Which fintech innovations are really adding value to customers?
Financial services, of all sectors, has seen some of the most significant technology innovations in recent years. Banks and insurance companies have been very keen to leverage technology in such a way that is mutually beneficial to both vendor and consumer, and now even superannuation is getting involved in the technology revolution.
While there is a lot of innovation happening for the sake of it, not all of it is useful for the end user. It sounds simple, but what we learned as we developed our automated SMSF solution is a lesson that a lot of other financial services apps seem to forget at times; good design principles that keep the customer in mind ahead of the benefits to the company result in applications that offer value to both.
1)Technology should be adding more value to the consumer rather than the vendor. Technology allows us to collect all kinds of data on our customers, and then leverage that to improve our “sell” to them. From demographic data through to behavioural patterns, financial services organisations now hold a lot of customer data. But as we’ve seen, there’s a tipping point where customers feel like the data being gathered is more beneficial to the vendor than themselves — in the insurance space, for example, tracking devices in vehicles has become a tough sell.
2)Technology should simplify customer management of finances. Depending on who you speak to in the consumer finance space, there are too many vendors doing too many things with their apps. Some banks offer multiple applications for different interactions that the customer might have with the bank. Apple and Google both have wallets of their own, and then there’s third party applications like Acorns and PayPal that many are playing around with. For some consumers it’s simply too much to manage, and that defeats the purpose of technology in the first place; it should be about making management of finances easier and more efficient.
3)Technology should be secure. There are still some inhibitions that people have in adopting leading-edge technologies, such as the ability to tap a phone to a payment terminal when making a purchase. It’s not necessarily the case that this payment method is less secure than cards or cash, rather, it shows a hesitancy in adopting new technology until security can be proven. Conversely, any financial services app that can’t demonstrate security is one in which customers will feel like it doesn’t add value.
4)Technology should be easy to use. More key than anything else, of course, is that the original purpose of technology isn’t lost in the desire to be innovative with it. Technology exists as a means to an end, and not the end itself. Often, when an application fails to gain the kind of traction that the developers expect, it’s because the app failed to be more convenient or easy to use than the “old way” of doing things.
In some ways, financial services — especially superannuation — has been restricted in what it has been able to do with technology. Regulation has restricted what has been possible — ultimately to the detriment of consumers. Increasingly, technology is being turned to greater and greater innovation, and those involved in financial services should remember that, ultimately, the technology does need to be in the service of the customer.
Source: Which fintech innovations are really adding value to customers? – The Australian