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Customer experience gaps drive bank clients back to branches
According to the survey that polled 661 people in Nairobi, Mombasa, and Kisumu, mobile banking is currently the most preferred channel, used by about 42 percent, nearly double the 24 percent that prefer branches.
Customer experience is the most influential factor among bank clients when choosing their preferred channel of interacting with the institutions, a new survey shows, driving many of them back to physical branches for help despite increased digitisation of banking services.
The 2024 Kenya Banking Industry customer experience survey by consultancy KPMG reveals that 47 percent of bank clients consider branch customer experience’ as the reason for their preferred channel of accessing banking services.
An estimated 29 percent cited in-person banking experience, and 13 percent attributed their preference to overall customer experience, meaning that clients generally value their experience while accessing banking services much more than anything else.
Charges or cost implications of the channels are the least significant determinant of the channel customers use, cited by only six percent of those polled in the survey, while mobile banking features influence just 11 percent of customers.
“This implies that customers’ sensitivity to charges and costs is low, and they rank customer experience over and above the cost it takes to access services via a given channel,” KPMG said in the report published this week.
“Banks need to have a well-articulated customer experience strategy to facilitate a blueprint for offering quality customer experiences to customers.”
According to the survey that polled 661 people in Nairobi, Mombasa, and Kisumu, mobile banking is currently the most preferred channel, used by about 42 percent, nearly double the 24 percent that prefer branches.
Internet banking and Unstructured Supplementary Service Data (USSD) codes are customers’ least favourite channels, preferred by only four percent and 5 percent respectively. Other channels – ATMs and agents – are preferred by 11 and 14 percent of customers in that order.
The survey also reveals that 84 percent of bank customers use these preferred channels for cash deposit and withdrawal services, and less than 5 percent interact with them for other services such as cash transfers, bank statements, airtime purchases, loan applications, or service payments.
A different survey done by the Kenya Bankers Association (KBA) last year revealed that although mobile apps were still the most preferred channel by customers, it was loved by about 70 percent of customers, much higher than what’s in the current findings by KPMG.
Comparatively, the KBA survey revealed that just 20 percent preferred branches, up from 18 percent in 2022, meaning that the number has possibly increased while those favouring apps drop as banks focus more on enhancing customer experience.
KBA is yet to publish its 2024 version of the annual survey, but the shift could explain why banks have lately been opening more brick-and-mortar branches amidst the digital migration that’s impacting all sectors.
Last year, Kenyan banks opened over 20 new branches across the country, and more have been opened this year in the race to meet customer experience expectations even as they also expand their digital service offerings.