In a recent article we discussed how Net Promoter Scores (NPS) are used to measure the quality of a business’ relationships. Specifically, they track how likely a customer is to recommend a business to a peer. In the 2017 February/March survey, the banking sector in general scored at an average -0.21%, while credit unions scored at a far better +40.43%. With our score of +63%, Fifo Capital is a very referable business that enjoys a high level of customer satisfaction. But what is it about us and similar financial institutions that allows us to perform so much better in regard to NPS than the sector overall?
The answer is simply that we have a fundamentally different business model than larger debtor financiers, which emphasises relationship-led services and allows us to work with smaller businesses more effectively.
How does the conventional service model work?
Traditional banking institutions operate like any large scale enterprise; they need to prioritise their shareholders. To maximise profits, they’ve been forced to move away from high-touch client relationships to a more segmented model. This is easier from an operational standpoint, and in terms of tracking the profitability of individual divisions within the bank, but it also interferes with the quality of the service for some groups of customers. Effectively, it means that only particularly profitable clients will get access to their institution’s full attention, while smaller business are left to work with lower quality support in the long term. Naturally, this can lead to lower customer satisfaction among small business clients.
Limited personalised service
Large alternative funding institutions can often only work closely with clients at the initial acquisition stage. This expert upfront service is paid for by initial service charges, and simply doesn’t allow for long-term in-depth support. This isn’t inherently bad for customers, but it can cause problems if a client’s’ situation and needs change. If they need something, smaller clients are forced to work through call centers with more generic account managers to get more limited service.
No dedicated point of contact
There is no guarantee, when you call your regular institution’s call center, that you’ll be talking with someone who knows anything about your business or your industry. What’s more, because this service center would be in a different division than the representative who supported you earlier, the representative you’ll be working with won’t have access to the person you talked to when you first joined the institution. As a result, business owners are often forced to spend time explaining the ins and outs of their business every time they call.
What makes institutions like Fifo Different?
SMEs have needs that this status quo service model simply isn’t designed to meet, effectively creating a market for institutions like Fifo Capital that specialise in serving small business clients. Businesses like us emphasise a high-touch client relationship that’s designed to accommodate entrepreneurs with a busy schedule and promote their long-term success.
All clients get the same treatment
SMEs don’t have the budget to hire a team of financial experts to manage their assets. To help them succeed, service providers need to offer customers a reliable, knowledgeable relationship manager who can offer actionable advice. Our clients work with a dedicated point of contact within our organisation who gets to know their business and their needs. This expert representative works with clients not only to find the best solutions for their business initially, but also to advise and assist clients in adapting to changing financial situations throughout the relationship.
Building financial partnerships
Our goal is more than just simply to issue a loan and collect interest. Instead, we build mutually beneficial long-term partnerships with clients that are designed to help clients to grow and become better established. In our business model, this makes perfect sense, because it helps us grow, too. By getting more involved in their business and offering our expert support, we can help to ensure our clients’ success. Successful clients are, by definition, clients who will get the desired return on their investments, and who will continue to be around to use our services again in the future.
Business owners have a lot on their plate, and their time is limited. They definitely don’t have time to wrestle with their debt-financing institution’s bureaucracy on a regular basis. We, and institutions like us, have decided to do something about it.
Fifo Capital’s NPS score results show that when it comes to small business financing, we’ve got it right. Our clients succeed, and are highly likely to recommend us to other business owners. We’ve shown rapid growth year on year, and helped to establish our service model as a clear way to help SMEs succeed. If you’re looking for solutions to cash flow interruptions and financing issues for your business, give us a call today!