Canada’s banking sector is working aggressively towards digital transformation, to help reduce costs and to improve customer experience, despite resistance to change, and security associated concerns. COVID-19 has sped up the pace of digital transformation across all sectors, especially retail banking, resulting in a sudden shift in customer behaviour and preferences. The pandemic propelled a rapid and far-reaching transformation from digital resistance to reformation, for many in the ethnic customer banking segment. This includes the first-generation multicultural population, who have been accustomed to traditional in-person banking from their home countries. Today, many of them have already transitioned to adopting virtual and mobile banking.
Retail banking: The Rise of Contactless Payments
During the lockdown, retail banking witnessed an increased online banking channel usage. This became the preferred channel for even daily banking activity. Cash usage had been on a gradual decline, but the increased fear of virus transmission and the need to follow the safety and distancing protocols, led to an estimated additional decline in cash usage of 62 percent, according to Payments Canada, resulting in contactless payments, paperless approach, and digital banking becoming the new normal.
For the multicultural population in Canada, among those who hadn’t jumped on the digital bandwagon earlier, both millennials and Gen Z were quick to adopt, while the older population gradually transitioned to embracing this change in banking activity.
Digital Banking: The New Normal
Research shows that many of the banking services such as consumer loans, mortgage and securities investments have been used online for the first time during the pandemic. An Accenture report states that 50% of customers now interact with banks through mobile apps or websites at least once a week, compared to 32% two years ago, resulting in a decline in branch visits.
Multicultural customers have displayed positive sentiments towards online and mobile banking experiences. The banking industry’s customer service infrastructure took the initiative of providing step-by-step support solutions, through help centres, video calls, call back options, among other tactics. This has encouraged and facilitated the transition to digital banking, especially for many of the reluctant tech-averse customers who may be wary of banking digitally.
Growing Trust in Times of Crisis
It is observed that despite the pandemic-associated insecurity and financial vulnerability, trust in banks is at an all-time high. Multicultural customers are viewing them in a positive light owing to the banks’ reassuring consistency in providing robust, rapid, and convenient online service across the board. Both the rate of personal savings and the spending sentiment have stayed strong, all indicative of the strong trust factor when it comes to their banking institution. Research suggests that this will only get stronger.
Hybrid Banking: The Best of Both Worlds
Post-pandemic, most bank customers will continue to acquire products and services digitally and make fewer visits to the branches. However many multicultural customers across the age spectrum, prefer hybrid solutions – a balance between the digital-human options, to be able to make use of both online and personal in-branch services, especially in case of more complex services and advice. Banks will have to operate across both virtual and physical domains seamlessly.
Multicultural customers prefer personalized banking and personalized digital interaction. They look for customized services, tailor-made solutions, dependable financial allies, and convenient banking transactions.
To know more about your multicultural customer, contact Maple Diversity Communications for actionable insights and multicultural brand solutions across all financial sectors. Our research experts will be happy share specific insights and findings relevant to your brand and business objectives.