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Customer Care in Indian Banking Industry

Over the last decade or so, The Banking Industry is swiftly transforming into the service industry.
With private players coming into the frame, the service standards have improved to new levels. Customer expectations have grown manifold in the recent past and the list will keep growing endlessly with continuous automation in products and processes. These persistent improvements in products add to increased pressures on customer service delivery to meet the customer expectations. 
The product features and the technology offered to customers are not the only differentiators any more. What differentiates the best in the industry from other players is the ‘Service Attitude’ of the front office.
The world over, Banking has become a technology based servicing opportunity. The Banking Industry has witnessed the introduction of various servicing channels for customer service delivery. The service channels such as ATMs, Phone Banking, Net Banking, and Mobile Banking are the key channels responsible for a reduction in the number of walk-in customers who normally otherwise were using the traditional branch channel for seeking banking services. However, this is seen as an effect only in the western part of the world. Story in India is not so. Until now, the psychology of common Indians is to visit the Bank / branch personally and transact for all the requirements. We Indians still find it difficult to use the technology-based channels to seek banking services. Indian population largely depends on personal interaction with the banker to ensure error and risk free banking services in the traditional way.
The banks are expecting enormous growth in business in years to come. The ever-increasing customer base creates service challenges to be faced for further growth opportunities. The increased pressure on the front office to meet customer expectations on one hand and to follow the regulatory norms on the other hand to mitigate risk in operations tends to tilt towards the risk mitigations on many occasions. The fear of errors in operations and the probable monitory risk involved in the transaction processing tends to kill or suppress ‘service attitude’ in the front office.

I am narrating a small incidence that has induced me to think about this seriously.
I happened to visit the ATM lobby of one of the private sector banks for cash withdrawal at 9.00.am in the morning. The security guard informed me that the ATM machines were out of service.
With an obvious intention to withdraw cash, I entered the adjacent branch. I requested the cash teller to help me with a withdrawal slip to withdraw cash from my account. The teller asked me whether I was carrying my debit card. On saying yes, I was suggested to use the ATM. When I informed him that the ATMs are down and I need to withdraw cash, he suggested me to use any other nearby ATM location. I again asked the teller whether it was a practice to refuse withdrawal slips to customers even if the ATM was down and the answer was assertive. I was later asked whether I was carrying any photo-id proof, which I was not. I requested them to speak to either of the two, The Branch Manager or his deputy and help me out. I knew both of them personally. Nevertheless, I did not see that happen. Finally with intervention from one of the sub-staff who luckily knew me, they somehow decided to help me with a loose cheque leaf.
All they could have done is exercise extra caution while handling my request but help me out in such an extraordinary situation. Banking anyway depends solely on signature verification of the customer before carrying out any financial transaction. The ID requirement comes into consideration only if my Signature does not match with the records. 
This ‘service awareness’ while handling my request as per laid down processes, is the “differentiator” 
I will mention another experience of a customer.
He was an NRI client of one of the private sector Banks in India. On his temporary visit to India, he felt the need of issuing mandates to his father to operate an NRE account in his absence. Instead of visiting the branch, he chose to download the mandate form from the official web site of the bank. However when he couriered the form to the branch it was rejected by the processing unit with reason “Submit requests as per new format”. He was surprised to know this reason for rejection of request from the bank. On the day of receiving the rejection, he revisited the web site of the bank and the new mandate format was not updated even then. The processing center of the Bank was not ready to act on the submitted forms and insisted on submission of a request as per applicable format only. The branch officials had to then convince the senior managers to approve process deviation to assist the customer. Later the customer was couriered the new mandate form to sign-off for bank records and he did so.
The back office seeking a fair legal reference and acting on the customer’s request could have avoided this whole episode. Then customer should have been requested to sign the request again for bank’s audit records. But the genuineness of the customer’s request was completely overlooked while sticking to the rules. This was probably the fear of compliance, which overtook customer convenience. Surely this client will not be a satisfied one even though his father’s mandate got updated after a lot of follow-ups and communication with the bank.
In this fraud prone world, it is critical and necessary for the senior leadership to lay down strict controls and processes. It is obvious that the front office team needs to probe and follow the laid down processes while handling customer transactions to mitigate the risk.
However, the question, which the apex leadership need to answer, is “are we letting “
the feeling of fear take over the feeling of care?"  If yes then it is dangerous. It can lead to dissatisfaction & escalations from customers even in normal situations.
Most of the banks provide different channels of services for customers to use such as Branch Banking, Internet Banking, Phone Banking, ATMs, and Mobile Banking. The front office should service people with empathy especially when they have been unhappy with the other channel of service. If  a customer walks into the branch since ATM machine is out of service and is not dealt with empathy, he will certainly walk out with dissatisfaction.
Rules and regulations will be there, Processes will be laid down but what will matter is the ‘service attitude’ in such situations. In today’s competitive and fast developing world, customers quickly migrate from one channel of service to other effective channel of service. However the speed of customer migration from one service provider to another is even more phenomenal. A slight dip in customer service can lead to a large outflow of customers and business opportunities.

The concept of Circle of Care & Circle of Fear can explain the importance of being proactive service providers and not being reactive service providers

  Circle of Care is the attitude with which we manage customers’ expectations. Do we manage their expectations or mere transactions? Circle of care is thus the mindset with which we offer customer service. When we are solution oriented, when we offer alternatives to customers and when our efforts to resolve the customer request/complaint are visible to the customer it makes a difference. We are able to build the trust of the customer for a long lasting relationship.
Circle of Fear on the other hand reflects the insensitive attitude towards the needs of the customers. Rigid and mechanical approach of service officers while handling clients as ‘transactions’, most of the times results into indifferent customer service.

Circle of Care will consist of attitudes such as

·        All the things I care about

Solutions to the client, enhancedcustomer Satisfaction, adherence to rules/processes

·        All the things I can impact

Error free operations, meetingcustomer expectations, timely query resolution.

·        All the things I can change

Improved customer perception,better brand image, and self-development through continued learning


Circle of Fear will consist of attitudes such as

·        All the things I fear about

Possible operating errors, iratecustomers 

·        All the things that affect me

Possible penalties for errorscommitted… both monitory & disciplinary

·        All the things that impact mywork

Work pressures, lackof knowledge, and irrational behaviour of customers

Circle of fear / circle ofcare


(Conceptual diagram inspiration from Stephen Covey’s Circle of Influence/Concern)

Where is your focus?

Service Providers who operate out of Circle of fear tend to reduce their Circle of Care. 
It results in insecurity feeling while servicing customers and they tend to commit more errors or their interaction results into customer dissatisfaction many a times. Customers today are keen to seek solutions/Alternative solutions for their needs. They expect results not reasons. They want to seek solutions and not excuses.
While risk mitigation, regulatory norms, audit & compliance issues will always carry due importance in the financial world, slow but consistent effort is necessary to develop the vision which will look beyond these for effective customer service. Going forward banks will need more senior management officials who will guide the front office to develop this vision of ‘Circle of Care’ while dealing with customers. An effort made in consciously widening the Circle of Care will definitely result into better customer retention and enhanced business opportunities. Customers of the 21st century look forward to deal with service providers who have a positive attitude and are solution oriented.
Be a 
PROACTIVE Service Provider by taking due care of rules & processes but above all take care of ‘Customers’. Else, you will be a REACTIVE Service Provider having no control over “Service’ aspect of managing Customer expectations. 
Either we choose to operate out of Circle of Care, run fast & run first or we will be run over by the more efficient in the end 
… The choice is ours…
Siddheshwar Vinayak Natu
Founder Member – MIDAS TOUCH Consultancy Services