Why is your bank so adamant about pushing online banking?
Converted customers like it because it saves time, automatically keeps its own transaction record and at the end of the month, makes bank reconciliation a breeze.
On the surface, for the bank, it creates a lower incremental transaction cost.
- The customer replaces the data entry clerk at the bank.
- It moves the transaction from a historical posting to a real-time capture.
- With real time capture, it eliminates manual reconciliation procedures associated with manual (historical) posting.
- Scalability (growth) is no longer dependent on employee head count, it is now dependent only on computer and system capacity.
But, here is the real payback, and it has nothing to do with lowering transaction costs.
- It creates a tighter tangible bond between they customer and the bank.
- The technical setup of the account (the hassle of passwords & security) makes it more difficult to switch to another bank.
- If a customer defects, they have to start over and will lose their online history (of course they can print it to paper), but online users quickly adapt to a paperless identity. Online history will be gone.
- To break this tangible tie will require abandonment, and will create a strong sense of psychological loss.
What is your company doing to create strong emotional ties with your customer? -TF