Fintechs have seen success in attracting banking customers with the convenience of seamless user experiences and attractive financial offers. Most fintechs recognize that building success requires an investment in additional solutions that meet not only the immediate needs of their customers, but their long-term financial goals as well.
How can a fintechs help their existing customers become better stewards of their own financial health—and help them become better qualified borrowers at the same time? By providing real-time, actionable information and credit education that empowers users and makes them better guardians of their own finances.
Helping Customers Feel More Confident
According to the National Foundation for Credit Counseling, four in five adults in the U.S. want advice about financial issues, like how to tackle credit card debt or improve their credit score.
Research by the U.S. Consumer Financial Protection Board (CFPB) similarly found that “consumers generally value financial management and planning, and believe they would benefit from it,” but often find budgeting and goal-setting too daunting or time-consuming to stick with on a regular basis.
To address these obstacles, the CFPB explored different approaches to furthering the cause of financial literacy and helping Americans achieve a greater sense of financial well-being. Its research uncovered a promising strategy: real-time guidance on financial decision-making.
CFPB findings include:
- Technologies that inform consumers in real-time, at the point of purchase, about the amount of funds available to spend (in a checking account, a weekly budget allowance, on a prepaid card, etc.) helped consumers curb excessive spending.
- Consumers are eager for guidance on other financial matters such as savings, bill payments and retirement planning, and real-time guidance on those concerns also could help consumers adopt and maintain greater financial discipline.
An Educated Customer is a More Valuable Customer
By helping consumers become more financially capable, fintechs build goodwill and help customers become better prospects for additional financial products: Equipping users with better credit management skills is one way fintechs can cultivate more qualified candidates for mortgages, auto loans, larger lines of credit, and other product offerings.
Eventually, financial education can even lead to customer adoption of more sophisticated products and services such as investment guidance, wealth management and retirement planning.
The CFPB found two consumer concerns that any app-based solution must address:
- Real-time accuracy. Consumers need to be confident that the tools they are using to make money-oriented decisions are showing them a true financial picture at all times.
- Data security. Consumers are willing to share personal information, including access to accounts and credit profiles, if they have assurances their data will be protected.
Experian Partner Solutions’ turnkey, white-label tools allow fintechs to quickly deploy world-class credit-education and identity-protection tools that satisfy these two concerns and help customers become smarter users of financial services. Whenever they sign in to their fintech’s mobile app or website, fintech customers can receive the kind of real-time, actionable information the CFPB endorses, including:
- Alerts any time a credit score changes, combined with score-improvement advice based on each customer’s individual credit history and usage.
- Credit score simulators that allow “what if” testing of credit decisions – such as previewing the credit score impacts of paying down different credit cards before making actual payments.
- Notification any time a loan or credit application is filed using the customer’s Social Security number—or the SSNs of their children—to help detect fraudulent activity.
The look and feel of all tools can be customized to blend into any fintech’s user experience, and all credit data is protected by Experian’s Security First program, the credit-reporting industry’s most stringent security and governance policies.
A fintech investment in value-added tools that empower customers is an investment in smarter, more creditworthy and financially sophisticated users, who’ll value and take advantage of quality financial products and services over the course of their lifetimes.
Experian Partner Solutions helps fintechs empower their customers with an array of credit-education and identity-products, available as turnkey white-label solutions or as hosted services. To learn more, enter your info below to download our complimentary eBook, How Credit Education Can Help Fintechs Grow.