How Digital Banking Impacts Consumers


The opinions expressed by Entrepreneur contributors are their own.

During the pandemic, the way we are accessed And managed Our money has changed. Of course it was personal banking decreasing in popularity even before the pandemic began, while digital platforms experienced a slow but steady rise.

Although their popularity has gradually waned, brick-and-mortar banking branches were undoubtedly still an integral part of many consumers’ financial routines. When the pandemic struck, there was a rapid shift in the digital and traditional banking balance. in 2020, 52% of bank customers went to branches to manage their money (or depended on the branch), according to a survey by JD Power. Just two years later, in 2022, more than 65% of US bank customers use digital banking services, according to Bankrate.

The challenges that digital banking brings to consumers

With this evolution in omnichannel banking come unique barriers and opportunities—particularly for older adults. While more people in this age group are now using digital technologies than ever before, a Pew Research Center study states that 25% of adults aged 65 and over do not use the Internet, 36% do not have broadband access at home and 39% do not own a smartphone. Accordingly MX Report 2022 on digital and mobile banking trends says that only 39% of baby boomers Use a mobile app to manage their financial accounts.

Related: 8 ways digital banking will evolve over the next 5 years

If this is taken into account, along with that 30% of American adults who struggle with technology and that economic barriers preventing the adoption of technologyIt is becoming clear that the digitization of banking poses challenges for many people.

adoption and implementation

Any change requires some effort and adjustment, no matter how great the benefits may be on the other side. The widespread adoption and promotion of digital banking is no exception, but it does not affect everyone equally.

Related: Provides a unified, digital banking experience

Older adults, for example, often have to overcome ageism in digital technology. Because new digital devices and services are generally not tailored to their needs, they may find digital banking counterintuitive, overly complicated, or physically difficult to use.

build up trust

Without the human factor, trust can be a big problem. Less than a third of those surveyed According to Accenture’s report, in 2020, Accenture’s said they trust banks “a lot” when it comes to their financial well-being. This compares to 43% saying the same thing two years ago, not to mention the growing suspicion stemming from Silicon Valley Bank’s recent bust on Friday, March 10th.

However, the tide could turn when it comes to digital financial services. Perhaps unsurprisingly, given the benefits of lower fees and lowering barriers to entry, 61% of traditional banking users said they would be more or very likely to switch to an online-only bank soon, according to the Bankrate study mentioned above.

After the pandemic, how can banks offer a great experience to all customers?

The tangible experience of walking into a bank branch and interacting with a human could be seem a world away, but it remains the norm for many people. Members of the older generation, in particular, can rely on this physical experience of attention and appreciation to help them navigate their financial lives.

Here are some effective ways to incorporate human touch into a great customer experience for consumers of all ages:

1. Remember the benefits of human interaction

People haven’t lost the basic need for face-to-face, face-to-face interaction. By building human interaction into your digital experiences, customers can adapt, learn and trust. Whether that trust comes from a sophisticated, intuitive chatbot that connects customers with personalized messages on your website, or from features that direct digital users to real people who can help them solve their problems.

It is important for all businesses today to understand that attentive customer service is more important than ever.

2. Don’t skimp on security

Security challenges and risks pose obstacles to the future of digital banking. The increasing use of mobile platforms and digital payments has increased the level of risk in terms of cyber security. Many customers now turning to digital banking belong to the older generation: less tech-savvy people who feel compelled to join younger generations online for fear of being left behind.

Related: “Information, communication and transaction – 3 levels of digital banking”

For these people, improving cybersecurity is even more important. Anti-phishing methods and training (as well as the introduction of mandatory two-factor authentication) could help protect even more vulnerable users.

3. Prioritize accessibility

Make your digital banking service as accessible as possible so anyone can use it, regardless of their digital skills. To this end, the University of Wisconsin-Madison recommends that websites offer subtitles, large font sizes, screen readers, screen magnification and fast-loading web pages. You can also offer in-person training to customers who need additional help.

Sometimes it feels like the digital transformation in finance has happened too fast for customer expectations to keep up. Fortunately, that catch-up is happening now. As customers of all generations become more familiar with mobile and online banking and its offerings, banking organizations can reduce the learning curve by providing secure and superior personalized banking experiences. Don’t wait until it starts.

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