According to EY study, fintech startups have raised $41.7 billion in the first half of 2018 across the globe. With financial services facing a challenging time, the real question is how to transform and improve consumer experience using technology. In digital era we’re currently living in, consumers want customer-centric and data-driven technology strategy. To meet these demands, fintech startups are expanding the meaning of financial services and completely revolutionizing the whole industry. So, what fintech strategies need to be implemented to transform the consumer experience on the market?
One of the most significant advantages when talking about digital technologies in finance services is its ability to provide personalized experiences for its consumers. The finance sector has never been considered engaging, no matter the service an institution or company was providing to its users. However, now these consumers want applications that have progressive digital and personalized features.
Any finance personalized solution which is based on in-depth consumer behavior analysis will always have a greater chance of success over amazing ideas which excluded consumer habits and preferences. Giving consumers a strongly personalized experience is the fundamental aspect of fintech startups. In order to revolutionize the finance sector, businesses will have to build everything around the consumer. Traditional systems will have to go through a wave of transformation to satisfy users in order to reinforce their role in today’s world.
The crucial factor in creating solutions for financial services around the consumers is rebuilding trust. The finance sector lost a significant amount of trust so rebuilding it will take a lot of time. To eliminate various risks associated with this sector, businesses have to gain trust from their consumers gradually, understand their needs and fears, and create a solution that will ease their lives and decrease negative connotation it had over the past few years.
In a way, financial technologies are an expansion of the consumers’ base. Therefore, analyzing and understanding their needs is crucial. It’s a problem-solving sector where users are not requesting new technologies but are requesting from fintech startups to solve the problems with their solutions. These solutions can revolutionize the financial services industry if they are not based on trust.
Lack of credibility
A lot of fintech startups fail due to their unrealistic assumptions. Lack of credibility and inaccurate interpretation of integration costs are the most common reasons for failure. To ensure the best outcome for a created solution, fintech startups should pay attention when forming pricing models. The first thing to consider is the cost of creating such a solution. To keep all the finances at one place, businesses are using effective tools such as small business budget templates which help with the organization and improve the process of forming prices.
Also, protection of intellectual property is another issue when talking about credibility regarding fintech strategies. Sharing concepts with banks and other financial institutions should be confidential so it can be very challenging to find the balance between sharing and protecting. How much of it actually needs to be shared in certain phases?
Partnership instead of competition
One of the most effective fintech strategies is partnering with financial service institutions instead of competing with them. If consumer problems should be solved with fintech solutions, then all the parties should work in favor of solving these problems. Companies that are not big players in this game don’t have enough resources to invest in technological solutions to improve their services. Consequently, they are partnering with fintech experts who can help them transform their ideas into a customized fintech solution.
All fintech strategies are devoted to one goal, and that is to fix issues within the financial sector. These issues cannot be set if fintech experts and financial institutions will compete with each other. The focus is not on them, it’s on the problem which is waiting to be solved. Even though fintech startups have to know-how, the other side has the experience and regulation knowledge. With these two combined, issues get fixed, and consumers feel satisfied.
Improving the quality of lives
Given all that, there are a lot of challenges the financial services sector has to face. Not to mention that giants like Amazon, Apple, Google, and Facebook are becoming an enormous threat to this uncertain environment. A better consumer experience, lower costs, and increased convenience are what financial sector desperately need. The question is who will deliver these demands to consumers?
If there is a partnership between fintech startup and financial institution or company, there can be excellence in customer experience which will digitally revolutionize financial services. Fintech strategies can differ a lot from one to another as long as their ultimate goal is to deliver the best solution to consumers. In this digital era, innovative ideas combined with digital channels and technologies is what will improve the quality of their lives. In the end, everything is up to the consumers!