As competition soars in retail banking, leveraging digital payment data enables banks to differentiate themselves from competitors, listen to customer needs, and create meaningful and profitable relationships through Customer Value Management (CVM) solutions.
Flaminio Francisci, Head of Customer Value Management from Nexi Group, explains how banks can engage with customers to grow their retail business through CVM.
Retail banking stands at a crossroads. Return on Equity in the sector halved, then remained flat between 2010 and 2020 before recovering slightly1. Meanwhile, established retail banks around Europe face tough competition from fintechs, Non-Bank Financial Institutions and big tech players. Some consultants now predict as many as eight in ten banks could be merged out of existence or “irrelevant” by 2030.
Despite impressive improvements by new technologies over the last decade, banks have yet to capture the opportunity to engage with their customers. Capgemini says 45% of customers feel no emotional connection to their bank, implying no loyalty and putting banks’ market share at risk. However, the rise of digital payments offers another, greater opportunity: to foster loyalty by forging meaningful and valuable relationships with existing and new customers, anticipating their needs and delivering personalized, relevant content and products which meet those needs.
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