Retail banking

Retail banking, or personal financial services, involves handling transactions for individual customers, whether face to face in high street branches, over the telephone or via the internet.

Typical services provided include personal bank accounts, savings, mortgages, personal loans, credit cards and general insurance. Organisations in this sector turn a profit by charging fees for services or interest for borrowing money. When financial markets experience turbulence, some companies introduce more stringent criteria for borrowing money and increase their interest rates.

New developments in retail banking

The advent of the internet has seen lots of new entrants in the market for personal financial services and intense competition; along with the well known high street banks and building societies, organisations such as supermarkets and personal loan companies also now offer products directly to consumers. Customer service has, therefore, become a key differentiator among companies in retail banking.

The biggest developments over recent years are:

• There has been increased regulation, with a focus on treating customers fairly.
• The expansion of technology is improving the speed and reducing the cost of banking transactions. The rise of the Smartphone, for instance, has prompted many banks to develop mobile banking services, providing customers with even more rapid and convenient access to personal accounts.
• Due to the increasing sophistication of fraudsters, many banks now offer downloadable protection software and in-branch advice on how to spot common scams online, at ATMs and at points of transaction.
• The challenge presented by the current economic climate: stricter lending criteria and low interest rates on savings accounts have prompted banks to develop their other income streams, eg insurance.
• The development of new products to accommodate the demands of an ageing population.

Starting out as a retail banking trainee

The main graduate roles are in branch management, leading a team to achieve sales targets and managing a bank, or in relationship management (also known as private wealth management), being responsible for a portfolio of high net-worth individuals. The best way to start in this sector is to obtain experience in a customer services environment and apply for a graduate training scheme; you don’t need a finance-related degree. The schemes normally involve spending time in customer-facing roles, learning the basics of banking and serving customers. Next, you’ll lead a team or work in an area of retail banking where the customers’ needs are more complex. A managerial role should follow. You may also complete a professional qualification.

Skills for graduate retail banking jobs

You’ll need to be able to strike up a rapport with people and you should be a natural innovator. You should also be able to cope in a fast-paced environment – good organisational skills are essential. Although it takes a lot of energy, running your own ship is rewarding. The variety of managerial opportunitis in retail banking is fantastic.

Mike Varley is a graduate recruitment and development manager for HSBC Bank plc. He graduated from Manchester University in 2001 and has eight years' experience in retail, commercial and corporate banking.