banking chatbot - 5 ways it impacts customer experience

The financial service industry is adopting technology at a pace that you might have never seen before. If you look at money-management, digital wallets, loan services, etc. – there is a new trend of banking chatbots, expanding the gap between those that use them and those who do not.

No matter the industry, customer experience is the number one priority. Your thoughts about your business can only be correct if your users feel the same way. Take two competing companies, pitted head-to-head: same offer, same value, same product.

The one with better customer service comes out on top.

Every time.

banking chatbot - 5 ways it impacts customer experience

Changing Times

The demand for financial services has skyrocketed recently. Work from home, local lockdowns, and reduced in-person staffing have shifted perceptions on “the best way to bank.” As a result, more and more people are turning to online solutions to help them manage their finances.

Growing demand spurs greater competition. To increase customer service with minimum resources, many financial institutions are investing in digital chatbots.

With the explosion of no-code chatbot platforms, a quick walk-through on how to create a chatbot is all you need to get up-and-running. Speed of application, human-level service, and risk reduction are increasing their adoption daily.

In this article, I will discuss the five key benefits of chatbots in banking. I will also explain how using chatbots can differentiate you from your competitors.

Why Use a Banking Chatbot?

Though chatbots are already in use across various industries, Covid-19 has created a surge in their adoption. Difficult times increase the pressure on customer service representatives as more people seek answers and reassurances.

Couple this with the monetary strain that many businesses have faced recently. The reduced work hours and shortage of staff resulted in companies delivering a disastrous customer experience.

Outside of this, the rise of online banking has created a wave of digital solutions – apps, alternative credit scoring, peer-to-peer lending, and the list goes on. A survey by Citi shows that 91% of users have had a positive experience with mobile banking.

When businesses are fuelled by innovation, they inevitably look at other areas to give them an advantage in the marketplace. At this point, customer service becomes the next domain to give them a leg-up on the competition. And when they want to facilitate this need with minimal investment, better response-rate, and fast implementation, an advanced banking chatbot is often the best fit.

5 Reasons to use a chatbot for your customer-facing operations

Large financial firms are already leading the way with AI assistants and natural language processing. For instance, Capital One has Eno, HBSC uses Amy and SEB has Aida.

The easiest way to show their benefits is to outline the potential use cases of chatbots in banking, how they work, and the values they bring on the plate.

1. High-Level Customer Service

Customers visiting the banks according to the branch open hours is outdated. Fully functional mobile apps and 24/7 customer service are what customers seek today. Some firms may have the resources to man the telephone lines, but these still succumb to the usual constraints.

Money-worries are a sensitive topic. Virtual assistants vastly improve the customer journey as there are no time restrictions on answering customer queries. Alleviating those concerns without making your customer wait until 9 am the next day for a response can make all the difference. As a result, you can grow the number of loyal customers to a great extent.

The recent developments in AI chatbots have made machine-to-human interactions so natural that it has become difficult for a person to judge whether they are talking to a machine or another human being. As far as banking is concerned, companies can utilize past customer data and train their bots to give a personalized and instant response.

2. Greater User Engagement

Regular engagement helps create an active user base.

You can share information about new releases, updates, or products via chatbots without it feeling intrusive. The more value your customer receives during an inquiry, the more likely they are to return, follow-up, or try a new feature.

Also, you need not limit the chatbot to only answering FAQs. You can program the bot to read interaction (and transaction) history and offer financial advice accordingly. Another way to engage with customers via chatbots to use website triggers. For instance, when a customer visits an insurance page, the chatbot should initiate insurance-related conversations. It will also help you make people aware of new products, app features, etc. In a way, it allows you to cross-sell your services.

3. Deep Data Collection

Customer feedback is crucial for any business. Even though businesses realize this, it can be difficult to act on customer feedback because of operational constraints. Also, sometimes companies collect the feedback, but since they are not embedded in operational workflows, the management or quality assurance teams do not get a chance to understand the customer sentiments instantly. It thus leads to the same customer service, despite having the insights for improvement from the customer.

The point is – if you are collecting data from customers, you must also have a mechanism to utilize it. And what could be better than an automated workflow?

For instance, you can integrate the chatbot with CRM software to record the interactions. It will benefit you in two ways. One, you will have a record of when you have received the feedback. And two, you can create automation workflows to send the customer feedback to the relevant department.

The same logic applies to other forms of data collection, such as telemarketing, reward points, and more.

Chatbots are natural data collection machines, literally. They allow you to automatically identify common pain-points, creating swathes of data for analysis.

You can further use the collected data to create personalized ad campaigns, marketing rollouts, feature upgrades, or update outdated processes. User’s trust in your business would grows as they see changes made off the back of their suggestions, as it reinforces the fact that the company values their opinions.

4. Fraud Reduction

Customers want to feel secure when they are handling their finances online. To minimize the risk of fraud, you need a seamless way of reporting suspicious activity to their users as fast as possible.

The rise of spam calls, texts, and emails means that customers are naturally dubious of any security warnings that come to them. You also cannot guarantee that they will see or respond fast enough to make the notifications effective.

In-app and website chatbots allow you to cover all bases. Sending auto-prompted fraud warnings through a chatbot on the official website means there can be no question of its validity. You can even develop virtual assistants that run through WhatsApp or Facebook. No matter what medium your customer is using, they will know about the alert straightaway.

5. All-round Efficiency

Advancements in conversational interfaces have made chatbots the go-to for financial institutions looking to expand their outreach without investing in additional human resources.

How bank chatbots work is they allow financial services businesses to conduct thousands of transactions in a single instance. Where a staff member attends only one case at a time, chatbots can handle many at once. All these without reducing the quality of service or speed at which they can respond.

If you think that implementing a chatbot on your website will need a lot of work and investment, I must say – you are wrong. Today, implementing chatbots on websites has become super-easy.

For instance, Landbot offers a no-code chatbot solution for financial services. You can implement this with minimal cost and time investment. Once in, it can free up your staff from menial tasks. This way, they can focus more on sophisticated tasks at hand.

[Also read: latest digital banking trends]

To Conclude

The case for chatbots in banking is not to replace human agents but to work in tandem to develop a value-driven customer journey. This customer journey is streamlined, responsive, and effective.

Start to facilitate an environment where your user receives the best possible service while staff has the time to become specialized in areas that they would not have had the chance to before.

Want to see LeadSquared in action?