How AI-enabled customer support can work for banks

The competition for customer deposits is going to continue to rise in the next few years and a dedicated retention strategy built around delivering the best customer experience will be needed.

By Rahul Kumar

Banks have been intently focused on digital transformation for the last several years. The key objective of digital transformation for banks and credit unions is to improve scalability, operational efficiency, and customer satisfaction.

While traditionally customer/member acquisition understandably has been a top priority of banks and credit unions, this year many of them are placing a higher emphasis on customer retention. There are several reasons for this shift in outlook.

Thanks to digital technology, it’s easier than ever before for customers to switch banks that are not meeting their expectations. Not only can customers open a bank account online, but they also can become open accounts anywhere in the country. Likewise, community and regional banks that traditionally have operated in specific communities and geographies in the U.S. are actively looking to go nationwide with new digital-only offerings. Thus, customers face far lower costs of switching and have more choices. Data shows that 80 percent of bank customers will switch banks if a competitor offers a better customer experience (CX), while 56 percent of customers who leave a bank say those institutions made no effort to retain their business.

Owing to the above and the current challenging macroeconomic environment as well as increased competition, bank deposits are challenged. Bad news—real or not–about a bank can be magnified through social media to create panic among customers. That’s the world we live in now.

It is important, therefore, that banks take active measures to counter any potential negative perception that could trigger a devastating deposit run and an exodus of customers. During difficult economic times, it is imperative that banks instill confidence in their customers. One of the best ways to do that is through proactive, transparent and consistent communication. Viewed through this perspective, customer retention—and the stability it provides—should be a higher priority to banks today than growth.

Customer retention also is more cost-effective. It costs five times as much to acquire a customer as it does to retain one. Further, increasing customer retention rates by as little as 5 percent can translate into a profit increase of 25 to 95 percent.

Customer experience and the contact center

Customer retention begins with meeting and exceeding the expectations of customers. For bank customers, arguably their biggest need (even subconsciously) is to feel secure about the ability of their banks to protect their money. Another primary requirement is a superior CX.

The right customer service platform can be the focal point of a bank’s CX strategy and retention efforts. A modern, cloud-based contact center powered by artificial intelligence and automation can provide bank customers with the personalization and self-service functionality they demand, while empowering contact center workers with the tools to efficiently provide superior, customized service.

AI-driven customer support allows banks and credit unions to meet customers/members how and where they want to be met by providing a personalized experience. This can be accomplished in several ways:

Omnichannel options. Many customers prefer talking to a support agent on the phone, or the option of using the channel most convenient to them at that moment.

While multiple channels for communicating are critical to offering desirable choices for consumers, it is even more important for banks to deliver an integrated experience by ensuring support agents have access to all relevant information about a customer across every channel. Channel integration helps agents resolve issues faster, without having to ask customers to repeat information. The result is a seamless customer experience.

Self-service. Sometimes customers want the convenience of self-service for simple needs such as checking how much money they have in their savings accounts. Enabling customers to help themselves both empowers them and frees up support agents to handle more complex customer issues.

AI and automation can be leveraged by banks and credit unions to provide powerful self-service functionality that customers will embrace. For example, chatbots and virtual assistants allow customers to perform common banking interactions such as transferring funds, checking account balances, or activating a card. More importantly, ensure the experience is more conversational and modern than the traditional menu-based self-service offered within the Interactive Voice Response, where customers get frustrated navigating multiple layers before they can get to the options that meet their needs.

Personalization. Utilize data and derived insights to proactively engage with customers. Identify patterns regarding customer intent and lead the conversation with that. For example, if a customer calls the fifth day of every month to confirm a paycheck deposit, automate that, and let her know proactively, rather than her having to ask every time she calls. Similarly, if a customer has been browsing through certain product pages and reaches out, make that information readily available to the agents so that they have the context in front of them before the conversation even starts and provide them with the guidance needed to have effective interactions to capture the “moment.”

Enhancing the human touch. Sentiment analysis and natural language processing are invaluable for helping financial services support agents interact empathetically with customers, some of whom may be concerned about a financial issue and in a highly emotional state. AI can guide agents through these difficult conversations, offering prompts that enable them to meet customers’ informational, transactional and emotional needs.

Customers have more options than ever and are far less willing to settle for substandard, non-personalized service. The competition for customer deposits is going to continue to rise in the next few years and a dedicated retention strategy built around delivering the best customer experience will be needed. Banks must meet customers where they are and provide them with a highly personalized experience. A cloud-based contact center platform infused with AI can help deliver the support that allows banks and credit unions to maximize retention and safeguard deposits.

Rahul Kumar is the vice president and general manager for financial services at Talkdesk.