Why it pays to expand digital banking for families
Traditional banks need to rethink their business models. This is the only way they can adapt to changing customer expectations and habits – especially when it comes to younger target groups.
The digital transformation poses new challenges for banks.
We’ve already reported on this in our blog article Caution Neobanks! How are you holding up next to the digital competition?: traditional banks need to rethink their business models. This is the only way they can adapt to changing customer expectations and habits – especially when it comes to younger target groups. Some banks have recognised the signs in time and are investing in their digital portfolio. However, many still have some catching up to do if they want to successfully bridge the gap between the generations.
Nowadays, customers expect their financial service providers to provide the most convenient and personalised experience possible when using their products and services. Millennials and Generation Z have grown up in a digital world and are therefore tech-savvy. This changes the way they deal with financial products.
In Europe, almost 99% of young people aged 16-19 use a mobile phone (2018, Eurostat) and for them, life without a smartphone is unimaginable. They want to be able to manage and maintain their bank accounts as easily as their social media accounts. At anytime and from anywhere. And of course, the fun factor must not be neglected here either.
That being said, the parents of these youngsters also have demands on financial service providers: they want to get their children used to dealing with money in an age-appropriate and safe way. This part is not so easy; there is a lack of time and knowledge on how to deal with this issue. And the digital information on offer is insufficient, many parents feel overwhelmed by it.
This is where banks can jump in to help by developing an appealing offer for both children and their parents. Addressing specific target groups, especially age-appropriate ones, is still uncharted territory in the banking world. This makes every offer that falls into this category a step in the right direction.
The following apps are good examples of family-friendly banking offers and provide solutions to the problems set out above.
Gimi helps children and young people become smarter about money and in this way gain financial superpowers. (website)
The app has been developed for busy families together with psychologists, financial experts and educators. It’s intended to help children and young people earn their pocket money, save it and also spend it. This is how they can learn how to get a handle on their personal finances. And all this in a safe and fun environment. What’s special about this app is that parents can work through small lessons together with their children and discuss financial topics.
- Financial advisor – gives tips on how to manage money better.
- Savings target calculator – shows how long it takes to reach a set savings target.
- Card test tool – checks the maturity for your own credit card.
KARD – The neobank for families that offers young people safe and transparent banking. This makes their daily life and their parents’ daily lives easier. (website)
The app helps young people to deal with their finances independently and responsibly. Using the app, parents can also easily manage all their teenagers’ pocket money via their smartphone.
- You can invite friends and relatives and save together.
- You can share purchases with friends and relatives.
Step – No fees and an all-in-one solution for families. (website)
Young people learn smart financial behaviour thanks to the Step app and a credit card. At the same time, parents gain an insight into their children’s spending. “Your money. Your way.” is the slogan of this bank for teenagers.
- Smart money habits: Step tracks account balances and reminds users of their remaining balance after each transaction.
- Step squad: As a member, you receive rewards through a referral programme.
- P2P payment: send and receive money instantly.
Go Henry was founded by a group of parents. They want to help young people learn how to handle money safely. (website)
Every child needs to learn self-confidence, independence and get a grasp of money. Only then will they be prepared for the digital and cashless society that’s coming.
- Earn money by doing tasks.
- Spending responsibly and achieving savings goals.
- Donating to a good cause.
Banks now have a new goal: to prepare the young generation for their financial future.
Children and their parents need transparent, flexible solutions. These must be geared to their specific life circumstances and needs. Most importantly, children should be introduced to handling money responsibly in an age-appropriate manner. The earlier and better this happens, the sooner they will be able to make the right financial decisions as adults – without parental control and not just with their pocket money.
Are you also thinking about improving your digital offer?
Do you want to lead your company safely into the future?
Are you looking for a competent consultant who you can talk through your innovations with?
Get in touch with us. Thanks to our competence and experience, we are the right partner to support you on the path into the future. Together we will find the best solution for your bank and your customers.
Zdenka Deskovic is a Senior UX / UI Design Consultant at Finnoconsult. She accompanies SMEs and international corporations from the conception to the launch of digital products.