The mass-affluent segment in Europe is expanding. Far from being a homogenous group, the demographic profile of the mass-affluent includes baby boomers as well as millennials. Similarly, their liquid investable assets range from $100,000 to $1,000,000. Hamidreza Ghanbari, CEO of Pilatus Bank, believes that to assume that this group would have the same financial behaviours and goals would be a mistake. He argues that retail banks have failed this large and important segment of the market by lumping everyone together into the same bucket and then designing a "one size fits all" solution known as premier banking.
Hamidreza Ghanbari of Pilatus Bank believes that premier banking was introduced as a means to offer the mass-affluent certain aspects of the superior private banking services, whereas in reality the initiative landed below the standard retail offering. Initially, it guaranteed that a relationship manager would be assigned to each customer, but soon the relationship manager was side-lined and the clients had to resort to online and mobile banking platforms. On the occasions where the clients required further assistance, for which the confusing online platforms failed to suffice, they were referred to a 0-800 number. Seemingly, this resulted in the role of the relationship manager becoming irrelevant for clients, causing further confusion whereby they had to go through a hopeless relationship manager only to realize that they were nothing but glorified retail customers; same service, different name. In the UK, retail banks such as Barclays and HSBC offer premier banking to affluent customers with the premise of offering a bespoke banking experience.
Hamidreza Ghanbari of Pilatus Bank believes it is still light years away from the level of service provided in private banking. He states, "Whilst premier banking is designed to help affluent customers achieve their financial ambitions, with the appearance of providing a private banking level of service, the reality is that they still need to go through the relationship managers who will simply walk them through the same process to which a retail customer would be referred to." He further adds, "Within the premier banking space, the primary role of a relationship manager has become to promote the online and mobile banking platforms. It's truly a sad situation to be told by a relationship manager that you have to call a 0-800 number to solve your banking problems."
Ghanbari at Pilatus Bank reiterates that private banking still very much holds a certain prestige for the exclusive service that it provides, though it comes with a high price tag that the mass-affluent currently is unwilling to pay. The only solution for making it affordable would be to use technology as an enabler for the customers to communicate with their relationship managers directly.
Pilatus Bank is one of the first banks to extend their private banking offering to the mass-affluent through their unique technology platform. The CEO of Pilatus Bank concludes by stating that, "The mass-affluent is an ambitious, driven, and tech-savvy group who value the latest digital innovation as well as bespoke services. Premier banking no longer satisfies the demands of this expanding segment. As much as they value quality of service, they also want it to come at an affordable price combined with a seamless and convenient user experience. Fundamentally, they are the early adopters who can accelerate the market's movement toward digital revolution."