Time for banks to pick up the PACE

May 29, 2015 Bonnie Ton

When 77 percent of your customers feel you’re “failing to meet expectations,” it may be time to take a long, hard look at yourself.

That was the headline statistic in FIS’s inaugural “Performance Against Customer Expectations” (PACE) study of the banking sector that it released last week – and it got us thinking.

Sure, banking services are hardly the stuff of effusive praise at the best of times. You won’t stumble across culty bank love-ins à la Volkswagen and Mini and Apple. Customers are more likely to remain silent if you meet needs and grab a megaphone when an ATM goes down or bank fee increases are announced (as discussed here).

That said, there are things that banks can do to create a “wow” factor or at least, in this era of escalating customer demands for convenience and personalization, keep up.


Where your bank stacked up

FIS went to nine countries and talked to 9,000 people. They found out 77 percent of all customers’ expectations weren’t being met by their financial institution, but they then parsed the data two additional ways when presenting the findings: by institution type and by country. See figure 1 below, and note the bars represent index scores, with 100 being “meets expectations.”

Figure 1: Overall Breakdowns

Figure 1: Overall Bank Performance Breakdowns

Source: FIS.

Big banks were clearly the losers here (and we’d wager that the sheer size of the Top 50 Global Banks pushed the overall average of the study to their own index score of 73). Community banks and credit unions are clearly doing something differently to earn such superior – though still sub-100 – scores. Similarly, the West rang in above average, with developing nations India, Brazil and Thailand lagging.

So what can banks do to get their scores up to the coveted 100?


Areas for improvement

The output of FIS’s study is the PACE index, which tracks customers’ impressions of bank performance across 18 service attributes. In round one, banks outperformed across a number of metrics but fell short on fully 11 of the 18 (See Figure 2).

Figure 2: Banks’ detailed scorecard.

Figure 2: Banks' detailed scorecard.Source: FIS.


The green dots congregated largely around what FIS terms issues of “convenience, choice and access” in its own version of Maslow’s hierarchy of needs (see Figure 3).

Based on these results, basic human (bank customer) needs for safety, fairness, simplicity and security are not being met – your Maslovian subject would essentially be dead (or gone to a competitor). Nor are the more aspirational goals of anticipating needs, offering control and providing advice. No self-actualization in sight.

Figure 3: Attributes ranked by relevance and quality

Figure 3: Attributes ranked by relevance and qualitySource: FIS.

So how to address levels one, three and four – and in doing so, push your bank into the “meets expectations” promised land?


A few ideas

We spend a lot of time thinking about these issues, so it’s great to see them so clearly articulated by FIS. Transparency and Fairness go hand in hand in our view, and one could even argue the most important (top, right) metrics on Figure 2, Security and Safety.

What ties these together? Trust. If you can convey to your clients that you are being forthright and honest, that you really do have their best interests at heart, you will build trust.

Zafin is in – among others – the transparency business. Through our fee transparency solution, we help banks not only profitably price their products on a client-by-client basis, but also turn around and provide that transparency back to clients. What could be more transparent (and incentivizing) than seeing not only what you’re being charged by product, but also why you get that price and how to lower it by bundling, increasing or decreasing transactions, or adding products?

Customized, Anticipates, Aspirations and Recognition speak to a desire by clients to be known and understood by their banks. No one likes to be a number. (Quick question: how do you identify yourself to your bank?) Investing in systems that help you disaggregate and analyze customer behaviours – transaction frequency, loyalty redemption pacing and merchant uptake, spend types – can help you target promotions and reward your clients with stuff they actually want when their actions contribute to your bottom line. Our loyalty analytics solution as well as elements of miRevenue come to mind.

FIS’s index should provide insight into well financial institutions engage their customers over the coming years. And a betting man could likely draw parallels between success on these measures and client retention, profitability, and the ultimate goal: shareholder return.


Brief “Fee Transparency 101” For more information on Zafin’s fee transparency solution, download this brief “Fee Transparency 101” piece.



Banking Solutions PrimerFor more information on Zafin’s loyalty analytics solution, download this primer.




May product and pricing lifecycle journal, Relationship Banker.To tap into more of Zafin’s thought leadership, check out our monthly product and pricing lifecycle journal, Relationship Banker.








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