This is the second article of a three-part series on convenience, inclusion, and advocacy – and lessons FIS is learning in its quest to support global financial access and education to underserved and unserved consumers and businesses.
Webster’s Dictionary defines advocacy as speaking or writing in support. In the context of this article, I’m broadening the definition to include: taking action in support. Whether someone is your coach, teammate or colleague, your advocate will take action on behalf of your interests.
Companies advocate for consumers
Apple has been named an “inadvertent consumer advocate.” A 10-year-old article from the Associated Press discusses how Steve Jobs insisted that iTunes pricing should be set at 99 cents per track despite strong urging from music companies to set the price much higher. Jobs’ reasoning was that he felt consumers wouldn’t pay more than 99 cents per track. Through the years, the actions Apple takes on behalf of consumers’ interests have seemed to be more inadvertent than intentional.
Turning to the financial sector, I see a growing need for intentional consumer advocacy. On one end of the social spectrum, consumers easily become overwhelmed with an abundance of choices. This can lead to inaction and, on an aggregate level, inhibit the diffusion of new technologies. To make appropriate product and service choices that fit their lifestyles, consumers need guidance. For example, dozens of payment schemes are available for adoption. Consumers easily become confused without an advocate to initially hone selections to a manageable “best in class” choice set from which the optimal one can be selected.
On the other end, the unserved and underserved around the world have little to no choice and need advocates to demonstrate a path to inclusion in the financial sector. In many countries, women have been excluded from financial participation. In 2013, Bharatiya Mahila Bank (now merged with the State Bank of India, the country’s largest lender) opened to advocate for Indian women through financial inclusion and support female entrepreneurship through some concessions on loan terms.
Advocacy is a burden for financial institutions
Advocacy is an easy word to say but a difficult tenet to live by. To be a strong advocate, you must bear the burden of leadership. Advocacy requires you to expand beyond your company’s comfort zone – for example, issuing prepaid cards to the unserved and underserved. Your company also must shoulder the costs of adding products that consumers expect from you such as Apple Pay and Samsung Pay. After all, the ability to pay for groceries with a mobile app is a reasonable expectation when one can watch a movie on a mobile phone these days.
Advocacy is delivering what consumers want and need
In today’s world, offering the lowest price is not a sustainable strategy; it’s just another race to the bottom. Instead, consumers want technology that enables them to transact anytime and anywhere, easily, conveniently and safely. As advocates, we must step up to the plate to provide these solutions or surrender the game.
Convenience remains imperative but the definition of convenience has moved well beyond location. Convenience has always been a primary factor in financial institution selection but today’s consumer defines convenience broadly. It’s about anytime, anywhere access to anything.
Most of us remember plowing through unintelligible instruction manuals written by engineers to assemble something or learn about a newly purchased piece of technology. Today, consumers go online, access a video on just about any topic, including financial education, and learn at their convenience – i.e., in their way, on their schedule, wherever they are.
Consumers want ownership and control. Remember the days when rebooting your cable connection required waiting on the phone for what seemed like an interminable time to locate a human to walk you through the steps required to regain your signal? Now, most consumers know how to reboot their connection and, if their attempt fails, they can usually go online to ask for a signal to be sent to reconnect.
In payments, consumers can elect what fraud controls they employ – switching cards on and off, setting transaction sizes, controlling locations of use and setting alert notifications – to secure card and mobile transactions.
Consumers want more flexibility. Rewards programs have historically been inflexible in terms of redemption options and many programs remain so. However, emerging rewards programs come with flexible options – e.g., enabling consumers to use rewards at any retailer to obtain cents off on the dollar, getting credit on purchases already made and making donations to favorite charities.