With the world experiencing a great economic crisis, any business involved with finance is obviously set up to have a challenging time in 2012. The financial difficulties that are affecting folks worldwide are expected to become even worse. It is impossible for 2012 to be challenge-free for banks. These financial institutions large and small, however, could take measures that could effectively soften the blow. The following are just a few suggestions of things banks can do to help them avoid the many challenges that this year will surely offer.
Banks will need to show their value and not just their balance sheet
Competition will be getting even tougher for banks in 2012 as financial institutions from emerging markets like China, Russia and Brazil grow. Customers from individuals to big businesses will want to be sure that they can trust their bank as the economic crisis worsens, and having a solid balance sheet is not the most important way to do that. Financial institutions will need to offer exceptional service to their clients. As these customers are forced to pay higher interest rates and additional fees during the economic crisis, they want to be sure they are getting the most for their money and will want to trust the bank holding on to their savings and spending money. Top customer service, incentive programs and transparency will help.
Banks need to attract customers who are presently unbanked
Not everyone uses banks, and the existing financial institutions need to woo these people. While usually not the most affluent, the money they could make off of the estimated 30 million underbanked or unbanked households in the United States alone could make this a worthwhile endeavor. The unbanked people may not trust big banks. They may have been shut out of them after defaulting on a large loan or having other financial problems. If the banks can use marketing strategy to bring these people to them, they may see surprising growth.
Banks need to cater to small businesses
Small businesses are often customers of smaller banks that cater to their needs. As the economic crisis continues and big business continues to scale back, new small businesses opening could represent a lot of opportunity for profit and growth for big banks. These businesses are currently underserved by big banks, often being forced to utilize tools like online banking that have been created for individual consumer accounts and not for business banking. Additionally, the opening of small businesses could well signal an economic turn around and some growing prosperity. Big banks will allow themselves to bounce back faster if they are involved from the onset with these smaller enterprises, and catering to them now will do that.