With evolving customer lifestyles and preferences, changes in current fiscal regime, and advancements in Nigeria’s digital landscape, the need for banks to adapt, innovate and evolve in response to the new realities of the 21st Century banking has never been more crucial.
This is the position of Chukwuka Monye, managing partner, Ciuci Consulting, as stated in the 2014 Banking sector report released by Ciuci Consulting.
Following the trend of 2013, Nigerian banks have continued to wade through tides, finding ways to thrive amid changes in the regulatory and business environment – with the outcome of each bank’s strategic response becoming more quantifiable.
Despite change of its helmsman, the Central Bank of Nigeria (CBN) has remained focused on its mission of consumer protection and value creation, and has delivered economic value to bank customers in 2014. Though there was the re-introduction of inter-bank ATM charges of N65 after four withdrawals, the reduction of Commission On Turnover (COT) to N2 per mille; removal of charges on cash deposits, and the complete removal of COT on public funds reflect the CBN’s continued commitment to its mission.
According to Monye, banks have also had to seek out new ways to raise or at least sustain their bottomline amid shrinking income opportunities. The battle for low-cost deposits has become even more intense.
While some have successfully acquired other banks, others have optimised their service delivery, explored new channels and developed unique products.
As customer acquisition and retention remain critical to success, the need to develop more customer-centric products, provide satisfactory service experience and maximise customer value have become more emphasised. Furthermore, the situation has re-awakened more banks to the need to better understand their customers and effectively utilise their customer data assets.
The report x-rayed the socio-economic and consumer lifestyle trends, Nigeria’s retail banking customers are expected to require more convenient and efficient banking services. They will demand flexible products customised to their needs and expect more personalised financial advisory services as value added.
Furthermore, Nigeria’s retail banking customers will require clearly differentiated products that provide unique and truly valuable features. Where no clear distinction exists, customers will easily exercise their ‘right to choose’ and switch to another bank.
As they become more and more tech-savvy, retail bank customers will demand speed in processing transactions and convenience when performing their day-to-day banking activities. They will want to purchase products through varied channels and access real-time summaries of their transactions at all times. All these will have to be provided at the best possible cost and with utmost customer care.
Banks must therefore gain greater insights into their customers’ needs and behaviour, and design their operations and processes with the goal of achieving maximum customer satisfaction, not just raising their bottomline.
In essence, Nigerian banks that choose to formulate their strategy and operational tactics by up-to-date customer intelligence will increase their competitive advantage. They will also realise higher levels of customer loyalty, grow their customer base exponentially and sustain their leadership position, according to the report.
HOPE MOSES-ASHIKE
