It doesn’t take reams of market research to work out that the UK consumer has fallen out of love with the financial services sector. Headlines that point to the miss-selling of PPI or highlight unfair overdraft charges do nothing but cement the perception that these same institutions are at the heart of the world’s current financial crisis.

At the same time retail banking has shifted from lending to gathering deposits.

Consumer sentiment combined with this change in strategic focus means that banks and building societies now have a renewed focus on the relationship they have with their customers. In particular, they are developing and implementing strategies aimed at addressing four key challenges:

• rebuilding trust and consumer confidence

• delivering increased cost-efficiency and maximising revenue

• retaining profitable customers through the delivery of a more personal customer experience

• managing risk and compliance to better protect customers

The customer service function is the deliverer of great customer experience – a source of competitive advantage in today’s banking landscape. Its role will become even more important to banks.

Whether it’s the weekly shop or a summer holiday, people now expect a seamless journey when making transactions or enquires about products or services. It’s no different when it comes to mortgages, current accounts or ISA’s.

Despite this, the financial services sector struggles to learn from other markets, such as retailers, which have mastered best practice multi-channel strategies which deliver an accurate, personal and efficient experience for customers.

There is a preconception that technology and data will deliver this loyalty. It will help of course but for me, delivering what for many in the sector is a dramatic step change starts with a focus on people. Through training, staff should feel empowered to own queries and with the appropriate tools deliver a personal experience which solves a query first time when they can.

However it takes more than a motivated and empowered employee to act effectively on a customer enquiry, you also need to create the processes and environment in which customers are listened to. By understanding the root causes of avoidable repeat contacts and ensuring customer feedback is appropriately recorded and acted upon, organisations can ensure they have a closer, more personalised relationship with their customers.

However, unlike other sectors, those in the banking sector must ensure they deliver this enhanced customer service alongside being compliant, particularly demonstrating their commitment to the FSA’s Treating Customers Fairly (TCF). A customer service function built within a risk-prioritised quality assurance framework is critical to ensure the appropriate checks and balances are in place to ensure customers understand what they are buying and have no barriers to switch, claim or complain.

So rather than a ‘new age of customer service’, its more about bringing best practice from other sectors and more flexible, yet compliant, processes to bear on the financial services customer.

Not only will this help rebuild trust and confidence but it will also help drive down operational costs as effectiveness and efficiency emerge.

To thrive in the market, companies must place as much importance on customer service as their consumers do.