In 2025, elevating the customer experience is the top agenda item for Australian and New Zealand financial services institutions.Understandably so. The market is not just mature and crowded; it is being reshaped by an unprecedented wave of mergers in the customer-owned sector and intense pressure from the ‘Big Four’ and a new generation of digital challengers. When it comes to selecting a primary bank, the quality and responsiveness of the service on offer has become the chief differentiating factor for customers.
Should the experience they receive be deemed sub-par, they’ll likely vote with their feet, defecting to banks that are willing and able to make them feel seen, heard, and valued.
Cognisant of this fact, financial services providers are embarking on high-tech transformation programs to deliver convenient digital experiences and responsive, personalised service. The challenge is no longer just about digital convenience; it’s about competing in the new era of AI-powered banking.
Betting the bank on bespoke technology
At the top end of town, the largest players are collectively spending billions building their own CX platforms from scratch. With deep pockets and in-house ICT teams of thousands, they can afford to bet the bank on bespoke solutions that will – hopefully – give them a competitive edge.
But for their mid-sized counterparts, this is a dangerous, high-stakes approach. Not only are they trying to build a customer experience platform, but they are also now in a race to build a competitive AI engine to power it – a far more complex and expensive endeavour. Typically, they won’t have the resources to deliver such projects in-house and will need to partner with external consultancies.
It’s not uncommon for unexpected issues to emerge after projects have commenced. Cautionary tales are legion of ICT initiatives that have failed to deliver, or experienced major time and cost blow-outs.
A blunder of this magnitude can damage reputation, brand equity, and the bottom line, doubly so if operational disruption and negative publicity ensue. Consequently, it’s a risk leadership teams can be reluctant to take.
Conversely, if competitors are powering ahead, doing nothing can be every bit as dangerous in a different way.
The clock is ticking: why ‘time to value’ is everything
Of course, not all bespoke transformation initiatives fail. Many succeed in delivering the promised benefits.
But the time it takes to reach this point can be fatal for smaller players. Developing a solution from scratch is a slow process, particularly when the specifications are complex.
Across New Zealand, we see this playing out in real-time. Some banks are undertaking high-risk ‘big bang’ core replacements, while others are pursuing a more pragmatic evolution. The common thread is the immense pressure to modernise the customer-facing experience layer, regardless of the back-end strategy. Planning and executing a major CX project can be the work of years, and whether customers will remain loyal in the interim is open to question.
Buying CX capability from a best-of-breed vendor
Fortunately, there is an alternative approach: transforming operations safely by buying, rather than building, the capability needed to keep the customer satisfied.
Partnering with a vendor whose solution addresses the unique challenges of the sector enables mid-sized players to access the functionality necessary to deliver a stand-out experience, cost-effectively and at scale.
Adopting a progressive approach – tackling the most impactful areas first – allows them to minimise disruption and ensure each stage is finalised successfully.
Elect to deploy engagement banking technology with composable, AI-powered customer lifetime orchestration capabilities, and you’ll move through those stages safely and fast. Instead of developing customer journeys from the ground up, you can implement out-of-the-box ones that allow consumers and businesses to engage efficiently across all digital and physical channels.
For most mid-sized institutions, this is likely to be the work of weeks and months, not the years it would take to start from scratch.
Delivering the CX your bank needs to survive and thrive
In today’s times, a consistently excellent, AI-driven customer experience is a baseline expectation. Banks across Australia and New Zealand that fail to deliver it can expect to lose mind and market share.
The choice is no longer just about technology; it’s about strategic focus. By partnering with a specialist, mid-sized banks can stop trying to be software companies and get back to what they do best: building relationships and serving their members, powered by world-class, intelligent experiences. If you’re committed to achieving profitable growth, partnering with a best-of-breed vendor with a stellar track record can help you get where you want to go.