The Digital Future of Consumer Finance

October 2, 2019 by Jessica Woods

As customer service continues its rapid shift to digital channels, consumer-finance companies have a powerful opportunity to engage customers and add value to the user experience. Credit education solutions can give customers valuable, personalized information and help lenders deliver relevant, prequalified credit offers that meet customers’ needs.

The digital shift is well under way. The U.S. Consumer Financial Protection Bureau (CFPB), in its 2017 Consumer Credit Card Market Report, documents ongoing customer migration to digital platforms for every stage of the consumer interaction with creditors.

In a survey of card lenders the CFPB characterizes as “mass market issuers,” which represent the majority of general-purpose and private-label credit cards issued in the U.S:

  • In the past, mail and in-branch credit applications were the most popular conversion points for lenders, but today digital applications dominate, crushing direct mail as the biggest application generator.
  • Beyond increasing customer acquisition and providing a channel for new applications, digital solutions are reshaping the entire consumer-finance process, creating a new end-to-end experience for banking consumers

As consumers increasingly adopt digital channels for dealing with their finances, consumer finance companies face both a major opportunity and a significant challenge. Digital channels offer a powerful conduit for marketing additional products and services to customers, but fostering customer engagement with platforms can be tricky, as customer expectations are constantly evolving.

The hallmark of digital channels is their convenience, which can be a double-edged sword for financial institutions. Quick, efficient digital services don’t give customers much reason to linger, and that can make it hard to create and act on cross-selling opportunities. So consumer finance companies that hope to boost engagement—and cross-sell opportunities—with their digital platforms must do so with valuable, compelling solutions—ideally interactive financial wellness tools that are personalized and highly relevant to the customer:

Accenture, in its 2019 Global Financial Services Consumer Study, found significant majorities of consumers place high value on services including:

  • Advice that is more relevant to personal circumstances
  • Personalized services/ information that helps to reduce the risk of injury, loss, etc.

Partnering with Experian, enables consumer-finance companies to provide customers with the kind of useful, high-value information customers want: Experian’s Credit Education services can help improve customers’ financial lives, Experian Identity Protection can help detect identity fraud and data theft.

  • Experian’s credit-education services use customer credit data to help them set and track credit-improvement goals.
  • Experian identity protection services can alert consumers immediately when suspicious activity is detected on their accounts (or in the names of their children) and can even help resolve cases of data abuse.

The same access to credit data that powers Experian’s credit education services can help consumer-finance partners precision-target credit offers as their customers’ evolve in their needs and creditworthiness.

Experian offers credit education and identity protection services as turnkey solutions, including fully hosted white-label platforms, hybrid options and APIs. Consumer-finance companies can quickly deploy these solutions, adapted to their own brand, to increase engagement and cross-sell opportunities and add meaningful value to the user experience.

To learn more about how your organization can take make consumer education and identity protection services part of an enhanced user experience, download the Experian Partner Solutions Consumer Finance eBook.