Dear Banks, We Need to Talk... As families reconnect over the Christmas period, it’s time to do the same with our banks  

 
Zahra Hassan, co-founder of Eligible, discusses how lenders can embrace technology to reconnect with customers and leave financial illiteracy in 2023

 
Key Stats:

• 11.9 million Brits agree that none of the financial advice they receive from their bank is personalised to them and their financial situation, leading them to ignore this
• 3 million Brits agree that they disregard bank letters and statements regarding late or missed payments as they do not understand the financial language that banks use
• As families reconnect over the holiday season, one relationship that’s fallen below the radar over the course of 2023 has been that of banks and their customers. In new landmark research unveiled by Eligible - the UK’s first platform used by banks to provide bespoke financial expertise - up to 12 million Brits cite that they receive zero personalised communication from their bank. Further to this, an additional 3 million people have been found to leave their communications from banks unread due to the inaccessible financial jargon favoured by their lenders. In light of this chasm of discourse between banks and customers, Zahra Hassan, co-founder of Eligible, discusses the importance of forging stronger relations with Britain’s long lost relative, the bank. 

 
According to Hassan, this past year has witnessed a continued strain in the relationship between banks and their customers. Ongoing bank closures remain a centre piece of the UK’s shifting financial landscape, with a total of 636 high street outlets reported to be closing their doors for the final time this year alone. Research from Link has also found that 2024 may be the year that up to 30 towns and villages across the UK become so-called “banking deserts” – communities left without an in-person service. 

At a time when more and more brits are deprived of the unique in-person support offered by the high street banks, lenders are increasingly relying on remote, digital communication to keep customers in the loop. However, this long-distance relationship remains particularly strained, with many commercial banks falling at the first hurdle – personalisation.
 
This has become increasingly problematic as the UK continues to grapple with shockingly low levels of financial literacy. In a study by Freetrade, it was revealed that 88% of Brits do not feel confident in their own financial literacy, with research from Allianz stating that the average UK household stands to lose almost £3k a year on account of poor financial decision-making. The high-street bank has typically provided a safe space for customers to have their personal finance queries addressed, however, the collapse of high-street branches in favour of digital-first approaches to support have left many customers feeling disenfranchised.
 
According to Hassan, the adoption of technology by banks may be the key to repairing the strained relationship between lenders and customers, leaving financial illiteracy in 2023. The advent of artificial intelligence can allow for vast quantities of customer data to be analysed at an incalculable pace, identifying consumers that are most at-risk – providing tailored support where needed. The incorporation of learning algorithm also enables service providers to demystify concepts, providing a vital lifeline to the 7-in-10 Brits that feel overwhelmed by financial jargon. 
 
Alongside the FCA’s recently published guidelines on Consumer Duty, obligating banks across the UK to provide tailored support and ensure that the unique needs of individuals are met, Hassan and the Eligible Team believe that 2024 will be a landmark year for banks to renew their all-important relationship with consumers. 
  
Zahra Hassan, co-founder of Eligible, said: “What AI can do today is interact with customers and measure the level of understanding of their existing product before providing bespoke financial expertise. Based on this, we can start to form views on the likelihood that they could struggle to meet their payments. 

“AI can be used to detect how well people understand their financial product and use this data to spot vulnerable customers in order to better educate and support them.

"AI has the power to transform customer support from a reactive relationship to a proactive one. Instead of banks providing support only when the customer asks for it, AI can detect those who are likely to need assistance and proactively engage with them, fostering education and active dialogue."