As it appeared in the Daily Nation on February 19th 2019
by Dr. Lucy Kiruthu
In the past few months, I have quizzed Kenyans around me about their commercial banks. I have sought to find out what it is that makes us choose one bank over the other. I have also been interested in finding out whether most of us would recommend our banks to others. It has been evident that most Kenyans have a love-hate relationship with banks. We have had an equal share of the good and bad times. Many have moved from one bank to another expecting something better. A few have been loyal to their bank for decades. It however seems extremely difficult to nail down on what exactly makes any of our banks unique. The word that best describes why some Kenyan have stayed on with their bank is “Kuvumilia” meaning persevering.
Most banks would be quick to point out their uniqueness. Some may say they are unique because of the hassle free account opening. A few years ago, this may have been a point of differentiation but it is no longer the case today. Most banks do not require you to provide a photograph, a recommendation letter or previous bank statements as was the case 10 years ago. Others may say that their mobile and online banking makes them unique. Today, most leading banks are using similar systems to support their online and mobile banking services making the difference minimal.
Could it be that banks are unique in their charges? Most banks I have interacted with have different bank accounts. Some accounts have a standard monthly charge while others charge per transaction. Regular charges such as ATM withdrawals, chequebooks, EFT, RTGS, standing orders, bankers’ cheques, and interest rates are almost copy and paste. I have searched for a comparative study on bank charges in Kenya and failed to locate one but I am convinced that this too is not a major differentiator. Bank location and opening hours are no longer differentiators too, most banking services can be received offsite. What is unique about your bank? Maybe the account number!
Internally, every bank has a distinctive culture. One would say that culture makes a bank unique. From the inside, culture defines the work environment, the trust levels, the performance and influences strategy and just about every facet of business. To those external to an organization, it may be possible to identify a bank with a strong culture. It is however more apparent when a bank has a customer-focused culture. The bank puts customers at the centre of everything in such a culture. This means that every decision is made with the customer in mind. Unless the culture is customer focused and well embedded in all aspects of the organization, customers may not recognize a bank’s uniqueness.
Looking into the future, banks must be intentional about offering a distinctive end-to-end experience. In particular, banks must design every product and service with the target customer in mind. The product or service needs to add value to the customer. Only a few banks will stand out and survive into the future. These are banks working closely with their customers and helping them find solutions to their financial tribulations. Smart Banks must spend more time and effort understanding the long and short-term aspirations of their customers and meet these aspirations in a unique way.
Dr. Lucy Kiruthu is a Management Consultant and Trainer. Connect via twitter @KiruthuLucy