The Top 4 Most Important KPIs in Digital Banking

So, which key metrics in customer service should you focus on and adopt as KPIs in online banking? Take a look at our list below!

Abandonment Rate

The first KPI in digital banking you should look into is your digital customer onboarding abandonment rate. According to the Innovatrics Trust Report^[1], the regular abandonment rates in digital banking varied from 38%-63% between 2016 and 2020. The reason behind them being so high? The process wasn’t intuitive enough.

You need to smoothen this process to manage customer expectations and become a fully customer-centric bank. Therefore, your natural goal should be to reduce abandonment rates; it’s the first KPI you should look into.

You don’t have to start bold—if you currently have a 50-60% onboarding abandonment rate, setting the KPI to 30% right away won’t do the trick. However, you should gradually aim to decrease these rates until you get below the average!

Feature Adoption Rate

Feature adoption rate refers to the number of functions of your digital banking app used by an average customer. It’s important because it shows whether your organization indeed meets the expectations and needs of its clients.

If the rate is low, this could suggest that the features in your app fail to support the needs of your customers. Hence, it is a good KPI for your product development team.

Net Promoter Score (NPS)

You should also establish the Net Promoter Score (NPS) as one of your main KPIs in digital banking operations. But, first things first: how do you calculate it using a customer satisfaction survey?

It’s a bit more complicated than for other metrics, but it’s not as difficult as it may seem. Generally speaking, you give your clients an option to rate their likelihood of recommending your products. They may rate it from 0 to 10, from 0 to 5, or even from 0 to 100, for what it’s worth. Then, you need to categorize the users, based on their answers, into three groups:

• Promoters—9-10 on the 0-10 scale.
• Passives—7-8 on the 0-10 scale.
• Detractors—0-6% on the 0-10 scale.

Based on this, you calculate the overall NPS score using the following formula:

%Promoters – %Detractors

Generally, any score over 0 is considered good, so you might start with that as your KPI and slowly increase it. However, according to CustomerGauge^[2][3], the average scores for financial services and banking are 44 and 30, respectively, so you should opt to exceed those numbers in the long run.

Mobile Banking App Retention Rates

Finally, you should set online banking KPIs regarding the retention rates in your apps. Here, you can set several goals, depending on the duration of the period you are measuring and trying to improve.

For instance, according to Statista^[4], the average retention rates of mobile apps in finance on day 30 in the 3^rd quarter of 2023 equaled only… 3%. Yet, if you were to measure this in longer timespans, for example, over the course of the last 90 days, the scores would be higher. Nevertheless, you should periodically increase the KPIs regarding your app retention rates, as this will stimulate your teams to build more user-oriented applications.

Online Banking KPIs – The Takeaway

Understanding which KPIs to focus on in digital banking will help you prioritize them, thus enabling your organization to achieve a much higher level of customer-centricity. Naturally, our claim that these four are the most crucial ones does not mean that you should ignore or overlook other KPIs—improving digital banking customer experience, engagement, and satisfaction is a multi-step process that requires joined efforts from customer service, marketing, sales, and product development teams and setting multiple, diverse objectives.

You might also read: How to Leverage Customer Feedback for Continuous Improvement in Digital Banking.

Sources:

1. https://innovatrics.com/trustreport/63-of-customers-abandon-digital-bank-onboarding-is-biometrics-the-solution/
2. https://customergauge.com/benchmarks/blog/financial-services-nps-benchmarks
3. https://customergauge.com/blog/nps-use-case-for-financial-services-companies
4. https://www.statista.com/statistics/259329/ios-and-android-app-user-retention-rate/