Temenos, the banking software company, has published a new report by The Economist Intelligence Unit (EIU) based on an analysis of over 10 million online conversations in public forums about personal finance.
The report, “Customer experience: learning from online personal finance conversations”, reveals the strengths and weaknesses of traditional and challenger banks in terms of how well they are meeting customer needs.
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It finds challenger banks are strongly associated with financial empowerment, but also twice as likely to be associated with security and privacy concerns when compared to traditional banks.
According to the EIU report, start-up, digital-first banks, and investment services have come to market promising superior customer experience and innovative services, such as budgeting apps and automated, low-cost investment tools.
But traditional banks still benefit from trust, reliability, and a wider range of services. And increasingly, spurred on by new digital entrants, they are investing heavily in their digital capabilities.
Customer experience is top priority for challengers and incumbents alike
In an earlier EIU global survey, a third (32%) of banking leaders stated that improving customer experience and engagement was their bank’s top strategic priority.
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By GlobalDataThe analysis found that 13.7% of conversations about challenger banks included associations with concerns about safety, security, or privacy, compared with only 6.7% of those about traditional banks.
Discussions about “investment” have grown in frequency since 2015, and the analysis shows that 14.4% of conversations that discuss challenger banks include associations with financial empowerment capabilities such as tracking and budgeting, compared with just 2% of conversations that discuss traditional banks.
But while many consumers are turning towards disruptive fintech platforms for enriched tools and services to bolster their personal finances, traditional banks remain heavily associated with rewards and loyalty programs — one of the most discussed subjects overall.
‘Financial services’ is a far bigger field than before
A quarter (24.9%) of conversations about traditional banks were related to credit cards or reward programs, compared to just 2.4% of those involving challengers.
The report also notes that the field of “financial services” is far bigger than before with open banking allowing third-parties to build innovative financial products and assist customers in many aspects of their financial lives.
This could see fintech become ubiquitous in areas far beyond core banking services.
The analysis shows incumbents and challengers are only associated with 18% of total personal finance discussions, with the rest covering everything from divorces and wills to car buying.
