The financial services industry has a notorious history when it comes to trust and transparent communication. The language used by financial institutions is often complex and unclear. This industry-standard has even received criticism in Hollywood blockbusters, as Ryan Gosling mentions in The Big Short “It’s pretty confusing, right?” Does it make you feel bored? Or stupid?” While this has gradually changed over the years, there are still problems being faced.
This opacity of communication is felt by those using online services as well. According to research by TimeTrade SilverCloud, 70% of banking customers start with online self-service support but 87% say that it’s not working for them. That’s a significant portion of people that struggle to understand, and therefore access, online banking services. However, in recent years, many have begun to recognise the importance of using more understandable language when speaking with people. As a result, incumbents need to take this opportunity to review how they talk to customers and make sure their bank is as accessible as possible.
The source of banking jargon
The complexity of language in financial services – even in retail banking – has often stemmed from a lot of jargon. The financial services community has historically failed to speak in simple language, with the complex terminology and abbreviations often only understood by the people in the sector itself. This has a very serious knock-on effect in retail banking, with customers who may buy financial products without properly understanding the risks that may be involved.
Retail banking is dealing with a broader pool of people with varying levels of comprehension so there is no doubt that many will be confused. As a result, it’s important that communication should be written with the lowest levels of understanding in mind.
In the past this complexity has been less of a problem – the presence of physical banks and the popularity of brokers meant that any uncertainty could be clarified on a call or meeting. The popularity of advisers gave a ‘translator’ for the complex work of personal finance. But banking has changed. Branches have closed on the high street and physical presence has reduced dramatically. Brokerages have changed to digital platforms, isolating those not comfortable with technology and removing the human interaction that can lend clarity. Unsurprisingly, COVID-19 and the subsequent lockdown has exacerbated this even further.
The digital switch
The COVID-19 pandemic has sped up the shift from high-street to online banking. Many consumers have faced problems during this period. While digital platforms have worked to improve accessibility for users, specific demographics have struggled.
Older users especially have faced difficulties when banking online. With finances involved, there is an understandable fear associated with managing money on a digital platform. This, combined with web design and UX that can often be confusing prevents users from fully going digital. Fortunately, fintechs have set new standards on how to engage with customers online.
Challengers on the horizon
The rise in challenger banks has arguably offered, a simpler and stress-free user experience. These institutions have been able to build in an accessible UX, and straightforward technology right from the start, meaning that improving access is much easier compared with incumbents. Many of these brands also offer a clear way of explaining certain banking activities – with some even outlining their tone of voice on their website for improved transparency.
This trend has put increased pressure on traditional banking institutions to improve the way they connect and communicate with their retail customers. Banks are putting more emphasis on improving the user design on desktop and mobile sites. Alongside design and UX, readability has become crucial to delivering a simple and stress-free user experience.
What incumbents can do
As well as making the design visually appealing, in line with the look and feel of challenger brands, traditional banks need to make sure the content itself is written in plain English. This can hard to achieve. Bankers will naturally understand their own jargon, making it easy for institutions to think their own content is understandable.
However, the reality is that the average user will likely face problems in understanding the content written on the site. Financial institutions need to take a step back from their day-to-day operations and look at the content objectively. Where possible, having an impartial party – whether a consultant or piece of software – to review the site, will make sure the material is readable for everyone and not just those ‘in the know’.
Banking has been democratised as technology becomes more advanced and services increasingly move online. For established institutions to stay competitive, showcasing the same innovation and customer-centric approach as challenger brands, they need to make sure content is not just well-written, but free from jargon, and understandable to everyone. Accessible content will help retain existing customers and appeal to a broader range of potential clients as well; ensuring that everyone who does business with an institution is fully informed and aware of what they are doing.