As the current pandemic has continued to curtail branch traffic and consumers have adopted new digital channels, the importance of the traditional voice channel has taken on added weight. For consumers who cannot or do not want to visit a branch, phone calls have become the most personal way to interact with the financial institution (FI)—and the preferred way to discuss some of the FI’s most sensitive and profitable products and services, such as business credit, mortgages, and wealth management.
In the first year of the pandemic, 96% of financial services workers reported their outbound calling activity had increased, highlighting customer preference for the voice call. Unfortunately, the pandemic has also coincided with stepped up and more sophisticated phone scams. FI customers have long been a popular target because the value of FI transactions is significantly greater than most other industries and scammers follow the money. Consumers received an average of 144 spam calls in 2020, with 58% of those calls actually fraudulent ones. These consumers are getting fed up. Today 94% of unidentified calls go unanswered, according to data from
For years, the financial services industry has spent huge resources on “know-your-customer” (KYC) initiatives so institutions can be sure that whoever they are interacting with is really their customer. Now one of their biggest challenges is convincing the customers that it’s really the bank trying to contact them, but overcoming this challenge has significant rewards. For example, Hiya’s Branded Call has enabled a Fortune 200 financial services company to incrementally outperform non-branded calls by 5%. This 5% growth yielded nearly $120 million in new revenue through the acquisition of 15,000 new customers -- all directly attributed to Hiya’s services.
The Perils of Ignoring Caller ID
Someday the pandemic will recede, of course, and customers will start returning to some of their pre-pandemic routines. But the reduction in bank branches, from nearly 100,000 in 2009 to about 80,000 by the end of 2020, will carry on. And, according to the S&P Global Market Intelligence’s annual Mobile Banking Survey, many consumers won’t miss them: 64% of consumers who said they were visiting branches less during the pandemic said they expect to use them less after the pandemic. As branches decline, the voice channel’s importance will expand—especially given its natural link to video banking.
So, it’s critical that FIs actively manage Caller ID to assure customers that they’re receiving a legitimate call, especially as more employees continue to work from home. Yet FIs often take a very laissez-faire approach to Caller ID technology. Banks and retirement plan sponsors continue to use outmoded technology platforms that have been in place for years and that don’t identify the institution, and worse, because of M&A, display unintended brand identities. To make matters even worse, some FIs have experimented with tactics that sow distrust and damage the brand. A prime example is the use of local phone exchanges to trick customers into thinking it’s a neighbor calling and not spam, but this tactic has backfired. Not only does it annoy consumers, but scammers have quickly adopted the tactic.
It’s ironic that while FIs often spend hundreds of millions of dollars investing to affirm brand equity—and are hyper vigilant about everything they do with their brand--their outbound phone calls are routinely unidentified, mislabeled with old/defunct brands, or even misspelled. Given the stakes, FIs need to be more proactive in managing the voice channel.
Unanswered Calls Hurt FIs and Customers
The negative consequences when legitimate calls go unanswered are significant for FIs and customers. For FIs, these include higher customer acquisition costs, slow sales-lead conversion, loss of business, and delayed response times. These obviously hurt the productivity and morale of employees who must constantly prove their legitimacy to customers before getting on to the business at hand. But these consequences also hurt the customer experience and can weigh particularly heavily on the institution’s bonds with small businesses, which studies show put an emphasis on relationship banking.
“When consumers don’t pick up a legitimate call it’s really a lose-lose situation for the consumers and the financial institutions,” says Stephen Shepherd, financial services sector head for Hiya. “Customers get frustrated when they miss important calls, so it’s critical that financial institutions take action to restore trust in the voice call and provide their customers with a better experience.”
One way to restore trust and increase call answer rates is to do a better job branding outgoing calls. Indeed, more FIs are considering solutions such as Hiya’s Branded Call, which provides the identity, security, and analytics required for enterprises to unlock the value of the voice channel. For example, Hiya began working with a leading mortgage lender that did not brand its calls and was suffering steadily deteriorating answer rates as customers increasingly ignored the lender’s calls. But after implementing Hiya’s Branded Call, the lender increased its answer rate by 24% and reached 52% more customers than it had previously.
Four Insights about the Voice Channel
Given the importance of the voice channel and the acute challenges FIs face operating it efficiently, Hiya recently published the
1. The Reliance on Voice has Grown. Consumers prefer to communicate via the voice channel across industries, and the sentiment is no different in the financial services sector, beating out email, instant messaging, and text. Consumers prefer the added reassurance that voice provides when it comes to discussing personal and confidential financial matters. As noted, 96% of financial services workers say their calling activity has increased in 2020.
2. Consumer Trust in Voice is Fragile. FIs use the voice channel to offer many high-value products and services—from personal banking and loans to mortgages and business credit, which unfortunately also makes the channel very attractive to scammers. In fact, increased spam, fraudulent calls, and/or spoofing, is making consumer trust in the voice channel very fragile. Sixty-two percent of US consumers surveyed say they have received a call from an impersonator spoofing a legitimate business at least once in the past year, and almost 40% of US consumers surveyed say that the impersonator claimed to be operating in the financial services sector. “As scammers and spam rates continue to give consumers pause about whether to answer a phone call, financial services firms should seriously inspect the damage to their brands, and the frustration of their advisors and customer-facing associates. Branding calls can address these issues and optimize the voice channel,” Shepherd said.
3. Critical KPIs are under Threat. Consumers are flooded with texts, calls, and notifications on their phones every day, making it difficult for businesses to get their attention. The existence of fraudulent calls within this deluge further erodes trust. From brand loyalty to decreased productivity, fraudulent calls are threatening the most critical KPIs in the financial services sector. Fifty-four percent of financial services respondents said their business has been spoofed by an impersonator, and 48% of consumers say spoofed calls make them suspicious of any subsequent calls coming from that business.
This translates into one of the biggest threats to brand value and loyalty and has tangible business repercussions. Financial services workers surveyed said that not being able to reach customers via the phone has hurt productivity (58% of respondents), customer satisfaction (44%), and efficiency (56%). In very real terms both consumers and the FIs that serve them have become the victims of scammers.
4. The Business Must Fix the Problem. Ninety-two percent of financial services workers believe that the voice channel has become more important than ever, and they realize that not branding their calls is becoming an impediment to doing business. A large majority of respondents surveyed—75%--said they know their outgoing calls are being erroneously marked as spam or blocked as fraudulent. Not surprisingly, they lay the blame for this state of affairs on spammers and fraudsters (58%), device manufacturers (33%) and the government (33%). Interestingly, however, 54% of financial services professionals believe it’s the responsibility of FIs to fix the problem.
“All four of these trends make clear that consumers will continue to rely on live human interactions to address their customer service needs in this industry, but fraudulent calls pose serious threats to the customer experience that business technologists and brand stewards must fix,” Shepherd said. “Fortunately, there are steps financial institutions can take to fortify the consumer trust they have worked so hard to build, including better branding of their calls.”
Chart a Path to Regain Trust
Despite the increased usage of mobile banking apps, chatbots, and other channels designed to drive efficiency and customer satisfaction, there will always be the need—and the desire—on the part of consumers to have live human interactions. By combining smart strategies with technologies that are purpose built to combat fraud calls, companies can drive increased value from their voice channel, regain the trust of consumers, and improve their overall business performance.
