Banking & Finance

Shanghai banks are becoming nicer, responding to shifting customer expectations, says McKinsey

Chinese banks are changing tact in the wake of changes wrought by the way tech companies, retailers and other innovators approach urban consumers

PUBLISHED : Friday, 26 January, 2018, 4:40pm
UPDATED : Friday, 26 January, 2018, 6:44pm

The banking industry in China is responding to changes in client expectations by urging branches to be more sensitive to the customer experience and provide differentiated services, according to global consultancy McKinsey and Co.

“Banks need to learn from other sectors, including technology, consumers goods, hotel, and new retail operators to improve the customer experience,” said John Qu, a senior partner at McKinsey.

Banks that can resonate with customers and provide personalised services will gain an upper hand over rivals, he said, stressing the urgency for transformation in customer service in the financial industry.

Banks in China, including foreign lenders, are investing heavily in new technology, reflecting the new emphasis on reaching customers.

Earlier in January, Standard Chartered opened two separate outlets in the K11 shopping centre on Huaihai Road in downtown Shanghai.

One outlet, in an attempt to create a unique client engagement, offers hi-tech interactive equipment, including a virtual reality game machine and a device that can produce short selfie videos with famous scenic spots -- such as the Eiffel Tower in Paris -- in an attempt to create unique client engagement.

It works as a platform to resonate with Chinese consumers as travel continues to grow in popularity, and it draws customers to the lender’s nearby banking outlet, which provides non-cash financial services including wealth management. The branch is open extended hours until 8pm including weekends, in an effort to cater to the busy work schedules of urban residents.

“Traditional banks need to find new business models to survive and thrive to cope with evolving technology,” said Zhu Yamin, head of retail banking, Standard Chartered Bank China. “The new branch underlines our latest effort to run banking services in a brand new and innovative way.”

Sophie Ding, 31, an office worker in Shanghai, said she felt foreign banks are increasingly catering to technology-savvy customers, adding that she was recently informed that she can pay her Citibank credit card through Alipay.

“A smooth digital service is what I preferred most,” said Ding. “When services are similar, I prefer those that can offer extra value such as special entitlements at retailers.”

Michael Wang, a small-business owner in Shanghai, said he found improved services at banks in China that used to be notorious for long queuing times.

“It’s unlike five or 10 years ago when cold, poker-faced staff were the norm and consumers had to bear long queues, sometimes lasting hours,” he said.

Wang said he was able to update his banking profile to reflect a change in his mobile phone number in just few minutes by going through several steps on a tablet with the help of staff at a local Shanghai branch.