Challenge The Norm
It seems like every day there is a new entrant into the FinTech ecosystem trying to innovate within the Financial Service. Everything from KYC to back office to customer satisfaction is being changed. How we work is changing and we are demanding that our banks keep up with this pace of innovation. Sometimes, however, they can’t.
Enter the challenger banks. The new kids on the block. The banks that want to make finance fun, easy and accessible to everyone. With easy to use apps and personal finance management (PFM) platforms built into them there is a great use case to go to a challenger bank. I am a user of EQ and Revolut and love the service I have gotten to date.
It seems like recently everyone is trying to launch their version of a challenger bank and one has to stop and think, is this really for the betterment of the ecosystem? I am a fan of innovative tools and services, especially when it comes to my banking but could challenger banks be doing themselves a discredit by overreaching in this space? Are they causing customers choice fatigue instead of being innovative? Let me explain: a few months ago I wanted to get a second prepaid credit card. After a terrible fraud incident, I felt it was probably a good time to top up my current solution. So I started looking and frankly it was overwhelming. There were almost too many solutions! At the end of the day, I didn’t bother and just stuck with what I currently had. Now, I wondering how many people in the general public do just that. Want to try something new, get overwhelmed and then just give up. It’s not worth their time or energy. So, they stick with the same big five banks and forget about trying something new.
As I constantly watch this ecosystem expand and evolve I think it’s key to remember that not everyone needs to become a bank. Not everyone needs to integrate a credit card or a cash account. Perhaps strategically it does make sense but it is also important to figure out how it will help your core business. Don’t do something just because everyone else is. Make sure it aligns with business priorities and it’s what your customers want, not just what you think they want. Test it, get feedback and then test it again.
Our banking industry is slowly (and I do mean slowly in some cases!) is being revolutionized. It’s changing and growing. This is a good thing, the innovation we are seeing now is going to change and shape the way we bank for the next 20 years at least. Let’s make sure that when we innovate, we innovate to last and that we’re building not for the sake of building but to help improve and make things better.