time and focus than ever before.
Credit card company
The pandemic has made finances very tough for many people and businesses, and this has already had a massive impact on credit card providers. These providers face three challenges of the COVID era: a greater need for credit, more payment options, and the need to develop a focus beyond credit cards.
Loans aren’t always the best option to fill the financial void during troubled times, but with soaring unemployment and ongoing economic downturn, many customers and businesses will rely on them to stay afloat. Because of these issues, providers with an increase in potential credit problems and a growing desire for perks such as deferred payments and daily necessities (gasoline, groceries, etc.)
Credit card companies can also expect changes in the way customers pay. Contactless payment has spiked during the pandemic and is likely to remain at that high level after the crisis.
While credit card providers continue to resemble banks in many ways, they have to focus on factors like future forbearances, payment difficulties, and debt consolidation. All in all, post-coronavirus credit card providers can move forward by designing their experiences with flexibility that can both calm customers and keep post-COVID-19 challenges from affecting the bottom line.
The future of Finserv
There is a common thread that unites all the changes that are to come, and that is human action. Whether customers are opening an account with a new bank, reevaluating their asset management, or applying for a credit card, all of these brands need to create an experience that is based on both flexibility and proactivity.
Financial service brands need to be able to quickly learn the new realities of the post-COVID landscape and then incorporate those insights into the experiences and products they offer. This strategy will result in customers being both happier with financial uncertainty and genuinely compassionate. The finserv brands that take on this work will emerge from this crisis with the most significant experience and the strongest result and thus continue to enjoy success for themselves and their customers.
By Jennifer Passini, Ph.D., Senior Director of Solutions Strategy