Executives Share Their Top 5 “Complaint Priorities” For 2020

Since launching the PositivityTech intelligent platform, we’ve met with dozens of financial institution executives. They have shared their need to listen more closely to their customers and to take action on the systemic patterns that manifest in their customers’ complaints. Here is what we’ve heard from them:

“We have so much innovative technology, and yet, we still don’t really know our customers.”

1. Financial institutions want to proactively protect and strengthen their businesses by turning complaints into strategic assets.

Today, the rise in customer complaints attracts media attention, amplifying consumer voices and driving regulatory scrutiny. To ensure our financial institutions are ahead of these issues, executives need to manage complaints proactively instead of resolving them one at a time.

“We have a lot of untapped customer data that is unstructured, and we want to understand its value to the customer experience.”

2. Financial institutions are beginning to recognize that their customers’ voices are their most valuable assets.

Executives understand the value that can be derived from customer complaints. Customer complaints can help executives flag future risks and take important preemptive steps, which can impact business performance. Managing customer complaints is like managing a portfolio, and can offer a multitude of new business opportunities.

“So much of our work is manual. We need to become more efficient at integrating our data.”

3. Financial institutions want to understand their market share of complaints. 

Executives want to know how their customer complaints compare to their competitors’ customer complaints. This necessitates integrating data from internal and external sources, including customers’ voices and behaviors. When executives see that the PositivityTech platform has this capability, they are intrigued.

“Different parts of the organization use different tools and methods to understand the customer journey.”

4. Financial institutions need to better align their complaint categorizations. 

Every executive we’ve spoken to has shared their need for standardized customer complaint categories. The PositivityTech platform develops categories that merge what customers say with how financial institutions can meet their needs.

“We need to be able to securely and efficiently integrate diverse data sources at scale with an end-to-end view of customer interactions.”

5. Financial institutions want to utilize complaints to impact their financial performance.

Instead of solely focusing on the volume of complaints, PositivityTech’s scalable platform focuses on the severity of complaints, which helps predict multiple business drivers, such as account attrition, customer engagement, and environmental risk management. All of these business drivers play a role in a business’s financial performance.

Our meetings continue to validate that the PositivityTech platform is helping financial institutions listen to their customers like never before, preempt regulatory and reputational risk, and grow their revenue in new ways.

If you’re interested in discussing your financial institution’s 2020 goals, we’d be happy to schedule a meeting. Please email me at marcia.tal@positivitytech.com. I look forward to hearing from you.

Are Gift Cards Really The Best Gift Of All?

The holiday season is here, which means that gift shopping season is well underway. While some of us spend hours selecting the perfect gifts for our loved ones, many of us will give our family and friends gift cards — which they may actually want most of all. In fact, according to the National Retail Foundation, gift cards are the most requested “wish list” items for the holiday season.

Yet, gift cards come with their own sets of challenges, including fraud and difficulty of use. For example, when people purchase gift cards from a store, they may not realize that the PIN number is already visible. If its covering is scratched off, someone may have accessed the gift card’s value.

Another gift card scam begins with a phone call from an imposter who shares that their victim’s Social Security number is suspended due to suspicious activity. After the imposter asks the person to confirm their Social Security number so that they can reactivate it or issue them a new number, they require the person to send them money with a gift card.

According to 2018 FTC data:

  • Since 2015, reports of gift card scams have increased 270%.
  • 41,000 fraud reports to the FTC involved gift cards.
  • From March 2018 – March 2019, people lodged more than 76,000 complaints against Social Security imposters.

Turning to banks to solve gift card scams

Though payments made to scammers through gift cards are untraceable and disconnected from one’s bank account, individuals continuously turn to their banks to help them recover their lost money.

Using the PositivityTech intelligent platform, we explored financial institutions’ customers’ complaints about gift card-related issues, including this one:

I was the victim of a Social Security gift card scam. I was called on my cell where the number of the SSA appeared. I answered the call and was told that my SS# had been used in criminal activity. To protect my money in my bank, I was to purchase the gift cards, scratch them, take photos, and send them by email to X, where my money would be protected until they issued me a new number…. I asked the bank to help me and give me credit for the scam charges and sent them all of the documentation. The bank completed the investigation and responded that all charges would remain on my statement…. I need help. 

By holistically studying all of the customer complaints about gift cards in the CFPB using the PositivityTech platform, we found that:

  • Top complaints relate to challenges customers have experienced when using gift cards.
  • 58% of customer complaints about gift cards relate to fraud.

Empowering banks to prepare for their customers’ complaints

With consumers spending more than $130 billion on gift cards per year, we expect customers to continue sharing their gift card-related complaints with their banks. After being defrauded, customers want to retrieve their money.

If you would like to discuss how you can turn negatives into positives and make the holiday season more joyous for your customers, we would be happy to speak with you.

Wishing all of you a wonderful holiday season!

When A Customer Says, “You’re Destroying My Life”

“This woman says Equifax mixed up her father’s credit report and ‘destroyed’ his life — and now she hopes to convince a jury,” begins a recent article in MarketWatch. The article details the tragic story of James Rennick, a man who requested a home-equity loan for renovations that would help his dying wife breathe more easily – but was denied the loan because his credit history information was mixed up with someone else’s. Rennick filed a lawsuit, but both his wife and he died before the problem was solved.

Unfortunately, this issue is not a one-time occurrence. In fact, in 2013, Equifax’s expert witness at another trial stated that credit mix-ups may occur in 1% to 2% of all files. In addition to putting Equifax’s problems in the public eye once again, this article highlights the issues that are intrinsic to credit scores, which we covered in the past.

The story was especially compelling to us because it featured a powerful word in a customer’s complaint: “destroy.” Do customer complaints to financial institutions commonly feature the word “destroy”? If customers use the word “destroy” in their complaints, what might we be able to predict about their future actions?

Uncovering the hidden value of the word, “destroy”

To gain deeper insights into this word usage, we explored the word “destroy” in over a million complaints in the PositivityTech intelligent platform. We discovered the following:

  • Proprietary Severity Score: 44% worse than the average complaint

Our proprietary severity score is built on financial language and captures both the customer’s emotion and the seriousness of their standpoint. Customer complaints featuring the word “destroy” reveal that they have a severity score that is 44% worse than that of the average complaint, indicating the customers’ high level of frustration.

  • Proprietary Lawsuit Score: 18% higher than the average complaint

Our proprietary lawsuit score shares the likelihood that a customer will file a lawsuit, based on their complaint. Customer complaints featuring the word “destroy” reveal that the complaining customers are 18% more likely to file a lawsuit.

  • Proprietary Account Closure Score: 13% higher than the average complaint

Our proprietary account closure score shares the likelihood that a customer will close their account, based on their complaint. Customer complaints featuring the word “destroy” reveal that the complaining customers are 13% more likely to close their accounts.

Transforming negatives to positives

While in the past, we may have regarded emotional complaints as just that, we now see that they can hold deep business implications. Through the PositivityTech platform, we can see the significance of a single word and predict its business impacts.

If you’d like to learn more about the hidden value of your customers’ words, please email me at marcia.tal@positivitytech.com. I look forward to speaking with you.

Complaints about digital money transfers are on the rise

It’s not surprising that digital money transfer services such as Venmo, PayPal, and Zelle are becoming so popular. The convenience and immediacy of paying for services, splitting a check after a dinner out with friends, or issuing a bill to a client feels satisfying and smart. But with ease of use also comes the ease of making an error — and accidentally choosing the wrong username or code can put your money or data into the wrong hands.

In fact, the PositivityTech intelligent platform’s proprietary trigger algorithms have illuminated an increase in complaints about digital money transfers. By listening to every customer’s voice and then analyzing what their complaints mean collectively, our triggers detect complaints before they become big problems for your bank or your own account.

While customer complaints about digital money transfers are still very small in number and are a relatively small complaint category, they are steadily rising and predict an emerging trend that merits banks’ attention now. After all, customers expect banks to protect them. Regulators also hold banks accountable.

Statistical analyses for near-term business impact may tend to disregard these low-volume complaints. But customers who are embracing digital money transfer are the early adopters of a capability that is quickly becoming mainstream. Interestingly, using the PositivityTech platform, we have seen that complaints about banks’ digital money transfer tools are growing at the same rate — and sometimes an even faster rate — than complaints about many of the newer tools. We believe that early adopters of technology usage can tell us where future complaint issues will scale and can reveal new opportunities for product and service differentiation.

Here are the growth rates in digital money transfers (based on the CFPB data and complaint categories), just since 2017:

Complaint Category Growth
Money Transfers 191%
Subcategory: Managing Mobile Wallets 457%
Subcategory: Unauthorized Transactions 1025%
Subcategory: Fraud or Scams 2250%

Below are two examples of related customer complaints.

 “I have experienced fraud in my [NAME OF BANK] checking account… A transaction of $1,800 was transferred from my account through the bank’s money transfer system. The amount was sent to someone named X. I do not know who that is and I did not authorize the payment. I have filed a dispute claim to the fraud team, but they have denied it by saying according to their investigation, they cannot prove fraud… As one of the leading financial institutions, [NAME OF BANK] should be doing more to listen to their customers and their plight rather than training their employees to repeat what’s on their screen.”

 “A transaction from XX was sent to a person by the name of XX… I was not aware… When I went to my bank, I realized a payment of XX was removed from my account… I am disappointed and I want my account credited… Bank managers were extremely rude and advised that I will never get that money back and sorry for my loss of funds. Banks are supposed to work for the people and determine right from wrong… I want my funds returned.”

 An exciting opportunity for banks

From listening to these customer voices, it is evident that people continue to rely on their banks for security and safety. As the world of digital money transfer tools continues to grow more robust, banks do not need to lose out to fintechs. Banks have an exciting opportunity to reposition themselves, providing the security and safeguards that customers expect and value from them and further differentiating their brands.

If you’re interested in discussing how your institution can get ahead of the market and meet your customers’ needs in the digital age, please reach out to me at marcia.tal@positivitytech.com.

Why Does How You End A Relationship Matter?

What’s the best way to leave a job? What’s the optimal way to end a professional relationship? My mother always advised me to keep the door open — just in case I want to return one day. “Things change and you never know what the future might bring,” she told me.

The same maxim can be applied to account closures. In financial institutions, an account closure occurs when either the institution proactively closes a customer’s account, or when the customer chooses to close their account. While not all account closures are easy and banks might expect customers to complain when the bank initiates the closure, banks want the account closure experience to be as seamless as possible.

After all, just because your customers’ accounts close, doesn’t mean they won’t want to reopen their accounts in the future. So, how can financial institutions ensure a positive ending that leaves the door open?

To find the answer to this question, we explored over one million complaints in the PositivityTech platform — identifying customers’ complaints about account closure and predicting their future risk. (Both steps are critical to understanding why customers’ accounts close and what your actions should be.) Ultimately, we learned that negative input can have a positive impact.

Here are the steps we took:

Identify the pain points associated with account closure.

Within the PositivityTech platform, we identified seven sub-issues in customers’ complaints about account closures — those initiated by institutions and customers. These sub-issues include, for example, “change in terms” and “fees charged for closing an account.” Below are two examples of customer complaints about account closure. We have hidden the identities of the banks mentioned.

“I received a credit card from [X Bank] that I did not request. I have called twice to request that the account be closed and both times, they refused to honor my request without me giving them my social security number. I refused to give this information out… My credit file was frozen several months ago to prevent fraudulent applications. I don’t know how this application was processed despite the freeze. The company suggested that I walk into one of their branch offices to get a telephone number for their credit fraud department rather than trusting the number on unsolicited mail. There are no service branch offices near me.”

“I initiated opening an account with [X Bank]. Today, an account closing was initiated by the company. I noticed what was done when checking my account online. I then called the bank to find out what was going on. According to a customer service representative, the account was closed due to suspicious activity. No further details or explanations could be given on the case because not enough information was available to the representative. The company failed to inform me of their actions and completely disregarded me as a customer. The company then charged me a whopping $25 closing fee.”

Understand the severity score of these customer complaints within these specific pain points.

The specific pain points driving these customer complaints have a PositivityTech proprietary severity score that is 6-8% worse than that of the average complaint.

Predict the likelihood of these customers going into debt collection.

The PositivityTech platform’s proprietary debt collection score reveals scores that are 76–95% lower than the mean. Interestingly, customers who complain about their account closure pose a low credit risk to financial institutions.

Predict the likelihood of account closure.

Each of the seven sub-issues show a very high likelihood of account closure, even while they reveal a low threat of future risk.

Prevent bad relationships with customers who close their accounts.

Customers who complain about how they are treated when their accounts are closed — and customers who do not complain — pose a low risk of not paying. In fact, they present a hidden segment opportunity for financial institutions to win back profitable customers.

While customers’ pain points are not significant in volume, they are very significant in severity and in predicting account closure. In one institution, we found that one of the strongest predictors of account closure was present in only 3% of all customer complaints.

Flip the script on customer complaints about account closure.

By exploring customer complaints about account closure, we were able to pinpoint past customers’ potential for future business opportunities. Understanding and addressing the root causes of these complaints can reduce customer churn and even alleviate future customer frustrations.

With the PositivityTech platform, customer feedback fuels businesses with the insight they need to identify issues and uncover actions. If you’re interested in learning how it can help your revenue grow, please reach out. I’d be happy to speak with you.