CUSTOMER RELATIONSHIP MANAGEMENT

IN COMMERCIAL BANKS
Meaning
• Customer Relationship Management (CRM) in the
banking sector helps in managing a bank’s relationship
with existing and potential clients through a set of
collected data, integration of communication channels,
and streamlining customer service.

• CRM in the banking industry allows banks to collect,

store, analyze and leverage valuable data to gain and
retain high-value loyal clients.
Importance of CRM in Banks
• CRM is essential for every business that deals with many customers or clients. However,
when it comes to entirely customer-dependent industries like banking, CRM is of utmost
importance. Here are some of the reasons why CRM in the banking sector is crucial.

• Record and manage customer data, communications, and interactions across

channels.
• Gives banks the ability to have a 360-degree view of their customers, understanding
their needs better
• Allows Customer service team to better serve clients with personalized service
• Gives deeper insight into clients’ demographics, buying patterns, and data for better
policies
• Identify and retain high-value loyal customers
• Allows teams to collect data for targeted marketing campaigns.
• Helps in Cross selling and Upselling
TYPES OF BANK CUSTOMER RELATIONSHOPS
• Bank as Debtor
• Bank as Creditor
• Bank as Guarantor
• Bank as a Lessor
• Bank as Agent
• Bank as Custodian
• Bank as a Bailee
Pledge, Hypothecation and Mortgage

• Pledge : Physical posession of goods

• Hypothecation: No requirement of physical
posesssion, ownership is not transferred
• Mortgage : Underlying asset , ownership is not
transferred yet.
Levels of CRM in banks
• Existing customers
• Previous Customers
• Visitors
• Prospective Customers
Effective CRM Strategy
• Understanding Business Environment: Customer
Interaction and Transaction Execution

• Understanding Bank Products

• Analysing Product Environment

Steps in Effective CRM
• 1. Define Your Goals and Objectives – Identify what you want to achieve
with your CRM strategy

As banks continue to explore the benefits of customer relationship management

(CRM) systems, it’s important to define your goals and objectives for implementing
such a strategy. The ultimate objective should be to improve the overall customer
experience while maximizing revenue potential. Some specific goals could include
increasing customer retention rates, streamlining sales processes, and developing
a better understanding of your customers’ needs and preferences.

With a clear set of goals and objectives in mind, your CRM strategy can serve as a
powerful tool for growth and success in the highly competitive banking industry.
Step 2. Implement an Automated System for Collecting Data – Set up a system to capture customer data
automatically

• As technology continues to advance, it’s important that banks keep up with the
trends to meet the changing needs of their customers. One way to do this is to
implement an automated system for collecting data. With such a system in place,
banks can easily capture important information about their customers, without
relying on manual data entry.

• This all starts with setting up a CRM for banks. This system will not only help banks
better understand their customers’ needs and preferences, but it will also allow
them to provide more personalized service, ultimately leading to higher customer
satisfaction. So if you’re looking to stay ahead of the game and offer the best
possible service to your customers, consider implementing an automated system
for collecting data. Your customers – and your bottom line – will thank you.
Step 3
• # 3.Segment the Customers

To implement the successful business strategy, your business requires

creating the right value propositions that are built on the experience. You
can design them by dividing the clients into the segments (e.g. based on
the income). Define the services that can be admired by the specific
groups and provide the appropriate offers to them.

This can help you meet the different prospects’ demands and improve the
satisfaction. CRM solutions are in charge of the delivering this experience.
Besides, you can determine the demographic data and manage the
service-related actions.
Step 4. Invest in Social Media Channels – Utilize social media channels to reach out and build relationships
with customers

• In today’s digital age, it’s crucial for businesses to meet their

customers where they are: online. That’s where social media
channels come in. By investing in social media, businesses have a
direct line to communicate with their customers, build relationships,
and establish brand loyalty. Plus, social media channels provide a
unique opportunity for businesses to showcase their products or
services in a visually appealing way.

• With the ability to share photos, videos, and other multimedia content,
social media platforms offer endless possibilities for creative
marketing. So don’t miss out on the chance to connect with your
customers – start utilizing social media channels today.
Step 5
• 5. Provide Effective Customer Service

• The individuals get in touch with the different employees of the bank when making a contract or looking for the
support. As the bank owner or manager, you have to identify, promote, and uphold customer experience at all
sectors of the company. To maintain the successful client service, try to show the shared mindset of the
individual’s issues, and empower the team to be quick in solving them. For instance:

• use ready templates for recurrent the problems, and

• the automatic assignment of requests to the specific departments that specialize in dealing with particular
clients’ challenges.

• Also, the employees have to build the relationships with people, and not the organization’s brand image. And each
interaction with a customer should be personalized, i.e. email letters.

• The well-adopted CRM can help you to build the strong relationships with the clients and resolve the issues nearly
at the point of contact. For example: set up a CRM to send automatic email sequences tailored for the specific
sales stages that a prospect is in, or when the client asks for the information or shows interest in your service.
 6.Develop Personalized Experiences – Create personalized experiences
tailored to each customer’s needs
• Every customer is unique, with their own set of preferences and requirements. By creating
personalized experiences tailored to each individual’s needs, businesses can build a strong
and lasting connection with their customers. Whether it’s providing customized offers,
recommending products based on past purchase history, or simply addressing customers by
their names, personalization can go a long way in making customers feel valued and
appreciated.

• By harnessing the power of data and technology, companies can develop innovative ways to
create these experiences and set themselves apart from the competition. So why settle for a
one-size-fits-all approach, when you can tailor your offerings to meet the specific needs of
every customer?
7.Monitor Performance Regularly – Track performance of your CRM tasks regularly to identify successes and areas of improvement

• As the saying goes, “what gets measured gets managed.” When it comes to
managing your CRM tasks, monitoring performance is key. Regularly tracking your
progress can help you identify areas of success and pinpoint areas that need
improvement. By keeping a close eye on your performance, you’ll be able to make
more informed decisions and optimize your efforts.

• So, whether you’re working on lead generation or customer retention, make sure to
monitor your performance regularly to ensure that you’re making progress and
achieving the results you want.
Steps
• #8. Get the Banking Data Secured

• The information security is essential for any business, and financial services
aren’t the exception. Sometimes appears question which CRM to use – on-
demand or on-premise. With the on-premise solution, you store all data locally
and need extra expenses on the staff and servers to maintain the security.
• While with the cloud solution, your CRM provider takes all care about your
safety with the corresponding level of coding information. Besides, the on-
premise CRM eliminates your abilities to be mobile, and your team can work
only from the office; with on-demand solution, your staff can run deals on the go
and be accessible for the customer nearly any time. The advanced CRM
systems provide the role-based safety measures and access control.
Steps
• The use of CRM in banking allows you to advance the
strategies of client acquisition and retention by delivering
the best customer experience in today’s competitive
environment. By examining and measuring the
engagement of the prospects, sales and marketing
performance, you can help your organization to thrive and
increase the revenue.
10 Best CRM to Overcome Challenges in Banking Industry

• Engage Bay
• Zoho CRM
• Nafhaa CRM
• Salesforce CRM
• HubSpot CRM
• Oracle NetSuite CRM
• Freshsales
• LeadSquared
• Solid Performers CRM
Benefits of CRM in the Banking Industry
• Streamlines Entire Operations: Streamlines and automates the entire client
management and service operation of a bank. Right from marketing to sales to
customer service through integrated workflows.
• Improves Customer Loyalty and Satisfaction: Provides a 360-degree view of customers
and allows banks to provide personalized service for improved satisfaction.
• Increases Efficiency: Boosts efficiency by automating repetitive tasks and improving
communication between departments.
• Smooth Workflows: Establishes workflows between different departments leading to
improved communication and higher efficiency.
• Boosts Revenue: Provides better insights of customers for targeted products, services,
campaigns, and policies for more revenue.
• Improves Decision Making: Provides a wealth of structured client data allowing banks to
make better decisions about marketing, sales, and customer service strategies.
Benefits of CRM in Banks
• Viable Reports and Analytics: Generates accurate and easy-to-read reports and
analytics for setting targets, identifying gaps, and tracking progress.
• Efficient Communication: Bank call center ensures an easy flow of information and
creates a relationship of trust. Customers can confidently share their information and
requirements with bank professionals.
• Personalize Customer Journey: CRM for bank can keep track of customer behavior
and predict their needs. Based on key data analysis, the software automatically
sends out suggestions for how the bank can fulfill the expectations of customers.
• Strengthen Customer Experience: Banking CRM helps you record customer data
and personal information which can be used to proactively deliver personalized
services to customers. This helps banks to focus on the needs of its customers and
in turn strengthen customer experience and loyalty.
• Effective Lead Management: Right from capturing leads to converting and nurturing
them, bank CRM solutions help with the end-to-end lead management.
References
• https://www.techjockey.com/blog/crm-for-banking-
industry#engagebay
• https://payspacemagazine.com/articles/crm-best-
practices-for-banks-strategies-for-success/
• https://www.bankingfinance.in/customer-relationship-
management-banking-sector.html
• https://www.findmycrm.com/blog/crm-industries/crm-in-
banking-build-the-effective-customer-strategy
• https://monday.com/blog/teamwork/crm-strategy-why-you-
need-it-and-how-to-create-one/
•