Why you can’t ignore the user experience

We look at examples of how community banks can adapt their digital offering to maintain an exceptional customer experience as more people migrate to online and mobile banking.

By Collin Canright

Community banks’ traditional competitive advantage is their personal service and proximity to their customers. But what happens when customers start preferring mobile devices and online banking to branch visits?

The user interface of a website or app can make or break any banking technology solution. But an optimized online customer experience requires technical know-how and financial resources, making it one of the biggest advantages large banks and fintech firms have over smaller community banks. Consumers’ steady migration to online shopping sites like Amazon and Netflix, which feature almost effortless
interfaces and personalized customer experiences, only widens the gap.

It’s fair to say that many community bank websites do not compare. They are largely static, digital brochures of products with a link to the online banking portal. Newer digital banking features like account opening or loan applications, while increasing in availability, are still lagging.

Fewer than half (48 percent) of all financial institutions indicate that the account-opening process can be done without coming into the branch at all, according to a recent study by the Digital Banking Report (DBR). The results for community banks are better when looking only at online checking account opening. Half of smaller community banks (less than $500 million in assets) offer online checking account opening; the percentage increases to 70 percent of those between $500 million and $1 billion.

However, the study concludes, “digital account opening processes are falling far short of customer expectations.”

“It starts with culture,” says Jim Marous, owner and publisher of DBR and copublisher of the website The Financial Brand. “That is the real challenge when many community banks are managed by traditional bankers who are reluctant to embrace digital.”

Broad appeal
It isn’t only millennials who want more digital functionality from their banks. A recent study by AARP, “Financial Innovation Frontiers 2017,” points out that Americans over age 50 are technologically adept and control more than half of the nation’s assets.

“When it comes to technology, they adapted to it, adopted it, demanded it, and made it an essential part of American life,” the study states. Recognizing the possibilities, fintech firms are “taking aim” at the opportunities.

But not all community banks are being left out. DBR research shows that customer experience is “extremely important” to banks, with 31 percent calling it their top priority and 66 percent placing it in their top three priorities.

Moreover, both third-party bank technology vendors and traditional core providers are developing digital-banking systems and interfaces for community banks. The digital front-end, or user interface, of these banks provides a path to increasing digital banking proficiency.

Below, we look at a few community banks that provide user-friendly digital experiences to their customers.

Lighting the way
STAR Financial Bank’s website is a good example of offering online capabilities in an intuitive way. Just below the headline image, four action icons tell visitors exactly what they can accomplish on the site.

From a branding and design perspective, it’s important that the account-opening and lending functions feel cohesive, even if they run on different systems. STAR, a $1.86 billion-asset community bank based in Ft. Wayne, Ind., uses the LoansPQ system from Costa Mesa, Calif.-based MeridianLink, yet it feels as one with the rest of the site.

Core providers are developing similar functionality. City Bank in Lubbock, Texas, features mortgage loans on its home page, with a red Prequalify Now button that takes the visitor to a mortgage application system—Jack Henry Banking’s OnBoard Loans—with seamless branding.

City Bank takes another step by emphasizing its award-winning mobile banking system. Right below its main call-to-action panel, the bank features an “ad” for its mobile banking app, including features at a glance, a screenshot of the app itself and a hard-to-miss button for when the customer is ready to take the next step.

The $2.5 billion-asset community bank’s site is more reminiscent of a fintech or online commerce website than the static design of many bank sites.

The $700 million-asset Guilford Savings Bank, based in Guilford, Conn., has a website that mimics the functions on online retail sites that enable customers to personalize their experiences on the site. It features a My Favorites function on the menu bar and a Live Chat icon at the bottom left of each page.

The community bank’s Self Service Center offers yet another way customers can personalize their experience, with a scrolling bar that provides task-oriented selections.

Never stand still
Some of the biggest digital challenges to community banks are those that lie ahead. For instance, the top priority of nearly half (48 percent) of community banks is to grow or increase business banking relationships, according to DBR’s “2017 Financial Marketing Trends” report.

Business banking services ties with mobile services as the second-highest marketing priority for 62 percent of community banks (mortgage loans take first place).

“When it comes to technology, they adapted to it, adopted it, demanded it, and made it an essential part of American life.”
—AARP report on over-50s’ use of technology

The best digital account and loan onboarding integrations on community bank websites largely focus on retail accounts and relationships. Calls to action for business banking generally require a customer to visit a branch. At the same time, these are the types of customers who are digitally savvy and pressed for time.

Community banks maintain their edge with personal business relationships, but they might not hold that advantage for long. “More and more organizations are building stronger small-business digital platforms that will simplify the small-business account opening and engagement processes,” Marous says. “The advantage of community banks could quickly go away if the digital channel is not developed.”

This becomes even more important as banking moves into a world where chatbots, voice-activated devices and systems based on artificial intelligence become increasingly common. The user interface will change dramatically, requiring another level of development for community banks.

3 qualities of a great customer experience

The ideal customer experience extends beyond any single technology and its user interface.

Frictionless. Make the web, mobile, voice and in-person experiences as seamless as possible, so customers can move effortlessly from system to system and task to task.

Consistent. As user-interface experiences multiply across devices and banking channels, make sure messaging and branding remain the same.

Personal. Personalize the digital experience as much as possible, ideally as a “customer journey” that builds over time and across channels, as online retailers do.
—Collin Canright

Collin Canright
is a financial technology writer based in Chicago.