Digitisation and the rise of AI have made the modern banking experience more convenient than ever. Apps more seamless, chatbots smarter and more intuitive, but the emotional connection that once defined banking relationships is quietly dissolving. Customers can now open accounts in minutes, manage portfolios from their phones, and receive automated nudges on spending habits. Yet beneath the polished facade of modern banking lies a growing disconnect. The warmth and familiarity that once made banks feel personal have been stripped away, replaced by a transactional feel that leaves many customers feeling like their bank no longer truly knows them.

Many aren’t voicing their dissatisfaction. They are simply diversifying their banking relationships. Globally, nearly three-quarters of customers now engage with more than one bank, often dividing their financial activity across institutions. One for their everyday transactions, another their credit cards or savings. The rise of digital-only banks has also further accelerated fragmentation, offering a robust suite of services and seamless mobile-first experiences that continue to erode loyalty. As the banking relationship becomes more scattered, customers are left stitching their own experience together - from juggling multiple logins to navigating inconsistent interfaces and repeating the same information across platforms. What should feel like control and empowerment, instead becomes a solo effort to navigate complexity. The result? Frustration and a growing indifference towards the institutions meant to support them.

Frustration doesn’t just affect satisfaction. It stalls growth.

In losing emotional relevance, many banks have also lost the ability to turn their customers into advocates. They no longer recommend their banks to others, deepen their engagement or explore broader offerings. In fact, banks with the highest advocacy scores (top 20%) have grown their revenues 1.7x faster than those with the lowest scores.  For the average bank, a 10% increase in advocacy scores would increase growth by 1%.

The real challenge for banks isn’t just retention. It’s reconnection. How can they rekindle trust, loyalty, and advocacy in an increasingly digital-first landscape?

It’s not just about adding more features and services but redesigning the relationship itself. Customers want to feel seen, heard, and genuinely supported. They want to know that their bank has their best interests at heart. They want to be remembered not just by name, but by context and be rewarded in ways that reflect the depth of their relationship, not just their last transaction.

So, what does this mean for banks?

1. Understanding intent, not just journeys

Banks have long prioritised building frictionless journeys, from acquisition to onboarding and cross-selling. But what many have missed is the deeper reason behind those journeys. From buying a first home to funding a child’s education or retiring early, these are the emotional drivers that shape financial purchases. To stay relevant, banks need shift from simply relying on surface-level demographics and financial data about their customer to building a kind of relationship memory. This means using data to recall not only the context of each interaction across channel, but also the customer’s past goals, emotional states and life milestones tied to them. Imagine, remembering the excitement of a customer’s first pay cheque and their early saving goals, or recognising how an aspirational purchase like a luxury bag can evolve into a long-term ambition such as buying a first home. By creating this kind of continuity, much like how a branch manager once did, banks can connect with customers on a deeper level and reinforce trust by showing that they truly know them.

2. Personalisation that actually feels personal

True personalisation is not just about inserting their first name onto the dashboard or triggering generic “next best actions”. It’s about recognising tone, context and state of mind in real time, and responding with empathy. With advances in emotional AI and sentiment tracking, banks can monitor the tone of digital conversations and proactively intervene when sentiment dips. Frustration in a chatbot exchange or hesitation during a loan application can be met with timely reassurance or tailored guidance, turning moment of friction into a moment of care. But in striving to make personalisation feel truly human, banks must also balance intimacy with responsibility. In an era of tightening data and privacy regulations, privacy-first personalisation will define trust. Unlike the handwritten notes once kept by a branch manager, today’s technology makes it possible to deliver experiences that are both dynamic and compliant, allowing customers to feel understood without compromising their privacy.

3. Orchestrate a seamless omni-channel experience

Most digital banking interactions today remain transactional, limited to balance checks and transfers, while complex needs like loans or dispute resolution still default to branches and often, with little continuity in between. In order to deliver a unified experience, banks need to bridge both physical and digital channels to enable customers to move fluidly across touchpoints, with full continuity. Done well, orchestration ensures customers never feel “handed off” but instead supported at every stage of their journey.  

As digital interactions evolve, the expectations of the next generation of customers will raise the stakes even further. Gen Z and digital natives, shaped by seamless technology, instant access, and a desire for authentic connection, are already redefining loyalty. Unlike previous generations, they are less swayed by traditional rewards and more motivated by personalised experiences, transparent communication, and values-driven relationships. For them, loyalty is rooted in emotional resonance and purposeful engagement, not just transactional perks.

Personalisation will mean far more than just tailored offers. It will require a contextual understanding of their needs, habits, and aspirations, delivered with immediacy across any touchpoint. Connection will shift from simply knowing who a customer is to understanding why they engage and what they care about, positioning banks as intuitive partners in both life and finance. This shift will also heighten impatience with static, one-size-fits-all experiences, as digital natives increasingly expect fluid, anticipatory services that evolve with them.

At the same time, loyalty is increasingly tied to values. Customers want their banks to reflect and champion the issues that matter most to them, making sustainability, ESG (environmental, social, and governance) and ethical finance imperatives for both retail and institutional banking. Authentic action, whether through green financial products, social equity initiatives, or transparent practices, will be critical to building trust and advocacy.

Ultimately, banking is not about balances, it is about belonging. Customers today expect empathy, honesty, and real purpose from the institutions they trust. Loyalty is earned through action, not algorithms, and only the banks that redesign the relationship and make every moment personal will be talked about, trusted, and chosen. The future of CRM is bold, authentic, and unapologetically human. If you are looking to build stronger, more meaningful connections with your customers, we’d love to partner with you. Connect with our team at Digitas to explore how our CRM practice can design solutions that drive relevance, advocacy, and long-term growth in an increasingly fragmented environment.