There’s healthy skepticism, and there’s just plain skepticism. The jadedness that comes from feeling taken advantage of, dismissed, or mistreated. It used to be a quality highly correlated with Gen Xers, but it seems more and more that consumers are skeptical of most institutions, and that includes their financial institutions.
In an environment of tight margins and heightened mobility, deposit relationships can evaporate just as quickly as they form.
For a bank or credit union serving the $1B+ segment, the risk in a rate-driven environment means deposits shift rapidly unless you also deliver clarity, consistency and trust. It isn’t enough to offer a competitive rate; you must ensure your rate story holds up under consumer and market scrutiny.
With this level of scrutiny from consumers in a rate-eats-rate world, deposits can exit from a financial institution almost as quickly as they are acquired. The real determiner for how many deposits stay with you for how long isn’t what your bank’s or credit union’s rate is, it may just be how you explain it.
Why transparency has become a strategic differentiator
When consumers feel informed and respected, they stay longer and become advocates. According to a recent global study of 49K banking customers, institutions whose customers trust them and feel understood achieved up to 1.7X faster revenue growth.
And in the U.S., more than 40% of retail-bank consumers cited higher deposit rates as the primary reason they would move their direct deposit.
Together, these findings highlight that while rate remains a driver, trust and the communication behind the rate is what creates staying power.
Transparent communication stabilises deposit flows
Research from the Wharton School of the University of Pennsylvania shows that banks with higher transparency in financial disclosures see deposits that are more sensitive to performance, but that also signal clearer, stronger relationships.
It sends a powerful message that “We’re not hiding the fine print.” Some leading institutions now feature rate history graphs directly within their digital savings dashboards. But you don’t have to build interactive charts into your digital banking platform. Our High Yield Savings by Plinqit clients send non-transactional emails notifying depositors of rate changes.
Institutions that provide savers with the reasoning behind rate changes build a stickier base – meaning fewer retreating depositors – of customers and members. Here are some suggestions of communication options that align with operational realities.
- Show historical rate trends alongside current yield offers in your digital savings dashboard.
- Notify depositors proactively of upcoming rate adjustments, tied to market benchmarks or internal policy.
- Frame rate changes with context; not just “Your rate changed,” but “Here is how your relationship fits with market direction and our approach.”
- Leverage automated segmentation and personalised messaging so communications feel relevant (not generic) and timely.
It’s also good business.
Transparent communication can help reduce call-center volume, drive higher re-fund (not refund!) rates, and even boost cross-sell performance. Saravana Kumar of Kovai.co in this Forbes article found that customer acquisition can cost 4-5X that of retention measures. Likewise, a 5% increase in retention can lead to improved profitability of 25% or more. For banks and credit unions under margin pressure, the implication is clear: Differentiate not with the highest rate alone, but with a rate story worth trusting.
You likely have examples from your financial institution of situations where openly sharing product updates reduced resource-impacts. Imagine implementing automated communications that are operationally friendly. One of those is using AI.
Digital tools make it easier than ever.
Consumers expect personalization and they feel a disconnect when their financial institution has not made effective use of its CRM or other personalization and recommendation tools. A recent Financial Brand article emphasizes the importance of using predictive analytics and customizing messaging to align with customer and member preference and financial goals to reinforce their loyalty.
At Plinqit, we believe technology should simplify trust. Our High Yield Savings platform is designed to serve as this strategic partner. We enable banks and credit unions to build transparent rate pathways, automate communication, and reinforce trust at each customer touchpoint. That enables you to hold deposits longer, deepen loyalty, and distinguish your institution in a marketplace dominated by commodity pricing.
