Wednesday, May 16, 2018 Stamford, CT USA — Commercial banks’ inability to keep pace with the digital capabilities of consumer platforms like Amazon, Uber and other slick retail banking websites is frustrating U.S. executives, who continue to struggle with cumbersome and often manual documentation and compliance requirements.
The disconnect between the rising expectations of corporate executives and the frequently clunky customer experience delivered by commercial banks’ digital channels is undermining banking relationships. A new report, Banking in the Era of Consumerized Digital Expectations, from Greenwich Associates connects a pronounced dip in U.S. companies’ bank evaluations with their evolving preferences and perceptions of how easy (or hard) it is to work with banks.
Driving this decline is the confluence of several factors. First, stricter “Know Your Customer” or KYC requirements and other post-crisis mandates have elevated documentation and compliance demands. Second, in the years since the crisis, banks were operating in a lean-margin environment that often precluded major tech investments.
“Finally, in the past decade, online service in other industries has not just gotten better, in some cases, it’s approaching great,” says Chris McDonnell, Greenwich Associates Managing Director and author of the new report. “Frustrated corporate executives area all asking the same question: Why can’t all this back and forth be automated?”
Banks Responding With Aggressive Investments
The good news for companies is that banks recognize these challenges and are stepping up investments accordingly.
Leading banks have set ambitious development timelines and are investing significantly to build out digital platforms they hope will address perceived “ease of doing business” gaps and ultimately deepen customer relationships. “The magnitude of development currently underway is unprecedented,” says Chris McDonnell. “We expect banks will have to do more than provide tech fixes for administrative processes as they scramble to keep up with accelerating expectations surrounding a differentiated digital customer experience.”