What U.S. FIs might learn from a U.K. banking customer experience

U.K. customer experience teams are using innovative approaches to drive loyalty. And a look across the Atlantic, into the not-for-profit space specifically, provides a different vantage point for U.S. financial institutions. FIs across all markets are digging deeper for new ways to effectively engage with audiences that have more choices than ever before.

One example comes from not-for-profit U.K. financial institution Nationwide, which has earned recognition for its customer experience program, digital transformation initiatives, and efforts to increase accessibility for customers with mental health conditions. These initiatives have helped Nationwide secure the third spot in the U.K. Customer Satisfaction Index (UKCSI)’s list of the top 10 companies in the country with the highest overall customer satisfaction scores.

With 16 million members across the United Kingdom, Nationwide is the world’s largest building society (building societies are the U.K. counterpart to U.S. credit unions). While traditional banks are for-profit financial institutions owned by shareholders, credit unions and building societies are not-for-profit cooperatives that are owned by members—and use their profits to offer benefits such as lower fees, incentive rates, or profit-sharing. Members have voting privileges to shape how the financial institution operates.

As a customer experience advisor to leading financial services brands, here’s what I’ve learned from top U.K. building societies like Nationwide.

5 CX best practices that help foster loyalty

Embed customer-first practices across the entire organization

U.K. best practice: Building societies like Nationwide prioritize fairness, transparency, and ethical banking, driven in part by the Financial Conduct Authority’s (FCA) Consumer Duty, which requires financial institutions to put customer outcomes at the heart of the business and holds leadership accountable for delivering positive outcomes. Thanks to these efforts, building societies tend to outperform traditional U.S. banks in areas like customer satisfaction and NPS, at least by some measures.

What U.S. banks should consider: While there is no direct equivalent to FCA’s Consumer Duty, which sets a high bar for customer experience, any bank tends to get higher customer marks when the financial institution implements clear, jargon-free product information, especially related to fees. Too often terms and conditions written in legalese, using very fine print, leave customers confused about important details.

Empower frontline employees to enable experience improvements

U.K. best practice: The Active Manager model that transforms managers into mentors and coaches who empower frontline employees and strengthen their active listening skills, resulting in faster, more personalized, and more empathetic interactions. Collectively, these efforts have reduced hold times, repeat calls, and staff attrition.

What U.S. banks should consider: Banks can train managers to be mentors, spend more time on frontline coaching, democratize access to real-time customer feedback, use customer insights for frontline training, and empower staff to resolve customer issues at the first point of contact, fueling efficiencies and CX improvements. Using structured frameworks like the “GROW” approach to coaching—it breaks down feedback sessions into four key stages: goal, reality, options, and way forward—can help frontline staff set objectives and evaluate their performance over time.

Another successful approach is getting to the root cause of employee experience issues. This involves identifying policies, procedures, and processes that prevent teams from meeting customer needs. This can make a difference for loyalty, as the majority of consumers (69%) say they feel more loyal when employees are treated well and 85% of CX practitioners say managing employee experiences impacts customer loyalty, according to two Medallia Market Research studies.

Design inclusive experiences across products and channels

U.K. best practice: Many U.K. building societies have implemented product lifecycle management practices to ensure every product, from checking and savings to loans and mortgages, and every service channel, from in-person experiences to digital, is designed, reviewed, and updated with inclusivity in mind. When designing policies, tools, processes, and products, everything gets evaluated every step of the way, from ideation to delivery, with a goal of increasing accessibility, fairness, and relevance.

What U.S. banks should consider: The voice of the customer should guide design processes and business decisions, with cross-functional teams regularly reviewing products, using customer data and feedback to drive enhancements and meet the needs of a diverse client set.

Invest in human-powered experiences to improve the omnichannel customer experience

U.K. best practice: Building societies in the U.K. aim to combine best-in-class digital, self-service touchpoints with accessible, empathetic, personalized, and human-powered channels, including physical branches. Brick and mortar locations are being reimagined as community hubs that provide face-to-face services, cash access, and private spaces for complex needs ensuring that retail banking remains personal as banking digitizes.

What U.S. banks should consider: In the U.S. the results are mixed. Some brands are rethinking branch expansion to targeted regions, for instance, guided by retirement demographics, while some are closing more of their physical branches in favor of offering digital-only experiences. For sure, there’s an opportunity to reinvest in local footprints, creating community hubs that offer in-person support, private meeting spaces for wealth and financial-wellness planning, as well as a sense of community. Banks that follow suit, and their customers, will benefit from creating seamless connections between digital and physical channels.

Create community and foster engagement and ownership

U.K. best practice: Building societies are deeply embedded in their communities, with members having a say in decision-making, which translates to higher trust.

What U.S. banks should consider: Another way to foster engagement and ownership is to actively gather and act on feedback via surveys, digital behavior, and customer conversations across channels. This helps ensure customers feel valued. Banks can also create customer advisory panels and host leadership town halls to strengthen community ties and accountability and co-design products with customers.

Why U.S. banks can benefit from shifting CX priorities now

Brands across industries are investing in CX, raising the standard for all financial institutions. The stakes are high as Medallia Market Research from the study cited above has found that only 24% of customers consider themselves very loyal, with another 46% citing slight or moderate levels of loyalty and 26% not loyal at all.

This a significant growth opportunity as nearly all CX professionals (97%) agree that loyalty is a critical factor in achieving long-term success.

Judy Bloch is VP, Industry Executive Advisor for Financial Services at Medallia.