Analysis by Tony Armour, managing director of DST, a customer information and business process expert
The combination of seven-day account switching rules and the new current account comparison tool from the British Bankers’ Association means that customers will be able to easily find – and move to – any account that they feel gives them a better deal. As a result, the old adage that you’re ‘more likely to get divorced than leave your bank’ may be on the way out.
This new agreement strips away much of the competitive divide between banks, leaving them to compete in two key areas: individual account promotions and service. This is a huge opportunity for banks to use data analytics to capitalise on the BBA’s comparison tool, thereby attracting their target demographics and cultivating a tailored, lucrative customer base.
Data and analytics are playing a growing role in UK banking, limited only by the speed with which institutions are able to incorporate new technologies into their legacy systems. Banks which are ahead of the curve can pre-empt the results of the BBA’s comparison tool and put themselves in pole position to take on the new wave of competition.