Fintech Adoption is About People, Not Tech

EY released their 2017 Digital Adoption Index a few months ago, and since then I’ve seen a lot of posts going around LinkedIN about how Canada is lagging behind the global digital adoption rate.

The big stat is that digital adoption in Canada is sitting at about 18 percent, which is a full 15 percent behind the global average of 33 percent.

But while digital adoption rates are lagging, consumer awareness of fintech has grown significantly: 78 percent of Canadians are now aware of fintech products (up from 51 percent in 2015).

This indicates that while banks and fintechs are doing a good job of driving awareness -- their awareness campaigns aren’t getting customers to actually try new fintech products.

EY recommends fintechs and traditional banks partner in order to create a better banking experience -- and increase adoption. But that suggestion is based on an assumption that banks will be able to drive adoption with existing consumers.

While partnering does alleviate some of the challenges fintechs face (like customer trust and reputation) banks still face other challenges in driving digital adoption -- primarily customer apathy towards changing the way they bank.

Driving Digital Adoption: A Two-Pronged Approach

Typically, digital adoption is considered a technological issue -- building the best tech, partnering with the best fintechs, etc.

But one of the biggest challenges isn’t the technology.  It’s the people.

No one wants to spend their spare time learning about banking products. And most of us are comfortable in our routines -- there’s no incentive to change.

This is especially true for Canadians. As the study and subsequent reporters pointed out, Canada wasn’t hit as hard as other parts of the world in the 2008 financial crisis. As a result, Canadian consumers have more positive relationships with their banks.

That positive relationship is part of the reason digital adoption rates are lagging in Canada. Consumers not only prefer using traditional bank services (the #2 reason for not adopting tech, as identified by the study) -- but most are apathetic towards changing the way they bank, because things “aren’t that bad.”

To get consumers to adopt fintech you need to go beyond traditional (boring) marketing campaigns. You have to give customers a reason to learn about (and try) your digital products.

And that has to happen both online and in your branches.

Frontline Staff

Your staff needs to be a driving force for digital adoption to reach customers that don’t think they need digital products -- or aren’t aware you offer them.  

But to successfully drive digital fluency in your customers, your staff also has to be up-to-speed. They need to be confident in their knowledge of your fintech and in their ability to spot opportunities to recommend them.

Engendering that confidence requires specialized training.

There are multiple ways to train your staff on digital fluency and adoption -- but one of the most effective ways is combining the tools you use to educate consumers (i.e. product simulations) with game-based learning and role-play scenarios.

Marketing Campaigns

Banking isn’t something most people want to spend a lot of time thinking about. And it can be difficult to grab your customers’ attention and convince them to try your fintech.

The solution? Game-based marketing.

Game-based marketing gives customers a reason to stop and pay attention. Instead of mailing brochures that just end up in your customer’s recycling bin, you can nest the educational information into a game, and reward customers for playing.

You’ll be able to teach customers the benefits, because they’re engaged with your program. And you can incentivize trying a digital product from within the campaign -- just reward with extra game-plays or chances to win.

The Bottom Line

Fintech adoption is lagging in Canada because we haven’t done a good job at convincing consumers to try new digital products.

We’ve fallen into the “build it and they will come trap.”

To drive digital adoption, we have to battle the apathy most Canadians feel towards banking.

We have to catch customers’ attention and educate them. And we need to offer support along the way in the form of online simulations and knowledgeable staff.

Digital adoption isn’t just about tech. It’s also about people.

And it’s people you need to convince to use fintech -- regardless of if you’re partnering with a fintech or not.

What do you think? What other challenges stand in the way for Canada? Let me know in the comments.