Why communication is important for banks? Describe the important functions where communication plays key role in a bank.
Why communication is important for banks? Describe the important functions where communication plays key role in a bank.
Answer: Communication in the banking industry includes exchanging information, ideas, and knowledge within and outside the financial institution. Effective banking communication improves relationships among customers, stakeholders, managers, employees, and employers.
Communication in the banking industry is very crucial. Here are the reasons why communication plays an important role in the banking sector:
Improving Public relations
Companies with excellent internal and external communication frequently have a strong and positive public image. This helps the organization stay competitive and may help them attract more investors and clients.
Raising awareness about banking products
A solid and effective communication system can help build brand awareness among the public. A clear and consistent communication strategy can help financial institutions promote their banking products.
Preventing misunderstanding and conflicts
A clear communication strategy can help resolve external customer disputes and provide the best solution. It helps in building team spirit and promotes healthy workplace communication. This also aids in resolving any misunderstandings and conflicts in the workplace.
Improving customer service
Customer service communication in the banking industry involves the flow of information between a customer and a bank. Active listening to customers’ pain points allows you to serve them better.
Meeting goals and targets
Employers should emphasize how each employee’s commitment will lead to personal progress while contributing to the company’s goals. This can be achieved through effective communication between employer and employee.
Clear communication of rules and policies
Any industry needs clear communication of rules and policies to resolve any conflicts and effectively run the institution. A transparent communication strategy will help explain the industry’s regulations and policies to the employees.
Improving employee engagement
Employees with effective two-way communication can share ideas, provide feedback, or report problems with the confidence that they will be heard. This also increases belonging by making them feel their voice is being heard.
Raising and resolving internal issues
Poor communication is frequently the source of workplace conflict and internal issues. You can turn a potential crisis into a productive discussion with the right communication strategies.
Delegation and Decentralization
Delegation involves assigning work to subordinates and delegating authority to them to complete it. Decentralization refers to a systematic effort to delegate the right tasks to the right people. A strong communication network allows all group members to communicate directly, eliminating the need for information to pass through several layers of hierarchy.
Achieving high productivity
Open and transparent communication is an excellent way to ensure that your employees understand the company’s mission statement and that everyone shares the same values. This leads to high productivity and efficiency in the workplace.
Important functions of communication in the bank
Effective business communication is very crucial for banks for the successful functioning and survival. Bankers must be able to communicate effectively with their colleagues, subordinates, superiors, clients, customers and with government agencies such as the central Bank. Below, communication in different banking departments/divisions are provided:
| Department/Division | Role of Communication |
| Retail banking | • Providing customers with teller services
• Convincing depositors to pursue different term deposits • Talking to borrowers about their loans • Providing customer service 24/7 via telephone or chat services • Communicating debit and credit card services |
| Commercial banking | • Taking meetings with business professionals, corporations and commercial borrowers
• Managing relationship with key business owners and corporates • Convincing businesses to keep cash account and deposits with the bank • Understanding the financing needs of the corporate clients • Providing the best financing solution from the understanding |
| Retail banking | • Providing extra care of services to high-net-worth individuals (HNWIs)
• Communicating the banking services to HNWIs • Advise the HNWIs on different products offered by the bank • Provide proposals on how to manage HNWI accounts |