10 Ways Fintechs Use Experience Design to Surpass Banking

10 Ways Fintechs Use Experience Design to Surpass Banking

Last Updated on August 11, 2021

Malaysia’s landscape of fintech is booming, and it’s even surpassing banking. Fintech companies place a lot of importance and emphasis on usability, ensuring that their users receive the best user experience possible.

Fintechs Map - Malaysia 2021
Source: Fintech News Malaysia

Only several years ago, I used to always prefer cash; but now every time I pay, I ask if e-wallet is accepted because it is so much more convenient. Not to mention, it is also contactless and a better way to manage my finances since I can easily track how much I’ve spent just by looking at my phone.

It’s no secret that fintechs tend to place a huge emphasis on delivering the best user experience for their customers, and that emphasis has often led to an exponential growth in their customer base and reach. But that’s only the tip of the iceberg for the power of financial UX design, the true power of UX comes from weaving that into a company’s DNA. Great UX design for banking and financial service is a methodology, not an app package.

Fintech in South East Asia is growing immensely, in fact, the digital economy’s contribution to Malaysia’s GDP reached 20% in 2020. Internet banking in Malaysia has quadrupled in the recent decade, with an increase of over 100% usage rate in 2020 with digital payments and e-wallets leading the Malaysian fintech landscape.

Fintechs Space - Malaysia

Mobile banking and e-money has also recorded the fastest growth pace in 2020, with MCO being the catalyst for this digital transformation where users quickly opted for cashless and contactless payment options.

Fintechs Growth - Malaysia
Source: Fintech News Malaysia

Here are 10 ways that Fintechs Use Experience Design to Surpass Banking:

1. Design is a methodology, not an output or product

There is an unfortunate train of thought in the traditional banking industry that thinks “design is just the logo and the colours for a company.”

For fintechs, design is a customer-centric business model and methodology. Good design drives decisions in a company, rather than as a last-minute addition once everything has been decided. In this digital age; fintechs put the customer front and center of their entire business process, from development to culture setting and the way that the team thinks and acts.

2. Allow UX design to influence beyond skin deep

Even if a bank hires the most talented UX designer in the world with years of experience, that individual will likely find their hands tied by branding guides, tones of voice docs, and other policy and guideline documents. This leaves UX skin deep, only able to influence visual appearance and aesthetics. Everything has been decided and they only provide the topcoat.

Fintech designers, on the other hand, are facilitators, they empower business processes, they ideate and implement customer-centric thinking into the product development, they teach and guide colleagues into becoming advocates for the customer, they shape culture so that a company’s DNA is truly focused on users.

3. Putting Resources in Customer Experience not Marketing

There are two ways to attract digital customers. One is to put all your budget and effort into large-scale marketing and advertising campaigns, and banks tend to do that.

Alternatively, fintechs build a valued based community around outstanding user and brand experience. Their main aim is to help customers enjoy and delight in the product, rather than twist their arm and convince them. In this scenario, your customers become your greatest growth asset as they advocate for you and it pays off long term in customer loyalty and referrals.

4. Add Value to Customers’ Needs

Consider the question “Why do banks provide banking services?”  Sadly far too many banks exist with the sole purpose of generating profit for shareholders, without real consideration for their customers’ needs.

On the other hand, fintech companies have to remain highly authentic and competitive to save their business from the “Red Ocean”. They labour to address pain points in customer interactions with the banks, and work to enrich customers’ daily lives.  There is no one-size-fit-all mentality, instead, a digital banking experience is crafted to create positive emotions and long term loyalty.

5. Not resting on legacy or history

“Adapt to survive” a term made famous by Charles Darwin. He was talking about nature, but the principle holds true to banking as well.

The world is moving at an increasing pace, those who can react quickly and courageously, keep their customers. While others, trapped in protecting a legacy, stumble and fail. Far too often, banks look back at how “things have always been done” and won’t/can’t change. History and legacy is an important asset, but can quickly become dead weight if held on too tightly.

Fintechs’ growth can be attributed to their ability to remove obsolete practices and adopt user-centric business processes. In other words, they adapt quickly responding to the needs of their customer and the changes in digital trends.

6. From product to ecosystem

Banks sometimes make the mistake of trying to digitize their products one at a time rather than holistically. This could be driven by necessity or perceived efficiency or asking different teams to work on their own products. This creates silos and fragmentation, leading to a broken customer experience.

In reality, users perceive a banking service as one whole interaction, not separate products and elements. Fragmentation leads to bad UX and breaks the user experience journey, leading to frustration.

On the other hand, fintech teams work together to improve the customer experience, connecting all their products into a single, united, user-centric ecosystem.

7. Emphasis on UX Research

Banks focus on delivering a diverse product range, believing customers will fall into one of its many offerings. Whereas fintech focuses on the users themselves.

Mobile banking apps made without user research is a recipe for disaster, you cannot meet the needs of the people if you don’t know what the problems they face are. Fintechs focus on UX research to create a solution that delivers value to their customers. The process doesn’t end after the app launch either, they continue to gather user feedback through social media, forums, Google Play, and App Store to deliver continuous improvements to their products.

8. Streamline functionality and products

Banks often have this mentality that “more is more”, the more products and functionality that they can put onto the market, the more chances of creating profit. It is like throwing a net far and wide in the hopes that something will catch. In fact, the opposite is true, having so many options confuses the customer and leads to decision paralysis.

Fintech offers fewer functions but provides a solution for user needs instead, they curate each feature and remove those that have no added value for their users. Users are able to approach fintech products having a clear goal in mind what the product will help them achieve.

9. Monitor Success through Quality not Quantity

Success is defined depending on how you measure it. If banks focused on the number of interface screens the UX designer churned out each day, then having high quantities of design output would appear to be successful, in the short term. But quality is often sacrificed for speed and quantity.

Fintechs break that mentality and focus on delivering an intuitive banking experience instead of trying to be first to market. They are careful and considerate about every element on the screen to make sure it is a cohesive whole and delivers value to their customers.

In the long term, poor design could lead to a bank’s support team receiving thousands of calls about similar struggles on their digital platform downstream, or customers giving up altogether. This in itself will create more cost for customer support and worst still, it tarnishes the bank’s reputation.

10. Hit the Heart not the Head

No matter how people deny it, humans are emotional creatures and they make many decisions based on the heart, not the head. Banks miss a trick when they front-load their products with head knowledge and miss engaging with the customers’ hearts.

Emotional connection is the key to drawing in customers and building brand loyalty for fintech companies. They create a delightful experience, demonstrating that they care deeply for their customers and connect with them on an emotional level. Connect with users by putting a pause on self-promoting information and product descriptions to their customers, and instead shift the focus to engaging the heart of users.

Summary

If companies really focus to form their culture and mission on human-centricity and developing a great user experience, its authenticity and quality will attract customers like a magnet and ensure a growing and successful business.

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