The global pandemic has caused high street banks to make more changes in the way they conduct business, and these changes have not gone down well with all. Butterfield Mortgages CEO, Alpa Bhakta offers us her thoughts on what the future might hold for high street banks and what they need to do now to appease their customers.
COVID-19 is a disruptive force, challenging old traditions and forcing businesses to adapt to a new set of circumstances. Even amid the pandemic, it is wrong to assume that things will go back to normal once a vaccine has been created or the rate of new cases drops dramatically. Instead, we must accept the nature of our new reality and adapt accordingly.
Financial institutions are continuing to monitor the effects of the COVID-19 pandemic, understanding the immediate challenges it poses to the economy and wider society, and the implications this could have on the financial services sector.
This is by no means an easy task. In this highly volatile operating environment, banks have to undertake a delicate balancing act. They must respond to the needs of their clients, ensure that fundamental services and products are available to the market, and also be prepared for any number of future scenarios.
All that being said, it is important for banks not to overlook their relationships with clients. Investors and consumers want guidance and the confidence of knowing that their banks are able to support their financial needs.
COVID-19 has posed challenges, but how have banks responded? In short, the experience of clients has been mixed.
This was revealed in a survey commissioned by Butterfield Mortgages Limited (BML). We wanted to uncover what UK individuals thought about their banks’ handling of the coronavirus pandemic and whether their approach impacted their client engagement and delivery of specific services.
Based on a survey of over 1,200 UK individuals, we found that a fifth (19%) have lost faith in their banks due to the poor support offered throughout the pandemic. Furthermore, 25% of current homeowners in the UK said they felt let down by their bank for not providing regular advice to assist with the management of their finances.
These are concerning findings; a significant proportion of people are losing confidence in their banks. I fear that this percentage could grow unless banks properly assess how they are currently engaging with their customers. Given the financial stress and uncertainty, many people face at present, providing prudent financial advice and encouraging the pursuit of new investment opportunities is extremely important.
Banks cannot overlook the needs of their clients
The BML research explains why many financial institutions need to take a step back and determine whether they are adequately meeting the needs and demands of their clients. Failing this, they could see their customers switching to competitors.
Regardless of the challenges, COVID-19 might present to the financial services industry, a bank’s ability to weather the storm will be influenced by its delivery of services and engagement with its customers. That’s why client relationships and regular customer communication cannot be overlooked.
I believe there is an opportunity here for banks to actively reach out to customers and provide them with the tools necessary to manage their finances and make investment decisions.
Alpa Bhakta is CEO of Butterfield Mortgages Limited, part of the Butterfield Group and a subsidiary of The Bank of NT. Butterfield & Son Limited. Butterfield Mortgages is a London-based prime property mortgage provider with a particular focus on the UK and international HNWIs. The views expressed herein are those of the author and do not necessarily reflect those of Butterfield Group.
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