Banking has gone digital — 78% of U.S. customers now opt for mobile apps or websites over in-person banking.
As branches become more vacant and ATMs less active, banks must navigate an evolving challenge in digital services: Accessibility. For customer groups like the elderly, underserved minorities, and those living with disabilities, new banking solutions may bring more frustration than engagement.
While 75.4% of the U.S. population now uses digital banking options, Black and Latinx users pay more in banking fees than white customers. White account holders paid $5 per month on average, Black users paid $12 and Latinx customers paid $16. In addition, these communities often lack access to brick-and-mortar banks — since 2010, the number of banks in majority-Black neighborhoods has decreased by 14.6%.
In this piece, we will explore four opportunities for banks to improve product accessibility and better engage diverse customer groups.
Customer feedback plays a key role in the development and deployment of digital banking services. The caveat? Many banks have a narrow feedback focus: they often ask existing customers what they like, what they do not like, and what they want to see next.
While this helps banks build better products for a specific customer segment, it ignores the nuanced needs of more diverse markets. Consider Black and Latinx populations, both of which are historically underbanked compared to white Americans: 22% of Latinx households and 32% of Black households were underbanked in 2019. In addition, both groups lack representation within the industry, with Black and Latinx employees 75% less likely to be promoted than their white colleagues. Interestingly, Latinx populations are more likely to use mobile banking options than white Americans — in 2091, 41.3% of Hispanic households used mobile banking, compared to just 31.4% of white households.
Using Ichor-facilitated, hyperlocal dialogues, financial institutions can gather feedback from diverse customer groups to identify current banking challenges and craft solutions unique to each group.
Good intentions do not always equal great choices. While staff asking "Do you need help with that?" or "What seems to be the trouble?" are well-meaning, these questions can negatively impact customer relationships.
Instead, banks can benefit from training staff to ask open-ended questions that allow clients to voice their opinions or concerns without feeling judged. For example, if employees encounter a customer complaining about access in person, via call centers, or online, it is worth asking how they prefer to access their financial data. It could be that customers are struggling to find a local branch, do not know what types of assistance are available to them, or are having trouble downloading and using mobile apps. They may also prefer banking websites but encounter accessibility challenges.
It is also worth educating customers on new and emerging digital options. By providing customers with easy-to-understand information about how different banking options work and what benefits they offer, staff can help clients find services that best fit their needs.
Competition drives innovation in the financial industry. In practice, this means taking the time to explore what other institutions are doing to increase accessibility — and then doing it better.
Consider a recent case study about one Southern U.S. bank. To help improve accessibility in person, the bank designed branch offices to include easily accessible ATMs and cash deposit boxes for customers with physical and sensory disabilities. Online, they used specialized software to create PDFs that are formatted for use with screen readers, allowing partially sighted and blind customers to easily access text, table, and graphic data. Since this formatting happens at a code level, the PDFs themselves do not look any different, meaning they are equally accessible to blind, partially sighted, and sighted clients. As a result, the bank has seen increased public awareness of its efforts to deliver inclusive and accessible services.
Exploring the accessibility efforts of both traditional banks and emerging fintech companies, however, can be both time- and resource-intensive for banks. Accessibility benchmarking from Ichor can help banks discover if peers are taking any unique approaches, and if so, how they could be applied to existing practices. For example, while smaller banks may not be able to afford proprietary software to reformat all their PDFs, open-source and cloud-based solutions may offer a cost-effective alternative. More than half of banks surveyed now say they are using open-source software for development and operations (DevOps) initiatives.
Put simply, the rapid shift to digital service delivery is a challenge for banks, especially when prioritizing accessibility. With the right approach, however, this is possible — banks such as Capital One have proven that even with large digital footprints, accessibility is achievable with an equity-focused, human-centered approach to continual refinement.
Inclusion does not happen by accident. Instead, banks must be patient and proactive when building a culture of inclusion that is founded on trust and driven by mutual success.
For banks looking to expand their impact in underserved markets, this means opening the door to meaningful dialogue. By connecting with community leaders and actively listening to their concerns — from lack of trust to lack of accessibility to lack of opportunity — banks can build rapport. This trust makes it possible to create wins for both the community and the institution.
For example, if communities struggle with mobile banking because existing apps do not offer full language support, banks could develop updated versions that are more accessible. In this case, communities win with more confidence about where their money is going, while companies win by capturing a new customer segment.
In practice, this requires a commitment from banks to be more intentional in building trust with minority communities. This may include growing partnerships with minority depository institutions (MDIs), prioritizing inclusion and diversity among staff, and collecting and disseminating data showing the positive impact of inclusion on minority banking participation.
According to the Federal Reserve Economic Well-Being of Households in 2021 report, 6% of Americans — approximately 20 million — are unbanked, a 1% increase from 2020.
Accessible banking products and processes help increase customer satisfaction and boost client engagement, in turn helping banks stand out from their peers. But giving power to the people requires a transformational approach that includes feedback, training, benchmarking, and inclusion.
Prioritizing accessibility can help build better banking products and improve community connections. Ready to get started? See how Ichor can help.