Rebuilding customers trust

The fact that the government could not wind down Northern Rock in fear of another run on the bank illustrates how banks need to do more to foster consumer confidence in that payouts, if a bank were to fail, will not only be immediate but also accurate. Consumer confidence in banks has dropped significantly, according to a survey by ICM, commissioned by Callataÿ & Wouters, with 40% of respondents saying their opinion of their bank has become more negative in the past 18 months. As a result, banks face being crippled further by the impact of the credit crunch unless they take immediate action to remedy this deteriorating consumer confidence.

 To reverse the tide of opinion, banks must change the way they might have done business in the past. This means realising the potential of its stored data by moving away from a purely silo-based approach to an enterprise-wide strategy. This will require investment in IT infrastructures by banks, as the article highlights and recent proposals by the Financial Services’ Authority (FSA) recommend, but by bringing together customer data created and stored across different silos, banks can adopt a single customer view. Through this holistic approach banks can not only ensure faster and more accurate payouts but significantly improve customer service levels.

 Those that take advantage of the potential of stored data and adopt a single customer view as part of their business intelligence strategies will not only have a greater chance of emerging from the current downturn unscathed, unlike Northern Rock, but will themselves rewarded with increased customer loyalty and brand stability going forward.