3 ways fintechs can use both tech and touch to serve customers better

From high-touch to high-tech, inclusive fintech startups can strike a balance along the customer journey

James, second from the right, works with Apollo Agriculture to meet with farmers face-to-face.

Digital technology continues to drive massive change throughout the financial sector. By acting strategically, inclusive fintech startups can use technology to increase access to, improve the quality of, or reduce the cost of financial services for the underserved.

However, in too many instances, fintech startups make the same mistake time and again: they build technology for technology’s sake. These fintech models are great on paper but don’t consider the needs and preferences of their customers. They don’t use new technologies strategically and fail to transform finance into a sector that works for everyone.

Fortunately, many successful inclusive startups are finding innovative ways to balance new digital technologies with appropriate human interactions to engage, educate, and support their customers. Finding the right combination of “tech and touch” at the right moments during a customer’s journey is a crucial factor in determining whether a startup succeeds or fails. Doing so will help a business acquire and retain customers, reduce expenses, increase profitability, and accelerate financial inclusion.

Accion Venture Lab has worked with fintech startups around the world that are grappling with how to best use technology and respect customer preferences for human interactions. In our new report, The Tech Touch Balance, we share our insights on to find a good balance, with examples from real companies that have established a successful mix. In the report, we also identified a spectrum of ways inclusive fintechs successfully balance both human touch and digital interactions to create a meaningful and effective customer journey.

This spectrum includes:

  • Tech enabling touch: In some instances along the customer journey, fintech companies may find that personal touch is critical to help customers develop familiarity, comfort, and trust in a product or service. In these cases, fintech companies still meet face-to-face with their customers, but they can leverage technology to improve in-person interactions. For example, tablets can help guide field agents in enrolling customers for a new product, WhatsApp chats and groups can help staff answer customer inquiries, and back-end algorithms can automate loan approval decisions. Customers don’t need to engage with or understand the technology; instead, tech enables the financial service provider to more effectively reach customers, collect the necessary data, and provide the information that customers need.
  • Tech imitating touch: In other instances, customers may feel comfortable using certain technologies, but are still uneasy doing business with the financial service provider or are uncertain about specific product details. When imitating touch, companies will use technology-mediated approaches, such as call centers, emails, and SMS messages, that can offer some of the same benefits that face-to-face interactions between clients and staff provide without incurring the full cost of relying solely on people to resolve issues.
  • Tech replacing touch: Finally, some customers may be comfortable relying on technology and foregoing human interactions. This preference tends to arise when customers are comfortable engaging with and using technology broadly, understand the product they are using, and trust the provider. Customers who are content with tech replacing touch also tend to have consistent internet connectivity, reliable power, and affordable smartphones.

Importantly, it’s not up to companies to decide when to enable, imitate, or replace human touch during the customer experience. Instead, companies must learn from their customers and determine when each is relevant for their customers. Moreover, the same organization might use technology to replace human agents in customer acquisition, imitate staff when making payments, and enable representatives during collections. No two organizations will be the same: each must identify its most valuable customer segments and cater to their preferences, adjusting operations from one process to the next.

There is no one-size-fits-all model for balancing tech and touch, but by considering the needs of customers along their journey, fintech startups can strike a balance that can allow them to serve their customers better and grow their reach.

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