Our financial sector has come a long way from where it was a decade ago.
Authored by Zafar Imam
Our financial sector has come a long way from where it was a decade ago. Back then, the processing of anything from a 'new bank account’ to ‘loan application’ took anywhere from several weeks to months. Even something as simple as a ‘cash withdrawal could easily take a few hours – half an hour on your lucky days.
Apart from the physical effort of going to the bank, you had to fill a withdrawal slip, receive your token, and then wait and watch as the slip passed from counter to counter, stamp after stamp, before finally stopping at the cashier. In fact, tokens were a big innovation that saved people from standing in long queues.
Today, we apply for a personal loan with a few quick clicks and swipes from the comfort of our homes. The application is approved and the money gets credited in a few minutes. We later make a transaction at a roadside vendor with a ‘ding’ sound on our payments app. To someone from the decade-ago period, all of this must feel nothing short of magic. But then, technology is magical. And, with the push from the FinTech segment, it continues to be more so with every passing day.
So, let us have a look at how FinTech players are making services increasingly customer-centric in an era of fast-paced technological advancements, especially with a strong focus on lending.
Tech-ing up the Mantle: The Rise of a Tech-driven Era in Lending
Customer experience is presently a key focus in the FinTech segment. As we all know the customer is the king. Leveraging their technological approach, FinTech players are simply adorning their kings with the ‘new gold’, oft-cited as data. The approach is straightforward.
New products and services must be customer-driven to the very extent possible, with a more prominent degree of convenience. Anything less than that will not pull in or hold the crowd.
Here, simplicity, comfort, and personalization play a key role. For instance, the majority of the data (or ‘information’) is easily available via digital channels. Some of these digital channels include GST APIs, the Aadhaar database, and alternate data repositories. In other words, everything from the name of the applicant to the physical address and even the tax-filing detail is easily available to a lender.
And, this information is made available via the verified sources. Then, it makes little to no sense to ask them all over again during the loan application. If you’d extend customer a touch-of-a-button experience, they will just click.
So, when you facilitate a quick and easy-to-understand buying experience with a consistent checkout, it's more likely that the customers will pick you. Our millennial generation, which is known for its unique and demanding attributes, is now also predominantly in the workforce.
An Accenture survey states that 68 percent of millennials demand an integrated and seamless experience irrespective of the channel that they are on. 60 percent of millennials also said they will continue purchasing from a brand ‘if treated well through customer-centric experiences’.
Where conventional institutions are lacking is that they are not adjusting to such youthful customer needs and desires. That is because conventional organizations aren't prepared for a mechanical upheaval at this point. So, millennials seek new solutions outside of traditional banks.
FinTech is one of these ventures where customers get a quick response, especially when it comes to payments.
There’s no space for mistakes and unresponsive customer service. The FinTech forte is to make financial services a lot less complex and more open to customers. Buyers ought to get what they need – and with the touch-of-a-button experience.
Tech-ing it a notch above
Technology is helping FinTech lenders to foster deeper relationships with their customers. For example, chatbots and virtual assistants are today driving customer awareness. The tech-driven approach enables lenders to fetch back-end data (a user’s geography, preferred language, past transactions, historic interactions, etc.) and resolve relevant queries optimally. They can even cross-sell products and services leveraging avant-garde technologies such as Artificial Intelligence. So much so that even financial institutions have started partnering with FinTech platforms to tap their technological framework.
Gradually, we are also observing the move towards open banking – which will pave the way for a superior corporation between traditional FIs and FinTech platforms for wide-ranging use cases. It will further give rise to more economical and targeted services.
The future surely looks promising!
Zafar Imam is CEO of Finshell. Views are personal
First Published: IST