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How apps are changing engagement with the fintech market

Future banking

Banking and other fintech apps are becoming increasingly popular for many consumers, but businesses will always require much greater detail than they provide.

Busy thumbs. Walk around a town centre anywhere in the western world and the evidence for increasing engagement via mobile devices is given away by the dizzying speed and dexterity of whole shopping centres full of busy thumbs.

What you can’t tell from a high level survey like that is exactly what types of software people are using – and this matters. If there was ever a marriage born to fail, it’s the one between mobile devices, websites, and financial information. The pressures of each factor are almost precisely opposed to each other.

Conflicting demands

On the one hand you have the consumer’s demand for ever faster, slimmer and more powerful devices. Then you have corporations and governments who want a usable standard that doesn’t hook them up to a version-driven treadmill, and users migrate rapidly away from awkward experiences towards streamlined, friendly, free, secure, responsive, and shareable brands and experiences.

Imagining a set of goalposts fitted with rocket motors, in four dimensions, is not even scratching the surface of this problem.

So it’s hardly surprising that the desire for a way out of this mess is driving a lot of institutions and brands to look for fixes in the app store. In this very thorough analysis of the Apple App Store in 2014, you can see that letting the data speak for itself produces some very relevant headlines for fintech.

One is that about 60% of the apps surveyed appeared to be empty shells, with very low download counts, no reviews, no live contacts for support, and no apparent added value. The other was that as a category, fintech apps were at no. 9 out of 22 in download popularity.

That’s a respectable showing. In a consumer market you might well expect each person to have one or two fintech apps loaded, whereas many will have 10 or 20 games, so even three years ago there was already decent penetration. This is because an app can be its own closed world, where a browser is inherently required to be much more open. Analyses of this shift in function are easily found with more recent tables of relative rankings, from 2016 can be seen here.

Again, some instant takeaways spring right out. The most apparent is that the vast majority of apps in the top ten list are specific portals into main high street bank customer interfaces. Only one of the top ten is a payment-specific app, and it’s out of a very narrow sector, concerning the type of cross-border, cross-instrument banking that used to be the exclusive domain of Western Union, C2C and B2C funds transfer.

Need for app-based analysis

That spurs the next observation, that none of these apps are analysis tools. You can see some transactions, from the point of view of a fund-holder rather than a manager, but the fundamental visual limitations of a phone really start to cramp the app’s style when it comes to trend analysis, unusual transaction spotting, and all the other tools of the payment system operator’s trade.

This in turn leaves us with a very strange notion that actually the custom software (in this case, the app) is not for the user group with the most complex use pattern - quite the opposite. It’s for the road warrior, who wants a basic status report or a function analogous to a smart payment card, on their phone.

The manager and operators of the payment process want a fuller, richer, more deeply integrated interface, which takes them back towards the faithful desk PC and an Excel or web browser mediated connection.

Apps definitely have a role in payments, if only to get away from the development burden of web browsers with too broad a content remit, but it’s out at the edge, not in the centre.