What Banks Can Learn from Social Media Apps

Social Media

By: David Lester, Managing Finance Director, Brightworks Interactive Marketing

With technology advancing at an exponential rate, it seems as though most banks have fallen behind the curve when it comes to their mobile app capabilities and enticing a millennial audience. A generation that demands superior service, convenience and accessibility at their fingertips, millennials will follow where amenity leads and unfortunately simply having a mobile app will no longer suffice.

So what exactly does the largest generation in the U.S. expect from its bank in terms of mobile FinTech? Here are a few features in high demand:

1. Budgeting Capabilities – It’s no secret that millennials struggle with money, but apps like Mint connect to bank accounts and allow users to create a detailed monthly budget, making budgeting effortless. Banks should be streamlining the process by creating a similar system within their own app. Imagine receiving a notification when there’s only five dollars remaining in your monthly coffee budget, devastating but practical.

2. A Simplified Process – The millennial generation is known for its desire of instant gratification, so why not integrate a feature into your bank’s app to streamline typically complicated processes? Starbucks’ mobile ordering system allows you to purchase coffee within its app to have it ready when you arrive. Imagine if banks had a similar system that allowed users to download documents like mortgage applications from their phone so they could drop in, sign the paperwork and be on their way. If they want to keep up with the trends, banks need to implement FinTech systems that simplify tedious processes.

3. Investing Capabilities – In order to help users navigate the investing landscape, banks should show them the ropes on how to invest on their own terms.  In addition to providing simple, step-by-step instructions, banks should also provide a service that rounds up purchases to the next dollar and moves that amount into a savings account to be reinvested. This feature is available at most on-site banks but not in their mobile banking apps. The Acorn app effortlessly invests the extra change, making saving and investing painless and user friendly.

4. Money Sharing – Millennials may not be experts at saving or investing money, but they are experts at talking about it, especially if it’s within a social setting. Venmo, CashApp and SnapMoney have already beaten banks to the punch with this one. These apps are not only incredibly easy to use, but also are very helpful when owing someone money.  Banks should integrate a system into their mobile app that allows users to send money simply by pressing a button, or better yet – partner with one of these apps! No use in recreating the proverbial wheel!

In the end, consumers want a bank that’s going to help them reach their financial goals in an easy and enjoyable way – so why not help them by creating more user-friendly features within their mobile banking apps? Before bank apps all follow suit of FinTech subsidiaries, they need to harness the data and innovate the structure they already have. Banking regulations and charters are due to change as the world slowly de-regulates.  At one time, the government regulated taxi services, but with the advancement of transportation services like Uber, the dynamic has shifted. Times are changing and soon the old regulations around who can be a bank and who can’t will change too. Just like how anyone can become an Uber driver, companies like Starbucks may be allowed to let people pay for things with their app at any store that accepts debit. The regulations are coming down in every industry and banking will be next. In a world of increasing technology, banks must keep up with the trends to keep their largest target market, millennials, intrigued.

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David Lester’s Bio:
David Lester, Managing Director, leads Brightworks’ digital financial services out of New York. Lester is a professional financial coach with over thirteen years of experience in finance, advertising and communications. He is the author of two finance books, I (Heart) Money and From Middle Class to Millionaire and writes the blog iheartmoney.com.