But while hipster 20-somethings celebrate the new functionality of these products and the impact on their lives, we should not lose sight of the fact that for this revolution to truly take hold, product advances must serve all consumers, not just tech-savvy early adopters.
Meeting this challenge will undoubtedly be tricky for the payments and banking sector. However, by understanding how consumers engage with financial services products, and how these differ vastly by capability, age and demographic, we can ensure that products are developed with universal benefit.
As the Director of Product and Strategy at Bacs I direct the Current Account Switch Service (Cass). We have been looking closely at our work on financial inclusion over the last two years. The 2016 Competition and Markets Authority report found that Cass was operationally highly successful (with nearly five million switches now completed) but we also accepted undertakings to ensure the benefits of the switching service could be enjoyed by all consumers.
"Hipsters celebrate new products, but advances must serve all consumers, not just tech-savvy early adopters"
To do this we have worked hard to understand the needs and behaviour of all of our different audiences and developed marketing and advertising materials not only reach them but also to give them the confidence to engage with their financial provider and review their options. In particular, we have conducted extensive research into the 18-24 age group and individuals who are financially disadvantaged.
From this research we have developed a whole new engagement approach. We designed tailored messages for younger audiences that highlighted the range of benefits available if they were to switch bank accounts. In addition, we expanded our marketing efforts to include platforms such as Snapchat. Based on this work, we have already undertaken targeted activity, achieving a 10 per cent uplift in awareness of switching amongst 18-24-year-olds and creating one of the best performing Snapchat lenses of 2017.
We believe the lessons from this work have wider applicability. No doubt fintech start-ups can gain market share with an interesting product and an app with an appealing user interface. But to really help all groups and improve financial services for everyday consumers, we believe financial organisations should do more—independently and collectively— to understand the different types of financial services that exist, and how products should be tailored to this emerging market.
Technology clearly has vast potential in our sector. However, we need to recognise that not all consumers are homogenous and work to tailor products accordingly. In doing this we will ensure that the products of the fintech sector aren’t just the preserve of early tech-savvy adopters and that we do truly move to a market of more inclusive products with wider societal benefits.
Read more from our financial inclusion supplementBanking on Change is a publication which examines how we can develop a comprehensive policy approach towards financial inclusion. The report features contributions from the likes of John Glen MP, Peter Dowd MP, Anne Pieckielon, Chris Pond and Guy Opperman MP.To find out more about how you can become involved in Prospect’s thought leadership programmes, please contact saskia.abdoh@prospect-magazine.co.uk.If you want to learn more about you can download the whole Banking on Change report as a fully designed PDF document. To do so, simply enter your email below. You’ll receive your copy completely free—within minutes. [prosform fields="email,forename,surname" signupcode="Banking" countrycode="GB" redirect="other/banking-on-change-is-yours"]When you sign up for this free report, you will also join our free Prospect newsletter.Prospect takes your privacy seriously. We promise never to rent or sell your e-mail address to any third party. You can unsubscribe from the Prospect newsletter at any time.