Why Are Customers Dropping Off Mid-Journey in Banks? It’s Time to Rethink the Experience

We talk a lot about digital transformation in banking. New apps, faster payments, sleek dashboards. But here’s a hard truth: most customer journeys are still broken.

Whether it's onboarding a new customer, approving a loan, or enabling a simple transfer—banks are seeing massive drop-offs mid-journey. And we’re not talking about fringe cases. These are core revenue and experience levers.

🔍 What’s a “Journey Drop-off”?

It’s when a customer starts a process—say, applying for a credit card or opening an account—but abandons it halfwaydue to friction, confusion, or mistrust.

The customer doesn’t always complain. They just disappear. And that silence is expensive.

🚧 Where Are Customers Dropping Off?

Let’s walk through real examples we’ve seen in the field:

1. Digital Onboarding

A Gen Z user begins opening a savings account. They hit a wall when asked to upload a PAN card three different times because the OCR fails. They abandon the app. You lose a lifetime customer.

➡️ Fix: Use AI to pre-fill forms, improve document scan reliability, show real-time progress indicators.

2. Loan Application Journey

An MSME borrower initiates a business loan application. He gets stuck on the income declaration step—no clarity on what counts as proof. The branch never follows up. He turns to a fintech lender instead.

➡️ Fix: Offer contextual help. Auto-scan bank statement PDFs. Pre-check eligibility based on GST or bureau data.

3. Payments & Transfers

A working woman tries to make a rent payment through the app. The app times out twice, and she’s prompted to re-enter her UPI PIN. She switches to PhonePe.

➡️ Fix: Ensure app stability, enable biometric fallback, provide "retry last transaction" option.

4. Customer Support

A senior citizen faces a KYC block but can’t reach a human support rep. He visits the branch instead, but it’s closed for lunch. Trust erodes.

➡️ Fix: Offer callback options, real-time human chat escalation, and digital KYC walkthrough videos.

🧠 What’s Causing These Drop-offs?

Here’s what we typically observe across banks:

• Poor UX design – too many clicks, unclear flows
• Lack of contextual help – no nudges or clarifications
• Weak cross-channel integration – mobile to branch to call center disconnects
• Overly complex compliance workflows – especially in tier-2/3 regions
• Missing personalization – treating all customers the same

And the biggest one?

👉 Assuming a customer will “figure it out” Most won’t. They’ll switch to someone who already has.

💡 The Way Forward: Build Journeys That Work, End-to-End

Here’s what I recommend to banking leaders and digital teams:

1. Diagnose Drop-offs at Each Step

Don’t just track funnel completion. Track where users struggle. Where do they pause? Where do they retry?

2. Co-create with Real Users

Conduct usability studies. Invite customers from different segments—urban salaried, rural MSMEs, students—and watch how they engage with your app or web portal.

3. Design for Progress, Not Perfection

A customer doesn’t need to finish in one go. Let them save, come back, and continue where they left off.

4. Unify Channel Experience

Make sure call centers, branches, apps, and bots share the same view of the journey.

5. Use AI to Predict and Prevent Drop-offs

Train models on drop-off behavior—look for early signals like time-on-step, multiple retries, or device switching.

🧭 Final Thought

In a world where fintechs win with simplicity, banks must win with trust, design, and follow-through.

The cost of a drop-off is not just a lost transaction—it’s a lost relationship. Let’s reimagine journeys with empathy, and turn every step into an opportunity to build confidence.

— What’s one journey you think your bank needs to fix first? Would love to hear your thoughts.

#Banking #DigitalExperience #CX #Fintech #Transformation #AIinBanking #CustomerJourney #Leadership