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Three things fintech gets wrong about customer support

Fintech products are gaining popularity and pose real competition to traditional banking. According to the 2019 FIS PACE study, 73% of consumer banking interactions are digital. Fintech startups have already raised a record $100M in Q2 2020 and, apparently, have cracked the secret to success — better CX and personalized customer service.

Direct-to-consumer banks have the highest consumer satisfaction outpacing credit unions. Digital banks also have the lowest rate of customer churn. 

While only half of the customers from the banking sector believe they received consumer-centric service, the same indicator reaches over 80% for fintech. 

Yet good can always be better. 

There are three mistakes most fintech companies make while setting customer support service. By avoiding them, businesses can stand out in both the traditional and digital banking sectors. 

1. Investing in tech rather than people

Tech solutions made banking accessible and drove consumers to fintech products in the first place.  However, when it comes to communicating with customers the rule of thumb is not to overdo with tech. Retaining “a human touch” is one of the biggest challenges fintech companies face, but they keep investing in tech-enhanced solutions rather than people. 

Recently, Robinhood’s customers were unable to reach a representative over the phone to report that their accounts had been hacked. They were left waiting for emails from support that would take days to arrive. Such a basic customer service channel as a phone line was not considered important for one of the biggest fintech companies in the US. This situation demonstrates that people still need to talk to a real person when it comes to handling financial issues. It doesn’t matter how small or big the business, or how tech-savvy the customers — talking to humans is still important.

Tip: If you plan to shut down your phone lines and switch completely to online customer support channels, think again. Fintech companies deal with a lot of sensitive information. The level of anxiety among customers is higher than usual. Our data indicate that during COVID-19 people started calling more regarding issues that could have been handled online — just to make sure their problems were definitely resolved.

In order to excel in customer support, don’t leave your customers in a state of uncertainty. Provide them with an option to talk to a person. Not a chatbot, not a virtual assistant, and not an email. A person.

2. Relying only on in-house support

Outsourcing is not new for fintech: as many as 20% of startups outsource their technology needs while another 65% are considering outsourcing in the near future. However, most of it is focused on programming and development, while outsourced customer support is still considered a compromise on quality and a higher security risk. 

No doubt, building an in-house customer support department gives businesses greater control over the process and direct access to customers’ insights. It’s especially important when your product is still in development.

But as operations grow, expanding an in-house customer support team may actually reduce its quality since it’s time-consuming and expensive. At some point, demand will exceed the in-house team’s capabilities and cause an increase in handling time. Outsourcing will enable fast team scalability and will save you from an operational headache. 

Tip: since fintech has especially high security standards, make sure an outsourced provider meets them. Nowadays there are multiple certifications that guarantee data protection by third parties. The most common is ISO 27001. However, to deal with payments, the provider should have a PCI Level 1 certification, developed by payment systems themselves.

3. Overestimating the level of product adoption

Millennials are the largest target demographic for fintech products since they’re more likely to adopt tech solutions. But companies should not assume that customers will figure out the way to use financial products easily and without confusion. 

Overall customer adoption of fintech products is 33% which mostly refers to payments and money transfer services. Financial planning, insurance and borrowing have lower adoption rates — 10-24%. 

Moreover, millennials aren’t the only group of people using fintech products. 64% of consumers use two or more fintech products, and some of them may need more guidance than others. Companies should not forget to invest in educating their users and explaining how to use the product. Ignoring this will lead to an increase in customer support expenses. 

Tip: One way to avoid unnecessary customer service inquiries is to invest in self-service tools: tutorials, explanatory videos, clear instructions, comprehensive FAQ section, and chatbots. Also, make sure your customer support reps are well-trained to deal with the technical complexity of the product and can explain it to customers in a simple way. 

Mastering customer service with a human face is something fintech startups should commit to in 2021. No matter how tech advanced the product is, human interaction is still crucial in customer service, especially for the industry dealing with a sensitive matter of money. 

Photo by Arlington Research on Unsplash
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Comments: (4)

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 16 March, 2021, 15:39Be the first to give this comment the thumbs up 0 likes

This post makes the assumption that fintechs want to provide good customer support. Going by the examples of PayPal, Robinhood, et al, that's a flawed assumption.

ICYMI, Reid Hoffman, one of the cofounders of PayPal and Linkedin, wrote a book on so-called Blitzscaling in which he actually advocates blitzscaling startups to ignore customer supportHe also gave the following tips in his interview with HBR: Prioritize areas that will result in funding; hire from Tier-1 colleges; use heuristics not rules; half knowledge works; ignore customer service, employee unhappiness, chaos and inefficiency.

I'm guessing fintechs are exactly following that playbook, so customer support is not likely to be high on their agenda.

Daria Leshchenko
Daria Leshchenko - SupportYourApp - Kyiv 17 March, 2021, 17:53Be the first to give this comment the thumbs up 0 likes

Ketharaman, thank you for your feedback! 

I think your point is very interesting and applies to some companies, not only in fintech. However, sooner or later businesses face a challenge of customer retention. That’s when customer support kicks in as a great tool and a real necessity. 

Are there companies out there who still don’t care about supporting their customers? Definitely. 

But we have plenty of clients, from fintech as well, who prioritize their customers and invest in their positive experience. They see great returns on those investments and, I believe, with a growing competition in fintech industry, CX and support will become a major competitive advantage. 

It’s fascinating to see what’s happening in the industry and how different businesses apply different strategies. Let’s see which one proves to be more successful! 

 

Michael Kyritsis
Michael Kyritsis - ACI - London 22 March, 2021, 13:06Be the first to give this comment the thumbs up 0 likes

Interesting data but wrong conclusion on point 1 "Our data indicate that during COVID-19 people started calling more regarding issues that could have been handled online — just to make sure their problems were definitely resolved." The conclusion that companies should hire more people that their customers can talk to doesn't solve the problem, which is that customers are fed up with generic answers like "your issue has been recorded and we're doing all we can to address it". Whether that comes from a chatbot, or whether someone reads it out to me from a script over the phone, it's not going to give me much assurance. Technology needs to enable meaningful communication from real people. e.g. The CSR should tell me "on average its taking 2 to 3 days before an engineer can look into your issue". And communication channels need to be kept open, e.g. the engineer should be able to add a note to the issue which sends me an email. 

Daria Leshchenko
Daria Leshchenko - SupportYourApp - Kyiv 22 March, 2021, 21:42Be the first to give this comment the thumbs up 0 likes

Hi Michael, 

thank you for your comment. I think your observation si generally spot-on: if your communication is not clear, the phone won’t make it better but will become another channel for uncertainty. But what if the demand for personal communication is not unclarity but the nature of business and peculiarity of human behaivor?

In our case, many customers called to postpone their regular payments. A basic action that could be done (and had been, before COVID-19) online. But after the first lay-offs took place, customers became more sensitive and uncertain about their financial future. They could not afford any room for mistakes and had to make sure their payments indeed were postponed. All this could be done online via an app, email or live chat. But in the attempt to reduce the amount of uncertainty in their lives, people decided to call and get a confirmation of their action from another human. 

A study by Genesys about the role of empathy in customer service indicates that people use the phone to contact customer service when they are in a heightened emotional state much more (in 56% of cases) than live chat (15%) or email (10%). Why? Because a conversation with a representative brings the feeling of personal accountability, reassurance and guarantee. It also allows customers to express their feelings and get a required level of empathy from representatives.

My point for the article was that fintech deals with a very sensitive topic of money. It’s something that makes people worry and double check everything. The level in anxiety among fintech customers is higher than for many other industries. Hence, fintech needs to address customers’ requirements for the level of empathy and desirable channels of communication. Phone is a direct channel that gives an opportunity for an immediate two-ways communication. No matter how technically enhanced our systems may be, many people still want to talk and hear from another real person on that side of the line. 

 

Daria Leshchenko

Daria Leshchenko

CEO

SupportYourApp

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28 Jan

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Kyiv

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Customer Service 2015-2019-2025

In the industry of customer service how it will grow nowadays. How was it in past and how it will become in future. Sharing innovative ideas about customer services like call centres, phone answering, business process outsourcing, lead generation, verification service, chat support etc.


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