Discover how conversational banking is reshaping customer experience in finance with faster replies, smarter automation and deeper connections through chat, messaging apps and AI.
What is conversational banking?
Conversational banking allows customers to communicate with banks or financial institutions using apps, chatbots or voice messaging.
It’s part of the digital transformation in the banking and finance sector, where brands are using the latest technology to enhance and streamline their services. Good communication is a key area of focus as customers demand engaging experiences, fast replies and personalisation.
These two-way conversations are convenient for businesses and customers because they eliminate in-person branch visits and long contact centre queues. Customers can manage their accounts/payments using mobile or digital devices, and get faster responses to FAQs with the option to speak to an advisor if they need one-to-one support.
Why is conversational banking on the rise?
86% of UK adults use online banking and more than half use mobile banking. Banks provide many self-serve options to improve convenience and offer flexibility, but there are times when customers might need to speak to staff for more complex matters, such as reporting a change in circumstances or obtaining financial advice.
Customers now prefer speaking to brands via a messaging app and our research found 80% are more likely to respond to a message from a brand through WhatsApp. Financial services companies need to meet this demand by offering conversational banking.
“Conversational banking is more than just being efficient and making cost savings, it’s about building deeper, more meaningful relationships with customers in the digital age we live in today. At Esendex, we believe the future of finance lies in intuitive, secure, and personalised conversations that empower customers and streamline business operations.
By embracing the power of conversational AI and with the right messaging channels, financial institutions can deliver levels of customer satisfaction and loyalty never experienced before, transforming every interaction into a chance for connection and growth.”
Automated chatbots or messaging apps like WhatsApp enable customers to send messages without having to wait in physical or phone queues and reply at a convenient time. For banks, it means they can reduce footfall in branches and call centre queues, so more attention is given to urgent/emotive queries.
Answering a query via SMS, for example, is also more cost-effective compared to a phone call.
Digital transformation has also led to changing customer expectations. As well as a fast site speed and an easy-to-use interface on apps and websites, many customers expect personalised, quick responses from chatbots or messaging apps – and many are willing to pay more for it.
Around one-fifth of consumers are looking to switch banks, so providing an exceptional customer experience can help with loyalty and growth. Figures show that satisfied customers are six times more likely to remain with a bank and will buy more of its products.
Real-world use cases
From setting up an appointment to a lost debit card or suspicious transaction, there are a number of reasons why a customer may need to get in touch. AI chatbots and automated messages can handle some of the load but other times they’ll need to speak to an agent.
Here are some ways banks can use conversational banking to resolve queries:
Balance enquiries
If a customer needs simple information like their account balance, it’s inefficient to head down to a branch, cash point or make a phone call.
Instead, banks can send account balances or updates using SMS or WhatsApp on a regular basis, or when a customer has requested this:
Hi, [NAME]
Your account balance for account ending XXX is £1,065. Login to your online banking or mobile app to make or check any transactions. [LOGIN]
NatWest customers can reach the bank through WhatsApp for queries about accounts and balances, payments and online banking.
Customers can also scan the QR code on their website to start a chat, where they’ll be redirected to its digital assistant Cora. NatWest also messages its customers through the messaging app for follow ups.
Other banks such as TSB send daily or weekly balance alerts to customers who have opted in, which also includes recent transactions.
Loan application updates
Loan applications can sometimes be complex and there may be multiple times where you’ll need to get in touch with a customer, for example, requesting evidence. Banks can offer updates through automated chats or SMS, so customers know how far along they are or next steps.
The Royal Bank of Scotland sends texts to customers to let them know when they’ll get their loan, once documents are ready and next steps. Customers can also ask the chatbot Cora for application updates.
Fraud alerts
Fraud is on the rise with 2.6m cases of remote purchasing fraud committed in the UK last year.
Banks typically monitor accounts 24/7 for suspicious activity and can flag transactions like overseas payments. Once flagged, many send alerts via text to customers to prompt them to review the transaction.
Nationwide immediately blocks the card if there is suspected fraud and sends a fraud alert message through its app, by text or with automated voice call. Customers can remove the block by using the button “Yes, it was me” or confirm its fraud with “No, it wasn’t me”.
Manage cards and payments
Customers can manage their cards and payments using chatbots – this helps to solve any issues straight away and better manage their finances. Santander’s chatbot Sandi can be used to:
- Order a new card
- Close an account
- Activate a card
- Freeze / unfreeze a card
- Add card controls
Customers can also speak to agents using two-way chat to solve more complex queries, like canceling a direct debit or standing order.
The technology behind it
Banks began to digitise in the ‘90s and many now offer a full digital service to improve accessibility and efficiency. Fintechs such as Monzo or Revolut also operate digital-first without any traditional high street branches.
Customer communications is also transitioning with new technologies like AI and automation driving cost-effective, tailored conversations. Banks and financial institutions can solve customer queries without any human input (using automated SMS or AI-powered chatbots) and improve response times.
AI chatbots
AI chatbots use natural language processing (NLP) to read, interpret and respond to customers’ messages with a human tone that sounds human-like. It means customers can get 24/7 support, fast replies and personalised experiences by using data such as names and previous chat history.
Fintech Revolut has an AI chat assistant built with an “algorithm that can recognise, summarise, predict and generate text and other content based on knowledge contained within datasets”. The service is fully automated.
API integrations
API integration means banks can deploy automated chatbots through messaging apps such as WhatsApp or rich communication services (RCS).
The chatbot uses data from a database or customer relationship management (CRM) software to personalise interactions and answer questions, while the WhatsApp Business Platform enables interactive features such as suggested replies and buttons to streamline the experience.
Customers can also be routed to an agent if they need extra support.
Find out how to set up a WhatsApp chatbot.
Messaging platforms
Messaging platforms are a fast way for banks to connect with customers and vice versa. Platforms like RCS enable banks to send rich media such as QR codes, videos, pictures, voice notes and more to build an engaging, memorable experience.
The different conversational messaging platforms include:
Multi and omnichannel strategies
Multi and omnichannel communication strategies allow banks to meet customers across different platforms (think WhatsApp, chatbots, email & SMS) and create a seamless experience across all of these.
Customers expect to be able to reach brands on multiple channels and switch between them with ease. They might start a query via chatbot and complete it on WhatsApp.
This, of course, requires a central platform to send and manage messages across different channels.
Why trust Esendex?
Esendex has the infrastructure to send and receive thousands of secure texts, as well as supporting a WhatsApp API for automated messaging and advanced marketing.
By keeping messaging apps under a central platform – that is also ISO27001 accredited and GDPR compliant – banks can better manage channels, and simplify security and reporting.
Esendex has more than 20 years’ experience working with financial institutions and helping to deliver a world-class customer experience. Banks can use the platform to strengthen fraud protection by sending one-time passwords (OTPs) and two-factor authentication (2FA), as well as meet customers on a channel of their choice:
Case study
Esendex helped the not-for-profit service, Fair For You, boost credit applications five times more compared to email by adopting SMS. Two-way messaging meant it could implement customer-centric communication, improve its customer service and automate processes.
“As a not-for-profit organisation, we must innovate to work smarter and build scalable solutions to achieve continuous improvement for our customers and Esendex was a natural partner to help us achieve this.”
Read the full case study.
Getting started with conversational banking
Conversational banking is the future as the financial sector undergoes the next stage of digital transformation with AI and automation, and customers continue to demand fast replies and personalisation.
Esendex helps banks and financial institutions implement a range of channels (SMS, WhatsApp, RCS, Email and Voice) to step up digital strategies in line with consumer expectations and industry standards.
Contact Esendex to get started with a messaging-based CX strategy.
Esendex
The team at Esendex comprises tech experts and experienced marketers who thrive on sharing their know-how, to support prospects and customers to identify the right mobile messaging solutions for their business.
