Even with WhatsApp and email, SMS still reigns supreme as one of the top ways customers prefer to communicate these days. With over 5.22 billion people using mobile phones worldwide, it's no wonder that SMS is the go-to method of messaging.
The best part?
You don't need a fancy app to send or receive texts. That's why it's a super reliable tool for getting your message across fast.
And it's not just for casual chats, either. SMS is making waves in the banking industry with more and more banks offering text banking services. Customers can quickly and securely request and receive their account info, check transactions, and get loan details all with the convenience of texting. You can even set up alerts for things like withdrawals, deposits, and low balances. It's like having your own personal banker in your pocket!
SMS in Banking, an Essential Step for Banks Towards Better CX
Before the pandemic, banks were already prioritizing to improve their most visible digital properties, such as apps and sites; and some banking consumers were already migrating to digital banking.
But moving from physical spaces to mobile banking apps isn’t quite enough. Mobile apps are an essential part of the package; however, there are significant risks in limiting CX investments to apps while neglecting other high-value engagement channels, like mobile messaging.
4 Reasons Why Financial Institutions Should Invest in Mobile Messaging for CX
SMS is already fully adopted.
The data speaks for itself: 98% of smartphone owners use SMS regularly.
Today, everyone from the youngest to the oldest knows how to send and receive a mobile message. More importantly, it leaves no one out: you don’t need the latest mobile phone or the fastest Internet connection.
Mobile Messaging increases not only revenue but also loyalty.
In an industry where multiple companies offer similar services, loyalty is critical. Financial institutions must ensure that their customers continue to choose them over others. For businesses that focus on enhancing the customer experience, 84% report an increase in revenue and 92% increase in customer loyalty.
Your messages are more likely to be successfully read.
The open rate of SMS is five times higher than traditional email, and response times are sixty times that of email.
Personalization can drive revenue growth — up to 15% significantly.
Digital is the future; physical branches not what they used to be.
The days of waiting in lines to see a teller are long gone. Many consumers prefer to interact with banks via their mobile phones, and they are able to do almost anything virtually – from opening a new account to talking to a service agent.
But that lack of face-to-face contact doesn’t mean consumers don’t want to feel cared for and look after. Banks and financial institutions must look for new communication channels to meet the new needs of their consumers from a distance, and here is where mobile messaging becomes a vital part of the solution.
Top SMS Banking Use Cases
Below mentioned are some ways banks can use SMS services to improve their customer communications.
Research indicates that SMS has an open rate of 98%, making it an effective means for communicating with customers. Banks can capitalize on the power of SMS to reach out to their customers instantly. SMS reminders are an effective way to let account holders know when their bill payment is due, or when they have unpaid transactions.
Sending out regular transactional SMS updates works great for both banks and customers. Banks are more likely to receive their payments on time, and the customers are less likely to have additional fees piling up for being late.
SMS is the best communication channel to send out time-sensitive information. Banks can use SMS to minimize fraudulent activities by keeping their customers informed of any suspicious activity on their accounts. Real-time notifications ensure that the customers are aware of all the activities carried out on their bank accounts and can quickly take action if something doesn’t seem right. These notifications usually include automated alerts about cash withdrawals from ATMs, account login from an unknown device, or online payments made to third-party accounts.
Data protection has become extremely important in the current digital age. OTPs are no longer a safe option when it comes to safeguarding a customer. Many big banks are now using two-factor and multi-factor authentication techniques to safeguard their users from cyber-attacks.
With 2FA, banks can request users to sign in with their login credentials, and then enter a code that is sent to them via SMS, thereby providing a layer of protection for users when they access the banking platform.
Through SMS APIs, banks can generate and manage one-time passwords for their 2FA login process. As a safety measure, the unique passwords generated for the 2FA process are valid only for 30 seconds or less; therefore, the chances of a security breach is minimal.
Enhance customer service with interactive messaging
Banks can consider incorporating a conversation-based engagement strategy by deploying chatbots along with two-way SMS to address immediate customer issues like loan refinancing and applications or warnings about incoming fees and low bank balances. These are all issues that anyone with a bank account runs into at some point.
Interactive messaging, if done correctly, can improve the customer experience. It can provide unique data insights to the bank about the customer as the conversation helps capture nuanced customer data, like their needs and preferences, and can also help in improving the operational efficiency by handling more number of user interactions without needing human intervention.
How Banking Sector Can Improve Customer Engagement and Experience With SMS Communication
On the whole, with SMS, banks can send personalized messages to engage their customers. They can send personalized messages like customized offers, product suggestions, and alerts based on their behavior's and preferences.
But here's the kicker: banks that go beyond basic alerts and offer dynamic messaging that can really up their engagement and build trust. That's where ValueFirst’s SMS platform comes into play, providing ways for banks to prevent fraud and authenticate accounts quickly. By putting all these sick strategies into action, banks can give their customers cutting-edge services and an unforgettable experience.