How digital banking affects consumers

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The way we access and manage our money has changed during the pandemic. Certainly, the popularity of personal banking was declining even before the start of the pandemic, while digital platforms recorded slow and steady growth.

Although their popularity began to wane, traditional bank branches were undoubtedly still part of the financial routine of many consumers. When the pandemic hit, the balance of digital and traditional banking began to change rapidly. According to a JD Power study in 2020, 52% of bank customers went to branches to manage their money (or were dependent on branches). Just two years later, in 2022, more than 65% of US bank customers used digital banking services, according to Bankrate.

Challenges that digital banking poses to consumers

With this evolution of omnichannel banking comes unique obstacles and opportunities – especially for older people. While more people this age are now using digital technology than ever before, a study by the Pew Research Center indicates that 25% of adults aged 65 or over do not use the Internet, 36% do not have a home broadband connection, and 39% does not have smartphones. According to the MX 2022 Digital and Mobile Banking Trends Report, 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

That being said, with the 30% of American adults struggling with technology and economic barriers that prevent it from being adopted, it becomes obvious that digitizing banking is a challenge for many people.

Adoption and implementation

Every change requires some effort and adjustment, no matter how much benefit the other party may bring. The widespread adoption and promotion of digital banking is no exception, but it does not affect everyone in the same way.

Related: It offers unified, digital banking

Older adults, for example, often have to overcome age discrimination in digital technology. Because new digital devices and services are generally not designed with their needs in mind, they may find digital banking counterintuitive, overly complex, or physically difficult to use.

Building trust

Without the human element, trust can be a serious problem. According to an Accenture report, less than a third of people surveyed by Accenture in 2020 said they trust banks “very much” when it comes to looking after their financial situation. That’s up from 43% who said the same just two years ago, not to mention the growing distrust stemming from the recent collapse of the Silicon Valley Bank on Friday, March 10.

However, the tide may be turning for digital financial services. Given the benefits of lower fees and increasingly lower access barriers, it is perhaps not surprising that 61% of traditional bank users reported that they would soon or very likely switch to an online bank, according to the same Bankrate study referenced above.

How can banks offer a great experience to all customers post-pandemic?

The tangible experience of walking into a bank branch and interacting with a human may seem far away, but for many people it remains the norm. Members of the older generations in particular can rely on this physical experience of attention and appreciation as they navigate their financial lives.

Here are some effective ways to integrate human contact with great customer service for consumers of all ages:

1. Remember the benefits of human interaction

People have not lost the basic need for face-to-face personal interaction. Embedding human interactions into digital experiences helps customers adapt, learn, and gain trust. Whether that trust comes from a highly advanced, intuitive chatbot that connects customers to personalized messaging on your site, or from features that direct digital users to real people who can help them solve their problems.

These days, all businesses need to understand that caring customer service is more important than ever.

2. Don’t compromise on security

Security challenges and threats clutter the future of digital banking with hurdles. The increased use of mobile platforms and digital payments has increased the level of cybersecurity risk. Many of the customers turning to digital banking today come from older generations: less tech-savvy who feel compelled to join the younger generations online for fear of being left behind.

Related: “Information, communication and transactions 3 stages of digital banking”

For these people, increasing cybersecurity is even more important. Anti-phishing methods and education (and the introduction of mandatory two-factor authentication) can help protect even more vulnerable users.

3. Prioritize availability

Make your digital banking service as accessible as possible so that everyone can use it, regardless of their digital knowledge. To this end, the University of Wisconsin-Madison recommends that websites include captions, large font sizes, screen readers, screen magnification, and fast-loading web pages. You can also offer personal instruction to clients who need extra help.

At times, it can feel like the digital transformation of finance has happened too fast for customer expectations to keep up. Fortunately, this catching up is already underway. As customers of all generations become familiar with mobile and online banking and what they can offer, banking companies can reduce the learning burden by providing a secure and perfectly personalized banking experience. Don’t wait to start.

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