Retail banks occupy a unique position in their customers' lives, similar to that of a family doctor. This relationship is inherently intimate; customers share their financial details, life goals, and vulnerabilities, expecting their banks to provide personalized, considerate advice. Just as we expect our doctors to consider all aspects of our health without ignoring critical issues, we should expect our banks to manage our financial well-being with the same level of attentiveness and integrity.
This expectation extends beyond doctors to relationships with life partners, best friends, and family members. We trust these individuals with our deepest concerns and expect them to act in our best interests. Likewise, the relationship with our bank should be built on trust, privacy, and personalized care.
Unfortunately, retail banks have often failed to meet these expectations, undermining the essential elements of their relationship with customers. Trust and credibility—derived from the Latin word "credere," meaning "to believe"—have eroded. Over time, customers have come to expect banks to turn a blind eye to their personal needs, resigning themselves to impersonal service and minimal engagement. This erosion of trust has led to a belief that banks are not truly interested in their individual circumstances.
The banking industry, like healthcare, is highly regulated, which theoretically should ensure adherence to standards of prudence, transparency, privacy, and responsibility. These regulations are designed to protect customers and maintain the integrity of the industry. In contrast, industries such as shoemaking or clothing are not bound by such stringent frameworks, allowing for more flexibility but less guaranteed protection for the consumer.
Despite this regulatory framework, the relationship between banks and their customers has deteriorated. The core values of trust and intimacy have been compromised, and many customers feel neglected. The affluent few receive personalized attention, while the majority are subjected to impersonal and often subpar service. This has led to a widespread perception of banks as mere utility providers rather than trusted financial partners.
However, the tide is turning. Advances in technology—such as large language models (LLMs), machine learning, and massive computing power—are becoming more accessible and affordable. These tools offer unprecedented opportunities for banks to enhance productivity and reconnect with their customers on a personal level. By leveraging these technologies, banks can anticipate their customers' needs and provide tailored financial advice and services that cater to the unique needs of each customer. This proactive approach transforms the customer experience, moving from reactive service to anticipatory guidance.
Now is the time for banks to regain the intrinsic trust and intimacy that is foundational to their relationship with customers. Modern technology enables banks to connect the dots in ways that were previously unimaginable, allowing for the anticipation of financial needs and personalized care that was once the exclusive domain of elite account managers.
As one customer succinctly put it, "Marius, but this is just a bank; what can I expect from them?" This sentiment reflects the prevailing view of banks as functional entities rather than trusted advisors. However, with the right approach and the intelligent application of modern technology, banks can transcend this perception and reaffirm their role as essential, trusted partners in their customers' lives.
In conclusion, the path forward for retail banks involves a return to the core principles of trust, credibility, and personalized care. By embracing advanced technologies and recommitting to the intimate, anticipatory service that customers deserve, banks can rebuild the vital relationships that have been eroded over time. This is not just a technological evolution; it is a return to the fundamental values that define the banking industry.
Turn your customers into fans.
