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How Financial Services Weathered the Switch to the Online World

5 minute read
Phil Britt avatar
Face to face interactions were long the mainstay of financial services, but institutions are learning how to adapt to an increasingly online world.

Loyalty and trust have long been central to building and retaining business in financial services. It’s somewhat of a two-way street. Consumers want to keep their money with financial services firms they trust, and the more they trust the firm, the deeper (more deposits/larger loans) and wider (more products) the consumer will commit to the provider. Meanwhile, the financial services provider needs to know any paper or digital currency is legitimate. Fraud prevention is a constant concern. The industry has fairly strict "know your customer" rules.

But building trust and loyalty requires some different techniques in a digital world than in a physical world. Below are how some financial services companies are handling the change.

Reliability Is Key to Trust

“The origins of banking as we know it, ranging from the Medici family in Italy to general stores on the American frontier, featured face to face contact,” said banking consultant Trent Fleming. “It’s only been since the advent of the ATM in the 1960s that customers could access their funds without interacting with a ‘live person.’ So this trend was driven largely by technological barriers.”

Beginning with ATMs, and extending through telephone banking to today’s mobile banking platforms, many customers chose remote delivery channels over personal interaction, Fleming added. Recent events forced the closing of lobbies for most banks, heightening the need for more comprehensive digital features.

From a marketing and relationship perspective, the least expensive and most impactful CX efforts are those that involve doing more business with existing customers. So digital channels at minimum must be more than adequate, and updated with new features and functions that provide customers with the same reliability as if he or she were doing business face-to-face.

“In a digital world, reliability is the key to loyalty and trust,” Fleming said. “We earn trust in drops, we lose it in buckets. A single event can be devastating from a cybersecurity perspective — so you must have security and operational reliability baked into any solution."

Related Article: Financial Services Rides the Disruption Wave

Moving Face-to-Face Interactions to Video

Wealth management has traditionally been an area of financial services where personal meetings have been critical to establish and strengthen relationships. However, like with other parts of financial services, those interactions have become increasingly digital — even before the pandemic hit.

Yet those critical face-to-face meetings are still occurring said Dave Murray, managing partner with Capitol Retirement Strategies. The company had typically built clientele by holding investment seminars. Trust and loyalty came through subsequent face-to-face meetings, starting with initial examination of a client’s assets and development of an investment plan, with the customer signing off on the plan and depositing or transferring funds.

The firm continued to build loyalty and trust with a customer through six-month and annual reviews of the customer’s portfolio, again, in face-to-face meetings.

But in mid-March, physical meetings stopped cold, as did the firm’s retirement wealth management seminars.

The firm already had a digital option in place. Due to the transient nature of the many who work in nearby Washington, D.C. (the firm is based in Gaithersburg, Md.), the company had already used Join.Me video to continue having face-to-face meetings with established clients who had moved on.

Learning Opportunities

“The success of a business like ours is not so much in getting new clients as in retaining the ones you already have,” Murray said.

So now the firm is using video calls to build loyalty and trust with new prospects, with the initial outreach via targeted marketing via Facebook ads and emails to a mailing list the company has built up over the last 20 years, Murray said. The company supports those marketing efforts with a podcast and a blog.

Related Article: How Financial Services Compete on Customer Experience

Maintain Exceptional Experiences

Safety is another important element of loyalty and trust, particularly as the pandemic continues.

Credit Union of Texas (CUTX) prides itself on building relationships with our members and providing an exceptional experience,” said Courtney Coss, chief retail officer. “The impact of COVID-19 has had major impacts on the economy as a whole and specifically on financial institutions.”

While branch lobbies were closed for a short period, CUTX still provided face-to-face interactions via drive-thru lanes and interactive machines available at all branch locations. "We had to be flexible with member requests in the drive-thru and made several adjustments to current processes and procedures to meet the needs of our members," said Coss.

The credit union introduced other new features to ensure they continued to serve its members:

  • Appointments: Members were able to make an appointment with any branch location by phone or in person to conduct transactions, open new accounts or apply for loans. 
  • Texting: Members can wait in the comfort of their car upon arriving at a branch and receive a text message when a representative is ready to assist them. This feature allowed the credit union to limit the number of members inside at any given time, keeping its lobbies safe.
  • Chat: Gives members direct access to a representative through their mobile phone or the credit union's website without having to wait on hold for long periods of time.

“Throughout the last several months, we continue to ensure our members that their health and financial well-being remain our top priority. New accounts at the branch level have increased and teller transactions are close to pre-COVID numbers,” Coss said.

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