News Article by Sue Hines appearing on BAI Banking Strategies - July 31, 2017
The competition for market share in the banking industry is fierce. As a result, the typical customer gets inundated with an array of offers from a variety of financial institutions—from the traditional retail bank to online lenders, payment providers and mobile-only banks. So it’s no wonder more consumers have grown comfortable having relationships with several banks.
Just look at the statistics: More than one-quarter of customers have accounts with more than one bank, while one-third have purchased a financial product from a provider that was not their primary bank in the past year.
GOBankingRates call this “Americans cheating on their banks,” and the financial promiscuity is not abating. In fact, it promises potentially catastrophic financial ramifications for banks that can’t adapt. Blame it on the global financial crisis, new technology and the staggering number of customers who view a bank as a place to hold their money and process automated bill payments, rather than a trusted financial advisor. Regardless, by 2020 roughly one-third of the retail banking industry’s market share could be up for grabs, according to data from Accenture.
The trend hardly sits well with traditional retail bankers who labor to woo new customers, maintain their existing ones and forge the powerful bonds that have consumers eagerly try new products and services.
But this is the new reality: Financial monogamy is as obsolete as a rotary phone...