# The open age of banking: technology’s role in driving customer trust and loyalty Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2017-12-20 Category: BANKING Category URL: https://financedigest.com/category/banking Meta Title: Build Trust and Loyalty Through Seamless Digital Banking Meta Description: Discover how the banking industry is evolving with Open Banking and the importance of building trust through seamless digital experiences. Learn more here. Tags: featured Tag URLs: featured (https://financedigest.com/tag/featured) URL: https://financedigest.com/the-open-age-of-banking-technologys-role-in-driving-customer-trust-and-loyaltyhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/fd201217-1-2-1736843126071-compressed.jpg) In the age of choice, where consumers can switch services at the click of a button, the only provider that has remained constant for many is their banking provider. UK consumers generally give a high amount of trust to their banking provider, with 85 per cent of customers saying that they trust their bank with personal information and to manage accounts efficiently. While many banks interpret this as consumer loyalty, the reality is that many people stay with their chosen provider out of fear of the presumed upheaval switching providers entails, and concern that their data and money will be put at risk. Our research shows that 48 per cent of banking customers would worry that direct debits and standing orders would not be transferred accurately during the switching process. However, this is all subject to change with Open Banking coming into effect in January 2018. Open Banking will make it easier for customers to understand what’s available to them and more able to compare and switch providers, which means more will have to be done to retain [customer trust and loyalty](https://www.financedigest.com/how-do-you-build-customer-loyalty-3-steps-to-follow.html "HOW DO YOU BUILD CUSTOMER LOYALTY? 3 STEPS TO FOLLOW") in the long run. And, in this open [age of banking](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"), trust can easily be broken if something goes wrong. For example, 62 per cent of [customers admitted that they would quickly lose trust in their banks](https://www.financedigest.com/how-close-can-banks-get-to-their-customers.html "How close can banks get to their customers?"), if the bank suffered a data breach. Similarly, 55 per cent mentioned the same if they were to become a victim of fraud. But it’s not just these high-profile instances that can [impact a bank’s](https://www.financedigest.com/digitisation-of-banking-the-impact-of-digital-money.html "Digitisation of Banking: the impact of digital money") reputation. Failure of the technology to “just work” is also a trust turn off, with 37 per cent of respondents stating they would lose faith in their provider if the website or mobile app isn’t functioning properly. The onus, therefore, is on [banks to ensure that their technology](https://www.financedigest.com/6-technology-trends-banking-2019.html "6 Technology Trends for Banking in 2019") is robust and reliable across all channels to prevent such situations from occurring, in order to build trust and a loyal customer base. **Acquire** loyalty with a seamless digital experience Technology is playing an increasingly greater role in our lives and, as such, our research has shown that [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") are changing. [Customers are embracing digital banking and are choosing to interact](https://www.financedigest.com/ai-will-power-95-of-customer-interactions-by-2025.html "AI will power 95% of customer interactions by 2025") with their banks more and more through mobile and online channels. In fact, 90 per cent of UK consumers report that they are signed up to use online banking and 95% feel that it is making their day to day, current account banking quicker. When asked, 91 per cent of respondents actually expressed a preference of checking their balance digitally and 74 per cent cited this means as their preferred way to change personal details. Now, more than ever, it is vital for [banks to ensure their customer experience is digitally](https://www.financedigest.com/being-the-best-digital-bank-is-not-enough.html "Being the Best Digital Bank is Not Enough") focused. [Banks need to be delivering a seamless customer](https://www.financedigest.com/knowing-your-customers-needs-is-essential-for-banking-innovation.html "KNOWING YOUR CUSTOMERS’ NEEDS IS ESSENTIAL FOR BANKING INNOVATION") experience across all touchpoints – both digital and physical.  With more than 482 bank branches closing down across the country this year alone, and RBS recently announcing a further 259 in the near future, delivering in-branch, personal experiences will become a thing of the past. It will not be enough to rely on the loyalty of the customer of yesteryear, a more [technologically advanced and less loyal younger consumer](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") is now coming into play.  Our research shows that the rising tech-friendly millennials are less loyal than their older counterparts; 38 per cent say that they would be likely to switch their bank with Open Banking compared to 13 per cent of over 65 year olds, and banks need to be mindful of this in order to retain them as customers. Whether customers [need to transfer money, check their account balance or even apply for a mortgage, banks need to be able to provide these services](https://www.financedigest.com/financial-services-need-a-digital-transformation.html "Financial services need a digital transformation") confidently online, just like they would in branch to meet the expectations of today’s customer. **Think different with digital** As well as using [technology to provide](https://www.financedigest.com/inmobi-wins-gold-silver-bronze-mma-smarties-mena-awards-named-technology-provider-of-the-year-for-fourth-consecutive-year.html "InMobi Wins Gold, Silver, Bronze MMA SMARTIES MENA Awards, Named “Technology Provider of the Year” for Fourth Consecutive Year") a better user experience, banks can also use it to differentiate themselves from their competitors. With the emergence of fintech and challenger banks, the [retail banking sector](https://www.financedigest.com/how-effective-talent-management-could-disrupt-the-retail-banking-sector.html "HOW EFFECTIVE TALENT MANAGEMENT COULD DISRUPT THE RETAIL BANKING SECTOR") has become much more competitive, meaning traditional banks have to be able to offer something different to be able to compete with the upsurge of this potentially more agile and customer responsive set-up. With customers having so much more choice, [banks will need to think creatively to stand out from the crowd and technology will be a key](https://www.financedigest.com/russia-bans-western-investors-from-selling-banking-key-energy-stakes.html "Russia bans Western investors from selling banking, key energy stakes") differentiator in the sector. In many ways technology can deliver the in-branch human experience via different formats: chatbots can give [loan advice or mortgages](https://www.financedigest.com/metro-bank-posts-second-quarter-of-profitability-on-mortgage-loans-demand.html "Metro Bank posts second quarter of profitability on mortgage loans demand") can be discussed via video calls. Integrated channels will mean that customers can start filling in [applications via their smartphone on their daily commute and then picking them up from the same position](https://www.financedigest.com/infant-positioning-aids-market-application-trends-growth-opportunities-and-worldwide-forecast-to-2027.html "Infant Positioning Aids Market Application, Trends, Growth, Opportunities and Worldwide Forecast to 2027") on their desktops when they get home. Moving forward, [banks will need to use technology in innovative](https://www.financedigest.com/transforming-the-retail-banking-ecosystem-its-all-about-technological-innovation.html "TRANSFORMING THE RETAIL BANKING ECOSYSTEM: IT’S ALL ABOUT TECHNOLOGICAL INNOVATION") ways to meet the needs of both existing and potential customers to retain and gain market share. **[Quality assurance](https://www.financedigest.com/the-neurotrophic-keratitis-treatment-market-to-stand-on-quality-assured-digitization.html "The Neurotrophic Keratitis Treatment Market to stand on quality assured digitization") equals reassured customers** With Open Banking due to come into play in January [next year](https://www.financedigest.com/uber-rival-bolt-seeks-to-turn-profitable-next-year-ipo-in-2025.html "Uber rival Bolt seeks to turn profitable next year, IPO in 2025"), it will be easier than ever for customers to vote with their feet if they lose trust in their bank and are frustrated with the technology it offers. However, with this [rise in importance of banking](https://www.financedigest.com/bank-of-england-set-for-second-hefty-rate-rise-in-a-row.html "Bank of England set for second hefty rate rise in a row") technology and more of it being implemented, there is also more potential for things to go wrong. To avoid this, banks need to ensure [quality assurance](https://www.financedigest.com/the-rare-disease-treatment-market-to-stand-on-quality-assured-digitization.html "The Rare Disease Treatment Market to stand on quality assured digitization") is consistently at the heart of all their banking systems. To retain and attract customers in an ever more competitive market [banks will need](https://www.financedigest.com/the-bank-of-me-why-banks-need-to-be-totally-customer-centric.html "The bank of me – why banks need to be totally customer centric") to ensure the stability and reliability of the systems their customers rely on, from the smallest to the biggest transactions. After all, when [personal information and finances](https://www.financedigest.com/top-8-must-know-personal-finance-facts-for-2023.html "Top 8 Must-Know Personal Finance Facts for 2023") are at risk, customers will be able to move to a more trustworthy provider a lot quicker with the new Open Banking regulations. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---