20% of Americans aged 20-29 have no clue about their credit scores. Even if they aren’t interested in their credit reputation right now, it may become life-critical in the future when they decide to request a loan or credit card, rent a house, or apply for a high-end job position. Or when they receive an adverse action letter with refusal, and it’s too late to do something about it.
Regardless of who is guilty, financial institutions are the party responsible for timely and effective communication in banking. For them, transparency and regular notifications are essential both to build solid customer relationships and to stay regulatory compliant. They need to enable consumers to request a credit report by mail, provide free annual credit reports, and complete a lot of other mandatory routines.
That’s why it’s so important to use the most efficient channels for customer communication and, ideally, combine a couple of them. More about credit score mailing lists and different ways to provide customer account details in today’s article on:
- The use of credit scores for effective communication in banking
- What main channels are used by financial services to stay in touch with consumers. Why emails are not enough
- Why direct mail and credit score mailing lists remain crucial in the banking industry
The Use of Credit Scores and Reports for Effective Communication in Banking
First of all, let’s clarify what is a credit score and how it works.
Credit score is a numerical value that stands for the creditworthiness of a consumer and is used mainly in financial and real estate industries. In the US, there are three nationwide credit bureaus, Equifax, Experian, and Transunion, that collect and provide the personal information necessary to calculate a credit score. The final score may differ among credit reporting companies since there are many formulas to determine it. The key point is that it helps consumers to know how their credit profile looks and, at the same time, enables financial services to quickly make weighted decisions for each case.
Financial services regularly use third-party credit monitoring to evaluate an individual’s credit history and handle the loan, credit, and other requests. After that, they provide an official notice, indicating the decision and the credit bureau they cooperate with. In case the credit score impacts the outcome, an institution is required to explicitly state this and provide the score that was the basis for their decision.
Here are some other things you need to know about credit scores and effective communication in banking:
Tip #1 for Effective Customer Communication in Banking
Consumers have the right to order a free copy of their credit score report once in 12 months. To do this, they can visit annualcreditreport.com, call a free-toll number, or request a credit report by mail.
Tip #2 for Effective Customer Communication in Banking
For individuals that request a report online, it must be provided immediately. If consumers choose to request a credit report by mail through the Annual Credit Report Request Form, it must be mailed within 15 days.
Tip #3 for Effective Customer Communication in Banking
Under federal law, US citizens have the right to receive a free report if a financial institution or company is about to take adverse action. They are entitled to request a credit report by mail or through other means within 60 days upon the notice.
Tip #4 for Effective Customer Communication in Banking
Apart from consumers, copies of credit reports and credit scores may be requested by insurers and creditors. Current or prospective employers can order a credit report only after the written consent of an employee.
As you see, credit score mailing lists provided by credit reporting companies are widely used in many fields. They allow institutions to comply with federal regulations and make their operation more transparent. Also, credit score mailing lists protect citizens from identity theft and help them better manage their credit history. Thus, credit reporting is an indispensable part of effective communication in banking.
Main Channels Used by Financial Services to Stay in Touch with Consumers
Based on the recent DMA report, commercial emails are used by 88% of banks and other financial institutions. The paid search accounts for 40%, internet display – 52%, direct mail – 68%, and social media – 72%.
Besides, offline interactions remain a critical element of every effective communication in banking. Speaking in numbers, 72% of people who research loans make at least two phone calls to collect the information and study the offer. Out of them, 33% contact financial institutions to discuss a tough situation. 24% call to quickly ask something instead of wasting time on online forms. Apart from that, consumers with the experience of offline communications are more likely to take a loan.
The above statistics show something the majority of financial institutions already know. Even though email marketing is one of the most widespread and affordable means of effective communication in banking, other channels still matter.
Whatever you do, give a million-worth loan or refuse to cooperate with an applicant, consumers expect to be treated well. Therefore, you need to make sure they receive the information in the most convenient and timely manner.
Unfortunately, email credit score mailing lists cannot cover all the needs of customers. Emails are good for general notifications, brief requests, and important updates, that’s it. To provide a more personalized customer-centric approach, it’s necessary to combine several channels. For example, you can use your social media profiles as an alternative way to consult customers or integrate chatbot software.
It is also important to invest in your website and publish content that can help people use your services. Financial and credit reporting companies that rely on credit score mailing lists should explain to consumers when they are entitled to request their credit information and how to do this.
Finally, every financial institution is required to use direct mail both for effective communication in banking and regulatory compliance. Find more about traditional mail and those who request a credit report by mail below.
Why Direct Mail and Credit Score Mailing Lists Remain Crucial in the Banking Industry
First of all, any consumer has the right to request a credit report by mail. Despite the steady digitalization of banking services, more than half of US citizens prefer to receive official communications based on mail lists. Hence, financial institutions must use mail to comply with federal regulations.
But direct mail can offer much more than compliance with regulations. Financial institutions also use credit score mailing lists instead of emails to achieve a better response. Household direct mail has up to 10 times higher response rates than emails, paid search, and social media. Recipients are more likely to check print in time and take the necessary action. This is critical if, for example, you need to ensure that an individual has 60 days to dispute your adverse action letter after receiving it.
Finally, modern direct mail automation software, including Inkit, allows banks to keep track of all their mailings. They can see whether the people on their credit score mailing list were informed and when. The full automation of mail printing and delivery supported by Inkit makes direct mail as easy as emails, magnifying its benefits. For more details on financial mail automation and outsourcing, read this article.
Need to automatically mail credit scores to those who request a credit report by mail? Try out Inkit to see how it does everything for you.