From Necessary Evil to Valued Partner: Transforming Banking with Real-Time Customer Engagement

Trust is an extremely important part of banking relationships; as a consumer, you want to be sure that your data and money are safe. However, the reputation of financial services providers today is not enough to attract and retain customers in the long term.


Customer Engagement in Banking: How to Change the “Necessary Evil” Perception


Despite years of innovation efforts to improve the banking industry, most customers still have negative opinions of their banks. This is evident if you ask those close to you about their experiences with their bank – you’re likely to hear eye rolls, sighs, and tales of frustration.

Many banking practices have remained unchanged over the years, putting the needs of the bank before those of the customer. This results in a customer experience that prioritizes cost-saving, risk management, and compliance over creating a seamless and enjoyable experience.



Banks have a limited understanding of their customers’ needs and behaviors. They tend to focus only on the bank’s products, rather than gaining a full picture of the customer’s needs. Customer segmentation is based on the products they hold with the bank and future needs, rather than a deeper understanding.

Behavioral and socio-demographic data that a bank collects on their customers tells an incomplete story. Although there may be behavioral models, they are only applicable to certain products, such as credit cards, and cannot be combined into a bank-wide strategy.

When consumer needs are identified and addressed based primarily on internal data analytics, the result is often “product-led customer centricity”, a half-hearted attempt at being customer-focused. Moving away from product-led, and towards customer-led focus is certainly the way to go for banks to shift from being seen as a necessary evil to a valued partner in managing finances.


Next Best Action in Banking: Real-time Decisioning Beyond Digital Interactions


Banks concentrate their customer experience efforts primarily on digital channels, even though many customers only spend a few minutes there per day. So, the question is, how can banks offer positive experiences when customers are not present in their digital channels without coming across as pushy or, worse, being flagged as spam?

Many marketing automation platforms claim to improve customer experience by determining and executing the “next best action” for each customer. In theory, this allows brands to deliver personalized experiences to their customers by executing the most appropriate action at the right time through the optimal channel. However, in practice, the results can often be vastly different. Next Best Actions, driven by data and intelligent technology, focused on the likelihood of a sale – are probably not the same as Next Best Actions focused on the actual needs of customers.



In the battleground of engagement, real time transaction communications – beyond just account activity notifications and security alerts – give banks the opportunity to pave a seamless customer experience and provide the high level of service that consumers expect from them.

Latinia real-time decision engine analyzes real-time banking transaction data along with all available customer intelligence information to determine the most appropriate content for that customer at the exact moment when it is needed. This solution allows banks to proactively anticipate potential issues and intervene in a timely manner. This proactive approach, akin to anticipating moves in a game of chess, allows the bank to be one step ahead and present as a solution for the customer, rather than allowing the customer to encounter the problem first.
The implementation of real-time analysis of customer transactions presents countless opportunities for proactivity in critical moments, allowing the bank to demonstrate its understanding of the situation and offer a solution before the customer is required to initiate contact through a call center, which is usually viewed as an unpleasant experience. By doing so, the bank can avoid the potential delays and inconvenience associated with the typical “interrogation” process in resolving customer issues.

Credit and/or debit cards are the products that generate the most interaction between banks and customers. For instance, if a customer is unable to make a payment due to reaching their credit limit, the bank, which has the information, can step in promptly to offer a solution.

Another example is when a customer tries to pay with an expired card or forgot to activate international payments before travelling abroad. These are Next Best Action instances where it is imperative for the bank to promptly inform the customer of the reason for the inability to use their card and provide an effective solution.

Listening to your customers is a great thing to do. Responding to and helping them is even better. But, today, it’s not enough. Ultimately, for banks to improve customer engagement, it is important to assess how their actions meet the customer’s expectations, wants, and needs, not just the bank’s own goals. If all your measurements are solely focused on the benefits to your brand, without considering how it affects the customer’s satisfaction, perception, or intention, then it cannot be considered a truly customer-focused program.

Categories: Strategy

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