All of us, no matter how sophisticated we are with digital financial flows, are on a continual learning journey. Simply put, we typically won’t use a new product or service unless we understand it and trust the technology.
We didn’t wake up one morning and just download Google Pay or Apple Pay, for example. We likely all did our own research, we likely felt more comfortable when banks and financial institutions we trust told us the product was safe and secure, and chances are, we won’t use any new product unless we find it easy to use and convenient.
Financial education as it pertains to financial inclusion should be understood with the same lens. I’ve spoken ad nauseam about two distinct fintech approaches: One builds a shiny new app and tries to lure customers to use it, while the other solves a problem for a customer, builds rapport and trust, and then grows with the customer. The latter process, by its very nature, builds education into every interaction with a customer.
The second approach requires tackling financial education in bite-sized, digestible chunks that are relevant and accessible. Naturally, it starts with what I would call a base layer – introducing formal education channels. These, too, need to be accessible.
A fintech firm needs to be sensitive to the fact that it will need to overcome an inertia of resistance born from a sense of trepidation.
How does this look? For example, on our WhatsApp channel, a menu item called Money Matters consists of formal content that people can access. This can take a number of different shapes and forms, and different businesses have come up with wonderful initiatives. The point is, it provides a layer of understanding, access to knowledge and awareness.
This can expand to campaigns. For example, leading up to the Christmas period, a fintech firm may send out communication with basic safety information, such as keeping PINs safe and not sharing personal information.
In more digitally sophisticated markets such as South Africa, communication may be centred around insurance, the commitment to instalments and where the value of taking out insurance lies. Education should be tailored for specific audiences.
However, real education happens when people engage with a product; when they use it. So, financial education should be a thread that is woven into every engagement with customers.
In the fintech world this is vital, because the vast majority of customers start out in an over-the-counter, cash-to-cash world that is unregulated. This doesn't mean they are unsophisticated, rather it means they are used to transacting in a certain manner.
The golden thread of education, then, needs to be present at every touchpoint to help a customer make the transition to the digital world.
I can remember the trepidation I had when I logged onto my bank’s website for the first time in 2002 and used online banking. There was most certainly a degree of anxiety related to trying something different, even foreign, especially when it had to do with my hard-earned money.
Underserved communities deal with these same emotions and so the question should be: How do we ease the anxiety and build trust?
When embedding the education golden thread, a fintech firm needs to be sensitive to the fact that it will need to overcome an inertia of resistance born from a sense of trepidation. However, this inertia can be overcome by ensuring a product is accessible, both in terms of solving the problems customers need solved, and by designing products in a way that they are likely to be used.
Fintech companies are bound by licences and regulation to ensure their customers know what they are using. We have a duty of care to ensure we provide them with the appropriate information.
Staff need to be trained on all channels and contact centres should be constantly going through training. Field ambassadors must make sure they can educate customers about the product. However, the biggest philosophical bent is to try, fail and learn, and by doing so, constantly learn what customers need, to design the education strategy accordingly.
How does this process look in the real world? It requires less trust to send money to another person than storing all your money digitally.
So, when a customer approaches a fintech firm to send money, they are often interacting with digital channels for the first time. Because the transfer is instant, they are getting rapid validation and a reinforcing feedback loop – the person on the other end messages and says: “I got the money.”
This creates a positive trust flywheel that then enables customers to learn and educate themselves over time that there are other services and products they can access on a platform they already trust.
A question at this point may well be around measurement. How does the fintech company know its education strategies are working? If the digital ecosystem has grown exponentially, this is crystal-clear proof that customers understand what they are doing, that they are comfortable doing it and they trust the platform.
Fintech firms have a crucial role to play in including millions of people in the digital ecosystem. Taking the time to understand customers, and walking with them on an incremental journey of education and trust, is the surest way to get it right.
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