Why Fintech Need To Act As Friends Rather Than Just Apps?
Robinhood, a noun that was synonymous with valor, courage, and unconditional financial support to the backward class. However, times have changed and so has its usage.
Let me tell you Robinhood is a trading app developed by two Stanford Alumni. When we came across this, we decided to deeply understand why this name was chosen.
The answer was a number of existing applications missed the humane touch which users felt was a must-have when it is about trusting a brand. The study carried out revealed that first-time-investors are keener towards gathering more knowledge on stocks and various investment strategies whereas experienced investors are more interested in joining an expert community to talk more on investments and have a deeper insight into the already invested stocks through varied graphs and charts.
Robinhood identified this shift and aimed at creating a community in which we have an existing leader and guide everyone around with their learnings and experience. They later aimed at creating algorithmic trading principles based on data and learnings.
However, were they successful? The answer is NO! Many users reported the information being compromised and hence leading to a huge loss of money. Many others revealed that there aren’t enough resources to fall back to for having more insights and others cited the lack of an expert community where they can learn, compete and practice investment together.
Even after so much fame and research, Robinhood failed to earn the confidence of its users. It revealed a new threat to the fintech app users.
The Gamified version of a fintech can make it attractive but lack of comprehensiveness, lack of transparency, and lack of humanized ethics will be detrimental. In fact, a number of users accused Robinhood of “luring young traders and ending them up with devastating results”.
Digital makes things easy to implement and optimize as well. With digital financial revolutionization growing with disruptive technologies like AI & ML, it has also attracted many other consequences which need to be taken care of. Some of the challenges we see are
“Lack of security compliance dampens the fintech market”
“A survey conducted by TopLine Comms on 2000 consumers found that a major 83% were ‘unsure’ of the workings of the fintech companies.”
Despite all the major efforts, we have often heard of fintech failing! Lack of security and absence of regtech is making the situation worse. Numerous reasons come up when we deep dive into the reasons for the failure of Fintechs. But, security often tops the chart.
We always have to come up with a solution, and humanizing fintech apps is one. It is important to talk about failures and accept the loopholes without always suppressing it.
“Make apps empath to humanize fintech”
When we say humanizing fintech apps we don’t mean only embedding human voice in a digital space. It is beyond that! “There are five fundamental pillars on which banking for humanity can be realized such as financial inclusion; financial literacy; financial capabilities for the vulnerable; financial wellness; and promoting sustainability” When companies start taking care of the five pillars, succeeding probability becomes higher.
Applications must act as a source that has empathy and values the money. Ensure you have smart bots and relevant integrations to support users’ capability to manage money better than ever.
“Make it simpler and easier to understand”
In a legacy system, bankers understood the client personas and came up with a solution, which undoubtedly was easier to understand and hence could easily earn the trust of Gen X and Y. But, the challenge is to entice the GenZ, who are more tech-savvy than their previous generation.
The concept of “physical teller” is long lost! But, we need a human factor to make it more humanized, and Fintech apps are expected to behave like them but at a much faster rate with no flaw. Overall, a fintech app is expected to teach financial strategies at layman’s terms!
- Come up with an accurate and clear understanding of the requirements of the target group. Start educating them based on your inferences.
- Delivering a convenient experience through convenient UX.
- Empowering the customers with visualization power of financial management and planning.
Human is an integral part of the financial services industry. Fintech, to date, has found difficulty in earning the trust of the customer in a smaller period. It is hard to gain the confidence of the users with their investments. When fintech is deploying technology to automate the process and deploying AI, ML to collect the customer data, maximum time for tiresome work has been slashed. This spare bandwidth can be utilized in building trust and reliability with the irreplaceable human touch.
The idea should be to ensure lower response time and better CSAT.
“Give bank to the unbanked”
To humanize fintech comes up with a responsibility to act on financial inclusivity. Giving basic banking facilities to the unbanked makes the fintech more human. Fintech can play a major role in financial inclusivity which also makes the app resilient.
A major portion of the informal sector doesn’t have access to the credit and lending facilities of the banks. This is an opportunity for fintech to intervene and give credit lending access to the unbanked. Also, helping them with other fundamental banking activities such as storing, saving, and managing wealth. AI-based fintech deployed to develop a tailored financial product for the “new-to-credit” group thus penetrating the uncharted market segment. Further, it will humanize the app for creating vast opportunities for the unbanked and underbanked.
Beginning of Humanization
In a survey on fintech consumers, it has been found that users are reluctant towards complexity with their money. With advanced technology and the recent rise of numerous fintech services, malpractices have increased at a huge rate. Money being an emotional part of common lives, the transaction becomes an emotional process, and taking chances with it, requires a lot of trustworthy reasons.
Standing out in any segment of fintech services is a bigger challenge and if we think of replacing humans then fintech will be on its halfway success. Humanising the app will not only ensure the highly trusted human touchpoint throughout the customer journey but also enhance the CX. Fintech must develop apps that focus on person-to-person dealings and build stronger relationships through unique customer experiences.
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