(Opinion) Community banks can build on customer loyalty

William Callif provided a great perspective in NH Business Review on why New Hampshire community banks are doing well. It truly does come down to the mutuality of local communities with their local bank.

Community banks and their customers join together for the common good of the community. In fact, most mutual banks and community banks are focused on customers’ needs, not the needs of public shareholders.

Through this approach, community banks and the customers they serve share a desire to make life better for all. Personal banking relationships are critical in making that desire a reality. These relationships translate to everything from a passion for helping first-time homebuyers and aiding affordable housing to supporting a new business that fills a special community need. Community banks aim to ensure customers’ needs are met throughout their unique and changing financial journey along every stage of life.

They’re also in convenient locations where national banks may not go. Especially in rural areas or small towns, a community bank is the “Cheers” of financial institutions — a trusted source and place where everybody knows your name.

As evidenced in Mr. Callif’s op-ed, customer trust and confidence are well placed because of the strength and structure of New Hampshire community banks. The mutuality and shared interests demonstrate to customers they matter, while safeguarding their money. And their bank has personalized services and solutions tailored to meet their individual financial needs.

Most importantly, customers see their community bank’s commitment beyond the numbers. They see their bank regularly investing in our New Hampshire communities through philanthropy when and where it is needed most.

They see bank employees volunteering to build New Hampshire homes for Habitat for Humanity, participating in a local Boys & Girls Club job fair, serving meals at the Friendly Kitchen in Concord, and beyond.

Yet, New Hampshire community banks can do even more to build customer loyalty. Bankrate outlines what it views as the “cons” of community banks. We see how these “cons” can be turned into “pros” for the good of all.

Challenge 1: Community banks can lack big bank products and services, particularly their own credit cards and investment services.

The opportunity:

• Offer a community bank-owned credit card and with it, customized credit card programs for New Hampshire residents. A community bank with its own credit card opens the door to credit offerings that help build small businesses and provide residents access to the financial system they may not have had before. For instance, the bank can offer a credit-building card option.
• Introduce a rewards program with debit cards, incentivizing customers to use their card at Northern New England participating local businesses where we work, live and visit.
• Establish a separate wealth management services practice that can guide customers through all life stages.

Challenge 2: It may be tough for account holders to find ATMs and branches when out of the community bank’s area.

The opportunity:

• Go broader with branches. Establish branch locations throughout the New England area, so New Hampshire residents can easily conduct in-person banking as needed when on weekend trips, vacations, while working and during business travel.
• Reimburse ATM fees from any other financial institution.
• Offer 24/7 customer assistance and technical support with the friendly personalized service customers expect from trusted community banks.

Challenge 3: Community banks typically lag on technology innovations.

The opportunity:

• Offer programmable payments solutions that support an innovative yet community-centered approach. An example of this is debit card integration with a local purchase rewards program. An app-based rewards program allows users to pay for purchases and services at participating local merchants. Customers automatically accumulate points and rewards in their card account.
• Develop state-of-the art mobile banking and online banking user experiences. Provide feature-rich apps where business users can make payroll payments and manage cash flow, while customers can manage credit cards in real-time, deposit checks easily and pay bills.
• Provide digital security options, such as a browser security plug-in to help protect their online accounts against fraud. Also offer online and app-based, user-controlled security options for credit cards. Customers can set custom real-time alerts to see card usage, view suspicious activity, limit transactions, and even turn cards on and off.

Bangor Savings Bank joins with its fellow community bank members in supporting and celebrating the hard work, ingenuity and pride in New Hampshire communities. By building on customers’ loyalty with innovative, accessible and personalized approaches, we can continue to do our part in helping create vibrant, resilient communities throughout New Hampshire.

Tricia Duchesneau is senior vice president and director of consumer banking at Bangor Savings Bank.