A lot of people know they’re getting older when they see grey hair in the mirror. If you’re me, you really know you’re aging when you read the FIS Consumer Banking PACE Index report.
They didn’t call me out specifically, of course. But when I got to the part about how Canadian banks service the “under 45” customer, it suddenly hit me that I will no longer belong to that demographic as of December. A small, sad whimper escaped from me at that point.
Once I got over the shocking reality that I will soon join the group profiled in bank industry reports as the “older consumer,” I hunkered down to read the findings. The study surveyed 9,000 bank and credit union customers in nine countries, including 1,000 here in Canada. Before we get to specific insights on the “under 45” set, here are some broader takeaways.
The good news headline is that Canadian banks are “performing well at providing (customers) omni-channel service … across all the possible points of contact,” the report says. Our financial institutions are also exceeding customer expectations when it comees to providing convenience, offering digital payment options and “enabling their connectivity, including anywhere, anytime access through online and mobile banking.”
Canadian banks, it seems, have got this omni-channel thing covered.
That’s great, the study says – for now. With technology moving as fast as it is, however, the authors warn that omni-channel service will only satisfy bank customers for so long. As they point out, mobile banking and payment services used to be “a vital differentiator” among Canadian banks. Now that mobile has become an almost standard feature, banks can no longer use it as a competitive edge in the marketplace.
Which brings us to the “under 45” group. Are they satisfied with all the omni-channel convenience and efficiency being served up by the banks? Again, the researchers’ answer is yes – for now. Yet they also caution it won’t be enough to retain these clients over the longer term.
“Young customers are already shifting their behaviours toward usage of alternative financial service providers,” the report states. “While these customers are likely to maintain a transactional account with their primary financial provider, the more valuable parts of their financial dealings are in danger of being captured by competitors.”
For anyone wondering who those alternative competitors might be, the CEO of RBC spelled it out in March when he said his bank is “on a collision course” with the likes of Apple and Google, which have already entered the mobile payment space.
FIS researchers recommend a few ways Canadian banks can fight back. One is to use the digital frameworks they’ve created to personalize financial services for each customer via analytics. Another is to extend omni-channel convenience beyond transactional services, applying it to value-added services like money management and financial goal setting as well.
FIS suggests banks should also boost the levels of security (think online and mobile), fairness (think service charges) and transparency (think ‘hidden’ service charges) in their operations. Those three elements topped the list of most important banking features in the survey of Canadian customers.
When I think about it, it does make some sense. Apple Pay lets me buy coffee quickly and conveniently. But now that I’m becoming an “older consumer,” I’m also looking for mortgage rates and financial planning advice. Not sure Apple or Google are the first place I’m going to for that kind of help, at least at this stage of the game.
Canadian banks have done a good job of offering omni-channel services. If they bundle that technology with the trust and expertise advantages they still enjoy over alternative providers, customers like me might not leave them – even after we leave the “under 45” category behind.