Francis Wade | In five years, customers may choose their bank by how it asks

Imagine you are a local banking executive who cares about the way customers experience your institution’s brand. You dread the calls from acquaintances complaining about a painful know-your-customer or anti-money-laundering (KYC/AML) demand for documentation. Are your hands tied?

It’s a problem plaguing everyone not wealthy enough to have a private banker. An innocent approaches a bank to take an action she thinks is straightforward. Before long, she’s hopelessly stuck in a never-ending loop of shifting requirements.

Documents submitted according to the initial checklist only spawn further obtuse requests, each for something harder to procure.

After a few rounds, she’s at her wit’s end. She quits, fed up but relieved. She will find another way to make do, knowing it is far from ideal, just to avoid further painful interactions. And she tells acquaintances the whole horror story. Prospects hear these stories before they ever walk in.

In your role, you have probably been on the receiving end of such complaints. By now, you know how to blame international regulators, local KYC/AML laws, and even the Bank of Jamaica. This, you confidently explain, is out of your hands.

I have been the customer in a similar story. Recently, a financial institution asked me to produce the original of a 40-year-old document most people have lost – a first, ever. I got lucky: I had mine. After being promised that my withdrawal would be easy, I needed insider tips within the branch to fill out five confusing forms.

The Pivot

There is something to be learned from doctors. They face a more extreme version of your dilemma every day: a diagnosis they cannot change but must communicate.

Yet, medicine treats the way a diagnosis is delivered as a distinct design problem in its own right. SPIKES, a protocol taught to clinicians, breaks a difficult conversation into six steps, from preparing the setting to responding to emotion to agreeing on a plan.

Ariadne Labs built a whole programme around serious-illness conversations, with guides, training and support for the institutions that adopt it. The illness stays exactly as it is. What changes is how the doctor intervenes and, with it, how the patient responds.

A KYC/AML request is not a terminal diagnosis, and I do not suggest otherwise. Nor do I know whether medicine’s methods carry over to banking. That is a hypothesis awaiting a test.

But the principle holds: delivery is a separate design problem. The rules and regulations fix what must be verified. They do not address how the customer is prepared, guided, and supported before, during and after bad news – a surprise demand for more information – is delivered.

Consider the first request for documents every customer faces. Today, it arrives as a curt order. Within five years, I expect at least one local institution to decide it should arrive differently: as a welcome invitation.

I call the discipline (and its profit potential) SCOPE: Strategic Customer Opportunity and Performance Edge. It starts by recognising that all difficult requests for documents have two layers.

The first, the “transaction layer”, consists of demands, promises, forms, and document delivery. By contrast, the “experience layer” is how the customer feels at each of those points, and whether anyone interacts with their emotions.

Take the initial request for information, usually embedded in a templated email, or generic handout. The message is factually correct and fulfils the transaction layer. The employee who conveys it is doing his job. Tick.

Unknown to him, this unwelcome demand makes a hard, painful landing in the experience layer. The customer reads it on their own, with no one on the line to explain reasons, handle disappointment or ease frustration.

The institutional default doesn’t help – compliance owns the rules, operations owns the forms, but nobody owns how the customer feels.

The financial institution that moves to capture this breakthrough opportunity acknowledges that an email is no way to deliver bad news. Instead, it will treat that first request as a pivotal moment in the customer’s experience and leave nothing about it to chance in this sequence:

Consciously structure each encounter by defining how the interaction should unfold, not just the data to be conveyed.

Train for emotional responses, so staff recognise confusion, fear, embarrassment and anger and respond appropriately.

Rehearse difficult situations, using realistic scenarios and feedback.

Measure the recipient’s experience, testing whether people feel informed, respected and supported or victimised.

Back to those tied hands. The rules fix what must be verified. How you ask is yours to decide. The first institution to treat that freedom as a long-term strategic differentiator will turn a pain point every customer shares into a reason to recommend it to others.

Rivals will wonder where their customers, and their profits, went.

Francis Wade is the author of ‘Perfect Time-Based Productivity’, a keynote speaker and a management consultant. To search his prior columns on productivity, strategy, engagement and business processes, send email to columns@fwconsulting.com.