Trust is the cornerstone upon which all relationships are built, but when it comes to our relationship with financial brands, building trust has never been more important. From the squeeze on household finances, to the growing threat of online scams, the UK financial services sector faces an era of heightened digital scrutiny and increasing competition, so how can financial institutions become the currency of choice for consumers seeking financial products and services they can rely on?
Why trust matters
Whether it’s opening a bank account, investing in shares, or seeking financial advice, consumers need to feel confident that the institutions and brands they engage with have their best interests at heart. At a time of increasing digitalisation, where online transactions and interactions are commonplace, trust becomes ever more paramount. Without it, consumers may hesitate to share sensitive financial information or make important financial decisions.
The impact of online scams
As more of our financial life moves online, the rise of online scams and fraudulent activities have had a significant impact on trust in digital banking. From phishing emails to fake investment schemes, consumers are increasingly wary of engaging with financial services online. This is particularly prevalent in older cohorts with Age UK research revealing that the fear of being scammed online was the main blocker for many older people, ahead of a lack of IT skills. It’s perhaps unsurprising when you discover that nearly a million older people fall victim to a scam each year.
This erosion of trust not only affects individual consumers but also undermines the credibility of legitimate financial institutions and brands. As such, building trust in online transactions and communications is a top priority for many financial service brands.
Other trust issues
But it’s not just the risk of being scammed that concerns UK consumers. Only a third of us trust financial institutions to act in our best interest according to research by the Financial Services Compensation Scheme. The same survey also found building societies to be the most trusted provider of financial services and unsecured lenders the least trusted.
Strategies for building trust
To build trust in financial services, brands need to communicate how they will support consumers, and ultimately that they have their customers best interests at heart. Essentially, this boils down to three key elements – transparency, reliability, and security.
1. Transparency
Financial brands must be transparent about their products, services, and fees. Clear and straightforward communication builds trust and fosters confidence in consumers. A good example is Monzo, who’s features such as real-time transaction notifications and fee-free spending abroad has positioned itself as a trustworthy alternative to traditional banks.
2. Reliability
Positive testimonials and reviews can serve as powerful endorsements as to the reliability of your services. Storytelling is a powerful tool for building emotional connections with consumers, so sharing the real-life experiences of your current customers can help build trust and reassure potential customers.
3. Security
Implementing robust security measures not only instils confidence in consumers but it’s also a key marketing tactic. 2024 research by FICO found UK consumers rank good fraud protection as their top consideration when opening a new account with a financial service provider, so demonstrating a commitment to protecting customer data is essential when attracting new customers.
The power of emotion
Finally, by tapping into consumers’ emotions, financial brands can create compelling narratives that evoke trust and inspire action. Whether it’s highlighting the security of a savings account, or the peace of mind offered by demonstrating how a product worked for someone else, emotional marketing can reinforce trust and loyalty.