 |  |  |
Industry News Customer Acquisition and Client Retention: New Banking Regulations Bring Challenges and Opportunity 2011-06-16 Banks face customer exodus! The era of free checking is over! Debit Card interchange revenue to be slashed! New ATM charges loom! These are among the headlines, somewhat sensationalized, being written about regulatory changes enacted as a part of the recent batch of financial reforms. What is lost in the commotion over the impact on the banking sector is what the changes will mean for customer acquisition and client retention for banks and other financial institutions. Banks have responded with initiatives designed to recoup revenue lost due to the new regulations. They’ve announced a range of fees on accounts that can be avoided by customers able to maintain a certain minimum daily balance. However, several big banks have said they will experience significant drops in client retention as there are many who cannot meet and maintain the balance threshold. One major bank estimated 15% of its customers will no longer be able to qualify for free checking. Where will those customers go for their banking needs? How can a competing financial institution acquire these clients? It’s true that the entire industry will feel an impact but some institutions could benefit by acquiring customers disenchanted by the way their existing banks implement changes. Given that changes are inevitable, banking industry consultants say institutions that convey what they’re doing with honesty and transparency stand to win new business. Nothing disturbs consumers, and harms customer loyalty, more than the deception perception. Banks need to ensure that new fee structures and policy changes are carefully explained and clear. What this means is everyone—from the top executives down to call center representatives—should have answers when customers ask. If customers fearing hidden fees or inexplicable charges don’t get satisfaction, they’ll take their business elsewhere and client retention rates will drop. One industry observer offered this advice: “If a competitor’s customers feel like they’re getting the runaround, do everything possible so that those customers run to your bank’s branch.”
Two More Words on Client Retention
|
 |
 |
 |
 |
 |
 |
Contact Us | FAQ | Site Map | PNT Privacy Pledge | © 2008 PNT Marketing Services