Winning hearts with Emphatic Banking

by | Dec 20, 2016

There are great opportunities for banks that learn to ‘feel’ for customers says Stessa Cohen, Research Director, Gartner

It’s been an unusually hot summer and the air-conditioner has been doing double duty. At the end of the month, Kavita receives a huge electricity bill. Her jaws drop as the ‘amount due’ figure startles her. And she wonders if this is one of those goof-ups from the power company. A call to the company confirms it isn’t. Reality sets in as she stares at the ‘units consumed’ column. And she wonders how she is going to pay her rent at the end of the month. What impact will this have on other expenses this month?

So Kavita turns to her bank for help, hoping her current account can get her out of this mess. The bank can respond to this situation in either of two ways: One, they can charge extra interest and penalties when her account goes into overdraft. Two, they could look at this as an opportunity to understand the customer (Kavita), and decide if they want to offer her a loan to pay the utility bill.

Option two sounds like a win-win situation. It’s called ‘Emphatic Banking’. International banks like DBS Bank and Hello Bank (owned by BNP Paribas) practice emphatic banking. It could be the way to go for Indian banks.


Stessa Cohen, Research Director, Gartner

Stessa Cohen, Research Director, Gartner says, “Emphatic banking is about having an understanding of someone’s situation or problem. It is about feeling the thoughts and experiences of someone else. The bank feels it and then takes a call to action, as against just saying: ‘I am sorry to hear that’. This is a business moment or opportunity for banks. It is an impetus for innovation. Emphatic banking can be delivered digitally.”

Once the bank makes an offer, the customer can respond using the channel that suits her (branch, ATM, social, mobile etc). The bank can pay her utility bill and then create a schedule for her to repay the bank. It can create alerts for future payments too. There are advisory services built around the customer service.


But before a bank reacts to distress calls from customers like Kavita, it has to do a quick check on past transactions. It must determine if Kavita is a careless spender or just a victim of unexpected circumstances, outside her control (as in this case). The bank also has to predict which of its customers could face problems with their finances in future – and reach out to them with offers.

“It is about using data to identify who is going to have problems with paying bills. This is a mutual opportunity,” said Cohen.


Cohen interacts with a lot of banks globally. She informs us of one bank that is successfully using technology for emphatic banking. And the conversations happen using NLP (natural language processing) enabled banking apps.

She cites the example of DBS Bank, which created a new platform offering personal financial management. It is deployed with Kasisto NLP for conversational banking. It uses another tool called Moneythor in the back-end to analyze customer data. With this tool, it can offer personalized recommendations and insights.

Cohen says people typically ask analytical questions like, “I want to buy a bike, can I afford it?” And these

“You should be able to pose this question to the (digibank) app, and it will respond with the question: ‘How much does it cost?’ And when you specify the amount the digibank app will tell you the balance in your current and savings accounts. It will also ask if you want to transfer some money from your current to savings account. And then it will ask if you want to pay for the bike? When you respond with ‘Yes’ the transaction is initiated,” said Cohen.

Digibank is an app from DBS Bank.

This type of engagement is also emphatic– it addresses the customer’s need and performs the transaction instantly. You could also ask a question like: “Can I pay my car loan in the next 6 months? What’s the EMI?”

“This is what makes DBS Bank different. And this is embedded in the mobile app. It has a chat bot interface. It is not a separate app,” said Cohen.

Another example is Hello Bank in Europe. It is a digital bank owned by BNP Paribas.


Cohen feels that humans are still relevant in the age of bots and robots.

“Not everyone is comfortable with technology and you still need to do banking the old way, along with all the digital innovation that you introduce. Many people want to talk to a bank executive for advice. Another reason why people shun technology is because it isn’t easy enough for everyone to use,” she adds.

Studies show that worldwide, even millennials and 18 – 24 year olds prefer to visit a branch when opening new accounts.

Some banking products are complex and we still need to ask a lot of questions. This is especially true for big ticket transactions.

And that’s why your friendly relationship manager will still be around to help in the age of digital.



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Brian Pereira
Brian Pereira
Brian Pereira is an Indian journalist and editor based in Mumbai. He founded Digital Creed in 2015. A technology buff, former computer instructor, and software developer, Brian has 29 years of journalism experience (since 1994). Brian is the former Editor of CHIP India, InformationWeek India and CISO Mag. He has served India's leading newspaper groups: The Times of India and The Indian Express. Presently, he serves the Information Security Media Group, as Sr. Director, Editorial. You'll find his most current work on CIO Inc. During his career he wrote (and continues to write) 5000+ technology articles. He conducted more than 450 industry interviews. Brian writes on aviation, drones, cybersecurity, tech startups, cloud, data center, AI/ML/Gen AI, IoT, Blockchain etc. He achieved certifications from the EC-Council (Certified Secure Computer User) and from IBM (Basics of Cloud Computing). Apart from those, he has successfully completed many courses on Content Marketing and Business Writing. He recently achieved a Certificate in Cybersecurity (CC) from the international certification body ISC2. Follow Brian on Twitter (@creed_digital) and LinkedIn. Email Brian at: [email protected]
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