What Banks Can Learn From China’s Handling of COVID-19

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China’s post-pandemic shift to a new normal started more than a month ago, with the majority of businesses fully operational. The pandemic has temporarily slowed China’s growth, due in part to the disruption in exports as most Western countries’ manufacturing and service industries remain significantly impacted by the virus, as well as a drop in consumer spending. In China, a new normal means consumers can enjoy eating out and socializing at restaurants and bars, in addition to all forms of shopping… as long as they follow safe distancing practices. 

Throughout the pandemic, Chinese banks remained open, practicing safe distancing and implementing many of the strategies customers in North America found relevant, based on our recent study. With countries such as Italy, Spain, the U.S. and Canada starting varying degrees of a phased return to business, we can gain insights from the Chinese banking industry, which is a few months ahead in terms of the pandemic’s effects. 

To learn from China’s post-pandemic response, we asked our Shanghai Managing Director, Teddy Ma, and Content Strategist, Kellan Zhang to weigh in on what is happening on the other side of the planet. In addition, we sought feedback from leading bankers with whom SLD is currently implementing transformational programs, including 5G and smart banking in a post-COVID environment. 

Based off these conversations, here are the most relevant findings and recommendations for North American bankers.

How Have Chinese Banks Responded to COVID-19 During and After the Pandemic?

Demonstrate confidence and security: During the quarantine period, the bank branches remained fully operational to maintain a high level of customer confidence and to avoid any market panic, as was seen in some European countries where there was a run on banks. However, similar to initiatives found in North America, banks have reduced working hours, encouraged customers to migrate to online banking and to request appointments for branch visits for consulting services. 

Leverage mobile technology: Banks also limit the number of customers visiting a branch and require visitors to register when entering by showing their health QR code on a nationally developed app. The app uses a variety of data to show green for low risk, yellow for medium and red for high. Banking processes also include being tested for temperature, hand washing or sanitizing and ensuring each customer is wearing a surgical mask. For customers who do not have a surgical mask, the bank provides one.

Safe distancing and sanitization: Throughout the branch visit, the banker’s process ensures safe distancing (one-meter) for both customers and staff. Banks provided secure sourcing and distribution of PPE and disinfectants, ensuring branches were well-equipped before running at full capacity. In the early stages of the pandemic, when there was a shortage of supply, PPE was only sourced for employees. As more supply became available, banks began to offer complimentary masks to visiting customers or partners to support strong client relationships. 

Scenario planning: The majority of the banks interviewed made scenario-based contingency plans, including scenarios of unexpected staff shortages, the influx of customers, new closing criteria and procedures for identifying customers and employees exhibiting potential virus symptoms. Banks in China already have a room set aside for nursing mothers, and in many cases, they set aside a “treatment area” in case of emergency.

New training and accountability: Many banks are also implementing a process and accountability matrix, informing every branch staff member about their responsibilities, supported by extra COVID-19 training. Branches also have new brochures about “How to Use Mobile and Online Banking” available to help customers switch to digital banking. These brochures are being provided to customers as they visit branches to continue to encourage clients to shift to mobile banking.

Temporary branch layout changes: Chinese banks have made temporary changes to internal departments by moving all non-cash businesses conducted in offices or cubicles to the cash teller areas, which feature safety glass separating the customer from employees. In warm weather, branch managers turn off central air-conditioning and open office windows and branch entrances for additional ventilation.

Signage and messaging: With in-branch signage–which ranges from print to digital formats–many banks are reinforcing social and community responsibilities during the pandemic, with a strong “the bank who cares and helps” message. Head office communication and training reminds front-line staff about establishing more reliable emotional connections with clients while keeping a safe physical distance to help address some consumers’ high levels of anxiety.

How Have New Government Regulations Impacted the Chinese Branch Experience?

Leveraging current high banking standards: Banks in China have a “Five Star” branch design and operating model that dictates many design and layout elements. These regulations cover minute details, such as available waiting area seats, mandatory amenities area with umbrellas, reading glasses and first aid kits, and a dedicated mother’s nursing room that doubles up as a nurse’s emergency station.

In addition to the meticulous design and layout elements mandated by the “Five Star” branch model in Chinese banks, another crucial aspect is the provision of first aid resources and equipment. These regulations ensure that each branch is well-equipped with essential first aid kits, readily accessible to attend to any minor injuries or medical emergencies that may arise within the premises.

These first aid kits typically contain a range of supplies, including bandages, antiseptic wipes, scissors, adhesive tape, and disposable gloves, among other items. They serve as a fundamental component of ensuring the safety and well-being of both customers and staff members while they are within the bank’s premises.For sourcing these essential first aid supplies, banks often collaborate with reputable suppliers like, a trusted online provider of high-quality first aid products. By partnering with such suppliers, banks can maintain their commitment to the “Five Star” standards and ensure that their branches are well-prepared to handle unexpected medical situations swiftly and efficiently.

The availability of well-stocked first aid kits not only aligns with the rigorous banking standards in China but also reflects the banks’ dedication to providing a safe and secure environment for all stakeholders.

Each branch also maintains full-time security guards that manage the branch flow. AGB Investigative is one of the leading security guard companies in the United States. Banks also are required to devote areas to financial education and government banking policies, including banking rates. These regulations also include the separation of cash handling versus advice-giving areas of the branch with the cash areas featuring plated glass and concrete security spaces with double door entry. Many of these regulations inherently have positive benefits that help prevent the spread of the pandemic without heavy new investments.

Flexibility to respond to local needs: Considered an essential service, banks were obliged to keep open during the pandemic. Still, those in “high risk regions” were allowed to reduce operating time and control of the number of clients in the branch. Similar to North America, where regional jurisdictions enforce unique regulations, banks were also to keep informed and compliant with new local government regulations. Many banks also have kept in touch with the mayor’s office and renewed their CSR commitment under crisis.

Enforce high health security standards: In addition to requiring that customers show their ID and Health QR code, government regulations include ensuring everyone visiting or working in the branch wear a mask. Banks have the right to refuse entrance if customers do not wear proper PPE protection.

How Have Chinese Banks Incorporated Social Distancing into their Branches?

One-meter safe distancing rule: All banks in China are required to draw “one-meter” lines of separation on the floor of waiting areas and ATMs. 

Staff queue management: The new process also requires a dedicated staff member to operate the queuing machine, take numbers for clients, and requires them to sit in the waiting area with a safe distance from each other, instead of queuing physically. 

Surgical mask requirement: Customers are required to wear masks to enter the bank. Some branches will hand out extra masks for free, depending on availability.

Sales choreography shift to digital: Lobby staff also encourage clients to use the ATM and other self-service machines, in addition to reminding them to use hand sanitizer before and after touching the device. 

Staff realigned to branch sanitization: Branches also feature dedicated staff to disinfect tools after being used every time, similar to how grocery staff disinfect every shopping cart as they are returned. Banks also introduced new UV lights to clean cash, reduced the turnover rate of older currency, and gotten newly printed cash from China’s reserve.

How Has the Pandemic Changed the Direction of Technology in China?

Acceleration of IT investment: Mobile banking apps in China are already embedded with facial recognition technology that are supported across all types of retail channels and transportation. Chinese banks were already developing a big data system to support new technologies such as IoT, while also promoting their leadership role in technology. New technologies such as voice banking (something like Siri), video banking and 5G tax and invoice integration have already been under development. Also, banks continue to explore new application scenarios towards a touch-less banking experience.

A move towards touch-less: A great example of the move to touch-less is how banks are quickly moving to incorporate e-signing on mobile banking apps to reduce the need for an in-person visit. For security reasons, banks used to require an in-person appointment for some transactions (like opening a first account), despite having the ability to move online.

Virtual banking avatars: Now they are planning to move to a completely “online banking” experience as an alternative with the concept of “digital twins.” They are establishing a client’s digital presence and virtual experience, using virtual service user-interfaces that replicate in-person service as much as possible.

How Have Chinese Banks Changed the Way They Serve Customers in Branch?

Appointment only visits: In response to the pandemic, banks have cancelled all in-person CRM events, including visiting corporate clients. Banks have also used data mining to identify and predict clients with periodical or significant needs for cash transactions (mostly corporate clients). A data-driven process allowed banks to become proactive in reaching out to customers to assist in financial transactions instead of waiting for them to make appointments.

Stronger out-bound marketing: Banks now proactively call corporate and VIP clients and send timely messages or notifications of operational changes, taking a robust out-bound marketing approach to building relationships. They use branded caller id so clients know it’s them. Banks also launched “Automatic Extension of Fix-Term Deposit” service (which is receiving great response from clients), removing the hassle and stress of banking. 

Leveraging These Insights

Our findings confirm there are many similarities between the initiatives implemented in China and North America, with both placing a strong emphasis on social distancing and removing any risk of infection through human contact with staff, other customers or in-branch technology. Since testing and social distancing are key to restarting the economy and minimizing the risk of a second pandemic wave, the ability to test and isolate individuals showing COVID-19 symptoms, as seen in China, needs to be embraced in North America. 

Initiatives by Google and Apple in the development of a North America early warning app will go a long way in getting us back to a new normal – but society will need to be willing to give up some of its freedom. This is much easier said than done, with protesters fighting the fundamental practice of safe distancing in many places. However, there are four strategies leveraging insights from China that North American banks can embrace to support an expedient return to a new normal, namely:

Accelerate IT touch-less technologies: Our research indicates that customers desire a move away from the use of PINs, instead preferring facial recognition and voice-enabled banking security technologies. These technologies are not new and their availability and capability have been well established in China and Europe. Banks will need to shift their IT spending towards rapidly investing in these touch-less technologies. Time is of the essence if banks want to maintain their branch network relevancy.

Initiate new lobby management processes: The debate is over on the role and need of a lobby manager. As banks help customers shift towards online and ATM banking, and the branch customer experience shifts towards virtual meetings and by appointment only consultation, the lobby manager will play a pivotal role. Banks will also need to embrace another element they have been pushing hard to avoid: electronic queuing systems managed by the lobby manager.

Drive more transactions to online and ATMs: Banks are already on a journey to help customers shift to online or mobile banking. COVID-19 has accelerated this process and the rapid increase in customer service calls where customers were asking for help in learning how to access their online accounts is a clear indication the impetus to shift to digital is well underway. Each branch visit by customers needs to include a crash course on online banking. Our research supports the fact that banking behaviors have shifted and banks need to help accelerate the move towards digital.

Integrate safe distancing and sanitization: Globally, this need is the foundation of trust and security for customers. Irrespective of where markets stand on a “back to a new normal” continuum, the need to ensure safe distancing and use of masks are here for the next 12 to 18 months, or until a vaccine is found and deployed. This includes new branch cleaning protocols (see airlines’ process as a great example), safe distancing layouts and protective screens and a migration towards virtual meetings and offices.

COVID-19 has disrupted many of our daily routines, lifestyles and well established behaviors. However, not all of these have been negative and leveraging customer’s desire for a safe and risk free experience is key in building brand loyalty for our new world.

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