I watched a room full of bank executives discover their app was broken.
The designers had spent months perfecting the interface. Every button was positioned exactly where they wanted it. Every feature was carefully crafted and easily accessible.
At least, that’s what they thought.
When actual customers tested the app in our lab, they couldn’t find half the features. Prompts and calls-to-action that seemed obvious to the design team were completely invisible to users. The disconnect was staggering.
This moment crystallized everything wrong with digital banking today. In my 25 years working with banks, consulting companies, and now helping financial institutions develop sustainable growth strategies, I’ve seen this pattern repeat endlessly.
Banks are designing for themselves, not their customers.
The Satisfaction Crisis Nobody Wants to Address
The numbers tell a brutal story. Mobile banking app satisfaction dropped 24% between 2021 and 2024, despite banks adding more features than ever before.
My gut reaction? Customers aren’t enthused about the experience anymore. The new features are either too complicated or they’re making apps more complex without adding real value.
Something deeper is happening here. Customer expectations have fundamentally changed.
When mobile banking was new, people were grateful it existed at all. Now that it’s commonplace, they’re less willing to accept a subpar experience. The bar has moved, but most banks haven’t noticed.
I’ve seen this firsthand. Consumer trust in retail banks has declined for a second consecutive year, with 8% of customers changing their primary bank.
The lab testing incident I mentioned wasn’t an isolated case. It revealed a fundamental flaw in how banks approach digital transformation.
Why Banks Choose Compromise Over Excellence
When we discovered those invisible features during testing, the bank’s reaction was predictable. Instead of redesigning the interface, they added more highlights and prompts.
The product was too far down the design cycle for a complete overhaul. After significant investment in time and resources, starting over would delay the launch and add costs.
Here’s the uncomfortable truth: banks have investors who want to see positive ROI on significant investments. If time and money appears wasted, it reflects poorly on the leadership team.
It becomes “better” to ship a compromised product than to perfect it and spend more time and money getting it right.
This thinking is fundamentally flawed, but I understand the pressure. Budgets and timelines aren’t static. Investor expectations create impossible choices.
The real cost of this “ship something compromised” mentality? Competitive position gets compromised because the output is compromised.
If banks truly looked out for their clients’ best interests, they would ensure whatever they create represents the best possible version of their brand.
The Resource Reality for Smaller Banks
Larger banks compromise by choice. Smaller banks face different constraints entirely.
Community and regional banks often can’t build custom solutions. They’re stuck with platforms provided by service providers. Aside from basic branding and functionality, they get whatever these vendors offer.
This creates a more difficult scenario, but not an impossible one.
The solution involves finding platforms that offer higher levels of customization and budgeting for custom development to make the product actually “yours.”
Most banks settle for the “out of the box” solution. They need to dig deeper into customization capabilities to tailor experiences for their specific customers.
The key is customizing the visitor journey. Yes, all transactions eventually end at the same point, but platforms must allow banks to adjust the experience based on customer needs and expectations.
The Segmentation Advantage Community Banks Miss
Regional banks typically follow the 80/20 rule. Their journey covers 80% of what the customer base needs, while the other 20% adjust their expectations.
Community banks have a massive advantage here. They serve very specific customer sets with specific needs and expectations. Their journey should reflect that reality.
If you mostly service small businesses, create an experience targeting what matters to that clientele. If you serve lower-income clients, tailor the experience to address their specific needs. If your customers are primarily senior citizens, modify the interface accordingly.
The best approach creates experiences for individual customer segments based on their actual needs and preferences.
But here’s the technical challenge: most banking platforms aren’t built for this kind of customization. Community banks in the top asset quartile are much more likely to engage in high tech-usage, while smaller institutions often struggle with resources.
When you can’t modify the core transactional experience, you have to get creative.
Building Digital Ecosystems Around Unchangeable Cores
Some parts of banking platforms simply can’t be fixed. The actual transactional portion of online banking often remains locked down by vendor limitations.
The solution? Create a robust digital ecosystem that covers every other part of the visitor experience.
Optimize the website. Create companion apps. Generate rich media content. Engage actively on social media. Do everything possible to demonstrate digital proficiency, even when you can’t modify the transactional core.
This approach requires different success metrics. These investments don’t directly generate revenue, making them harder to justify to leadership.
You can measure success through customer satisfaction surveys, attrition rates, cross-sell rates, and general acquisition numbers. Between these metrics, you should establish whether there’s positive movement toward your goals.
The key is tying dollar values to these metrics to prove justification for the investment.
The Commodity Trap Every Bank Faces
The reality is harsh: in most customers’ eyes, banks are just a commodity.
Banks can continue down the path of mediocrity and keep doing what they’ve always done. Or they can rise above their competitors by going against the tide and making investments needed to satisfy modern consumer expectations.
The choice determines everything.
For banks wanting to escape commoditization, the transformation starts with a fundamental shift in approach. Goals first, strategy second, technology third.
Most banks do this backwards. They adopt technology and then figure out what problems it might solve. This never works.
The correct sequence: lay out institutional goals and overall vision. Figure out what strategy achieves those milestones. Then determine if technology is needed to rise to the occasion.
Make methodical, fact-based decisions. Don’t waver unless there’s compelling reason to change course.
When Banks Finally Put Customers First
The first thing that changes when banks get their priorities right? All employees, from leadership to front lines, align on putting customers first.
Many companies say this. Few actually live it.
The difference shows immediately in how they approach digital transformation projects. Instead of asking “What features can we add?” they ask “What do our customers actually need?”
Instead of shipping compromised products to meet investor timelines, they invest in getting the experience right.
Instead of accepting vendor limitations, they build ecosystems that work around those constraints.
The banking industry stands at a crossroads. More than half of digital banking transformations exceed their timeline and budget or fail entirely.
The institutions that recognize this moment and act decisively will gain significant competitive advantages. Those continuing with incremental improvements will watch their customer relationships deteriorate.
The 24% satisfaction drop isn’t just a statistic. It’s a warning signal that the old approach has reached its limit.
Banks that want to survive and thrive must stop designing for themselves and start building for their customers. The technology exists. The strategies work. The only question is whether leadership has the courage to abandon the comfort of incremental change for the necessity of fundamental transformation.
The customers are telling us exactly what they think of our current approach. The question is whether we’re finally ready to listen.
