Despite WhatsApp and email communication, SMS ranks among the top customer-preferred channels in the current Internet era. With around 5.22 billion people using cell phones globally, SMS is one of the most easily accessed means of communication. Further, to send or receive SMS, you do not need any specific app. It makes it one of the most reliable and popular tools for quick, short, and time-sensitive communication.
Due to the ease and popularity of SMS communication in Banking, an increasing number of banks are adding and enhancing their Text Banking Services. These services offer customers the convenience and security where they can quickly request and receive their account information, and check recent transactions, and loan details by texting or receiving alerts on specific events such as withdrawal, deposit, or low balance.
Importance of SMS Communication
If you are still not convinced about the importance of SMS communication in the banking sector, here are some stats that speak for themselves.
- According to the 2022 Text Messaging Marketing Report, on average, around 42% of Millennials check their SMS 10 or more times a day, while 60% of surveyed consumers check text messages within 5 minutes of receiving them.
- Around 68% of the survey respondents mentioned that they are more engaged in checking, sending, and answering SMS on the phone than checking emails, social media updates, reading news or other content, or making phone calls.
- Almost 60% of customers prefer to text businesses about customer support issues actively.
- Around 41% of the customers in the banking sector opt to receive text messages.
- Further, 62% of business owners see SMS texting as beneficial due to fast delivery, 48% attribute it to strengthened customer engagement, and 41% believe that it is significantly cost-effective.
How Banks Can Benefit from SMS Communication
For any business, SMS communication benefits go beyond enhanced customer experience and engagement, and banks are no exception! Here are the key benefits that efficient SMS services offer to financial institutions, including banks.
Enhances Productivity and Efficiency
With the help of effective SMS communication, banks can resolve most financial issues. Further, they can integrate their business SMS communication with their CRM and other platforms to automate administrative processes such as sending their customer automated notifications. It eliminates the need for larger help desks and call centers, reduces their staff’s workload significantly, and minimizes human errors.
Businesses can reap the benefits associated with SMS communication at a marginal cost. Additionally, its non-intrusive and direct feature coupled with vast availability due to the continuously growing mobile user base makes it one of the most popular and low-cost communication channels with better response and open rates than other alternatives.
With automated real-time SMS, banks can notify their customers about critical account activities and lower the possibility of fraud. Since SMS does not occupy much network bandwidth, it can be sent instantly, even in network issues, and offer a faster solution than any other means of communication, including a voice call.
Helps in Lead Generation
Displaying your bank’s dedicated mobile number in the branch or on public materials can encourage people to subscribe to your SMS subscriber list, helping you in lead generation.
Boosts Customer Convenience and Loyalty
Besides offering convenience through SMS banking that helps your customers track their account activity in real-time, banks can send other notifications and friendly messages that help you nurture and care for your customer relations. It results in enhanced customer satisfaction, trust, and loyalty.
Amplifies Marketing Campaign Effectiveness
Combining your email campaigns with SMS functionality can offer you a competitive edge by reducing the number of unread emails. It can help you widen your email campaign effectiveness and reach a larger audience.
How the Banking sector Can Improve Customer Engagement and Experience with SMS Communication
Text communication is effectively and widely used in the banking sector. Here are some ways banks can offer enhanced customer experience and improved engagement using SMS communication.
Real-time Notification and Alerts
Transactional SMS is the best way to send time-sensitive information to your customers and keep them informed about the activities associated with their accounts and take quick action if they feel something is amiss. Real-time notifications encompass automated alerts on online payments made to third-party accounts, account login from an unknown device, or cash withdrawals from ATMs. It can be an efficient way to minimize fraudulent activities by taking customers into confidence.
With a 98% open rate, SMS is one of the most efficient ways of communicating with customers and can be useful for reaching them instantly. Thus, it can be the best way to let them know about their unpaid transactions or the due bill payment. With regular SMS reminders, banks are more likely to get their payments on time. It can be beneficial to customers since they are less likely to have to pay late fees.
Enhanced Customer Service
Banks can enhance customer experience through conversational engagement by using interactive chatbots with bidirectional SMS for addressing immediate customer issues. Some examples can be warnings about low account balances and incoming fees or issues such as loan applications and refinancing, etc. Through Interactive SMS, banks can capture vital and unique information related to customers’ preferences and needs to serve them better. Interactive dynamic communication using a communication chatbot facilitates managing a more significant number of customer interactions without human intervention, resulting in enhanced operational efficiency.
2-Factor Authentication (2FA) or multi-factor authentication offers a secure and reliable technique to safeguard customers from cyber-attacks. With 2FA, banks can request their customers to log in with their credentials and enter a code sent through SMS. Banks use transactional communication APIs to generate and manage OTPs (One Time passwords) for 2FA that are valid for 30 seconds or less. This extra layer of protection minimizes the possibility of a security breach.
Promote New Products and Services
SMS can help banks promote their products and services to their existing and potential customers. For existing customers, banks can use customer-specific data to showcase products and services that the customer can most likely avail of. Banks can send customized messages to keep their new and potential customers engaged by providing them with a direct link to the product page.
Role of Customer Communication Management Software (CCM) in Enhancing SMS Communication
Large-scale customer communication without a dedicated tool can prove costly, time-consuming, inefficient, and prone to errors. That is where CCM software comes into the picture! With a CCM platform, you can send highly engaging, creative, and timely communication to step up your customer experience and engagement and retain more valuable customers. The right CCM solution helps you keep up with and exceed the ever-increasing customer expectations.
CCM solutions can help banks enhance SMS communication by helping them with
- Interactive Communication, e.g., a customer asking a query using SMS and seeking a solution.
- On-demand Communication, e.g., accounts balance inquiry using SMS.
- Event-triggered Communication, e.g., notifications related to low balance, login, ATM withdrawal, etc.
- Structured / Targeted Communication, e.g., banks sending messages to customers based on their unique profile and segment. It can include offers, discounts, cross-sell, or up-sell messages.
Besides enhancing your SMS communication, a CCM can help you optimize omnichannel communication to elevate overall customer experience and engagement.
How FCI Can Help You Improve Customer Experience and Engagement
FCI’s centralized CCM Platform enables banks to generate higher revenue per customer interaction. Our SaaS-based CCM helps you transform your paper-based business correspondence into digital communication and engagement. By facilitating an automated customer service journey and digital onboarding, you can significantly reduce service and risk costs. Our CCM services and solutions with full CCM API support facilitate hassle-free digital transformation in customer communication through real-time interactive communication platforms with reduced churn and drop-off rates.
Our CCM solutions help banks modernize regulatory and compliance processes, add actionable value to banking and investment reports and reduce IT support dependency for connecting with customers.
Besides offering the essential, enhanced customer engagement and experience, our CCM platform helps banks,
- Integrate digital onboarding
- Single end-to-end control
- Reduce time-to-market
- Save postal and printing costs
- Utilize lost customer data for silos
- Mitigate AML data risks with Cloud CCM
Enhanced SMS communication is vital for improved customer engagement and experience, and CCM can help banks achieve it with ease. Contact us to know more about FCI CCM and how we can help you take your customer engagement to the next level by fortifying your CX strategy using CCM.