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The state of mobile finance in 2021: growth trends and strategies

By Saurabh Madan, general manager, SEA & ANZ

June 28, 2021 | 7 min read

Mobile finance has been booming and new brands are emerging all the time. Saurabh Madan, general manager, SEA & ANZ, MoEngage defines the trends and strategies that can help brands keep customers engaged.


More than 4.3 billion fintech apps were downloaded between September 2019 and August 2020, and numbers are only trending upwards as banks accelerate the switch to digital and new fintech players enter the market.

A recent study by Citi showed that mobile banking apps rank third behind social media and weather among the most used apps. In 2020, digital banking witnessed rapid consumer adoption, and financial services globally are reevaluating their tech stacks and assessing the best tools to reach the growing digital demands of their customers.

Countries in Asia such as Indonesia and Vietnam are leading the digital-first, fintech charge due to low market saturation, a large pool of unbanked users, and other demographic factors. In these markets, fintech is seen less as a disruptor and more as fulfilling a need that most traditional banks don't address. These fintech apps have forever changed user behavior and are expected to have a long-term impact on how users interact and engage with businesses.

For example, Kredivo, a buy-now-pay-later platform and a leading fintech player in Indonesia, helps users maintain purchasing power with access to credit at a low cost. “From a user behavioral point of view, it is interesting to note the receptiveness to new payment and alternative lending methods like buy now pay later across all age groups," said Alethia Tan, Head of Growth, Kredivo while speaking to MoEngage.

Providing users with the right information at the right time and on the right channel is the key to meaningful engagement and encouraging product usage. The kind of media, content, and channels that Kredivo uses to engage different age groups varies. In fact, there are differences even within the same age demographic. Data analytics-backed insights play a crucial role in determining how to engage users. For example, while targeting baby boomers, it is imperative to understand their financial preferences and incentivize purchase intent by ensuring the right information is being conveyed.

Visa is another organization that sees a massive opportunity for fintech in areas like payment flows, community banking, and gamification.

Speaking to MoEngage, AJ Shanley, Head of North America for Visa, said, "We really see two trends driving everything. One is the unbundling and re-bundling of services, where a company starts with very differentiated offerings and gradually incorporates traditional banking offerings. The second is the proliferation of banking as a service. Everything is just one API away. This essentially means fintechs can experiment quickly without having to build everything from scratch and instead tap into APIs to get to market faster."

Successful growth strategies from leading mobile finance brands

Building a product that people love to use is especially difficult if organizations don’t have a thorough understanding of the intended demographic. Here are some actionable strategies and real-world use cases from top global financial institutions that you can emulate:

Pre-launch promotion to boost mobile app adoption and usage

For financial institutions, building trust is everything. With users' financial information at stake, moving too quickly isn't a good idea. The leaders in this space work to build a basic services layer and add more as they earn the trust of customers and develop content that showcases authority and builds credibility. The seeds of future success are sown way before any product launch. Hence, extensive promotion is required to build a brand perception and generate social proof among target demographics.

Fine-tune product design according to your user demographic

In the mobile finance and fintech space, product design can build or erase credibility and trust. For example, a sign-in page with broken elements and outdated design breeds distrust among users. Research conducted by Stanford's BJ Fogg revealed that design was extremely crucial to the credibility and trustworthiness of a website. Further drilling down into the finance vertical revealed design to be the most important consideration for the finance category, beating search engines, travel, and sports, among others.

Reduce acquisition costs through a combination of incentive programs and user experience optimization

The American fintech brand Acorns paid just $4.50 as customer acquisition cost (CAC) per customer in Australia in 2017. In contrast, renowned robo-advisor brand Lending Club shelled out $200 as CAC in the same year. How did Acorns pay a staggering 50X less CAC than its competitors?

The company tapped into social media by providing strong incentives. It optimized the process by making sharing easy and ensuring payouts corresponded to active new users. Specific steps that Acorns took included offering an incentive of $5 per new referral, which was deposited directly into the referrer's Acorns account. While referrals are often an afterthought for a lot of companies, Acorns worked hard to perfect the process as research shows that eliminating new page load for referrals increases the chances of referral by four times.

Making referrals easier made all the difference. In addition, Acorns ensured that the referral incentive is triggered only when the referred user starts depositing money instead of incentivizing everyone who signs up. This saves the marketing dollars while increasing time spent in-app.

Improve financial inclusion

Close to 1.7 billion people across the globe, mostly from developing nations, have no access to banking facilities. These regions also tend to have higher use of mobile devices, presenting a lucrative market for fintech and digital-only banks. Improving financial inclusion is a critical focus for fintech brands across geographies, many of which are working to provide easier and faster financial services to the unbanked segment.

Financial literacy will also play a key role in the further adoption of fintech services. People who understand money are immensely more valuable to the fintech ecosystem. Fintech brands are addressing the challenge of financial literacy by building solutions directly into their apps, helping customers understand how to manage money wisely, save better and invest. For fintech companies, investing in financial literacy programs is directly linked to increasing long-term loyalty in customers.

Overall, development in the financial services industry is geared towards providing better services, increasing access to financial information, improving transparency, quicker transaction processing, more secure identity authentication, and better support for the customer lifecycle. To ensure that you are not left behind, listen to your clients, earn their trust by creating transparent and seamless experiences, respect them and their privacy, look out for industry trends and always choose to make the investments required to align the latest technological developments with what users want.

The next generation of high-growth personal financial management (PFM) tools isn't going to be built according to a formula. Tactics will shift rapidly according to user preferences; however, the core strategies for driving traffic, converting, and keeping users engaged are not mere flashes in the pan but rather fundamental to building products that people love.

Saurabh Madan is general manager, SEA & ANZ, MoEngage.

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