Most Financial Institutions Have a Data Problem, Not a Deposit Problem
Banks are facing unusually sluggish deposit growth projections of just 4 to 4.5%. Financial institutions who successfully integrate behavioral data, account activity, and permissioned insights can transform marketing into service. There are five key strategies: breaking down data silos, embracing value-based permissioning, using multiple data sources to find demand, treating onboarding as continuous, and implementing true personalization that drives action.
By Mark B. Egan
Many banks say they personalize their marketing and cross-selling — few actually do. True personalization goes beyond inserting a customer’s first name in an email. It means understanding context: what the customer needs now, what they’re likely to need next, and what channel they’re most likely to respond to.
That requires combining behavioral data, account activity, life-stage signals, and permissioned insights into a cohesive picture. When done right, personalization feels less like marketing and more like service — and that’s what builds trust, loyalty, and ultimately, deposits.
Deposits are a critical case in point — not just because they’re a keystone of account holder commitment and institution growth, but because the battle to grow them has rarely been hotter. Normally, when rates are in an easing cycle, as is the case now, deposits surge. But 2025 is expected to disappoint: Levels of low-cost deposits are already elevated, making the public resistant to holding more. Indeed, the Office of the Comptroller of the Currency has warned that deposit growth may come in at just 4-4.5% in 2025, a fraction of the 8-17% pace seen in previous easing cycles.
To compete for deposits, financial institutions will need to sharpen their offers. The problem is, most financial institutions still rely on fragmented, outdated approaches to customer data — separating marketing from product, and operating their digital channels in disconnected silos. This puts truly personalized offers out of reach for most financial institutions.
In fact, these institutions don’t have a deposit problem. They have a data problem.
"Growth isn’t your biggest challenge," says MX Chief Product and Technology Officer Wes Hummel. "Financial institutions have more data than ever, but making it actionable and turning it into real results isn’t easy. Customers want better, more personalized experiences. Competition is fierce. Margins are tight and data is messy and often siloed or incomplete. Your biggest challenge is how you use your data to power growth."
The good news is that financial institutions that leverage data the right way can help tilt the odds back in their favor. These include developments and best practices in customer experience and data management. And they’re empowering financial services providers to better leverage the information they have to increase success rates and lower costs of acquisition.
In an environment where interest rates alone may no longer be enough to attract or retain deposits, financial institutions must adopt a more integrated strategy, one that taps into the full range of data at their disposal. Following are five critical insights about data that financial institutions should embrace to outperform in the battle for deposit growth.
Want more insights like this? Check out MX’s content portal: Data in Action
What’s in Your Silo?
Many financial institutions lack the mature data teams or advanced analytics capabilities needed to fully leverage the data they already have. Even when data isn’t siloed and is technically accessible, banks often struggle to extract actionable insights about customer behavior, preferences, and attributes to inform business, product, and marketing decisions.
According to an oft-cited McKinsey report, the single greatest challenge to personalization is gathering and integrating customer data. Making matters worse, almost half of firms don’t have the in-house talent required to manage and analyze this data effectively. The good news is that the investment pays off. McKinsey found that companies that successfully use data to personalize their marketing can see revenue gains of up to 40 percent. The goal is simple: deliver the right message to the right customer at the right time. Unfortunately, many banks and credit unions still waste marketing dollars on broadly targeted, irrelevant campaigns — for example, offering a mortgage to a customer who already has a competitively priced home loan and no intention of refinancing.
The Age of Value-Based Permissioning Is Here
Permissioned data allows financial institutions to move beyond blunt instruments like credit scores and generic third-party datasets. Instead, banks can work with data that customers explicitly choose to share — enabling more tailored offers, product pricing, and outreach through predictive analytics.
This approach is rooted in a broader shift that began more than a decade ago. In the wake of the 2008 financial crisis, regulators and advocates began pushing for consumer data rights. The result was a growing recognition—reflected in legislation like Section 1033 of the Dodd-Frank Act — that customers should have the ability to control and share their personal financial data. That principle is now shaping the future of financial marketing.
And, MX research shows that consumers are willing to share their data when two conditions are met: if they perceive value and have trust their data is securely protected. Forty-nine percent of U.S. consumers say they freely share their financial data as long as they trust it is securely protected. And, 55% agree they would give their financial provider access to more of their data if they knew it would result in a better experience.
With permissioned data, banks don’t just check a compliance box — they gain a more accurate and dynamic understanding of customer needs. In an era where generic products and marketing no longer perform, this kind of data-driven relevance is becoming essential.
You Can’t Only Create Demand — You Have to Go Find It
To compete effectively for deposits, financial institutions need more than compelling offers — they need a deep, data-driven understanding of who their customers are. That means moving beyond generic targeting and building a better understanding of each consumer that reflects the full spectrum of financial activity and behavior.
MX’s research shows 67% of consumers expect their financial provider to know them and they want their financial providers to use that data to deliver on this expectation:
- 58% agree they expect their financial provider to leverage the data they have about them to personalize their experience.
- 65% agree they expect financial institutions to use the data they have about them to provide them with actionable and clear insights about their finances.
Financial institutions can tap into three primary sources of data to better identify and engage deposit prospects, according to Trent Riddle, Senior Director of Data Products at MX:
Core data is the richest and most underutilized source. It includes transaction history, account usage, and internal customer interactions. Core data is often locked behind layers of compliance. But when accessed and analyzed properly, it can reveal powerful patterns — like which customers don’t have direct deposit set up, signaling an opportunity to deepen the relationship.
Inbound data includes information from external accounts that customers connect through tools like personal financial management or account aggregation services. With permission, banks can gain visibility into broader spending habits, budgeting needs, and financial goals. For instance, if a customer opts in for help managing their finances, permissioned access to outside accounts can enable more relevant product recommendations.
Outbound data refers to the signals banks receive when third-party apps or platforms request access to a customer’s financial data, through open banking protocols. These are real-time indicators of intent — such as a customer shopping for a new credit card or savings account — giving banks a window to respond with timely, competitive offers.
Always Be Onboarding
Too often, financial institutions treat onboarding as a one-time event — something that happens in the first week or month after a customer opens an account. But in today’s competitive landscape, onboarding should be seen as a continuous opportunity to deepen relationships and drive deposit growth.
As Riddle puts it: "Let’s take this data and message consumers in a way that actually induces conversion as opposed to most campaigns, which are often half-hearted, here’s-something-you-could-do offers."
Get Personalization Right for Once!
Personalization in financial services can be transformative. But, it means going beyond understanding the data to drive action.
"Driving better engagement, and ultimately deposits, starts with being able to truly understand your customers," says Billy Gast, Senior Director of Mobile and Experiences Products at MX. "Financial providers need to bring together disparate data into a comprehensive view and leverage it to gain actionable insights. But, having the data is just the beginning — you have to do something with it. Those who can effectively drive that next action will see tremendous results."
Global Credit Union offers a case in point. The credit union partnered with MX to grow revenues and deposits by making it easier for its 750,000 members to set up or switch a direct deposit. Using MX’s Direct Deposit solution, Global Credit Union guided customers through a seamless direct deposit switching process that generated a 40x deposit growth increase within 72 hours compared to the credit union’s previous solution.
"We knew which members would most likely benefit from switching direct deposit and this simple solution allowed us to identify and communicate directly with those members and then provide a quick and easy way to move their direct deposit," said Global’s Chief Operating Officer Elizabeth Pavlas.
Deposit growth is getting harder, but smarter use of data offers a path forward. For banks willing to rethink how they connect with customers, small shifts in strategy can lead to meaningful results.
