How Changing Consumer Needs Are Shaping Financial Services

Technological innovation led by fintech companies is shaping consumer expectations and demands in the financial industry. Banking customers want better service and optimized convenience when dealing with their finances, and they know technology can provide them with that. These expectations and demands are forcing banks to innovate their financial services to keep their customers satisfied. The majority of banks are turning to fintech companies for new tools and services to evolve their service to meet these current needs:

 Optimized Convenience

 A survey conducted by the DMA (Data & Marketing Association) found that four in 10 banking customers named convenience as a top reason for staying with their bank. The rapid rise of mobile banking clearly indicates that consumers want banking services at the touch of a button. Mobile banking is just one service in the financial industry that caters to consumers’ on-demand lifestyle. The fact that financial services are quickly evolving to provide customers with real-time information in a moment’s notice shows that consumer expectations of convenience are being continually redesigned. Consumers want information at their fingertips in seconds that traditional financial services don’t provide them with. The DMA’s survey also asked how interested consumers would be in a service that verified their I.D. through face recognition so they wouldn’t have to remember a password. Half of consumers reported that they are interested in using facial recognition, which further shows the consumer’s need for ease.

 Personalized Control

 Technological innovation that automate services and eliminate the burden of financial management are also of interest to consumers. Consumers are looking to their banks to help them stay on top of their finances. The DMA report states, “The search for control is an overarching driver that affects consumer behavior; across many areas of consumption, the pressure to navigate the daily challenges of budgeting desirably, working efficiently, using free time optimally places control as a central aspiration of consumers today” (16). Consumers are interested in tools that will keep them on track to meet their goals. In financial services, customers have control with the use of automation and customer data. Banks can also create a bond with consumers and provide them with personalized advice to help them feel in control of their finances.

 Banking Solutions With Human Touch

It is evident that customers want a digital banking experience, but the need for human touch hasn’t been completely eliminated. Consumers still value customer service, thus banks must humanize digital touchpoint ID and broaden the services available to customers digitally. The DMA examined the interest of different generations of artificial intelligence in banking services, and found that the youngest consumers aged 16-24 were most interested, particularly in services that are available by chat messenger platforms, compared to using voice commands. This may suggest that in the future, consumers will push for more Artificial Intelligence implementation in financial services without the complete loss of human touch.

 Rewards

 Consumers are looking for more reward and recognition from banks they are loyal to. This developing expectation expresses a wider change in the customer mindset. They are seeking more reciprocal relationships with brands and companies they engage with. Where customers can influence brands and be rewarded in transparent ways, we can see the future of customer brand engagement.

 Millennials need for a digital experience is driving these changes in the financial industry. As they take a more significant place in the economy, we can expect these needs to only grow stronger. Banks need to evolve their services to meet the demands of the modern market by making their services easier, personalized, and more rewarding.

Author: Whitney Besser

 

Works Cited

The DMA. Talking the consumer’s language: financial services 2016. Rep. The DMA, 2016. Web.

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