The local bank branch may well be a thing of the past. Across the US and Europe, “banking deserts” – geographical areas without a bank branch within reasonable travel distance – are growing. In the US, more brick-and-mortar bank branches closed in the first half of 2017 than in any other year prior. And big name consumer banks are leading the way in branch closures – even Bank of America has closed 10% of its branches since 2010.
The article was originally posted on BankingTech.com
The reasons for this trend are clear, as are the potential long-term benefits – lower overhead equals greater profitability. But as financial institutions forego physical branches in favor of virtual branches, are consumers paying the price? More importantly, are banks – especially bank contact centers – actually prepared to provide full-service remote banking?
Digital adoption – not there yet
A recent survey we conducted found that the usage of online self-service for low-complexity actions in US-based financial services sector is disappointing, to say the least. For example, 63% of customer service calls to banks surveyed were made for simple requests, notably checking account balance. Moreover, the majority – 57% – of financial services customers surveyed still preferred human-to-human interaction over digital self-service.
This trend puts a damper on the savings that banks are hoping to reap by closing physical branches. Despite their massive investments in solutions for cost-effective digital self-service, call center agents are still bearing the brunt of consumer banking interaction. And these agents, it turns out, may not always be equipped with the same tools and skillsets as veteran branch employees.
Consumer banking contact center challenges
As contact centers grow to absorb the burdens of branchless consumer banking, their challenges are mounting, too. Banking contact centers face:
- Deficient skillsets
Contact centers were designed to be reactive and customer maintenance-focused. They were built to take incoming calls and provide answers to customer questions and requirements. But with agents burning out within ten to 12 months, they’re also challenged to deliver the high-level expertise required from a banker. A virtual branch needs to be an engine for growth, augmenting the bank’s business with proactive sales capabilities – upselling and cross-selling as the situation warrants.
- Different mentality
Contact center staff are evaluated and compensated according to service or operational KPIs – call length, calls per agent, on-hold time, etc. A true virtual branch needs to be measured and rewarded according to business KPIs – the number of customers signed up for services, number/size of loans, amount of value-added services sold per customer, and more.
- Lack of visibility
Contact center personnel – assuming they’re bank employees and not outsourced contractors – tend to exist in the contact center bubble. Their physical location may be remote from the institution’s headquarters, and their turnover higher than organizational standards (as per the above). Because of this, they may not fully identify with the needs, goals, and vision of the financial organization. This feeling of shared values and purpose drives innovation, a crucial motivating factor to providing better customer service.
Contact center solutions for consumer banking
To survive and thrive in the new age of banking desertification, contact centers need to evolve.
Decision makers need to act now to ensure that their organizations effectively leverage the tremendous opportunity offered by the dawn of fully remote banking. Here are four things they can do to get there:
1. Lower the burden of low-level interactions.
Relieve agents from dealing with trivial requests that can be better handled via digital self-service. To accomplish, introduce digital tools that intelligently and gracefully deflect low-value interactions to digital channels – leaving contact center staff to field only high-value requests. By reducing the amount of menial tasks, you enable your contact center staff to become proficient in skillsets that further strategic goals and positively impact the bottom line.
2. Change the call center mindset.
Virtual branches need to be built from the ground up, just like physical branches once were. This includes teaching staff to focus on business KPIs and proactivity. Create a climate that encourages and rewards proactivity and higher-than-expected levels of service, and your agents will likely exceed your expectations.
3. Mimic the physical branch experience.
Introduce innovative digital tools that emulate live branch capabilities, and raise consumer comfort levels with remote banking. For example, offer co-browsing (the ability for agents and customers to browse the same web pages together) and co-signature of forms. Enable agents and consumers to share documents and images, to use video chat, and more. By developing a more personal, real-time digital interaction experience, contact centers position themselves as a viable alternative to physical branches.
4. Think and act post-channel.
The promise of the virtual branch is universal customer access – anywhere, anytime, over any medium – yet banks still hesitate to deploy solutions that create a truly unified customer experience.
To meet the demands, your contact center needs to handle customer care with a “post-channel” approach. Engagement can no longer be siloed, so financial institutions should adopt technology that enables a customer to open a service call via digital, continue with a live agent, and resolve the issue back in digital. In the post-channel world, customers need to flow in and out of channels without interrupting services processes.
The bottom line
The transition from in-person local banking to a virtual branch environment is a difficult one for both bankers and consumers. To maximise the benefits of remote banking, financial institutions need to fully commit to encouraging digital services without sacrificing customer satisfaction.
If call centers are prepared, trained, and – most importantly – equipped with the right digital tools, banking desertification will become more asset than a liability.
By Tuval Lava, president & executive chairman of CallVU