Flights are being cancelled, events are being postponed and consumers are locking themselves up in their homes as coronavirus cases continue to soar worldwide.
And as illness, self-isolation and the loss of pay from employers and clients continues to take its toll on consumers’ finances, people are turning to their banks for support – yet, taking a trip down to a local branch is risky, and for those infected with the virus, not possible.
That’s why it’s crucial for retail banks to identify and invest in new ways of supporting their customers from a distance.
How Covid-19 is impacting the retail banking sector
In what is now being labelled a “pandemic” by the World Health Organization, coronavirus is wreaking havoc in the banking sector, with international stock markets taking a beating. Across the world, governments and brands are stepping in to support consumers and businesses by offering interest rate cuts, short-term loans, payment relief options and more.
Retail banks are also under strain and could face an influx of customers unable to meet mortgage repayments, or faced with financial difficulties, as a result of forced self-isolation or going without pay.
For instance, global retail bank HSBC announced plans to cut 35,000 jobs over three years and warned about the impact of the coronavirus outbreak in Asia, which may cost up to £464bn to cover the fallout.
And, of course, retail banks face the exact same predicament other businesses are in – ensuring the safety of their staff _ which is why many many banks across the US and the rest of the world are asking their employees to work from home.
What are banks doing to help customers?
The Italian government recently announced a nationwide mortgage repayment holiday to all homeowners. As one of the countries hit the hardest by the pandemic, second only to China in the number of cases, Italy is encouraging its population of 62 million to stay at home, which is having a huge impact on its economy given its dependency on tourism, retail and manufacturing industries.
In the UK, a number of high profile banks including NatWest, RBS, Lloyds and TSB have offered three month mortgage repayment holidays as relief measures to those impacted by the virus, while others such as Barclays are making evaluations on a case-by-case basis. Other initiatives include allowing customers to temporarily increase credit card limits and access cash in fixed savings accounts without early closure charges.
But offering a blanket nationwide mortgage repayment holiday might not be possible in the UK, as total outright homeownership rates are roughly double that of Italy at around 30%, and allowing the nine million outstanding residential mortgages (a collective £1,486 trillion) to take a repayment holiday that could last months is no easy decision to make.
A number of banks are also looking into initiatives that provide customers with access to financial services without visiting a branch.
Singapore’s DBS Bank has implemented a number of digital measures designed to reduce reliance on physical over-the-counter exchanges and is offering clients 50 free “FAST transactions” a month in an attempt to cut the need for physical cheque handling. The bank is also training customers on how to use digital tools by running webinars and customized teaching sessions.
We could also see the number of retail banks offering contactless card options skyrocket in the weeks to come. Earlier this month, a spokesperson from WHO told The Telegraph that consumers should use contactless payment options where possible, as Covid-19 can cling to the surface of cash for a number of days.
In the US, contactless card adoption is very low compared to the rest of the world. A 2018 study by consultancy A.T. Kearney found only 3% of cards in the US are contactless, compared with 64% in the UK and 96% in South Korea.
But we could soon see this change dramatically. The Futurist Group recently surveyed 3,187 US consumers before and after the coronavirus began spreading, and about 38% of consumers now see contactless as a basic need, up from 30% a year ago.
Why banks need to invest in remote banking services
Consumers and businesses need access to financial support now more than ever, yet the majority of people are still accustomed to visiting branches to receive support face-to-face, particularly in the US.
According to Qudini’s 2020 US retail banking survey of over 2,000 consumers, the main channel consumers use to interact with their banks is visiting a branch, with 46% stating this to be the case.
As global coronavirus cases continue and social distancing and self-isolation becomes the new norm, retail banks need to find ways of supporting their customers’ needs.
Telephone and video banking service is the new way forward
By offering their banking customers an in-depth service over telephone and video calls, banks will be able to provide their customers with the services they need at this important time – and making these services accessible and seamless to use is essential.
Qudini offer Appointment Scheduling software that integrates with video conferencing tools to enable your banking customers to easily:
- Book an appointment online
- Or join a virtual queue for the next available advisor
- Receive reminder messages
- Connect with a banking advisor over telephone or video call when the time arises.
The retail bank NatWest uses Qudini’s appointment booking system to enable customers to get in touch with the bank in ways and times that suited them, as demonstrated in our case study video below.
We’re offering fast set-up and implementation for any financial institution we can help at this time. Find out more about how we’re helping retail banks provide a great banking service while enabling social distancing and isolation during Covid-19.