Private banking clients choose multi-channel service and flexible commission system

A McKinsey survey revealed that with the spread of COVID-19, 71% of European private banking clients switched to multi-channel services, and 25% preferred the digital service with remote support from a personal manager whenever required.

Increasing demand for digital service channels revealed the unpreparedness of the banking industry for new customer needs and led to customer dissatisfaction with the level of private banking in general. The third of respondents noted the poor quality of financial advice, one of five clients transferred their assets to another bank during the pandemic, and the quarter said their bank had never contacted them since the beginning of the COVID-19 epidemic.

McKinsey notes that the current crisis could reduce global GDP by 3.5%, which would result in slump in banks’ revenues and profits. Therefore, McKinsey experts made several recommendations to private banks:

• to provide customers with the multi-channel service of the future: video conferencing, webinars, and secure chat rooms, as well as mobile access to the service. To do this, banks must invest in cybersecurity and make sure these channels are safe to use.
• to personalize content and recommendations on social networks — from investment advice to the lifestyle. Targeting should be based on customer behaviour and demographic data
• to accelerate the pace of innovation – this will make the services and offers of banks more competitive
• to reduce the number of service centres through more active remote interaction of the bank representatives with the customers and strengthening of the position of the front office digital support
• to assess the workforce, combine employees by skills and specializations. Banks should also start retraining employees
• To consider partnerships and participation in different ecosystems.