For banks, the imperative of sustaining new business growth in both the retail and commercial sectors has more variables to manage than ever before. Many banks and credit unions have already redesigned their new business processes, resulting in simple and quick ways to get a loan or set up a deposit account. The digital world has brought in the Fintech cluster of competitors who use fresh approaches to appeal to younger retail and small business owners. They offer a digitally-optimized approach to new business which can be accomplished at whatever time of day or night the customer wants, without visiting a bank facility. The Fintechs are also high-profile, relentlessly advertising “no hassle loans” far more frequently and prominently than traditional banks. In short, the competition is fierce.

One often overlooked factor that can thwart innovation is a bank’s inability to look inward and objectively evaluate their own new business processes from the standpoint of the customer. What are today’s expectations of clients who visit a branch to open up a new account? Is the customer experience quick and hassle-free? Symptoms we often see include:

  • Bank staff members must navigate through old forms and multiple inputs of the same information, which translates to customer inconvenience. Experienced bank staff members who know the drill often create workarounds by writing down information that is repeatedly required.
  • Loan and deposit systems are not integrated, causing unnecessary re-entry of data. Typically, 75% of a bank’s small business and retail new business is with existing customers. Yet some banks cannot populate their new account input requirements with data from a CIF or a loan or deposit accounting system.

Where are you on the spectrum of competing for customer relationships by making their experiences quick, easy, and intuitive? One way to find out is to ask your customers. A simple three-question poll will tell you volumes, some of which you may not want to hear. If your new business is either stagnant or diminishing, then it’s time to take action to become that customer-friendly bank by today’s
standards. Here are some action items to consider:

  • Conduct a high-level analysis of your new business processes. Tally up the manual workarounds, data-entry bottlenecks, and steps that inconvenience customers. If you found any, that’s too many relative to today’s competition.
  • Compare your time-service and digital-enablement to the Fintechs. Are you serving customers on their terms? Identify the one or two things you can fix now to improve your performance, and implement those using an agile approach (i.e. iteratively and rapidly).
  • Benchmark your customer-facing technology to those of non-competitors such as Starbucks and Uber. Fair or not, those are your customers’ comparators. Assign responsibility to specific individuals to close the gaps.
  • Capitalize on social media to build awareness and invigorate your brand among next-generation customers. But don’t do this until your delivery capabilities match your brand promises.

If you are like many banks, you will find ample opportunities to improve. The hard part is making it happen, which takes urgency, objectivity, commitment, and the right resources. Meanwhile, the Fintechs are marching on.