Giving customers what they want: How to build an ecosystem of socially impactful financial products and services

Fintech and mobile technologies have revolutionized how we bank, transact and purchase countless products and services. And this revolution is just beginning. As fintech shakes the foundations of brick and mortar banking, mobile technologies are redefining the strategies of numerous sectors — including insurance — and amplifying consumer demands and the expectation that companies deliver social impacts as well as just economic returns.

Fintech platforms — Rising to the new level

Global trends in fintech and digital engagement are evolving from providing traditional financial services to expanding their offerings to include a wide range of products and services. This next level of fintech platforms goes beyond remittance, credit, GPR, prepaid, and digital wallets that exist on a purely stand-alone basis.

As we wrote about in What’s next in finserv digital engagement?, financial services providers who offer products and services digitally (by now are there any that don’t?) have to think more innovatively to be competitive. They have to develop an ecosystem of offerings on their platforms.

As fintech is becoming saturated with financial services (credit, payments, remittance), providers need to offer more than the typical. The idea is to allow users to do as much as possible in one app, providing services that foster convenience and cultivate loyalty and habituation.

Social media platforms have led the way in user loyalty. Starting with simple social interactions as a means to leverage engagement, social media has expanded to become community hubs. On Facebook, for example, users can send money to friends, fundraise, buy and sell products, search jobs and more.

A socially responsible digital ecosystem

Services geared toward social responsibility and impact have been shown to increase customer engagement. Social responsibility is a big customer influencer, especially among millennial and Gen Z demographics — and is increasingly a fundamental need for a 138M financially vulnerable Americans.

Among other studies, the Cone Communications Millennial CSR Study notes the trend:

“More than nine-in-10 Millennials would switch brands to one associated with a cause (91% vs. 85% U.S. average), and two-thirds use social media to engage around CSR (66% vs. 53% U.S. average).”

According to the Nielsen Global Corporate Sustainability Report, 66% of global consumers are willing to pay more for sustainable brands, and of that percentage, 56% are influenced by the company being known for its commitment to social good.

Customers want to support companies who are providing social value.

The need for insurance

Americans need insurance. As the Center for Financial Services Innovation (CFSI) reports, 57% of Americans struggle with overall financial health, and 40% of adult Americans don’t have life insurance. When a financial shock hits these Americans, their financial security can be disrupted to the point that they don’t recover for many years.

From CFSI’s report, Insurtech for Financial Health:

“Financial health — which comes about when an individual’s daily systems help them build resilience and pursue opportunities — requires a financial ecosystem filled with high-quality, affordable insurance products that support consumers when they suffer financial shocks.

“The U.S. insurance industry has yet to channel the energy of insurtech into products and services that support consumer financial health.”

Inclusive insurance — Monetizing with a positive social impact

Offering no-cost inclusive insurance is amongst the services coming next to expand the ecosystem. Not only does it provide what customers need, it offers a socially responsible solution for a society of underinsured Americans.

Inclusive insurance can be offered at no-cost, with opportunities to monetize by exchanging it for predetermined units of user engagement that drive corporate objectives followed by the upsell of low-cost insurance that provides real value.

Having already hit the Asian markets, no- and low-cost digitally delivered insurance is on its way to the U.S.

• Alibaba’s Ant Financial Services offers no-cost insurance coverage for users under 65 years old when more they make offline payment.
• Singapore’s Grab is growing with their diversified offerings.
• Baidu now offers finserv in addition to its many search-engine services.
• Rakuten, Japan’s largest e-commerce site, has diversified beyond online shopping into financial services.
• MoneyLion, a platform for consumer borrowing, saving and investing, recently launched a line of products to support consumer financial health, in addition to a suite of banking tools to boost membership.

Methodology — An example in brief

A company like MoneyLion and its competitors offer a number of services, including savings products, investing solutions, and short-term loans with applications processed and loans delivered digitally. Resilient partners with financial service providers in this space to offer free insurance protection products to customers based around behaviors — platform usage, investing activity, repayment behaviors and renewal options, etc.

The initial product offers life insurance at no cost. Additional protection products are offered at a range of affordable price points. All offerings are available through the lender’s mobile app to make it convenient for customers, diversify the mobile platform ecosystem, and cultivate customer loyalty to the brand.

The emphasis here is that Resilient’s products drive financially healthy behaviors that benefit both lender and borrower.

Learn how Resilient’s Inclusive Insurance programs can benefit your business. Visit imresilient.co, and contact us as Maximilian.Weiner@imresilient.co.