Trust, But Verify

Blue banner that says Consumer Lending with a triangle overlay

Do you trust me to tell you why trust is important?

I love data, numbers and surveys in my role as the head of product management here at Baker Hill. Data on market conditions, surveys on what banks and credit unions are wanting from the solutions I work on, and insights that are gained from all these data sources are so important for one simple reason – they are true. The bias often comes when we start interpreting or “massaging” the data but at the core, I know that I can trust numbers when I make important decisions.

Trust is core to banking. The Edleman Trust Institute, said it best in regard to trust – “[Trust].. is the ultimate currency in the relationship that all institutions — business, governments, NGOs and media — build with their stakeholders. Trust defines an organization’s license to operate, lead and succeed.”  I love that line – it is the license to succeed.

We live in very interesting times. Two years ago, consumer deposit accounts were overflowing with government aid to assist families during the pandemic, spending was minimized because we simply were not going on trips, buying things outside of what Amazon could deliver, and the prices were relatively stable. Fast forward to today, where to quote Governor Christopher Waller of the Federal Reserve’s latest description of the economy, “Consumer and business spending has softened, amid deteriorating business sentiment in most sectors of the economy and near-record-low readings on surveys of consumer attitudes about the economy. There is no secret about why—inflation is very high, something people are reminded of every day when they see the prices of things they buy go up. On top of that, higher interest rates are raising borrowing costs for businesses and households.” These challenging times can create situations where consumers when pushed, and may unfortunately push some of the limits and cross the line of trust.

So, what do we do in banking to respond to these changes?

I am advocating that we take the high road, but to pull out the classic quote from the Cold War era, “trust, but verify”.  Banks should also look to maintain the trust that consumers have in them.  I personally believe that creates reciprocity when it comes to trust. There was a great survey done by the Irish Banking Culture Board this year, and the top ten drivers of trust were called out. These very top attributes that banks illustrate to cultivate trust:

  • Understands customer needs
  • Delivers high quality products and services
  • Listens to what customers have to say and acts on it

These are the top things banks can do to build trust, but again for consumers we should verify.

How do we verify the consumer, without having it be intrusive and a barrier to the overall relationship? Again, it goes back to data and numbers. In this three part blog, along with our partner, Equifax, we are going to dive deeper into this topic. Join us over the next several weeks as pursue a deeper conversation – in the meantime, if you would like to know more, reach out to us here.