You Want Your Banker to Know You -- Trust Me

When I started working as a teller at First National Bank of Valparaiso, I learned my regular customers' names. If I didn't, they'd give me a disappointed or concerned look and usually glance over my shoulder for one of the veteran tellers who did know them. Even though they may have recognized me (I'd grown up in the bank), they still wanted me to know them. These customers valued familiarity, and were unsettled by anonymous service when it came to their valuable bank accounts. They chose a bank based upon relationships, and you should, too.

Knowing a person's name is a powerful thing. Not because of the marketing value of customer identification or the power of social media. Because of human nature. When you know someone's name, she becomes more of a person and less of a customer. As Atul Gawande shares in his enlightening book, The Checklist Manifesto, when surgical team members introduce themselves, by name, to one another, they are far more communicative during surgery -- and ultimately successful -- than when they operate without formal introductions. When dealing with stressful, complex tasks, familiarity goes a long way. So the next time your loan needs surgery, you'll want your lender to know your name.

Familiarity also builds trust, and trust is scarce in banking. The latest surveys show that almost no one believes statements from financial institutions. But I suspect that those feelings are aimed largely towards the bank as a corporation, not the banker as an individual. Wouldn't it be nice to trust your banker? If you work with one who knows you, you will.

This is simply because humans are less likely to lie to someone they know. A person who knows you is far less likely to deceive you, according to research supporting "interpersonal deception theory." If the Wells Fargo bankers knew their customers, then they would have been less likely to manipulate overdraft fees, overcharging to the tune of hundreds of millions of dollars. Moreover, anonymity -- the typical state between big banks and their customers -- is the enemy of positive human behavior. Spend any time reading Yahoo! News comments and you'll know that. As I've described in the context of telephone customer service, anonymity encourages or excuses rudeness and impatience -- on both ends of the phone.

Big banks have higher employee turnover than little banks, which inevitably means their tellers and loan officers are less familiar with customers. And less familiarity means a greater tendency to deceive and disrespect you than a local banker who knows you. Big banks may make you think that they know you. Ever get eerily timely or relevant communications from your bank? Banks achieve this veneer of recognition through Customer Relationship Management (CRM) software that gives you the impression that your bank knows you. This expensive software is geared towards providing you with greater numbers of products, not greater service. Customer familiarity is not when a bank knows you went to Iowa last month based on your last ATM withdrawal: it's when a banker asks about your trip to Iowa for your son's college graduation. And it leads to better, honest, and more trustworthy service.

In the 1995 book, Bowling Alone, Robert Putnam explained and lamented America's decline in so-called "social capital," and namely face-to-face social interactions. As the nexus of all kinds of community members, community bankers have always been leaders in building social capital. They are the "Cheers" of businesses, "where everybody knows your name." You ought to consider stopping in.