The European Financial Management and Marketing Association (EFMA) Business Banking Advisory Council has launched its first annual report, summarising the trends and developments identified in the business banking sector during 2010. The report identifies some key differences between banks across Europe, in particular some pan-European banks are trying to standardise their processes across the countries in which they operate, while others prefer to live with differences between European countries, believing that they reflect the varying needs of the areas in question.
Some other key issues raised by the council included:
- Relationship managers are in a key position in terms of understanding customers’ strengths, weaknesses and needs. However, they now need to become more proactive in developing their customers’ businesses, using new tools and new skills.
- A problem common across several regions is the difficulty of recruiting and retaining high-quality relationship managers.
- The role of the branch is also changing: it is increasingly becoming more of an advisory centre. Meanwhile, more use could perhaps be made of contact centres in terms of supporting both the relationship manager and the branch, and by assuming responsibility for some of the more straightforward processes.
- Some banks use small business centres to provide a service to their small and medium-sized enterprise (SME) customers however, many of the council members felt that banks need to be closer to local communities.
- The credit process can originate in the branch, on the internet or through a call centre. However, whichever route is involved, the decision-making process can still be very lengthy and needs to be reduced wherever possible.
- The recovery process is very important and like the credit process, needs to be as rapid and as effective as possible. This might even involve outsourcing the operation.
- Banks could do more to try and find solutions to their customers’ problems before they default. They also need to communicate more effectively with clients, using a range of methods.
The economic recovery may have begun, but the business banking sector still faces a range of challenges. Patrick Desmarès, secretary general of EFMA, said: “At the launch of the council at the start of 2010, the erosion of trust was a major factor that was affecting many other issues. There is still a need to rebuild trust and customer loyalty – with particular emphasis on the relationship with the business client – but some of the focus has shifted to the development of new or better strategies and processes, which reflects, perhaps the first signs that the intense mistrust of the last two years is beginning to fade in the minds of banks’ customers.”