Matt Hammerstein


"To truly win trust, we need to balance digital banking with human support"

18 November 2021

As more of the world moves online, how can banks balance the best of digital with the best of human support? Matt Hammerstein, CEO for Barclays Bank UK, shares how the bank is keeping pace with tech transformation – while understanding that face-to-face interaction remains vital to customers.

We might have got used to working remotely over the past two years, but the banking and payments industry still gathered in person at the MoneyLIVE Autumn Festival this week, where I was asked to comment on how banks will thrive in a digital world. What this shows us is that you still need connections with people face-to-face to build relationships and trust. Deep down we’re still social animals, and we crave human interactions, whether that’s looking someone in the eye, sharing a smile, or just being in the same room together. As more of our world shifts online, some fundamental truths like these remain.

The best banking services of tomorrow will be provided by those who can get the balance right – combining what machines do best together with what people do best.

In the banking sector, we’ve seen more change in the last twenty-year period than any other. That’s mostly been for the better, with technology revolutionising how we store and exchange money. Once upon a time, banks had to be solid, physical buildings, because the vital aspects of banking were physical – storing and protecting cash in a vault, depositing cheques and making documents legal by signing them by hand.

These requirements now seem quaint and obsolete, as we happily track our finances through our phones on the go. But that doesn’t mean that the need for the human element is gone. If anything, it heightens that need. The best banking services of tomorrow will be provided by those who can get the balance right – combining what machines do best (routine actions) together with what people do uniquely well (empathy, support and solutions).

We should be proud of how far we’ve come already. Contactless spending has risen 60% since 2019, while cash use has dropped by almost a third. No one predicted people’s behaviour would shift that fast. And the ways that we’re paying for things are still evolving, whether that’s using Face ID to unlock a phone for Apple Pay, or splitting payments into chunks through Buy Now Pay Later platforms. But the advance of technology, including data capabilities, is unrelenting.

This begs the question of whether a traditional bank – like Barclays – can keep pace. Well, over the last few decades, Barclays has been at the forefront of these changing technology trends, and will continue to lead the way. We’ve gone from zero to 10 million active digital banking customers in the last 10 years, and have been carefully adapting our physical high street presence in line with how people bank. In some places, that means reducing the physical space banks have, with 40% fewer bank branches in the UK since 2015. In others, that means changing how people can get access to their cash. We believe that shared solutions will have a key role in supporting customers – in the form of banking hubs and premises with the cost and infrastructure spread between the major banks - and we’re willing to go faster and further to make this happen.

The banks that can offer the best of digital with the best of human support will be the ones that win trust.

Keeping our money safe in the digital world

The pace of change creates a risk for us - move too slow and alienate those who are digitally savvy; move too fast and alienate those who aren’t digitally confident. We have to get that balance right. For people who are nervous about the shift to digital banking, it’s our job to guide them helpfully forward. This might be providing one-to-one support through a training programme (like our Digital Eagles do every day) or educating customers on what types of counter transactions in a branch can be done quicker and more easily through a self-service machine. Many of us are now used to scanning our own groceries at a supermarket checkout, and the simpler aspects of banking can be done in a similar way.

Moving our entire lives to the cloud doesn’t lend itself to the subtlety of a human interaction. However digitally savvy some of us are, we all have a moral and social obligation to vulnerable customers, who may not be able to get the most out of their money through purely online or app based interactions. We can draw an analogy between online banking and visiting a doctor: we should be able to sort needs that are easily diagnosed and treated via an online or video check-up. But when it comes to something serious (for finances, this might be complex fraud, arranging your first mortgage or a bereavement), seeing a professional, in-person, can help us feel seen, heard, treated properly and sorted.

We don’t store away our cash in bank vaults anymore, so we need ways to keep our money safe in the digital world. Fraud has unfortunately proliferated (2020 was the highest ever year for scams) as digital criminals take advantage of online anonymity. We reimburse thousands of customers every month, but this isn’t going to solve the problem. We need better collaboration between banks, telecoms and tech companies, but also government, regulators and law enforcement, to close the gaps in the system and prevent scams at their source. This is another reason why hurrying a complete shift to digital is not the answer – we occasionally need to pause and see where and why people are falling between the gaps in the system.

So we should be hugely excited about how far we have come, but clear-eyed about the challenges ahead. The banks that can offer the best of digital with the best of human support will be the ones that win trust, and therefore, be trusted to deliver. That’s what we’re aiming to do. We look forward to your help in making that happen.