The experience gap between banking and ecommerce
Retail banking has long been structured around product silos, compliance-heavy onboarding and loan origination, and fragmented channels. As a result, many customers don’t even realize what options exist beyond their current account. Digital application journeys are often slow and disjointed, requiring too many forms, document uploads, and offline steps that break the flow.
J.D. Power finds that 13% of U.S. customers say they plan to switch banks in the next 12 months. This becomes a troubling cost for banks: at 9., switching in 2022 was at its lowest level in nearly a decade, but it still cost banks around $80 billion in annual revenue, equivalent to roughly $640 billion in customer lifetime value (CLTV).
At the same time, wallet concentration remains elusive. Research shows that only 3% of banks capture more than 80% of their customers’ wallet share, leaving most institutions with under-utilized relationships and missed opportunities.
Why banks should think like ecommerce
Customers don’t measure their banking experience against other banks, but rather against the best digital interactions they have anywhere. When Amazon can deliver in one click and Netflix can surface the perfect recommendation instantly, a clunky account opening process feels anachronistic. Expectations are being reset outside of banking, and institutions that fail to match them risk losing relevance.
Industry shifts make this mindset non-negotiable:
- Mobile is the new branch. Forrester (2025) reports that up to 73% of online adults in markets like the US, UK, and Australia expect to complete any financial task inside a mobile app. That means banking apps are now the front line for sales.
- Checkout expectations are universal. McKinsey’s 2024 Digital Payments Survey shows that nearly 90% of consumers used digital payments last year. If checkout elsewhere is seamless, banks can’t afford to frustrate clients with clunky application flows.
- Experience is the differentiator. Deloitte’s Digital Banking Maturity 2024 highlights a shift among leaders: away from adding endless features and toward simplifying journeys and hyper-personalisation.
What unites these trends is a simple truth: customers value experiences that save them time, anticipate their needs, and remove friction.
The 4 pillars of a banking shopping experience
To bring this vision to life, banks can focus on four key pillars that shape a modern shopping-like experience for financial products:
1. Effortless discovery
Customers shouldn’t have to hunt for products buried in menus or brochures. In the same way that ecommerce platforms surface items based on browsing history or purchase context, banks can recommend the right product at the right moment.
For example, a customer who frequently travels could see an in-app suggestion for a premium card with travel perks. With easy discovery and contextual, banks can move from passive product lists to proactive engagement.
2. Intelligent personalization
Leaders in retail already use first-party data to deliver hyper-relevant recommendations. Banks have an even richer dataset: transaction histories, spending patterns, savings goals that can be harnessed to deliver meaningful offers.
Imagine a checking account customer prompted with: “You spent $1,200 on dining last quarter. With our Rewards Plan, you could have earned $60 cashback.” These data-driven nudges show tangible value, making offers feel helpful and relevant rather than pushy.
3. Frictionless onboarding and origination
Nothing kills intent faster than a clunky application flow. Pre-filled applications using existing customer data, mobile document capture, and real-time progress updates can dramatically cut abandonment.
A well-designed onboarding and loan origination experience reassures customers that the bank values their time and makes it easy to complete the journey in one sitting. For the institution, it means more completed applications and faster revenue realization.
4. Consistency across channels
In ecommerce, the product you see on the website is the same one you find in the app or in-store. Banking needs the same discipline. A single source of product data ensures that pricing, eligibility, and features remain consistent whether the customer interacts through an app, a branch, or a call center.
From one-click shopping to one-click banking
Retail banks that redesign their journeys around discovery, comparison, and seamless checkout will not only meet these expectations but also win on loyalty, share of wallet, and long-term growth.
The next evolution is already on the horizon. Shopping-style banking will increasingly integrate:
- AI-driven recommendations that proactively suggest products based on real-time behavior.
- Predictive product suggestions tied to life events (like moving home, starting a family, planning retirement) that make banking feel anticipatory rather than reactive.
- API-first delivery, ensuring that customers can start an application in one channel, pause, and finish in another without ever losing progress.
At Backbase, we help banks move from vision to execution. Our AI-powered Banking Platform is designed to deliver shopping-like product experiences inside your app or web channels, unifying product data, personalising offers, and simplifying onboarding and loan origination. And because the platform is modular and API-first, banks can launch these shopping-style journeys in months, not years, without ripping out core systems.
