SHIFT

Positive customer experience key to sustainable digital banking shift – report

In Summary
  • Kenyan banks had started shifting to digital banking, Covid-19 accelerated the process
  • 15 branches were closed in 2019, a year before Covid-19 hit

Digital platforms allow banking at your convenience
Digital platforms allow banking at your convenience
Image: NCBA Bank

When was the last time you went to a bank to deposit money or to an ATM to withdraw cash?

In the new normal, most processes have gone digital, even banking.

According to a report by Ernst&Young on how Covid-19 has sped up the digitisation of banks, giving clients a positive experience in digital banking will be key in making the digital revolution last while still maintaining profitability.

The report notes that with the acceleration of the shift to digital banking, customers may look unfavourably on banks whose systems feel slow, cumbersome, or overly complicated.

In Kenya, most banks now have digital and mobile banking but some of the apps and websites are not user-friendly, making banking difficult. This could hamper profitability.

“I wanted to send money to someone using my app but it keeps on sending an error message,” said Alex Musau, who preferred to keep his bank anonymous.

Musau said digital banking is very convenient but the experience is not pleasant, hampering efforts in ensuring seamless contact-free banking.

An analysis by the Star of most banks' social media pages noted a number of complaints by Kenyans unable to complete transactions.

“Your app has not been working for the past three days, how should I complete my transactions,” a user tweeted to the KCB Group page.

“The USSD platform is not very convenient for me as it hangs sometimes or gives 'connection problem' as feedback when I am carrying out my transactions, the platform needs to be made better,” said Susan Maina, who banks with Cooperative Bank.

The last Bank Supervision Annual Report 2019 by the Central Bank of Kenya, shows the number of bank branches decreased from 1,505 in 2018 to 1,490 in 2019.

According to EY, the ability to spot and quickly smooth over any bumps by banks will be key to making the experience better for customers and avoid reputational damage.

The report also added that banks can improve their web channels by personalising experiences through self-selection navigation, targeted online banking communication and robust FAQ content and features. 

Kenyan banks had already started shifting to digital banking even before the Covid-19 pandemic, new data shows.

The last Bank Supervision Annual Report 2019 by the Central Bank of Kenya, shows the number of bank branches decreased from 1,505 in 2018 to 1,490 in 2019.

This means 15 branches were closed in 2019, a year before Covid-19 hit.

According to CBK, the decrease in physical bank branches was mainly attributed to the adoption of alternative delivery channels such as mobile phone banking, internet banking and agency banking.

The Covid-19 pandemic was therefore a catalyst to the already started shift to contactless branch, which is now preferred to reduce the spread of the virus.

In 2020, Standard Chartered Bank was voted the best digital bank in Kenya by the Global Banking and Finance Awards.

The Kenya Bankers Association has launched a security awareness campaign, 'Kaa chonjo', to prioritise digital financial safety.

“While the banking industry’s digital resilience has continued to promote continuity in the financial services sector, rising cases of fraud need to be addressed further through consumer education,” said Habil Olaka, KBA chief executive officer.