Technology alienating banking customers

Moves by European financial services firms to improve process efficiency through IT upgrades is alienating customers, research published today has claimed.

A study from TowerGroup warned that the increasing use of technology has distanced banks from their customers, causing confusion and mixed messages.

The study noted that, while a one-to-one relationship between a client and a relationship manager was the norm in financial services, today it is the exception.

TowerGroup asserted that 15 years of technology implementations with little regard for preserving or enhancing a bank's brand have "severely" affected how consumers view European financial services providers.

"Faced with a preponderance of self-directed financial services channels, consumers now view banks as purveyors of undifferentiated commodities and can easily choose products from alternative financial services providers based on price," the report stated.

Although brand loyalty is still strong, the 'gap' between technology and brand objectives has created a serious effect that could jeopardise the long-term viability of the entire industry.

TowerGroup believes that this trend can be reversed if IT departments make the financial services providers' brand an essential criterion in their decisions.

"Banks must consistently and carefully evaluate the impact of new technology on a financial institution's brand so that it supports rather than degrades the institution's image," the study concluded.