The ability to express empathy in customer service in the financial services sector is a vital customer service skill and can also be a determinant of customer loyalty and regulatory compliance in the UK. Empathy when expressed appropriately in a business context builds trust, enhances customer experience and helps resolve issues more effectively. Given the sensitive nature of financial matters, customers often feel vulnerable when dealing with banks, insurance companies or investment firms. Demonstrating empathy reassures them that their concerns are being heard and valued. 

Our customers within the financial services sector tell us that the ability to genuinely express empathy is high on their agenda. It is a fine line to tread between being appropriately empathetic without over or under doing it! In our experience service givers can be overly familiar in trying to build a strong relationship with a customer who is sharing information that requires an empathetic response or, alternatively, can miss the opportunity altogether.  

From these discussions, it is clear that the ability to appropriately express empathy has many benefits. Some more obvious than others!  

Empathy builds trust and strengthens relationships  

Financial matters are, of course, deeply personal, and customers want to feel secure when discussing their finances. Empathy helps create a sense of safety and understanding, fostering long-term relationships with clients. Trust is a key factor in customer loyalty – when customers feel understood, they are more likely to stay with a financial institution. 

Enhances customer satisfaction and experience 

Empathetic customer service can help to de-escalate emotions, making customers feel valued and respected especially as they often reach out to financial institutions when they are experiencing stress, such as during financial hardship, fraud or confusion about products. 

Helping customers navigate financial service interactions involving complex or distressing situations such as debt management, loan denials, fraud cases or insurance claims requires a high level of technical and people capability. In such cases showing empathy reassures customers that the institution cares about their well-being, not just their financial transactions. It also helps in guiding customers through difficult decisions with greater understanding and patience. 

Encourages better problem resolution 

Customers who feel listened to and understood are in a better position to cooperate with service givers, making it easier to collaborate to resolve their issues. Empathy enables customer service representatives to tailor their responses based on the emotional and practical needs of the client. When customers feel their concerns are acknowledged, they are more likely to accept the best solutions, even if they are not ideal. 

Reduces complaints and improves compliance 

Empathy helps mitigate frustration which can build up in situations involving personal or business finance. Using appropriate empathy can reduce the impact before it escalates into complaints or formal disputes. Regulatory bodies emphasise fair treatment of customers – demonstrating empathy aligns with these compliance requirements. 

Supports customers in times of crisis 

As financial services team members provide support through the ups and downs of personal and professional lives, economic downturns, job losses or unexpected financial emergencies can cause immense stress for customers. Demonstrating empathy and focusing the customer on the action the organisation or they can take helps to move situations forward and find solutions.  

How to show empathy in financial services customer service
 

• Active Listening: Allow customers to fully express their concerns without interruption. 

• Appreciate the impact and move to action: Acknowledge how the situation is affecting the customer, for example by saying, “I appreciate this situation is very challenging for you. The best way I can help is to… Or a suggestion I have for you is…” 

• Personalised responses: Tailor the conversation to the customer’s specific situation and avoid robotic or scripted replies. 

• Solution-oriented approach: Offer clear and compassionate solutions rather than just stating policies. 

• Follow up and assurance: After resolving an issue, check in with the customer to ensure they are satisfied. 

Empathy is a business imperative in financial services. Institutions that prioritise appropriate empathy in customer service can build stronger client relationships, improve problem resolution and differentiate themselves in the market. By actively listening, acknowledging the impact of a situation on a customer and providing compassionate solutions, financial service providers can create positive, trust-based customer interactions that drive long-term success. 

Get in touch here to find out how MGI’s proven Mindset, Language & Actions Toolkit can equip your frontline finance teams with the skills they need to excel in providing effective, empathetic customer service, whatever comes their way. 

Read our latest articles

Explore our latest blogs, written on topics to help you and your people thrive at work.

Building optimism as part of your customer service ethos  

Optimism is a fundamental characteristic that shapes how service givers interact with customers, solve problems and contribute to the overall success of an organisation. Optimism fuels a positive outlook, encourages creativity in problem-solving and builds trust with customers. It empowers service givers to approach challenges as opportunities, ensuring that customers always feel heard, valued and […]

Discover

5 ways to improve customer care in your organisation 

Knowing that service-givers in an organisation care about their customers and work diligently to do their best for them is an important factor in delivering service excellence. Therefore, a clear focus on customer care should be at the heart of any organisation. Delivering exceptional service strengthens relationships while boosting customer loyalty and satisfaction. To truly […]

Discover

Empathy in Customer Service: Strategies for handling challenging situations 

Empathy is essential in customer service, as it helps build trust and ensures customers feel heard and valued. In our discussions with customers, there is a strong desire and need to help service givers professionally express empathy. Showing empathy is a vital service skill and can turn a negative experience into a positive one. Below […]

Discover

Pathway to thriving and success: building your team’s resilience   

As today’s workforce navigates a dynamic environment, the need for skills that enhance wellbeing, resilience and optimism is an important priority. By focusing on their people’s needs, leaders can provide tools to empower their teams with confidence and resilience. This foundation strengthens collaborative efforts, fostering productive and positive workplaces that drive both individual and organisational […]

Discover

Mastering three vital customer service skills in frontline financial services 

Working within the financial sector around the world has demonstrated to us at MGI the importance of three key customer service skills for all in the frontline to master. To create positive customer experiences, build trust, and retain customers requires an excellent balance of both people and technical skills and knowledge. Whether it’s handling a […]

Discover

The fundamental people skills needed by managers and leaders  

Effective leadership and management are built on a solid foundation of people skills. Wherever an individual sits in an organisation, the ability to communicate respectfully, take ownership, focus on solutions and contribute positively to the organisation is paramount. These essential skills define how managers lead, inspire and collaborate with others and fostering them will lay […]

Discover

Connect with us

Ready to discover what we can do for you?

Get in touch