Rapid technological progress is having a profound impact on the digitization of the world – a development that has been further accelerated by the Covid-19 pandemic. Much of the world has so far moved to the Internet.
The world of finance and banking in particular has followed this trend and is increasingly taking place in the digital space.
More and more bank branches are being closed or centralized and even transactions in the branches are becoming fee-based, so that customer service is increasingly moving to the Internet. In this sense, last year (2021), more than 70% of the Luxembourg population used the Internet for online banking. This does not only lead to a reduction of personnel in the Luxembourg banking sector, but also has an impact on the banks’ customers.
Any transition requires support.
The digitization of banking and the resulting closures and centralization of bank branches is particularly affecting the older generation in the country. In particular, bank customers who were not born in the digital age, the so-called “digital immigrants”, find it difficult to use online banking services. In addition, branch closures do not necessarily make banking easier.
In addition, online banking always carries risks for every user. It is not uncommon for customers to fall victim to phishing attacks and be robbed of their money.
One thing is certain: the process of digitizing banking cannot be stopped. Therefore, digital inclusion of all citizens must also take place and online financial services must be safe and affordable for all parts of society. The transition phase can only be successful if customers are accompanied in the best possible way.
Digital inclusion first.
Furthermore, bank branches must not disappear completely from our society and environment. Customer service must remain a core task of banks. At the same time, good customer service also contributes to the success of a bank.
The financial sector and the banks in particular must serve the people and not the other way around.
Communicated by the OGBL Financial Sector on 30 November 2022.