Make your Multibanking App a Success – Part 2
While we dealt with very practical tips in the first part of the article, this part is about an outlook. I’d like to show you a few trends and developments that you should think about on your way to a successful multibanking app.
#3 Keep going
Once your app is on the market, it is by no means time to sit back and relax. Digital innovations do not take a break. AI, super apps, Internet of Things – the list of buzzwords in banking and finance is long and you can hardly afford to ignore these trends.
Let’s first take a look at the so-called super apps – a trend that is slowly gaining a foothold in Europe.
The best-known example is probably the Chinese app WeChat, which offers – amongst others – payment and banking solutions in addition to classic messaging options. But Google Pay and Apple Pay (both available in the US since 2014 and 2015) have long since ceased to be exotic apps, even though it will probably be a while before it is completely normal to pay your local baker with your smartphone.
In 2019, Amazon introduced its Amazon Pay service and Facebook announced its own cryptocurrency Libra and launched Facebook Pay a little later. In the same year, Apple launched the credit card Apple Card in the USA. For 2020, Google plans to cooperate with Citigroup and the Stanford Federal Credit Union in the USA to offer its own bank accounts. Amazon is also planning a similar collaboration with JP Morgan, as reported in the UNITE BANKEN & FINTECHS 2020 study by the Sparkassen Innovation Hub and EY.
Facebook’s so-called super app strategy seems to be paying off already. At the end of January, the company reported a 31% increase in ad impressions within the last quarter. CEO Mark Zuckerberg believes that this growth is due to the expansion of the main app’s capabilities – it has been expanded to include dating, gaming, Facebook Marketplace, and more.
Zuckerberg also sees great potential in the expansion of payment functions via Facebook. The aim is to offer these as free of charge as possible. In order to achieve this, attractive offers for advertisers are needed, who in turn benefit from a direct payment function on Facebook, as the purchase can be completed directly on Facebook’s platform.
There is another trend in the banking and finance industry which isn’t quite as new but is still only at the beginning of its possibilities.
Artificial intelligence and the Internet of Things have long since found their way into the living room with language assistants like Alexa. These open up completely new possibilities for operation, but at the same time, a completely new field is emerging – the field of conversational banking.
Conversational banking entails the integration of messaging apps – with all their native text, voice and rich format communication capabilities – into a bank’s customer experience. For example, chatbots can answer frequently asked questions, freeing up resources for employees to answer special cases.
Conversational banking entails more than that though. The goal is to communicate with customers through the bank’s own channels, but also to be available exactly where customers are already. This means that customers can stay in their familiar environment and speak their accustomed language, which in turn makes natural language processing extremely important.
The training of chat bots and artificial intelligence becomes a decisive factor between you and your competitors.
Today’s banking customers are very interested in messaging and expect a personalized digital experience. Banks need to increase efficiency and can achieve this by using AI to automate some customer processes.
In addition to new technologies, banks must now also face new competitors. Numerous fintech companies are settling in Germany and abroad and must either be won as partners or kept in mind as competitors.
#4 Fintech vs. Banks – United, not isolated
By the end of 2019, there were already 610 financial start-ups in Germany – 330 of which are core fintechs and 196 are providers of finance-related services and 635 fintechs in the Netherlands. This makes Germany and the Netherlands two of the largest centers of the European fintechs scene.
When the first fintechs entered the market, a discussion was already sparked that continues to this day: will fintechs outstrip the established banks?
Short sprints, agile teams, innovative spirit, courage – all this leads to a much shorter reaction time of fintechs compared to banks with long-standing structures. But why should these banks not take advantage of fintech’s unique features?
According to a study by the Sparkassen Innovation Hub and EY, fintechs are no longer seen exclusively as threatening competition. Rather, the established forces in the financial sector want to exploit synergy potentials and integrate fintechs into their strategic orientation.
The models of collaboration range from cooperation and support programs to investments or M&A, i.e. a complete acquisition of a fintech.
The industry expertise and the trustworthiness of the banks on the one hand and the agility of the fintechs on the other hand complement each other ideally.
The establishment of own digital factories, such as those of Deutsche Bank, is also a method of creating a separate company within the banks for the development and promotion of innovations.
As you can see, especially in today’s world, it’s crucial to stay on the ball and not rest on a recently launched app. Stability and security paired with innovative spirit and courage are attributes that you need on your way to becoming a successful multibanking app.
Think big, because the mere overview of different accounts at different banks will not convince your customers in the long run. The younger generation, in particular, expects smart and easy-to-use apps that score points with intelligent functions and user-friendliness.
If you’d like to find out more about how we support you in developing your digital financial products, please contact us. Together with you, we’ll develop a test concept adapted to your needs.
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About the author
Carl is our expert for the finance, banking, and insurance industry.
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