The mobile banks making customers care about banking

If you’ve spoken to me for longer than fifteen minutes, there’s a good chance you’ve been the recipient of my enthusiastic Monzo elevator pitch. A true millennial cliché, I was once so engrossed in demonstrating the app that I walked into a lamppost. Monzo is one of the new(ish) challenger banks: a branchless, smartphone-only bank that is everything traditional banks aren’t. Others include Starling, Revolut and Atom, and their numbers are growing.

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Monzo in particular was born from a crowdfunding campaign and achieved the fastest equity crowdfunding raised to date – a sure-fire sign that consumers craved something new. The aim of these fintech start-ups is to take the stress and confusion out of everyday financial management and bring it into the smartphone era. As a lover of data, I get a particular thrill from having all that information at my fingertips, but these banks offer so much more than numbers.

Traditional banks take note: here are six ways the mobile banks win with customers.

1. Ease of use

Every day we’re faced with cheerful new headlines reminding us how busy, stressful and demanding our lives are. Hyperbole or not, customers appreciate solutions that alleviate the pressure, particularly when it comes to financial management – not roadblocks that add to it.

  • ·         Living right on your phone with simple yet attractive interfaces, the new mobile banks are impressively easy to use. They require little-to-no effort to get the most out of their features, and tasks like budgeting and saving money are accessible rather than daunting.
  • ·         The account creation process is speedy and painless. Having previously gone through the process of switching banks, this was a comparative joy – though it did require a cringeworthy selfie video for identification purposes.
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2. Instant gratification

Within our always-on society, we chase the dopamine rush of notifications and instant gratification. Mobile banks harness technology to provide immediate access to transaction details, savings, and money transfer.

  • ·         They send real-time notifications each time you use your card, telling you the spend amount and vendor. Any subsequent transactions that day have an extra bit of information: total daily spend. There’s nothing like your phone announcing, “you’ve spent £200 today” to sober you into putting away your card.
  • ·         If a card is lost or stolen, the app allows customers to block it immediately. If it is found, the card can be easily unblocked – otherwise, customers can request another one to be sent the next day. No need for lengthy phone calls, a five-working-day wait for a new card, or the horror of cancelling your card only to find it later.
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3. They’re smart…

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A good service offers customers what they need – a great one offers them something they didn’t even realise they needed. The new banks go above and beyond, collecting data and offering services that can really help with money management.

  • ·         Detailed transaction information can be accessed in a few taps, from monthly category spend to a map that shows you where you were when you made a purchase. They can even display your total spend in Pret since opening your account if you dare to look.
  • ·         Customers can automatically divert a portion of their income into different savings pots, without the need to open additional accounts or set up direct debits. Forecasting can predict whether you’re likely to run out of money before you’re next paid, and bill tracking tells you when your direct debits are higher than usual.

 

4. … But they don’t make customers feel stupid

Customers expect their banks to be smart and trustworthy but are discouraged by masses of incomprehensible information. If customers don’t understand, they won’t engage. 

  • ·         The mobile banks recognise that consumer trust is low, and a lack of accessible information only compounds this. Their tone strikes the right balance between friendly and professional, rather than isolating their customers with jargon. Monzo even have a set of tone-of-voice guidelines that ensure their app, communications, and website are all clear and simple.
  • ·         Not satisfied with making only the necessary information clear, Monzo has released several easy-to-digest financial education articles. Monzo University is in its early stages but is a great exercise in demystifying a difficult topic for consumers.

 

5. Collaboration

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There is often a feeling of disconnect between businesses and customers, particularly in the financial sector. The new challengers involve their customers directly in new features and developments, hinging their business models on a culture of transparency.

  • ·         Online communities sit at the heart of these banks. They encourage customers to propose new features, learn more about the app, find out about events, and chat with other customers and members of the internal teams.
  • ·         Some go further still, with Trello boards sharing details of upcoming features and an estimate of when these are likely to be actioned – the ultimate in transparency. Customers can vote on features they want to see next and the banks consider this in planning their next steps.

 

6. Customer service

Demand for immediacy has also heightened expectations of great customer service. Waiting 48 hours for an email response or listening to hold music is out-dated and unnecessary. Mobile banks offer up-to-date solutions to customer service as well as banking.

  • ·         If you can’t find an answer on the community forum or within the extensive FAQs, in-app live chat allows customers to chat with a member of the team. Replies are swift, and there’s even an option to mark your message as urgent.
  • ·         Overall, interactions are helpful, positive and solutions-focused, which makes their customers feel heard.

 

There are yet more reasons why mobile banks are welcome alternatives (think: easy use abroad) but fundamentally, the challengers are successful because customer experience sits at the core of everything they do. Not convinced? Let Monzo’s recent NPS speak for itself.

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Grace Bowmer, Research Executive

Katie Grundy