The Quest for a One-Stop Shop Financial App
One result of the furious competition between financial institutions and their fintech rivals is the drive towards building a comprehensive, one-stop shop application for mobile. Rather than just offering consumers the opportunity to use a company’s products and services on mobile, there is a push to retain customer loyalty with bundled ecosystems that offer more than just traditional banking, including items that are not traditionally in the purview of financial institutions.
Who else is pursuing this quest?
Consumers are looking for apps that combine and clarify all their financial decisions, especially when it comes to handling banking needs, investing, shopping, financial education and even big purchasing decisions like home and auto. In October of 2018, Bank of America unveiled their one-stop-shop app that enables users to not only manage their bank account, but also quickly check investing services. Meanwhile, Square is reportedly considering adding additional features to its P2P payment app that would offer traditional banking services.
Fintech firms have been remarkably quick when it comes to identifying what functions consumers want on an app and deploying those apps into the marketplace. However, many analysts now say that with big tech companies poised to enter financial services, the threat to traditional financial institutions have heightened.
Banks and credit unions are now facing the reality that consumers are increasingly likely to buy financial products from tech companies. According to an international retail banking customer loyalty survey by Bain & Company, 73 percent of Americans aged 18 to 34 say they are willing to switch to a tech company for their financial needs. And millennials aren’t the only ones who are so inclined: 61 percent of those aged 35 to 54 also agree.
Meanwhile, consumer trust and confidence in tech companies is rising. Part of this can be attributed to the perception of “digital lag” in financial institutions by consumers, especially millennials. Fintech and bit tech companies are quicker to jump on integrating new technologies, such as voice assistants like Alexa. This could mean all the difference to financial institutions hoping to retain their customer base. The Bain survey found that 27 percent of US consumers already use voice assistance on their mobile phone, yet many banks and credit unions have yet to come around to utilizing the technology.
Where banking institutions fall short
Consumers believe the current digital channels offered by their financial institutions fall short. A recent survey of UK consumers found only 25 percent of respondents felt their banking app serviced all their needs, and only 34 percent considered it easy to use.
Financial institutions need to take a deep look at their websites and mobile apps and look for ways to make the customer experience easier. If given a choice, many consumers would prefer one convenient channel for everyday banking, not several.
To hone in on what their members are looking for in mobile banking capabilities, credit unions should pay attention to their behaviours at branches, on social media, and on the credit union website. What are their technology use habits? What are their pain points? If they use an existing mobile app, why and when do they visit a branch? Answering these questions will lead to insights and answers on how their mobile experience can be improved and their loyalty improved.
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