Banks did not create human needs, but the other way around

Banks did not create human needs, but the other way around

It was not banks that created human needs, but human needs created banks.

We are all users of financial services, some less, some more, but it is an industry that cannot be avoided in the modern world. Just as the way of life changes and develops, so does the way in which financial services are used.

Banks used to be conservative institutions because branches used to have a physical separation between the client and the banker in the form of counters and glass. We used to address our banker through small holes in the middle and/or bottom of that glass. Over time, that physical barrier disappeared and we got desks, financial advisors and a closer relationship with the client. After that, bankers went to the field, to meet the clients.

Many have formed specialised agent networks that visit companies, talk to clients (legal entities or individuals) and complete their entire administrative work. Visiting clients in the field has become a regular practice of almost all banks. Then came the time of digitalisation, and banks began to allow customers to use the services, without any physical contact with the banker.

At the same time, we have the evolution of client behaviour.

Many were bothered by the physical separation in the old banks and the conversation through the holes in the glass, so they were positively surprised when those barriers disappeared. Later, when clients got their desk and the possibility of closer contact, they were happy for a while. Then, when the banks started to meet the clients in the field, many decided to change their existing bank because some other “came to their door”. With the advent of digital services such as online bill payments, loan applications and ATMs which allow clients to can make payments and withdrawals themselves, a number of clients once again experienced a mild shock.

Several times I witnessed a situation in branches where bankers advised clients not to come to the branch, but complete the service themselves from their home, to which the clients said: “Why, am I bothering you here? It’s hard for you to make this payment, so I have to do it myself? I will not use the machine, because if I make a mistake, I will be to blame!”

Given the pace of rapid change, today it is necessary to choose a good strategy of approach to clients, which is easy to modify and adapt to future changes. Analysing human behaviour during the expansion of digital services, an interesting trend was observed:

– The more HI-TECH or the world of digital grows, at the same time HI-TOUCH or the need of a person to be in close relations with people grows. Why?

Because people, despite all the changes, are social beings and have a natural need to be in close relationships with other people.

Analysing the evolution of banks and clients, the question arises as to which model would be tailored to the largest number of users today.

I believe that a large research conducted on a sample of 350,000 users of financial services around the world can be helpful. Participants were asked to describe in 3 words the ideal financial advisor with whom they would be most satisfied. Of all the answers, 3 words were repeated the most times:

  1. TEACHER– He teaches me that I needed something, even though I was not aware of it. Teaches me how to think in a certain sphere of life. Teaches me how to use financial services in my own interest. Teaches me how to use digital services. Teaches me to keep up with the times.
  2. ADVISOR– when I need it, he always recommends the best solution for me and my situation, and not what is on his target list. Before recommending that best solution to me, he makes a real effort to understand my needs and put himself in my situation.
  3. FRIEND– he is a person I would hang out with in my free time and invite him to my house for lunch with my family. Over time, I gained so much trust in him that I no longer question his suggestions and advice.

Taking all the above into account, I believe that one of the best strategies at the moment, for a good relationship with clients and meeting and exceeding their expectations, is precisely the strategy that we can define as follows:

– 50% DIGITAL – all simple services and transactions go through digital with educating clients for their use to avoid mistakes and fears.

– 50% RELATIONSHIP – building superior relationships with clients based on their trust in advisors, which is deserved by a focus on the client’s needs rather than banking services. Financial services are just a tool, a means to meet-satisfy client needs.

As I have already said, banks did not create human needs, but human needs created banks and that is why we must develop and work with each other to build trust.

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