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By Tina Giorgio
We are in unprecedented times. “Shelter-in-place” acts help slow of the spread of coronavirus, but at the same time, they inject uncertainties into the economy and drive volatility in markets. This delicate dance between taking appropriate precautions and infusing necessary economic assurance has led to the passage of a $2 trillion federal stimulus package.
Despite this capital infusion, two-thirds of Americans anticipate having trouble paying credit card bills because of COVID-19, while the Federal Reserve Bank of Atlanta’s Survey of Business Uncertainty showed that from February to March, businesses’ sales growth expectations fell from above 5 percent to below zero—the steepest one-month decline in the survey’s history.
More than ever, customers will have to rely on digital solutions to manage cash flow and make payments and may need your guidance. To support customers in this digital-first environment, we suggest community banks.
1. Help customers migrate to a digital platform. Data from ICBA Bancard’s Digital Payments Strategy ToolSM shows that 40 percent of consumer customer interactions still occur at the branch. With the COVID-19 crisis severely impacting these face-to-face interactions, now is the time to create tools to help customers access your digital offerings. Promote online resources that allow customers to monitor financial well-being and emphasize any payment allowances you are providing. Finally, assess which of your customers—via bank data and/or direct customer relationships—would benefit from a quick overview of how to use digital solutions and reach out via targeted communications.
In short, find new ways to meet your customers where they are and help them embrace this new digital norm.
2. Ensure flexible digital payments options are available. More than 60 percent of Americans believe they can catch coronavirus from handling cash, so payments now factor into their fears. Eliminate the concern by providing cashless solutions. Our Strategy Tool data tells us that 89 percent of community banks already offer mobile check deposit as a helpful example, but only 54 percent have digital wallet offerings.
Digital wallet and digital payment app use will climb during this pandemic, so make sure you’re primed to support your customers by offering solutions. It can be as simple as certifying your cards for use with Apple Pay, Samsung Pay and Google Pay or exploring Card App™, Bancard’s offering. In addition, consider contactless technology integrations for point-of-sale purchases, and explore incentives to allow you to remain top of wallet. In an environment where consumer spending is tight, inducements will make a difference in the transactions that come to your card versus another payment solution.
3. Continue to serve as a partner. Your customers are trying to navigate today’s landscape, and you are in a position to help. In fact, a recent Mercator study reported that small businesses are most likely to turn to their bankers (59 percent) for business advice. So, take the time to talk to and survey your customers. Find out how your digital solutions serve them and what more you can offer. In addition to helping them today, these insights will support your future strategy and product planning as you learn exactly what they need.
Certainly, we are living in an uncertain time, and it can be tempting to get caught up in immediate demands. But this experience can inform next steps for your digital strategy and support your customers’ needs—both in today’s tumultuous environment and in the future, whatever the new normal looks like.
Tina Giorgio is ICBA Bancard President and CEO.