A New Experience for and by Banks

I still remember when I went to the bank with my Dad in the 90’s. That was an experience. A long line to deposit money, then we went to a huge machine where we swiped a plastic card through a reader and a long piece of paper printed the last transactions in his checking account. “Oh! Here is the deposit we made a few minutes ago” he said.

It has being almost 20 years and while there have been some aesthetic changes to bank branches the experience of “physical” banking hasn’t changed.  While banks claim that the internet channel is just as important I still see longlines at the end of the month or people rushing to the banks prior to closing time to finish one last transaction.

“No fees and the best customer service”

Talking a few days ago with friends I inquired what services they would want from a perfect bank?  Everyone’s response was the same: “No fees and solid customer service.” This is not new, but after pondering this I think the biggest challenge that banks are facing related their clients is maximizing their value offer and reducing their direct cost related with customer care systems.

Regarding banks fees there are interesting debates about which is the best business model to make competitive systems. In this case, it is valid to ask how to improve customer service.

“The social networks are for gen-y”

In the States I observe many large banks that employ social networks as a channel for customer service. A subset of generation Y actively reject acquiring debts through the use of prepad credit cards instead of checking or savings accounts.

From this point of view, BankSimple and CapitalOne introduce interesting business models and use of social media that provide excellent examples of how financial institutions can apply the Internet to innovate not only in costs, but also in quality of service.

And so the question is this:  Will clients be willing to have a smaller investment interest rate or a set monthly fee for all transactions in exchange for solid customer service interactions through technological channels?

Suggestions to continue reading:

- About the UnderBanked Space

- BankSimple: The Best Bank in the US

-Wikipedia: First Bank of the United States