Guidance – The Foundation of Today’s Retail Banking Customer Relationships

The pandemic and all its uncertainty have resulted in complex financial situations for many individuals. For example, millions lost their income, when certain industry sectors immediately shut down in 2020. Others incurred unexpected expenses such as increased childcare or struggled with job security, putting them under considerable financial stress.  Now with inflation on the rise, uncertainty, fear and anxiety are shaking the financial foundation of many to the core.

Financially Stressed Americans

The American Psychological Association’s latest Stress in America survey found that 72 percent of Americans reported feeling stressed about money sometime in the prior month. Further research revealed that young adults are three times more likely to experience pandemic-related financial stress. An additional report uncovered that financial stress and anxiety are highly linked to low levels of financial literacy, problematic financial behaviors, and decreased financial security. EY revealed that about 30% of consumers say their households’ finances are worse today than before the pandemic.

Financial Guidance Needed

Consumer financial stress is not going away anytime soon. With soaring inflation, rising interest rates, and a war raging in Europe, consumers are anxious about their high debt, lack of assets, and how to manage their money. Consequently, consumers are in dire need of financial guidance. But, unfortunately, only 38% can pass a basic financial literacy test.

Advanced Sales Engagement Tools

In the past, financial guidance was only available to the rich who had access to wealth management advisors. However, there has been an accelerated shift to digital across the banking industry, over the past couple of years. This transition allows financial institutions access to a category of sophisticated sales engagement technologies.

These innovative technologies enable bankers to provide guidance to help consumers build economic resilience. For instance, advanced sales engagement tools give retail banking staff and credit union reps the knowledge to convey which products are the best for a particular customer based on their current situation. And which banking products will help consumers meet their financial goals and help alleviate their economic anxiety.

Using intelligent customer facing technologies allows FI’s to scale and service personalized one-to-one-to-many conversations. In branch, online, remotely as well as in call centers. This engaging technology allows the banker to educate, understand the needs and recommend products/services of value while showing empathy and understanding – lending a helping hand.

By meeting customers where they are and fulfilling their need for financial advice, banks will gain their trust and thus build loyalty. With the right tools, staff at financial institutions go from basic customer service to offering guidance and cultivating relationships.

Expectations for a Hyper-Personalized Experience

Companies like Amazon, Google, and Netflix have set elevated expectations for personalized experiences. Today’s consumers expect to be treated as individuals and believe companies should understand their unique needs and empathize with all they have been through over the past years. They expect a hyper-personalized experience from every business they deal with, including their financial institution.

As banks look to distinguish themselves in this extremely competitive market, providing financial guidance will be a key differentiator. Since monetary guidance is so in demand it is becoming the center of the customer relationship. According to Deloitte’s Future of Retail Banking report, “going forward, advice will play the prime role of anchoring retail banking relationships.”

To learn more about sales engagement tools that can help your customer find the path to financial wellness, download here.