If the pandemic has taught us anything, it is that we can’t function without our frontline workforce. But the next time you walk into your local bank branch and see a lineup of four tellers serving customers, know that one of those tellers won’t be working there this time next year. The annual turnover rate for frontline bank employees has risen to 23.4%. Coupled with pandemic-induced staffing shortages across industries, including banking, customer service at bank branches and financial service call centers is subsequently at a nadir. To delight customers, banks need to recruit and retain frontline talent by providing real, substantive learning opportunities tied to career advancement.

As we stand now, customers across our country are paying attention to this shortfall in customer service. A wide-ranging survey of 229,000 banking customers from Rivel, a data-driven consultancy, notes that the number of households that believe their primary banking institution is not responsive to their needs has risen by an astonishing 212%. Branch closures, happening at double the rate compared to before the pandemic, are now moving banking institutions further from their customers than ever before.

While the connection between depreciated employee bases and customer service is no surprise, the consequences to brick and mortar banking might be dire. Staffing shortages that lead to poor customer service in 2023 pose a significant risk to banking institutions which are facing pronounced competitive pressures from FinTech rivals. A key competitive differentiator for financial services companies has always been the ability to provide unrivaled, personalized care to customers with a diverse workforce that looks like the communities the bank serves. When customers no longer feel like their bank knows them and their needs, FinTech firms are poised to press the perception that they provide similar services at lower prices.

So how do banks compete with the tech sector’s increasing encroachments on established institutions? They can double down on what has always set them apart: their people.

Lowering the turnover rate for frontline staff and upskilling team members to be ambassadors of the benefits of experienced banking institutions can resuscitate customer experiences. As can attracting a diverse and inclusive workforce that can make meaningful connections, forged in mutual lived experience, with their customers. Fortunately, the pandemic has placed renewed focus on the people functions of companies and the CHROs who lead them. Attracting, retaining, and training diverse talent is possible and the financial services companies that excel in this will fend off FinTech’s attacks and in doing so, rise above others in the industry.

What FinTech companies generally fail to realize about employee benefits is that employees don’t place significant value on unlimited paid time off (which people don’t feel like they can actually use) and cold brew coffee on tap. Employees do place value on a company’s commitment to a worker’s career aspirations – and financial services institutions can outperform here. Due to their sheer size, a frontline worker can aspire to a long and fruitful career at a banking institution, but this is possible only if the bank creates career pathways for them.

For instance, Desert Financial offers employees 100% tuition paid up front for skill-building courses and undergraduate degrees, and up to $10,500 tuition coverage per calendar year for graduate degrees or graduate certificates. Investing in workers and tying educational attainment to career growth demonstrates a tangible commitment on behalf of the employer to the employee, leading to a reciprocal commitment. This is how high-performing staff, those who are homegrown, can and will create a powerfully positive customer service experience, whether at a teller window or in a call center.

A culture of continuous learning is not aspirational, it’s simply smart business. Recent surveys have shown that 68% of workers would stay with an employer if the employer offered opportunities for learning and upskilling.

The remedy for 25% frontline turnover and a reduction in bank branches is to double down on investing in the team members who directly interact with customers: the frontline.