The Future of Localised Customer Experience in Banking

In a not-so-distant past, personal banking was exactly that—personal. Your local bank manager knew your name, financial goals, and needs. This era of personalised service created a deep trust and loyalty between customers and their banks. The transition to digital banking during the late 1990s and early 2000s marked a radical change in customer service. The introduction of online banking platforms and mobile apps transformed how customers interacted with their financial institutions. Efficiency soared but at the cost of personal connections. Branches started to close around the UK. In fact, this trend has continued, with approximately 645 closing in 2023 alone.

According to a survey by CompareBanks, over 90% of British people used online or mobile banking services in 2023, highlighting the widespread adoption of digital banking for convenience. Despite the rise in digital banking, many customers value the personalised service offered by physical branches. A recent report shows that 81% of adults consider the quality of their online banking experience crucial when choosing their bank, but many still miss the personal interactions that branches provide​.

This article will explore how localised customer experience is rising, with businesses reorganising their customer service operations to better align with communities.

The stories we tell below are fictional but based on future trends that are fast coming to fruition in the financial services industry.

A Tale of Two Eras

Imagine the town of Epsom, a community where everyone knows everyone. In the 1990s, Epsom’s local bank was the hub of financial activity. The manager, Mr. Jenkins, was a familiar face at town events and could often be seen walking along Main Street, greeting customers by name. He knew that Mrs. Robinson was saving for her grandson’s education, Mr. Thompson was worried about retirement, and the young Miss Fielding was setting up her first business. This personal connection wasn’t just pleasant; it was effective. People felt secure, knowing their finances were handled by someone who understood their life’s context.

As the new millennium dawned, so did the age of digital banking. Epsom’s bank introduced online banking—a transition met with mixed feelings. Younger customers enjoyed the convenience of managing finances from their smartphones, but many long-time patrons missed the human connection. Mr. Jenkins, too, felt the shift. He spent less time with customers and more time behind a computer screen, monitoring transactions and responding to online queries.

The Resurgence of Personalisation

By 2023, the pendulum began to swing back. Banks noticed a growing trend: customers looking for a blend of digital convenience and personal interaction. In response, Epsom’s bank initiated a new model of localised customer experience by integrating digital tools with a personal touch.

They introduced a local contact centre staffed by residents of Surrey who knew the area well. This centre used advanced CRM systems integrated with AI to provide personalised financial advice based on individual customer data. When Mrs. Robinson called about her account, she didn’t reach a distant call centre agent but spoke to Sarah, a local who knew of her grandson’s academic aspirations.

The bank also started using data analytics to anticipate customer needs before they even walked through the door. Predictive AI tools alerted Mr. Jenkins about potential financial products that might interest his customers based on their life stages and previous interactions. This approach also ensured compliance with the Consumer Duty Act, particularly in considering the needs of vulnerable customers.

The New Chapter

The story of Epsom’s bank is being replicated across the globe as more institutions recognise the value of localised, personalised service. This approach improves customer satisfaction and rebuilds the trust and loyalty once the hallmark of personal banking.

As we move forward, the future of customer service in the banking sector seems poised to continue this trend. It’s a blend of the old and the new, where technology doesn’t replace personal service but enriches it, making every customer feel like the bank truly knows them—not just as a number, but as a part of the community.

Embracing Local Identity in Banking Services

In the coastal town of Folkestone, another story unfolds that mirrors the evolution of banking towards community-centric services. Here, the local bank has embraced its maritime heritage by tailoring services to the fishing community’s needs, offering specialised loans for boat repairs and seasonal fluctuations in cash flow. This customisation extends beyond products to the very language and imagery used in the bank’s communications, resonating deeply with local customers.

At Folkestone’s bank, the staff—many of whom come from families intertwined with the sea—understand the ebbs and flows of maritime life. This deep-rooted local knowledge allows them to offer financial services and genuine advice based on a shared understanding of the community’s specific challenges and opportunities.

Technology as a Bridge, Not a Barrier

The development of digital tools has provided these local banks with capabilities that were once the exclusive domain of the largest institutions. Folkestone’s bank, for example, utilises satellite imagery and marine weather data integrated into their systems to help fishermen manage risks associated with their trade. This technology allows the bank to alert its customers to potential bad weather, helping them protect their assets and plan their finances around the natural cycles that affect their income.

Building Trust Through Personalised Digital Interactions

In London, the local bank uses geo-targeting technology to send personalised offers and advice to customers based on their specific locations and spending patterns. Customers walking near a branch might receive a notification on their phone inviting them in for a free financial health check-up or a tailored investment advice session based on recent economic trends.

This level of personalised digital interaction shows how technology, when used wisely, can recreate the personal touch lost in the time of mass digital banking. It’s about making technology feel as warm and personal as a handshake, ensuring that the bank’s digital presence is as welcoming as its physical one.

Looking to the Future

As we move forward, it’s clear that the banking industry is poised for some serious changes, with localised, personalised customer experiences at the forefront. This isn’t just about nostalgia for the past or resistance to digital transformation. It’s about forging a new path that combines the best of both worlds—the efficiency and accessibility of digital technology with the authenticity and personal connection of traditional banking.

The ongoing story of banks like those in Epsom, Folkestone, and London shows a future where financial institutions not only know their customers’ names but also their life stories and aspirations. This deep connection is what will distinguish the leaders in the next age of banking, where being truly customer-centric means embracing the local context of each customer, making every interaction not just a transaction but a meaningful part of a customer’s life. This is the future of banking—deeply digital, truly personal, and intrinsically local.

Explore how Cirrus is improving customer experience in financial services with solutions that enable financial companies to blend digital convenience and the personal touch, ensuring every interaction is meaningful and tailored to individual needs. Get in touch today.