Why Should Fintechs Care About UX?
The COVID-19 pandemic and the resulted social distancing and remote working trends have significantly accelerated the shift to digital financial services. With the massive surge in e-commerce, customers quickly moved to all types of digital products and services like digital payments, wallets and mobile banking. But, as demand continues to grow, so does the competition.
So, how can fintechs sustain competitive advantage in the changing economic environment? One way is by embracing the power of user experience (UX) into their company’s DNA. In this blog, we discuss what UX design is and why it matters for fintechs now more than ever.
“Fintechs have reshaped customer expectations, setting new and higher bars for user experience. Through innovations like rapid loan adjudication Fintechs have shown that the customer experience bar set by large technology firms, such as Apple and Google, can be met in financial services.”
— Deloitte, 2020
What is UX product design?
User experience or UX is a popular business term that is usually used to describe the way people interact with a particular product or service. For example, when you want to digitally send money to a friend, you might interact with a money transfer provider’s online application. And certain aspects of the application’s design like accessibility, speed and physical appearance might determine your overall feeling about the interaction.
In the modern digital world, UX is often accompanied by the term “design” and it refers to the process of improving a user’s satisfaction with a digital product or service by catering to the following 4 key experience factors:
- Value — Does the product provide value?
- Function — Does the product work as expected?
- Usability — How easy is the product to use?
- Overall impression — Is the product pleasant to use and/or entertaining?
In other words, UX design is all about creating a series of conditions that are more likely to result in an overall positive impression or experience. Leading UX expert and author, Peter Morville, has grouped those into a 7-trait honeycomb user experience model that includes:
- Usable: A product should be easy to use and familiar.
- Useful: A product must meet a user’s need or solve any of their pain points.
- Desirable: The visual appearance of the product should be attractive and evoke positive emotions.
- Findable: If the user has any issues with the product, they should be able to quickly find a solution.
- Accessible: The product or service needs to be easily accessible.
- Credible: The provider and its products or services should be trustworthy.
- Valuable: The product must deliver value to both the end user and the provider.
Whilst Morville’s honeycomb user experience model provides a good overview of the key facets of discipline, there’s a lot more to it when implementing it in the real world. In the next section, we’ve summarised the top 5 things fintech entrepreneurs and product managers should know about UX design.
UX design is more than good usability
The level of usability of a product is essential for creating good UX, but it’s not everything. Whilst usability can ensure a product is functioning well, it cannot guarantee that people will eventually use it.
UX design is different than UI design
UX and UI (user interface) are often used interchangeably, but there’s a major difference between the two terms. Although UI plays an essential part in UX, it covers just the visual / surface level of a product. UX, on the other hand, combines all product design processes under one roof to bridge the gap between the product functionality and its physical appearance.
UX design is about humans
Every good design requires a deep understanding of the end user and their exact needs, aspirations and demands. Good UX design puts the human and their emotions and behaviours at the centre of the product and the challenge it solves.
UX design is a marathon, not a sprint
UX design doesn’t stop with the delivery of the product. As you start onboarding users and receiving feedback about the product, your UX design will continue evolving, too. Changes in consumer preferences, technology advancements and regulations might require further design improvements and amendments to your product or service.
UX design should account for business needs
There’s no point creating a product that users love if it doesn’t also help you achieve your overall business needs and requirements. Finding the balance between creating a lovable and practical solution is key for UX designers.
Need help with your UX design? Book a free 30-min UX consultation.
Why fintechs should care about UX?
Here are 5 reasons why fintechs should invest in UX design:
It cuts development costs
If you spend a dollar on making an app that users like before you release it, then you won’t have to spend nine dollars afterward on fixing what they hate. Actually, the saving is between $10 and $100 for every dollar spent according to Roger Pressman in Software Engineering: A Practitioner’s Approach.
Research has shown that 50% of programmers’ time is wasted on avoidable work. In contrast, UX/UI designers tend to be significantly more productive as they focus on identifying users’ exact needs and wants right from the start.
It helps you to attract new users
Word of mouth and testimonials are the most powerful form of advertising. If someone you trust likes and recommends you a product, it’s highly likely you’d also give it a try.
Every successful company knows this, so they’re all working constantly towards making their offerings as user friendly and likable as possible. They know that more loyal fans mean more “free” recommendations for their products and services.
And the beauty of it is that any business can improve their UX to attract new customers, too.
It increases the conversion of leads into customers
75% of people judge a website based on how it looks, and a user-friendly interface is more likely to turn leads into customers.
An entire generation has grown up interacting with screens, and the longer they’ve been doing it for, the higher their expectations have become.
They want an interface that they can understand and use straight away with minimal instruction and interruption.
Good UX and UI designs can streamline your entire digital selling. Simple, intuitive and eye-catchy UI design combined with clear Calls-to-Action (CTAs) and user flow can help you qualify, attract and convert all the right customers in a matter of a few clicks.
It builds long-term user loyalty and trust
Your brand is a lot more than just a logo and a slogan. It’s the identity and reputation of your entire business. Delivering consistent and positive brand experiences across all customer touchpoints is thus crucial a business’s long-term growth and success, and you can’t afford to compromise it with non-functional and inefficient digital app, for example.
Simple and intuitive UI can easily help you turn your users into loyal brand fans. Research by Bain & Co. found that a 10% increase in user retention leads to an average increase in your business’s value of 30%. A pretty good reason to keep your customers loyal, right?
Trust is also one of the biggest challenges for fintechs. Users, especially those who are not digitally native, will be much more skeptical about adopting new financial products or apps and giving them access and control to their finances and personal information. UX designer’s ability to read human psychology can help tackle this and identify and address any user doubts at the different stages of the customer journey.
It reduces your customer support costs
If a product is easy-to-use and doesn’t require any additional user skills and knowledge then customers won’t need any additional support. This, on the other hand, means that you won’t have to spend any extra resources and time on customer education and support.
Book a Free Strategy Call
Schedule a free 60-minute strategy call with our founder and design lead, Tim Strebkov, and see how we can help you reach your goals with 1st class product design.Book a Free Strategy Call