# CUSTOMER EXPERIENCE: DIGITAL STRATEGIES IN PAYMENTS AND COLLECTIONS Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2016-08-22 Category: FINANCE Category URL: https://financedigest.com/category/finance Meta Title: The Evolution of Customer Expectations in Retail Financial Meta Description: Discover how retail financial institutions can enhance customer experience and increase revenue by adopting digital technologies for regular payments and URL: https://financedigest.com/customer-experience-digital-strategies-in-payments-and-collectionshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/business-man-holds-touch-sc-1-1736844568570-compressed.jpg) **Grant de Leeuw, Global Sales Manager,** [**TALKINGTECH**](http://www.talkingtech.com) Consumer behaviour and expectations have changed beyond all recognition in the past 10 years. The ways in which financial services providers service and communicatewith their customers has evolved, as has consumer adoption of digital technologies, such as mobile payments and apps. Customers expect a reliable, highly personalised, effective customer experience and many of them expect theseinteractions to be digitally powered. Retail financial institutions are being kept on their toes by [challenger banks](https://www.financedigest.com/the-rise-of-challenger-banks.html "challenger banks") and those adopting technology to make their services more efficient. Amazing strides in technologies powering retail [payments have been made over the past few years](https://www.financedigest.com/the-year-ahead-top-payments-trends-to-watch-out-for-in-2022.html "The year ahead: Top payments trends to watch out for in 2022"), yet it is the less visible payment processesof regular payments and collections that are often been left behind. The misconception is that these processes have less [impact on customer loyalty](https://www.financedigest.com/how-will-the-introduction-of-digital-banking-impact-customer-perception-and-overall-loyalty.html "HOW WILL THE INTRODUCTION OF DIGITAL BANKING IMPACT CUSTOMER PERCEPTION AND OVERALL LOYALTY?") and engagement. This is a dangerous stance to take because we have seen that the opposite is true: they can be crucially important in the customer lifecycle. The relationships that banks have with their customers can last for decades. Therefore, it’s crucial that they [adopt engagement strategies](https://www.financedigest.com/bev-automotive-oil-filter-market-recent-industry-developments-and-growth-strategies-adopted-by-players.html "BEV Automotive Oil Filter Market: Recent Industry Developments and Growth Strategies Adopted by Players") around regular payments and collections. **[Customer experience](https://www.financedigest.com/insurers-ready-to-fight-back-against-poor-customer-experience.html "Insurers ready to fight back against poor customer experience") must drive decisions** Organisations should integrate all of the data that it has to better understand each [customer and develop communications strategies](https://www.financedigest.com/why-equipment-assets-should-be-the-source-of-your-customer-strategy.html "Why Equipment Assets Should Be The Source of Your Customer Strategy") to align with their preferences. The brand experience is just as important and valid in a bill reminder as it is in-branch. Each [communication is an opportunity](https://www.financedigest.com/military-communications-market-worldwide-growth-trendsleading-segments-and-opportunities-to-2028.html "Military Communications Market Worldwide Growth, Trends,leading Segments And Opportunities to 2028") to deliver on promises. Yet banks don’t need to make huge [investments in technology or instigate a company-wide digital transformation](https://www.financedigest.com/intelligent-investment-in-digital-transformation-driving-change-from-the-grassroots.html "Intelligent investment in digital transformation: Driving change from the grassroots") project. First, they need to be able to extract meaningful insights from the data that they already have access to. As McKinsey said in its report [Trailblazing Trends in Global Payments – 16 in 2016](http://assets.mckinsey.com/industries/financial-services/our-insights/16-in-2016-trailblazing-trends-in-global-payments).) “Knowing how to extract value from data is the core competitive requirement in multi-channel commerce”. Secondly, digital initiatives don’t have to overwhelm. [Digital transformation](https://www.financedigest.com/the-four-benefits-of-digital-transformation-in-the-finance-industry.html "The Four Benefits of Digital Transformation in the Finance Industry") is seen as complex and costly, often too sprawling to implement.  [Banks should adopt gradual digital](https://www.financedigest.com/how-fs-organisations-can-enter-the-new-age-in-digital-banking.html "How FS Organisations Can Enter The New Age in Digital Banking") adoption, choosing the best technology-driven processes to improve customer service and increase revenues. Often technologies, such as ‘Pay by SMS’, card registration, IVR and web bill payments don’t require significant infrastructure investments. It’s fine to take a [lower risk](https://www.financedigest.com/evergrande-jitters-pull-risk-currencies-lower-dollar-gains-on-safety-bid.html "Evergrande jitters pull risk currencies lower, dollar gains on safety bid") and incremental approach. **Widen payment options** Too many financial service providers still rely on standing orders, [current accounts](https://www.financedigest.com/coffee-current-accounts-and-the-commoditisation-conundrum.html "Coffee, current accounts and the commoditisation conundrum") and direct debits for collecting regular payments, despite evolving consumer behaviour. Offering additional payment methods, based on known [customer preferences](https://www.financedigest.com/walk-in-coolers-and-freezers-market-preference-for-customized-and-smart-machines-growing.html "Walk-in Coolers and Freezers Market: Preference for Customized and Smart Machines Growing"), can increase customer satisfaction and collections reducing the need to charge additional fees or spend extra time on call-based collections.  As [consumers become more comfortable with digital payment technologies](https://www.financedigest.com/specialty-printing-consumables-market-rising-adoption-of-advanced-technologies-to-bolster-markets-growth-prospects.html "Specialty Printing Consumables Market – Rising Adoption of Advanced Technologies to Bolster Market’s Growth Prospects"), organisations should look to mobile channels to not only communicate with their customers, but also as channel for them to pay unpaid bills. Other technologies, such as powerful predictive IVRs (interactive voice response) can encourage customers to call in when it suits them.  This results in fewer outbound calls, numbers of which are restricted by Ofcom regulations, and delivers a better [customer experience](https://www.financedigest.com/is-your-customer-experience-exceptional.html "IS YOUR CUSTOMER EXPERIENCE EXCEPTIONAL?"). **Personalising payment preferences** Customers expect to have flexibility in how they engage with a company.  [Service providers](https://www.financedigest.com/can-companies-minimise-their-dependency-on-cloud-service-providers.html "Can companies minimise their dependency on cloud service providers?") that use intelligent systems to analyse customer behaviour means they can better set preferences around payment dates, service methods and billing. Payments UK’s recent [report on its ‘World Class Payments’ project](http://www.paymentsuk.org.uk/sites/default/files/World%20Class%20Payments%20in%20the%20UK_Payments%20UK%20August%202015.pdf), highlighted four key priorities that should “offer the greatest potential benefit to customers”.  One of these was that customers should be given “more control over requested outgoing payments, enabling flexibility over the timing of their regular payments to fit with income and money [management](https://www.financedigest.com/looking-to-buy-a-rental-property-heres-why-you-need-a-property-manager.html "Looking to Buy a Rental Property? Here’s Why You Need a Property Manager") needs”. I couldn’t agree more.  Personalised payments and the communication around these payments increases customer satisfaction and reduces churn. It also significantly reduces the [cost and effort](https://www.financedigest.com/factbox-europes-efforts-to-shield-households-from-soaring-energy-costs.html "Factbox-Europe’s efforts to shield households from soaring energy costs") associated with collecting overdue payments. **Managing and anticipating payment behaviours** Data is at our fingertips and banks that can use this data to better understand customers and their payment history can foster better relationships with them. Communicating with customers at an earlier stage in the collections cycle, before implications become critical, will reduce the [operational cost](https://www.financedigest.com/trend-micro-vision-one-stops-threats-faster-streamlines-operations-and-cuts-costs.html "Trend Micro Vision One Stops Threats Faster, Streamlines Operations and Cuts Costs") of each payment and relationship.  Small touch points, such as sending high-risk customers a friendly reminder before their payment is due, offering different channels for payment, can make a huge difference. Further automated reminders can then be [set across](https://www.financedigest.com/how-ai-looks-set-to-power-facial-recognition-passport-adoption-across-southeast-asia-post-covid.html "How AI looks set to power facial recognition passport adoption across Southeast Asia post-COVID") multiple channels If the account becomes overdue.Retail [banks](https://www.financedigest.com/how-is-green-finance-reshaping-the-banking-industry.html "How is green finance reshaping the banking industry?") have the financial knowledge of their customers over long periods to achieve this. **Prioritising payments and collections** Re-evaluating operational practices and processes to push payments and collections further up the priority list should be high on the agenda.  Not least because the latest [\[1\]](#_ftn1) UK Customer Satisfaction Index (UKCSI) report by The Institute of Customer Service showed that the banking industry is the only sector, out of 13 measured in the UK, that hasn’t improved its customer satisfaction rating in the last year. These are exciting times for the financial [services sector](https://www.financedigest.com/why-the-financial-services-sector-could-thrive-in-the-subscription-economy.html "Why the Financial Services sector could thrive in the subscription economy") and there is still a great deal of opportunity and change ahead. [Innovations can help banks reduce the friction around](https://www.financedigest.com/the-soft-skeletal-implants-market-revolve-around-digitally-driven-innovation.html "The Soft Skeletal Implants Market revolve around digitally driven innovation") payments, collections, security and identity verification. Regulatory [changes are starting to support this innovation and encourage competition](https://www.financedigest.com/foley-catheters-market-pin-point-analysis-for-changing-competitive-dynamics.html "Foley Catheters Market: Pin-Point Analysis For Changing Competitive Dynamics"). Now is the [time](https://www.financedigest.com/now-is-the-time-for-finance-leaders-to-take-on-a-more-strategic-and-valuable-role.html "Now is the time for finance leaders to take on a more strategic and valuable role") for banks and financial providers to examine and improve their payments and collections processes. [\[1\]](#_ftnref1) 19 July 2016: https://www.instituteofcustomerservice.com/media-centre/press-releases/article/new-report-shows-clock-is-ticking-for-banks-with-poor-customer-service --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---