6 Ways Banks Can Radically Decrease Their Servicing Costs

The COVID-19 pandemic accelerated self-servicing trends in virtually every industry. A Forrester study commissioned by Intercom.com reported that 71% of support leaders and decision-makers credit the pandemic with having an enormous or large impact on how they will address customer support long term. Similarly, Acumen reported that 45% of customers are more likely to use self-service now than they were before the pandemic.

The result of providing more and better self-service options has been time saving for the consumer and substantial cost savings for banks.

Low-effort experiences have been found to reduce costs by decreasing up to 40% of repeat calls, 50% of escalations, and 54% of channel switching. In comparison to live channels, such as phone, live chat, and email, which cost brands an average of $8.01 per contact, self-service channels cost about $0.10 per contact. Overall, a low-effort interaction costs 37% less than a high-effort interaction.”

Today’s technology allows customers to access services without visiting a physical branch, which busy consumers prefer. Options like mobile deposit, internet banking, and interactive voice response (IVR) systems have rapidly gained popularity. They enable customers to perform a wide range of routine tasks such as balance inquiries, transfers, and bill payments. Most institutions even support online loan applications, with no need for the customer to ever have direct contact with bank personnel.

With further investments in technology, banks stand to gain even greater efficiency, radically decreasing the cost of servicing their customers while improving customer satisfaction.

Here are six strategies for getting there:

1. Paperless Transactions

Transitioning to electronic delivery of statements, notifications, and documents reduces printing and postage costs associated with traditional paper-based communication.

For the consumer, paperless bank statements offer an array of advantages. First and foremost, they provide instant access and easy retrieval. Instead of waiting for a physical statement to arrive by mail, customers can view their statements immediately online, often as soon as they are generated. Digital statements are easily searchable, enabling customers to find specific transactions without the need to rummage through stacks of paper. Storing statements electronically also reduces physical clutter, eliminating the need for filing and storage space.

From the bank’s perspective, paperless statements mean substantial cost savings. It’s also better for the environment, helping financial institutions to achieve their sustainability goals. Overall, going paperless is a win-win, combining efficiency and eco-friendliness while optimizing the user experience.

2. Automation

Automation of customer communications allows for personalized interactions at scale, reducing the need for manual intervention and streamlining processes. Consider, for example, how a bank might enhance the onboarding experience for a new customer. Personalized interactive video enables a bank to communicate important information to the customer in a way that is highly relevant to them individually. That translates to a better customer experience, without the need to engage directly.

By automating workflows, including customer communications, banks stand to gain huge efficiencies. This is especially true if they build their automation around a single integrated platform, offering a unified approach to CX, regardless of which channel the customer prefers.

3. Self-Service Options

Providing customers with self-service portals or mobile apps for accessing documents and information can dramatically lower the demand for human interaction, decreasing operational costs.

Chatbots, for example, provide a simple and effective means for customers to get what they need quickly and efficiently, anytime, without visiting a branch or waiting on hold to talk to someone. According to a study by the Enterprise Strategy Group51% of consumers express a preference for automated self-service channels, whereas only 37% prefer to interact with a live agent. Younger respondents were three times as likely to favor self-service channels as an initial point of contact.

While self-service options won’t replace human interaction altogether, they have an important role to play in delivering a strong customer experience. They also save substantially on costs.

4. Streamline Communications

A unified customer communications management (CCM) platform allows banks to consolidate various messages and documents into a single communication, reducing the frequency of customer interactions and associated costs.

Many enterprises struggle to manage multiple channels of communication. Without an integrated CCM, that frequently means disjointed content, as bank personnel must manage multiple copies of the same information in various systems. It also means having multiple copies of the same customer data, making compliance more challenging and costly.

With a unified approach to templating and design, data management, delivery, and analytics, banks can focus on crafting the right messages, rather than administrative overhead. With a unified CCM platform, turnaround times are dramatically reduced, which improves organizational agility.

5. Efficient Handling of Disputes

Electronic delivery enables quicker access to transaction records and statements, facilitating faster resolution of customer disputes and inquiries.

Self-service options benefit customers by giving them the information they need right away. Instead of waiting for a paper statement in the mail, they can see their account activity and balance immediately. They can use self-service channels to gather additional information, using search capabilities to make the process faster and more efficient. When customers have fast access to information, and when bank personnel view the same information in real time, they can work together to resolve disputes quickly and easily.

6. Real-time Notifications

Instant notifications via email, SMS, or in-app messages can help prevent overdrafts, fraud, and other issues, minimizing the need for costly corrective actions.

Customers appreciate it when their bank takes a proactive approach to communication. That’s especially true when something happens that could cost the client money. A simple oversight, for example, could easily lead to a series of overdrafts, resulting in a slew of bank charges, NSF fees, and considerable embarrassment. By notifying the customer immediately, the bank can prevent a relatively small problem from quickly turning into a big problem.

Real-time alerts are also helpful in reducing costs for the financial institution. Payment card fraud costs banks billions of dollars every year. By promptly notifying customers of potential abuse, banks can take quick action and limit further losses.

A unified, cloud based CCM offers a very rapid return on investment, helping financial institutions to radically decrease their costs while simultaneously improving the customer experience. The EngageOne^TM software from Precisely helps you design and deliver personalized, interactive communications across multiple channels, including personalized interactive video, chatbots, email, SMS, and PDF.

Learn how Precisely helped a leading financial institution save millions of dollars annually. Read the case study Top 5 Online Bank Saves $4.7 Million Annually in Customer Servicing Costs now.