Is the Emphasis on Financial Convenience a Threat to Consumer Control?

With a variety of payment methods, apps and devices available to consumers today, it’s no surprise that, across demographics, we see people taking advantage of them all. Consumers typically have a number of cards on file in various apps on their smartphone: they use a corporate credit card in their Uber app, a personal debit card in Instacart and a personal credit card to earn miles with their favorite airline. Adding to that, they have a bank account attached to their Venmo, a card in their Apple Wallet and PayPal pulling from a different bank account. Through these various payment options, life is more convenient. Consumers can move money and purchase products and services with a simple tap of their finger. But with so many apps and services pulling from various payment sources, how do consumers keep track and maintain control? And how can financial institutions, or “account providers” help them stay in the driver’s seat when it comes to their finances?

Financial control gives people confidence and eliminates stress in people’s lives. Everyone wants the security of knowing how much money they have and that their funds are safe and available to them 24/7. Giving consumers the power of control helps them to not only live within their means but also plan for the future, increase their savings and look for more affordable options when considering a major purchase. Consumer control, we’ve learned, is also crucial to establishing a trusting, mutually beneficial relationship between consumer and financial institution or account provider.

Understanding and Evolving with Changing Consumer Needs and Demands

Remember when consumers had to wait for a monthly bank or credit card statement to review all of their transactions and account balances? That’s no longer the case in today’s on-demand environment where anyone can instantly order a car service or have food or groceries delivered. But all these on-demand services, while convenient, make it increasingly difficult for consumers to keep track of funds and balances that exist across multiple accounts. With consumers’ bank accounts connected to a variety of apps and set up to automatically refill cards and virtual accounts when they get below a certain balance– control can feel elusive.

So, today’s consumers want to take control of their money and to better understand how they can optimize their finances and savings. With this growing demand for more control, there is increased pressure within the financial arena to develop innovative products and services that allow for more consumer oversight, while maintaining the benefits of convenience and security.

In answer to this demand, some financial institutions and account providers, have built their own apps to help customers maintain access to account balance information in real time. Others send text alerts to notify customers of transactions and balances so charges from an app or subscription service aren’t a negative surprise when they check their balance.

To add to the equation, changing trends in consumer behavior, needs and demands translate differently across demographics and socioeconomic standings – so, control could look differently for different segments of the population. It’s the responsibility of financial institutions to offer features and solutions that meet consumers’ expectations and needs regardless of their financial status. 

Where Should Financial Institutions and Account Providers Go from Here?

Today, many consumers can review their account balances and transactions in real time with a tap of their finger or by receiving alerts instead of going to an ATM or their local bank branch. Digital trends in peer-to-peer banking, automatic savings apps, mobile deposit, mobile “pays” and other propositions have further increased these behaviors and needs. With this ability to self-monitor at any time, anywhere, the human-to-human element will still be essential in helping customers feel secure and supported.

These digital trends and consumer demand for greater control are creating an opportunity for the financial services industry to empower and encourage all subsets of consumers to take a more active role in their financial management and health. The industry shouldn’t be exclusive to those with good credit or attractive financial history. All consumers deserve to have control and insight into their current financial standing. Additionally, it is up to financial institutions and account providers to continue to invest in and create robust, easy-to-use product features that are convenient yet help consumers maintain their sense of control. This will be critical in helping financial institutions and account providers retain current customers and attract new ones.

Ultimately, consumers who feel they are in control are more confident in their banking practices, behaviors and financial decisions and more likely to remain loyal to their financial services provider. In an increasingly on-demand world, industry-established entities and new fintech companies alike must bridge the gap between convenience and oversight while ensuring variety and ease-of-use don’t cause consumers to lose their sense of control or visibility to their holistic financial situation.

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