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It’s no surprise that customers today are more inclined to switch to a competitor due to poor service rather than poor products.

With 89% of businesses expected to compete mainly on customer experience (CX), this factor becomes the ultimate differentiator.

Many companies dealing with the end customer – be it in retail, insurance, telecommunications, or ecommerce – have not yet realized the opportunity in improving CX in financial processes.

Payment, invoicing, dunning, or debt collection represent key interactions, and now it’s more important than ever that companies think about streamlining these touchpoints.

What are the most common problems of customer support in financial processes, and what can organizations do to resolve them?

1. Little focus on CX in financial and administrative stages

Just with a simple glimpse at the latest improvements in CX, we can see that most of the advances have been made in the early stages of the customer journey, be it marketing, sales, and slightly post-sales. But no particular progress has been achieved in relation to cash processes.

This is particularly obvious in the 'negative' aspects of the relationship, such as in the payment of outstanding debts. Many companies still operate offline. They send red-tape, formal, and bureaucratic letters that often have the same design as those sent two decades ago.

If you have a very easy-going touch in the marketing stage and then an almost threatening approach in the management of receivables, this dissociation may come across as striking to the customer. This presents a major opportunity: The expectations of customers in financial processes – especially when it comes to debt collection or dunning – are extremely low. So by treating the customer well and seamlessly guiding them towards ways to fix their debt, you can make a huge difference.

2. Customer representatives apply outdated rhetoric

Closely related to the first point, there are some areas that have traditionally been neglected. Receivable management specifically is one of them. Sometimes, customer service reps still rely on outdated thinking patterns: “If the customer didn’t pay on time, why should they get special treatment?”

That’s why they adopt formal, dry, and purpose-based interaction, centered around getting the payment through. This all goes without the understanding that if the issues were dealt with in a positive way, the customer would be more satisfied and more likely to remain loyal.

Imagine if the marketing or sales team knew what was happening; they would potentially intervene because they know exactly how much they had to spend to win the customer in the first place.

However, making this shift can be a tough battle. While training is one answer, it often requires a cultural change, which can take years – so organizations should instead accelerate this change through technology.

There are tools based on machine learning and artificial intelligence that can help optimise one-on-one communication. These tools can coach agents in real-time about what phrases to use and which ones are in line with the company experience.

3. No omnichannel experience

Many organizations still use traditional channels to reach out and fail to take customer preferences into consideration. But the reality is that 47% of consumers use three to five different communication channels to get in touch.

Even if we wished everyone communicated digitally or only through one channel, it’s obviously not the case. That’s why organisations should use data from marketing and sales to determine the channel preferences of each individual. They may find out that expanding on platforms such as messengers holds great potential.

Customers expect communication to be at least near-time, and while this may be a challenge, it’s a decisive factor for streamlined CX. However, to fully reap the benefits of diverse channels, the communication needs to be synchronised. The history of interactions should be consolidated into one omnichannel postbox, providing transparency into the current state of communication and bringing value both to internal processes and the customer.

4. Failing to communicate in real-time

Transparent and fast communication is key for customers across industries. Problems such as sending inaccurate updates never leave a good impression.

For instance, as soon as a customer pays, they should get a confirmation of that action - even if it’s just a pending status - and a final notification will be sent once the payment has been processed.

The importance of real-time experience can’t be overstated. Features like chatbots can be leveraged to standardise communication, but remember to always coordinate the chatbot messaging with the brand experience and the desired tone to provide a homogenous and consistent CX across both personal and automated interactions.

Organizations can also experiment with live video and voice, text messaging, screen shares, recording, and file transfer – something that can help the customer resolve issues without needing to physically visit a local branch.

5. Not using data to its full potential

Despite constant reminders about the importance of personalisation and targeting, companies have been slow in adopting a comprehensive data-driven approach in their financial processes, making them unable to differentiate between customers.

Let’s take another example from debt collection. You can have a customer that has been loyal for decades with no complaints or previous issues. Suddenly, they move and forget to update their address in the system and fail to execute the payment in the process. Companies shouldn’t treat this person identically to a customer who just closed their contract. Sending an undifferentiated and cold message to a loyal customer could damage the relationship irreversibly.

Situations like these can be prevented with functional information exchange. By implementing cross-channel communication, organisations should champion transparency and optimal data usage. This may require connecting the systems used in CRM or adopting a middleware that connects the infrastructure.

Specifically, financial processes should differentiate by customer segment or customer lifetime value. Honouring loyal customers with extra leniency pays off.

The value of a relationship card can be used even with new customers. If a payment is missed, try out messaging like: “We are happy you joined the ranks of our customers. Missing on your first payment makes us worried that we might not be the right partner for you. Let us know how we can help.” 

The most notorious customer service problems in financial processes demonstrate that organisations haven’t been able to fully reap the benefits of technology. By overcoming that, they can unlock the potential CX has and enjoy unprecedented customer retention rates.

* Philip Rürup is the founder and managing director of troy, a debt collection service focused on customer retention and recovery. He has more than 20 years of professional experience in management and managing director positions, as well as in business development with corporations and start-ups in financial services, data management, and dialogue marketing.