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How customer experience is helping payment companies and digital banks to differentiate

In the financial services industry, both traditional banks and FinTechs are now operating in an extremely dynamic and competitive market environment. The race to reinvent the payments landscape to meet changing consumer demand is heating up - and a key differentiator is customer experience (CX).

By Michael Schweidler, Senior EMEA Marketing Manager

Last updated December 20, 2021

As consumers, we are living our lives through technology – and increasingly mobile technology at that. We’ve come to expect a seamless, digital-first experience from all the brands we buy from and interact with, irrespective of whether we’re food shopping or doing our banking. The pandemic has rapidly accelerated this and levelled the playing field, with all brands now competing in our new, digital-first world.

In the financial services industry, both traditional banks and FinTechs are now operating in an extremely dynamic and competitive market environment. The race to reinvent the payments landscape to meet changing consumer demand is heating up – and a key differentiator is customer experience (CX).

Three FinTech companies at the forefront of digital payments are global open banking platform, TrueLayer, payments technology company, Trust Payments, and digital bank, Monese. In our recent panel discussion, Chris Brogan (Head of Client Operations at TrueLayer), Rob Hawley (COO at Trust Payments) and Daniel Wright (Customer Support Lead Manager at Monese) discussed together with Celine Maher (Regional Vice President UKI and Emerging Markets at Zendesk) industry change, shifts in customer expectations and how CX is setting them apart.

From cash to app

The world of payments has changed dramatically in the shift from cash to digital and, as Hawley confirms, this is only set to continue. “Trust Payments has been supporting its business clients as they rapidly pivot to accepting payments via online and mobile. There has been hyper growth in the volume of digital payment options now available to us, from digital wallets and Apple Pay, to open banking,” he says. “We enable those payment methods that our client’s end consumers want to use, across a whole host of channels. What we’ve noticed is a blurring between mobile and online – it’s all essentially becoming digital.”

Wright at Monese – a start-up that provides a mobile app as an alternative to banking – says customers now expect payments to be faster, cheaper, and more convenient. “As a society, we’ve moved away from cash,” he explains. “Today, we don’t take out foreign money when going abroad, we can access multiple currency corridors and we can send money anywhere in the world immediately, with very low fees. We’re always looking to offer our customers different payment methods, keeping speed, price and ease of use front of mind.”

The rise of open banking

Open banking has become an important element of the digital payments landscape. And with Amazon recently announcing that, as of January 2022, it will no longer be accepting Visa credit cards, its use cases – thinks Brogan – are on an upward trajectory. “Cards are becoming an outdated infrastructure now. Customers today expect immediacy and open banking gives it to them. If you want a refund, it’s an instant settlement,” he says.

Consumers also now expect this immediacy from customer service, says Hawley, with real-time information and swift resolution when it comes to any queries they may have. “They don’t want to wait, so the challenge is being able to give them an instant response via whatever channel they use to reach out. We therefore also need to make sure that all the information related to payments is available for that first touch resolution and that’s very much a focus for us”.

Overcoming obstacles

In this brave new world of digital payments, all three companies agree that a key challenge is educating the market about the various payment methods available and their advantages, especially when it comes to open banking. As Brogan says, “We’re trying to inform our clients more, so they can translate those benefits directly to their end users.” explains Hawley. Once people know more, new ways to pay are then adopted naturally. He uses the example of Apple Pay, which for many users has become a natural way to pay, so much so that they no longer take their wallets out with them.

Another key challenge raised by the panel is maintaining customer loyalty, especially with fraud having escalated during the pandemic. Almost half of UK consumers say they would switch to another brand at the first sign of a bad experience. Maintaining customer loyalty is “a matter of balance,” thinks Wright. “Using our app, customers want to feel secure in the knowledge that their payments will be sent both instantly and securely.”

“Financial services firms have access to so much customer data and if we cooperate more, we could help combat fraud across the whole industry,” he adds. “Open banking is a great start to this, as banks are now collaborating with smaller players like Monese.

Customer experience as a differentiator

As competition in the space heats up for 2022, many brands are looking to differentiate with their CX. TrueLayer, Trust Payments and Monese are all focused on being proactive, rather than reactive, when it comes to customer needs and potential issues. “We’re focusing on giving our clients data that enables them to add value to their offering, and, by extension, their customers,” explains Hawley.

“CX is at the forefront of how we in FinTech are going to scale,” he adds. “We benefit hugely from having a single view of our customer data, so we can then triage straight away. This not only allows for swift response times but also for our agents to be proactive, when it comes to knowing what users may ask and that increases their productivity.”

The payments sector has become a booming area of the financial services industry. Providing a frictionless, convenient and safe journey for consumers using digital services, will not only set brands apart now, but help drive new frontiers to better serve customers in the future.