Client experience rules the day
We often hear the term “customer experience,” and while it can include a number of elements, essentially it boils down to the perception the customer has of your brand. Those in the customer service industry need to understand that they are also in the customer-experience business and, for the financial sector, this certainly rings true. And part of this customer experience is being truthful, fair and respectful in all customer dealings.
Small businesses want to know that their financial provider has their best interests at heart – whether they are a new or existing customer. The majority of SMEs are largely driven by costs – they need to see the value in a product or service that promises to improve their business offering or financial standing. Therefore, it’s important for credit solution providers to use their position as market experts to inform rather than just sell.
Sales practices need to be done transparently, honestly and fairly. What’s more, finance providers need to ensure that they are giving SMEs as much insight into their products and offerings as they can – demonstrating how they could add value to their business. It is critical that they provide details on what the available products are and how they work – including all fees and charges, how the funding and repayment process works, as well as the total amount should be disclosed in a clear and transparent way to ensure it is easily understood and that the benefits are clear, and in no way misleading. It is also critical that the terms of the contract are explained, as well as finer details such as settlement discounts and contract termination, so ensure that small business owners can make the most informed decision and that the sales people remain respectful of business finance requirements and decisions made.
SME Finance providers also need to ensure compliance with all applicable laws within the South African regulatory framework, including but not limited to privacy, marketing and direct marketing and are not just pushing products, but are rather listening to needs, respecting decisions and very importantly explaining all terms, conditions and requirements in detail and in understandable terms so that SME businesses know what they are agreeing to. The funding that has been provided to the business should be intended to add value and not cause the business to be stuck in a cycle of debt. Every customer should also be treated equally, where creditworthiness is determined based on the business’ credit/debt proposition rather than subjective bias.
However, the fair and ethical treatment of customers goes beyond the sales process, it also needs to extend throughout the contractual period. The SME Finance provider must adhere to the terms of the agreement and, at the same time ensure compliance with all laws and regulations governing their collections practices or mechanisms. The same applies to collections of non-performing loans. In the instance when an account is in default, the SME Finance provider must treat the merchant fairly and make every effort, in good faith, to resolve the issue in a manner that is professional and respectful.
Furthermore, a provider must ensure that customers have a channel available to them to file complaints or raise queries that will be promptly addressed.
With the emergence of non-traditional financial providers providing alternative funding solutions (such as unsecured loans, merchant cash advances, revolving credit facilities etc.) to small businesses given that this is still a relatively new model, the governance, transparency and treatment of customers, needs to be, and should be, regulated. SMEs need to be confident that they are dealing with financial providers where treating customers fairly is central to the corporate culture. They need to know that they will be provided with clear information and kept appropriately informed before, during and after point of sale and that where advice is given, it is suitable and takes account of their circumstances. Lastly, they need to be confident that they will not face unreasonable post-sale barriers to change product, switch providers, submit a claim or make a complaint.
SMEs need the peace of mind that they are engaging with lenders who are committed to providing this transparency and ethical treatment of clients and conforming to best customer experience practices.