By Devon Kinkead

The banking industry has always faced the challenge of attracting and retaining deposits. Traditionally, financial institutions relied on interest rate adjustments, personalized services, and marketing campaigns to hold on to accountholder deposits; but most actually did very little to retain large deposits. However, as financial technology advances, solutions like Micronotes’ exceptional deposits and retention technologies are changing this space. Here’s a comparison of these proven modern tools to historical methods of deposit retention.

The Historical Approach to Retaining Deposits

Historically, depository institutions used several key strategies to attract and retain deposits:

1. Interest Rate Adjustments: Offering higher interest rates on savings accounts and certificates of deposit was a common method. However, this approach often created a “rate war,” where profitability could be compromised​​.
2. Personalized Service: Smaller community institutions excelled in creating lasting customer relationships through in-person interactions and relationship banking​. While effective, this approach was limited by scale and geography.
3. Marketing Campaigns: Depository institutions relied heavily on promotional campaigns and advertising to attract and retain depositors. These efforts were often broad and lacked personalization.
4. Deposit Guarantees and Stability Measures: After the Great Recession, deposit insurance limits were raised, and programs like the Temporary Liquidity Guarantee Program (TLGP) instilled greater confidence in deposit safety​​.

While these methods had varying degrees of success, they relied heavily on general trends and lacked the precision to target individual accountholder needs.

Micronotes’ Exceptional Deposits and Retention Technology: A New Paradigm

Micronotes takes a modern approach by leveraging digital conversations, statistics, and machine learning to understand customer behavior and tailor banking solutions. Here’s how it sets itself apart:

1. Personalized Customer Engagement: Using microinterview technology, Micronotes engages customers with highly personalized interactions. Unlike traditional marketing, these digital conversations are based on near real-time deposit data, ensuring relevance and increasing the likelihood of engagement​.
2. Predictive Analytics for Retention: By analyzing customer behavior and attrition patterns, Micronotes can predict which accountholders are likely to leave and take their deposits with them. This insight allows financial institutions to proactively offer solutions, such as offers to talk to a banker to discuss their banking experience along with targeted product recommendations or loyalty rewards​​.
3. Cost-Effectiveness: Unlike interest rate adjustments, which can strain profitability, Micronotes helps banks retain deposits by addressing customer needs without significantly altering their pricing models​​.
4. Scalability: Traditional relationship banking is constrained by human resources and geography, but Micronotes operates on digital platforms, making its tools scalable for institutions of all sizes​.

Advantages of Micronotes Over Historical Methods

1. Precision: Micronotes’ ability to deliver tailored solutions means customers feel understood and valued, reducing churn rates. Every large deposit is a life event and Micronotes connects accountholders to their financial institution when they need help through a life event.
2. Efficiency: By automating the targeting and customer engagement process, financial institutions save time and resources and get it right.
3. Proactivity: Instead of reacting to customer attrition, Micronotes enables proactive strategies to retain customers and their deposits​.

Lessons from the Past, Powered by the Future

The financial crisis of 2008 highlighted the importance of customer confidence and liquidity management​​. While traditional methods relied on broad-based solutions, tools like Micronotes address the individual needs of customers in real time. By blending historical insights with modern technology, banks and credit unions can build stronger, more resilient deposit bases.

In conclusion, as the banking landscape evolves, Micronotes’ exceptional deposits and retention technologies exemplify the shift towards data-driven, customer-centric approaches. By understanding individual customer behaviors and needs, banks and credit unions can ensure they remain competitive in a digital age while drawing on the foundational practices of trust and service. Request a demo here.

By Devon Kinkead

When accountholders make unusually large deposits, their intentions for those funds provide critical insight into how financial institutions can guide and retain those deposits. Recent data from Micronotes’ mobile banking microinterviews with exceptional depositors reveals distinct trends in customer preferences and behaviors regarding exceptional deposits. Here’s what the data tells us and how financial institutions can act strategically to help their accountholders through significant life events, evidenced by exceptional deposits.

Key Insights from the Data

Based on 183 recent responses across 3 financial institutions with accountholders who had an exceptional deposit.

1. Low Interest in Calling for Investment Options (2% of responses)
   Accountholders seem less inclined to call their bank to discuss investment options. This may reflect a broader trend where convenience and immediacy outweigh in-person or telephonic consultations.
2. Investment Interest, Digital Preference (11%)
   A small but notable group prefers to learn more about investment options online. This underscores the importance of robust, accessible, and engaging digital content to capture customer interest in investment products.
3. Minimal Interest in Calling about CDs (1%)
   Similar to investment options, calling about Certificates of Deposit (CDs) garners even less interest. This suggests that traditional outreach methods may not effectively drive engagement for these products.
4. CD Interest, Strong Preference for Learning More Online (33%)
   The majority of respondents interested in CDs prefer online resources. This is a significant opportunity to leverage digital platforms to showcase CD offerings, especially with interactive calculators and comparison tools.
5. Predominance of Other Plans or Indifference (52%)
   Most respondents indicated “not interested” or stated they had “other plans” for their deposits. This could indicate a gap in communication or relevance of the bank’s offerings to customer needs.
6. Rare Disclosure of Alternate Plans (1%)
   Only one respondent shared specific details about their “other plans.” This suggests either a reluctance to disclose financial intentions. For example, “I have a money market, 3 annuities, 6 CD’s, a Roth, an IRA and they all pay more interest than you do.”

Actionable Strategies for Financial Instutions

Invest in Digital Engagement
With customers showing a preference for online learning about CDs and investments, financial institutions should enhance their digital educational tools. These could include:

• Interactive product pages with videos explaining the benefits of CDs and investments.
• Savings goal calculators to show potential returns.
• Chatbots that guide customers to the right financial products based on their goals.

Targeted Promotions for Investment Products
To engage the small but interested group in investment options:

• Offer tailored digital campaigns highlighting unique investment benefits.
• Use personalized outreach via email or app notifications to nudge customers towards exploring investment products.

Rethink Call Strategies
Given the minimal interest in calling for information, financial institutions should prioritize enabling self-service tools and only supplement them with call-back options for complex queries.

Understand the “Other Plans” Group
The largest group of respondents cited “other plans” for their deposits. Financial Institutions should:

• Conduct follow-up interviews or incentivize customers to disclose their plans.
• Use AI tools to predict behavior patterns based on transaction history and segment communications accordingly.

Highlight Flexibility in Product Marketing
The indifference to traditional products may stem from a lack of perceived value. Highlight the flexibility of investment or CD products and how they can align with customer goals like short-term savings, emergency funds, or wealth growth.

Framing the Opportunity

Financial Institutions are in a unique position to act as financial guides for accountholders making exceptional deposits. The data shows a clear preference for self-directed digital exploration over traditional customer service methods. By leaning into this trend, Financial Institutions can create a seamless digital journey that informs, engages, and ultimately converts deposits into long-term assets for both the accountholder and the institution.

By addressing gaps in communication and aligning products with customer preferences, financial institutions can capture untapped opportunities, ensuring that every deposit contributes to deepening customer relationships and financial growth. Request a demo to learn more about how Micronotes can help retain deposits and deepen accountholder relationships when it matters most.

By Devon Kinkead

The financial services sector faces constant pressure to adapt, innovate, and keep customers engaged. But how do you not only attract new customers but also ensure they stay loyal in an increasingly competitive landscape?

During our recent Gain and Retain webinar, we unpacked actionable insights to tackle this challenge, weaving technology, personalization, and strategy into a framework for success. Let’s break it down.

Deposits Are More Elusive Than Ever

Financial institutions are grappling with two critical issues: attracting new customers and keeping the ones they already have. In today’s environment, consumer expectations for personalized services are high, yet loyalty remains fragile. Bank data reveals that more than 50% of large deposits are withdrawn within 90 days without proactive engagement​.

How can banks and credit unions close the gap between their services and what customers need during pivotal life moments?

Partnering for Smarter Solutions

Micronotes has stepped up with innovative tools designed to address these challenges head-on. By leveraging vast data sets, predictive analytics, and hyper-personalized outreach, Micronotes helps financial institutions anticipate customer needs and deliver tailored solutions right when they matter most.

For example, Micronotes’ Accountholder Retention solution uses machine learning to identify at-risk customers and initiate automated, meaningful conversations within mobile banking apps​. Similarly, Prescreen Acquire deploys hyper-personalized prescreen campaigns to connect with creditworthy prospects and accountholders using geotargeting and 230MM consumer credit records, updated weekly​. Exceptional Deposits identifies unusually large deposits and immediately reaches out to depositors through the digital banking channels to offer help during major life events.

Engage at Scale with Personalization

1. Understand Your Customers’ Moments That Matter
   Life events like buying a home, consolidating debt, or receiving a windfall are critical opportunities to build trust. Micronotes identifies these moments through its Exceptional Deposits program, which flags large deposits and automatically connects accountholders with relevant services​.
2. Turn Data into Actionable Insights
   By analyzing millions of data points, Micronotes’ tools predict accountholder behaviors and needs, enabling financial institutions to act proactively, not reactively. Whether it’s cross-selling products, retaining an accountholder ready to leave, or acquiring new creditworthy accountholders, the results are transformative.
3. Scale Conversations Without Losing the Personal Touch
   Traditional marketing may start one conversation at a time. Micronotes’ Cross-Sell achieves 26x the click-through rate of banner ads by engaging accountholders in interactive dialogues tailored to their specific situations​.

Real Results, Real Growth

Micronotes customers are already reaping the rewards of Micronotes’ gain and retain approach, from acquiring new accountholders at a profit, to expanding wallet share, to retaining depositors and their deposits. It’s a powerful combination.

Step Into the Future of Banking

2025 is the year to stop losing opportunities to competitors with outdated systems and thinking. Let Micronotes help you gain new customers and retain the ones who already trust you.

By Devon Kinkead

Deposits aren’t just numbers on a balance sheet—they’re the pulse of banks and credit unions, fueling lending, investment, and operational stability. Yet, deposit retention often takes a back seat to acquiring new customers. With mounting challenges like economic volatility, customer mobility, and rising competition, the ability to retain deposits has become a make-or-break factor for financial institutions.

The High Stakes of Deposit Retention

When a depositor leaves, the ripple effects go beyond just liquidity:

1. Liquidity Stress: A sudden outflow of large deposits can leave financial institutions scrambling to meet obligations, increasing reliance on expensive external funding sources.
2. Erosion of Trust: Large deposits are often tied to significant life events—retirements, home purchases, inheritances. Losing these customers signals a deeper disconnect in building trust during crucial life moments.
3. Regulatory Strain: Attrition can weaken compliance with capital and liquidity requirements, placing the institution at risk of penalties or operational challenges.

In fact, we’ve seen up to 50% of large deposits exit within 90 days without proactive intervention—a sobering statistic for community banks and credit unions with limited resources.

The Micronotes Advantage: Turning Risk Into Retention

Imagine having the ability to detect when an exceptional deposit is made and stepping in to help. That’s where Micronotes’ Cross-Sell Exceptional Deposits capability excels. The solution empowers financial institutions to:

• Identify Large (At-Risk) Deposits: Micronotes flags statistically anomalous deposits—those that often signal life events.
• Engage With Precision: The platform automated tailored conversations with large depositors, offering personalized solutions like retirement planning, mortgage services, or wealth management, addressing their needs head-on.
• Seamlessly Integrate: Compatible with major digital banking systems, Micronotes ensures effortless implementation without disrupting your operations.

This technology transforms a looming risk into a growth opportunity, helping banks and credit unions retain valuable deposits while deepening customer relationships.

A Story of Success: Real Customer Insights, Real Impact

Micronotes’ Cross-Sell Exceptional Deposits isn’t just theory—it’s already making a tangible difference for financial institutions. Here are real-world examples of how the platform helped retain deposits while strengthening customer relationships:

1. Preempting Fund Transfers to Competitors: A customer shared, “I was planning on investing into a money market with Wells Fargo at 5.4%.” With Micronotes, the bank proactively engaged the customer, offering competitive investment products that met their needs, preventing the outflow of funds.
2. Providing Access to Expertise: Another customer expressed, “I’d like to speak with an investment advisor.”Recognizing the opportunity, the institution connected the depositor with financial advisors, resulting in tailored solutions that solidified the relationship.
3. Encouraging Long-Term Commitments: When a customer stated, “I’d like to open a CD,” the bank was able to respond immediately through Micronotes, streamlining the process and securing funds for the long term.
4. Addressing Immediate Needs Thoughtfully: A depositor noted, “[I’m planning on using the funds for] vacation and dental expenses.” By engaging with empathy and offering personalized budgeting and savings advice, the institution reinforced its role as a trusted financial partner.

These interactions showcase how Micronotes empowers banks and credit unions to anticipate customer needs and respond with precision, ensuring deposits remain within the institution while deepening trust and loyalty.

Actionable Strategies for Deposit Retention

While Micronotes provides a technological edge, the broader strategy to retain deposits requires a mix of tools, culture, and customer focus:

1. Personalize at Scale: Use data to understand depositor behavior and offer tailored products. Customers value institutions that recognize their unique needs.
2. Strengthen Relationships: Build trust through regular communication, transparency, and financial advice that aligns with customer goals.
3. Focus on Digital Excellence: Ensure your online platforms are seamless and intuitive. Digital convenience is no longer optional—it’s a cornerstone of retention.
4. Incentivize Loyalty: Offer benefits like higher interest rates for long-term deposits or discounts on loans to loyal customers.

Looking Ahead: A Future Built on Retention

As banking evolves, one truth remains constant: deposits are the cornerstone of success. For banks and credit unions, retaining deposits is not just a financial imperative—it’s a testament to the strength of customer relationships and trust.

Micronotes’ Cross-Sell Exceptional Deposits capability offers the perfect blend of technology and strategy to help financial institutions not only navigate the challenges of deposit retention but thrive in them. By addressing the root causes of deposit attrition, namely inaction, and engaging accountholders at critical moments in their lives, banks and credit unions can ensure stability, grow their base, and fortify their future.

Your deposits—and your depositors—deserve exceptional care. Let’s make that happen.

By Xav Harrigin-Ramoutar

In today’s competitive banking industry, community banks face a constant challenge: retaining customer deposits. With numerous alternatives available, maintaining loyalty and preventing fund outflows are critical for sustained growth. Micronotes’ Exceptional Deposits solution offers a powerful tool to address these challenges, leveraging analytics and personalized engagement to enhance deposit retention. This case study highlights how a community bank successfully used Micronotes to achieve remarkable results in deposit retention and wealth management growth in a matter of 2 months.

Introducing Micronotes’ Exceptional Deposit Solution

Micronotes’ Exceptional Deposit solution uses statistics to predict which customers are moving through a life event, manifest by an anomalous large deposit . By identifying these customers immediately, banks and credit unions can engage customers moving through a life event proactively, offering personalized solutions to both help customers and retain their deposits. This proactive approach ensures that banking providers can address potential withdrawals before they occur, transforming at-risk customers into loyal accountholders.

Benefits of the Exceptional Deposit Solution

• Catching Life Events: Accurately forecasts life events identifying those who likely need help, which their primary depository institution must deliver to stay ahead of potential fund outflows.
• Personalized Engagement: Delivers tailored interviews large depositors addressing their specific needs and concerns. Personalized engagement ensures that customers feel valued and understood, enhancing their loyalty to the bank.
• Proactive Retention: Engages customers before they decide to withdraw their deposits increasing the likelihood of retaining the customer and their deposits. Proactive retention strategies are essential for maintaining a stable and loyal customer base.

Challenges of Customer Retention in Community Banking

Customer retention in community banks is complex due to several factors:

• Competitive Offers: Customers have numerous alternatives, making it easy to switch banking providers. Community banking providers must differentiate themselves to retain customers.
• Customer Dissatisfaction: Unresolved issues or unmet expectations can lead to attrition. Addressing customer needs promptly is vital to prevent dissatisfaction.
• Changing Financial Needs: Customers’ financial situations and needs evolve over time, requiring continuous engagement and adaptation. Banking providers must be agile and responsive to these changes using technology.

Micronotes’ solution addresses these challenges by providing banks and credit unions with tools to understand and respond to customer and member needs proactively. By leveraging data, insights, and automation, community banking providers can implement effective retention strategies tailored to their customers’ needs.

Case Study: Exceptional Deposit Campaign

Campaign Overview

On March 1, a client community bank launched a campaign targeting personal banking customers who made atypically large deposits. These customers, identified through Micronotes’ analytics, received personalized interviews via the online and mobile banking platforms. The goal was to engage these customers and help them find solutions to retain their deposits within the bank.

Key Insights

Micronotes discovered that 54% of these customers typically withdrew their deposits within 90 days, if not contacted. By engaging with them promptly, the bank aimed to retain these significant deposits.

Campaign Results (March 1 – May 7, 2024)

• Leads Generated:
  • 43 warm leads
    • 32 for Certificates of Deposit (CDs), 11 for investment opportunities with LPL Financial advisors
  • 31 cool leads
    • 24 for CDs, 7 for investment opportunities
• Conversions:
  • Warm Leads: Over $1.1 million in new CD purchases
  • Cool Leads: Over $500K in new CD purchases

The campaign’s success in generating leads and converting them into new CD purchases highlights the effectiveness of Micronotes’ solution in retaining customer deposits.

Detailed Engagement Breakdown

• Warm Leads:
  • 28 customers requested email information on CDs
  • 4 customers preferred a call about CDs
  • 10 customers asked for more information on investments and were sent a link
  • 1 customer requested a call about investments
  • Additionally, 24 customers were interested in CDs but declined further contact, and 7 customers were interested in investments but did not want to be contacted

Conversion Metrics

• Warm Leads:
  • 9 accounts without prior CDs now hold a total of $1.055 million in CDs
  • 1 account increased its CD balance by $44,000
• Cool Leads:
  • 3 accounts without prior CDs now hold a total of $525,000 in CDs
  • 1 account increased its CD balance by $31,000

These conversion metrics demonstrate the tangible impact of the campaign on the bank’s deposit retention efforts. By converting warm and cool leads into substantial CD balances, the bank successfully retained significant funds, more than half of which would otherwise have been withdrawn.

User Experience

The campaign’s interface within mobile banking was designed for seamless interaction. Customers could choose options like ‘Call me’, ‘Email me’, and ‘Not now’, each triggering specific follow-up actions by branch managers. This intuitive design ensured a smooth user experience and effective engagement. The ability to interact with the campaign through familiar digital channels made it easy for customers to respond and engage with the bank’s staff and products.

Verdict

The Exceptional Deposit Campaign effectively demonstrated the power of Micronotes’ data-driven engagement strategy in retaining deposits, one of hundreds of powerful use-cases. By retaining significant deposits and fostering deeper customer relationships, the campaign showcased how analytics and personalized engagement can drive positive outcomes for community banks.

Community banking providers looking to enhance their deposit retention strategies can benefit significantly from Micronotes’ innovative solutions. By leveraging advanced analytics and proactive engagement, banks can stay ahead of potential withdrawals and build stronger, more loyal customer relationships.

Call to Action

Discover how Micronotes can transform your deposit retention strategies. Contact us today or visit our website for a detailed overview and to schedule a demonstration of our innovative solutions. Let us help you turn potential challenges into opportunities for growth and customer loyalty.

By Xav Harrigin-Ramoutar

The Challenge of Retaining Significant Customer Deposits

In the ever-changing landscape of banking, a prominent challenge stands out: effectively retaining and managing large customer deposits. These deposits often represent crucial moments in clients’ lives, making them key touchpoints for banks. Traditional engagement and retention methods, however, are increasingly falling short, leading to missed opportunities and potential erosion of trust. This scenario underscores the need for a transformative solution that redefines customer engagement and deposit retention in banking.

Understanding the Customer’s Journey

At the core of our story are the bank customers, each navigating significant life events that often coincide with large deposits. These moments, whether it’s selling a home, preparing for a wedding, or welcoming a new family member, are not just financial transactions; they’re personal milestones. For banks, these instances are more than deposit entries; they represent a critical opportunity to connect, support, and grow with their customers. Embracing a customer-centric approach in banking means understanding and empathetically responding to these needs, turning routine financial interactions into meaningful relational touchpoints.

The Inefficiency in Traditional Banking Methods

The banking industry faces a critical problem: the inefficiency in retaining significant customer deposits. Traditional methods are proving inadequate, lacking the personalization and timeliness needed to effectively engage customers during these pivotal times. This inefficiency not only risks the loss of substantial funds but also misses the opportunity to deepen customer relationships, a key aspect for long-term success in the banking sector.

Introducing Micronotes Cross-Sell: Exceptional Deposits

Enter Micronotes Cross-Sell, Exceptional Deposits, the guiding solution in this narrative. This tool is designed specifically for the banking sector to address the challenge of deposit retention. It automates the detection of statistically exceptional deposits, signaling key customer life events, and acts as a bridge for personalized and timely interactions between banks and their customers. This not only facilitates the retention of significant deposits but also nurtures a deeper, more meaningful banking relationship tailored to each customer’s unique journey.

Seamless Integration and Strategic Engagement

The plan for implementing Micronotes Cross-Sell is straightforward yet impactful. Banks can integrate this technology seamlessly into their existing systems, enabling the automatic detection of significant customer deposits. Once identified, the platform facilitates targeted, relevant engagements, ensuring communications are not only timely but also resonate with the customer’s current needs and life events. This strategic approach enhances deposit retention and strengthens customer loyalty, turning routine banking interactions into opportunities for deepened, lasting relationships.

The High Stakes of Deposit Retention

The stakes are high in the banking sector when it comes to deposit retention. Failure to adopt a proactive, personalized approach can lead to significant deposit losses. Banks risk losing up to half of their large deposits to competitors within just 90 days, affecting liquidity and eroding long-term customer trust and loyalty. Inaction in this dynamic market could mean missing crucial opportunities to strengthen customer relationships and secure and expand core deposits.

A Success Story: The Power of Personalized Engagement

A testament to the effectiveness of Micronotes Cross-Sell is a success story from a participating bank. A customer, initially engaged in basic banking services, experienced a major life event leading to a substantial deposit. Leveraging Micronotes’ targeted approach, the bank immediately identified and responded to this event, resulting in the customer expanding their relationship with the bank, including investment services. This story exemplifies the power of personalized, timely intervention in transforming standard banking relationships into comprehensive, mutually beneficial partnerships.

Conclusion: Setting a New Standard in Banking

In conclusion, the adoption of Micronotes Cross-Sell and its exceptional deposits feature represents a pivotal step towards redefining deposit retention and customer engagement in banking. It’s a move towards understanding and catering to the evolving needs of customers, especially during significant life events. Banks that embrace this approach will not only safeguard their financial interests but also build stronger, more loyal customer relationships, setting a new standard in the banking experience.