Customer centricity is now the differentiating factor amongst South African banks

15 April 2019 Consultancy.co.za

While regulatory and technological disruption have received much attention as the biggest challenges to the banking sector in South Africa, Quinton Pienaar of PwC South Africa believes that having a comprehensive customer service strategy is another key priority for financial services firms in the country.

Pienaar is the Lead for Customer Engagement & Salesforce at PwC and has offered his take on the current challenges for South Africa’s financial services firms. Much has been said of the developments that the sector is undergoing, primarily in the digital domain where the rapid growth of Fintech has pushed banks to transform their operations. 

Banks are engaged with digitalising their operations, while simultaneously navigating an increasingly stringent regulatory environment due to the global emphasis on data protection and cyber security. Pienaar suggests that as most banks move in the same direction, customer service will become a key differentiating factor.

One way of achieving a unique customer relationship framework is to invest in getting to know the customers. According to Pienaar, most customers are currently prioritising a human connection, and need to know that their issues will be handled by the bank squiftly and efficiently.

Customer centricity is now the differentiating factor amongst South African banks

Customer-centricity is crucial in this regard, given that providing a truly personalised experience requires the tailoring of services to specific needs of customers. Such a strategy is increasingly essential for the larger institutions, given that smaller FIntechs are emerging and are more able to connect with the customer. 

“By investing in strong platforms, educating personnel and aligning to customer experience objectives, financial services organisations can refocus time and effort to grow the business, while building capabilities to improve customer value. Investing in customer-centric business models to speed up access to underserviced communities makes business sense,” says Pienaar.

Regarding the challenge from FIntech, Pienaar acknowledges the gravity of the disruption, but suggests a more collaborative approach to these organisations as the solution to tackle this issue. Innovation is a crucial part of the South African economy at the moment, and collaborating with smaller players is the best way to remain ahead of the curve.

“Adopting effective growth strategies and integrating with fintech businesses will be essential for traditional players to go into partnership for innovation. Compatibility between the two can be further supported by the growing emergence of start-up incubators and accelerators set up by the traditional players to explore the spectrum of fintech possibilities,” he adds.

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Capitec is the most popular bank amongst customers in South Africa

29 March 2019 Consultancy.co.za

South African research and business performance consultancy Consulta has released the latest iteration of its South African Consumer Satisfaction Index (SACsi) for retail banks in the country. Capitec has emerged as the most popular bank in the country amongst customers, followed by FNB.

The latest index comes shortly after Big Four accounting and advisory firm PwC released analysis detailing how the major banks in South Africa have maintained a mild but steady degree of growth due to increases in consumer spending. This is against the backdrop of sluggish economic growth in the country.

Alongside a slow economy, however, the major banks are currently struggling with a range of other disruptive factors, including regulatory and digital disruption, as well as the rapid increase in the number of smaller competitors who are emerging to capitalise on the rapidly expanding Fintech environment in the country.

Capitec is the most popular bank amongst customers in South Africa

Keeping customers happy is of paramount importance in such a scenario, and the SAcsi has revealed that the major banks appear to be doing so to a relatively high degree. The Big Four major banks listed by PwC – Absa, FNB, Nedbank and Standard Bank – all make the top six bank in Consulta’s list.

Nevertheless, the top spot in the SAcsi has gone to Capitec, which appears to have achieved a great degree of familiarity with its customers. “The Capitec promise of simple, easy, and affordable banking is strongly backed by its ability to deliver in terms of processes, people, and systems,” says Consulta.

Capitec was on top of the index for the last year as well, and has maintained its position despite a minute 0.4 point drop in its SAcsi score. FNB and Nedbank follow Capitec, and all three scored ahead of the industry average this year, while African Bank, Standard Bank and Absa followed in the same order, scoring below the industry average.

“Traditional banks are facing steadily increasing customer expectations while struggling to consistently get the basics right that underpin the most fundamental aspects of customer satisfaction,” said Consulta, in addition to enumerating the range of other challenges that are currently plaguing the South African banking sector.