Banks need empathy in their digital environment

April 2021

The rapid shift to working from home, forced by circumstances over the past year, has shown that in many fields it is possible to not only work and communicate efficiently with colleagues remotely, but also to serve clients completely electronically. For many firms, this change marked the completion of the digital transformation of their business, while for many others it may only be their first step towards digitisation. The situation for banks was a bit different. Bank clients had routinely used various digital channels before, but last year meant a virtually complete cut off of personal contact with their bankers.


“Communicating and delivering services through digital channels is very convenient without a doubt, but it also often leads to depersonalization and alienation. For banks, this may mean a reduction in the loyalty of clients who, because there is a lack of personal connection, easily switch from one virtual environment to another,” says Lubomír Tomány, product manager at BSC, which has been digitising banks at home and abroad for 30 years. That’s why the new challenge for banks is to regain empathy and establish personal relationships with clients within a fully digital communication sphere.

In many ways, the coronavirus pandemic and its consequences has shown just how important a personal approach to clients is. Many clients, who are not entirely used to dealing with their financial affairs online, need help accessing and using the bank’s digital channels. Similarly, there are a significant number of clients who have run into financial problems in the context of the pandemic and expect an individual approach from their bank to resolve their difficulties. And for many other clients, the new situation provides a clear signal to pragmatically choose the bank that demonstrates the greatest technical sophistication in its digital services – regardless of any personal relationship. For all of these reasons, banks should be particularly concerned this year with finding and maintaining a personal relationship with the customer – in a fully digital environment.

Personalization in the Digital Age

The full digitisation of the banking services landscape also means a sharp increase in competition in the market as customers completely stop differentiating between banks with a branch network in each major city and fully digital banking service providers. Internet banks, meanwhile, are built on the massive use of modern technologies that enable agile responses to new situations and the very rapid introduction of new services.

“Traditional banks must adapt to the pace of their online competitors and catch up with their technological lead. We are at a point in time when potential technological risks in the introduction of new technologies pose significantly less danger to banks than slow reactions and delays in innovation. The whole banking market is in a highly precarious situation and only those able to respond quickly to new client needs and demands will succeed,” explains Lubomír Tomány.

Modern technological solutions are also ready to help with the return of a personal approach to clients. Based on advanced data analysis, it is possible to see what kind of life situation the bank’s clients are in and react ahead of time to their new demands or impending financial problems. Artificial intelligence technology can predict client needs to a large extent, automatically offering highly relevant financial products, while simultaneously evaluating clients’ ability to meet the qualifying conditions. A high level of automation will also enable an individual, personal approach to clients with highly specific needs or customers who require face-to-face contact.

Meanwhile, client demands for a personal approach coupled with an increase in the predictive powers of service providers based on previous interactions are constantly growing. After more than a year in which even very conservative clients have become accustomed to the daily use of digital, on-demand and highly personalised services in the areas of shopping, communication or entertainment, they automatically assume that their bank will offer them a similar service – at any time, through any device and with the necessary empathy.

“An example of such empathic banking might be a reminder of too small a balance to cover permanent payments and a normal spending pattern. Or, conversely, an unnecessarily large current account balance that might provide a better return in a bank’s investment product. Some may appreciate reminders about the payment of various taxes on the dates the client actually sends the payments. Another might like a reminder of their wife’s birthday. Needs are individual, and that is the power of empathetic banking – that, like the big technology players in other industries, it is able to recommend, based on user interactions, the exact product or action that suits the client. Clients expect to be more than an account number for their bank,” says Lubomír Tomány.

In addition to data analytics and artificial intelligence, cloud and container technologies, as well as progressive approaches to development are helping banks to deploy new services quickly and with a personalized, individual approach to customers. While some processes and technologies may be new to banks and therefore potentially risky, online banks and other fintech companies started using them a long time ago.

“Technology now allows banks to use real ‘hyper-personalization’, which can be reflected in the offer of the specific banking products, but also in the communication style of the message – should the banker call you or would you prefer a message? Or even a Whatsapp chat? There are many dimensions of how to be “empathetic” and the possibilities are based on which platform the bank has and the bank’s willingness to experiment,” concludes Lubomír Tomány of BSC.

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