CUSTOMER EXPERIENCE: HYBRID PLATFORMS It’s getting personal: But what’s the best technology approach for legacy providers?
, e m ’ e e e ‘S m w o n k Modern payments need to service the needs of users, before even theyknow what they want, says Philipp Baecker, a partner in Bain & Company, and Mambu’s Kunal Galav
Consumers today want that ‘Netflix experience’. They want their products and services to know them and know what they want, before even they do, and payments are no different. The last few years have seen financial services revolutionised by mobile payments, embedded finance and, more recently, buy now, pay later (BNPL) services – a digital revolution only accelerated by the COVID-19 pandemic. But simply providing a quick and efficient solution is no longer enough. “Now what customers are expecting is ‘how can you do something which is for me?’,” says Kunal Galav, who runs the advisory team for EMEA at Cloud banking platform Mambu. “I don’t just want a credit card, I want a credit card that acknowledges who I
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am as a customer – treat me like you know me. So, what banks need is innovation around how products are offered to customers.” Such personalisation, enabled by data, is becoming one of the key drivers for banks’ growth strategies, agrees Philipp Baecker, an expert partner in digital financial services and advanced analytics at management consultants Bain & Company. However, providers need to remain wary of putting technology ahead of the needs of the customer – and not just innovate for innovation’s sake. “I’ve spoken to many people from the industry and you get that quote that ‘we need to become technology-first, mobile-first, AI-first’. Which is all fine but, at the end of the day, it strikes me as a bit of innovation theatre,” he warns. “It’s very easy to get into a situation where you have a solution in search of a problem. But if you start with the customer, you can actually turn it around.” So what, exactly, do customers want today? If the mile-long queues outside any Apple store at each of its latest tech launches are anything to go by, it’s the convenience of having the world in their pocket. They can surf the web, organise
their affairs or see something they like and buy it, at the touch of a smartscreen – meaning banks face a competitive threat also from outside their own sector. “I always use the analogy that, when a bank launches a credit card, there are no customers who line up on the street,” says Galav. “But when somebody launches a new iPhone, there’s always a line of customers. So, I think it’s about that connectivity, being closer to customers, and customer expectations are rapidly changing.” Indeed, super-apps such as Alipay and WeChat are already leading the way in the payments revolution in places such as China and parts of Asia. E-wallet app Alipay also enables users to hail a taxi, get a credit card and buy insurance, while Tencent’s messaging app WeChat facilitates payments, gaming, ride-hailing, and more. In India, Paytm lets users do everything from paying bills to booking cinema tickets and investing in stocks. Europe and the US may currently lack obvious equivalents, but are already seeing the rise of embedded finance, with major retailers such as IKEA and Amazon expanding into the payments space. Meanwhile, the BNPL market is thriving in
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