User-Centered Design in Digital Banking

August 25 , 2020

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All banks have one thing in common: they need their customers in order to survive. Yet, some people are distrusting of banks. When it comes to their hard-earned money, consumers can be paranoid and hypersensitive. This is their livelihood, afterall. How can banks earn and build trust with their customers?

Enter user-centered design. 

What is user-centered design in digital banking?

A user-centered design approach is unique as it requires you to empathize with your consumer while advocating for them throughout all stages of your business. User-centered design is a framework that accounts for usability requirements, user characteristics, environment, and workflow to create an exceptional experience within a product or service. 

Simply put, it’s the way that banks build trust with their consumers. Once a bank focuses honestly on aligning their products and services to the way its consumers live while creating added value, the user will feel positively about the bank and drive the value of the product – ultimately leading to higher conversion and increased market share. 

Why is user-centered design important?

Two key factors indicate the importance of user-centered design in digital banking.

  • Users have options
  • Users have high digital expectations

Users have many options

In an era where there is a lot of digital competition, user-centered design is no longer an option. It is a necessity. Banks used to only have to compete with other physical branches, but now there are many neobanks and FinTech companies that offer the same products and services at a lower price with more convenience. Millennials are 2–3 times more likely to switch banks than baby boomers, with a focus on convenience and perks. This is good news if you have the best and most straightforward technology and bad news if you don’t.

Users have high digital expectations

Users spend most of their time on other sites, which raises their expectations when they come to use yours. If your site or app is outdated or not working as expected, the difference could be jarring. Users expect your product to work the same way as all the others they already know. Because all other industries have accelerated digitally, it is no longer an option for financial apps to be behind. Customers have been spoiled by the digital age and no longer have the patience for inefficient user experiences. Furthering the demand for these digital innovations, an estimated $68 trillion will transfer to a digitally-native population over the next quarter century. Is your bank ready for the user-centered design revolution?

Best practices of user-centered design

Let's take a look a the best practices that have evolved user-centered design:

  • Data sources
  • Aesthetics
  • Managing complexity
  • Onboarding
  • Devices and channels

Data sources

Where do I collect information?

DO product reviews and ratings. What are your customers actually saying? If just one person is having a bad experience, that is an indicator many others have the same sentiment. Users have an emotional response to products that are hard to measure quantitatively but will still have a very real impact on your business and brand. In the age of social media and hyper-connectivity, word spreads quickly.

DON’T rely solely on historical trends. We are in an era of massive digital innovation which means the industry is changing quickly, so your bank has to stay agile. Your track record of past excellence will not serve modern-day users. It’s time to break from the past and react quickly to new findings.

Aesthetics

Is design form or function?

DO make it beautiful. Let’s be clear, good design is not just a beautiful interface. However, users often perceive aesthetically pleasing design as design that’s more usable. They will also be more likely to remember the experience fondly. This provides a unique challenge in banking given the subject matter is usually abstract and can be difficult to comprehend. Some have trouble visualizing their finances. Distinct use of colors and clearly labeled charts can help your users finally understand their financial situation or options. The goal is to delight the user, not confuse them.

DON’T forget about function. Good design is not just how something looks, but how it works. You should make sure the underlying experience is smooth and seamless before you even attempt to make a sleek version. Do not try to hide usability issues in a beautiful app. Users will catch on.

Managing complexity

What is the users’ most important goal?

DO keep it simple. Finance and banking is pretty complex by nature, making simplification a tough challenge. But if you are able to make your apps intuitive, your users will be very grateful and prefer your service over others. Everything should be clearly labeled with a simple navigation and obvious calls-to-action. Make the process as clear as possible by providing alerts before important steps, and feedback along every step. Encourage your user along the journey – everyone relates to that.

DON’T overload on features. A common mistake banks will make is load up their digital experiences with features, thinking that will please customers. The opposite is often true. The more options a person has, the more time it takes for them to make a decision and the more likely they will even get overwhelmed and abandon the process. According to the Pareto Principle, 80% of the user’s value will come from 20% of the features. Focus on the 20% and make them really great.

Onboarding

How do we get users excited about the app?

DO Make onboarding delightful. The first engagement with your user may be your only chance to win them over. The onboarding process is a make or break moment so it’s important to get it right. Onboarding should be informative, fast, and exciting for the user. One way to do this is to use a chatbot, which asks questions about the user’s goals, with simple “yes” or “no” answers. Wizard design models and interactive onboarding are a great way to welcome new users to your digital experiences. This doesn’t ask much from the user, while still capturing enough data to personalize the experience.

DON’T ask for personal information before absolutely necessary. Be careful that you are not demanding personal information such as addresses or credit cards before the user is sold on the value of your offer. Otherwise users may drop off and never return.. This could also lengthen the process more than users will tolerate.

Devices and channels

What devices do our users use most?

DO create a seamless omnichannel experience. Someone may require access via mobile devices, in the branch itself, while they’re on their work PC, or on their personal tablet relaxing on the couch. Make sure the experience is seamless across all devices by testing your app on all popular devices and practicing responsive web design. Don’t get complacent keeping up with new and emerging digital platforms (AI, smart watches, smart speakers, smart TVs). Stay current and your users will stick with you.

DON’T neglect mobile. These days everyone is glued to their phones. This is why many companies opt for a “mobile-first” design approach to ensure the mobile experience is taken care of. 47% of Millennials use mobile banking, twice as much as baby boomers. Interestingly enough, millennials are also the fastest to jump ship due to a frustrating user experience and likely (31%) to share their negative experience with others. The best way to capture and retain users under 35 is to make sure the mobile experience is running smoothly.

The simple answer is that FinTechs have recognized that customers were quickly transitioning to the subscription mindset of buy now, pay later. With this recognition came a huge uptick in the number of FinTech players offering direct-to-consumer financing options.

The demand is clear

A surge of new tech-savvy and mobile-first users has placed a clear demand on banks and financial institutions to focus on creating delightful user-centered banking experiences. These users are less trusting of typical banks, prioritize convenience and perks, and trust the recommendations from those close to them. As these users increase in purchasing power, their impact will be an even greater force on the financial industry.

influencing-factors

While there may always be a need for physical bank branches, the demand for digital experiences is clear. Even in-branch, the modern consumer requires a user-centered omnichannel design. However, it is apparent that major generational and technological shifts have already happened, causing focus to be firmly centered on the user. Institutions that whole-heartedly prioritize the user have and will continue to come out on top.

Ready to take your digital banking experiences to new heights and start delighting your customers? Amount makes digital financial experiences that align with the way we live. The Amount platform empowers your financial institution to modernize your user experience and optimize your growth – all in a fraction of the time with no disruption. Amount’s omnichannel product suite gives your customers the freedom to apply from the web, mobile app, in-branch, or over the phone. Amount’s profit-proven enterprise framework centers the experiences around your user so you can focus on what matters most – enabling secure growth and delighting your customers.

LEARN MORE

Footnotes

This article was written by an Amount Guest Contributor. The content of this post is provided for informational and advertising purposes only. Amount's service may vary for each customer. For more information, email us – media@amount.com.

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Alexandra Grochowski

Alexandra Grochowski is a human-centered product designer based in Chicago. Her background in banking has fueled her interest in designing creative solutions for the transforming financial industry.

User-Centered Design in Digital Banking

Posted by Alexandra Grochowski on August 25 , 2020
Alexandra Grochowski
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User-Centered Design in Digital Banking

All banks have one thing in common: they need their customers in order to survive. Yet, some people are distrusting of banks. When it comes to their hard-earned money, consumers can be paranoid and hypersensitive. This is their livelihood, afterall. How can banks earn and build trust with their customers?

Enter user-centered design. 

What is user-centered design in digital banking?

A user-centered design approach is unique as it requires you to empathize with your consumer while advocating for them throughout all stages of your business. User-centered design is a framework that accounts for usability requirements, user characteristics, environment, and workflow to create an exceptional experience within a product or service.

Simply put, it’s the way that banks build trust with their consumers. Once a bank focuses honestly on aligning their products and services to the way its consumers live while creating added value, the user will feel positively about the bank and drive the value of the product – ultimately leading to higher conversion and increased market share.

Why is user-centered design important?

Users have many options

In an era where there is a lot of digital competition, user-centered design is no longer an option. It is a necessity. Banks used to only have to compete with other physical branches, but now there are many neobanks and FinTech companies that offer the same products and services at a lower price with more convenience. Millennials are 2–3 times more likely to switch banks than baby boomers, with a focus on convenience and perks. This is good news if you have the best and most straightforward technology and bad news if you don’t.

Users have high digital expectations

Users spend most of their time on other sites, which raises their expectations when they come to use yours. If your site or app is outdated or not working as expected, the difference could be jarring. Users expect your product to work the same way as all the others they already know. Because all other industries have accelerated digitally, it is no longer an option for financial apps to be behind. Customers have been spoiled by the digital age and no longer have the patience for inefficient user experiences. Furthering the demand for these digital innovations, an estimated $68 trillion will transfer to a digitally-native population over the next quarter century. Is your bank ready for the user-centered design revolution?

Best practices of user-centered design

Where do I collect information?

Data sources

DO study product reviews and ratings. What are your customers actually saying? If just one person is having a bad experience, that is an indicator many others have the same sentiment. Users have an emotional response to products that are hard to measure quantitatively but will still have a very real impact on your business and brand. In the age of social media and hyperconnectivity, word spreads quickly.

DON’T rely solely on historical trends. We are in an era of massive digital innovation which means the industry is changing quickly, so your bank has to stay agile. Your track record of past excellence will not serve modern-day users. It’s time to break from the past and react quickly to new findings.

Is design form or function?

Aesthetics

DO make it beautiful. Let’s be clear, good design is not just a beautiful interface. However, users often perceive aesthetically pleasing design as design that’s more usable. They will also be more likely to remember the experience fondly. This provides a unique challenge in banking given the subject matter is usually abstract and can be difficult to comprehend. Some have trouble visualizing their finances. Distinct use of colors and clearly labeled charts can help your users finally understand their financial situation or options. The goal is to delight the user, not confuse them.

DON’T forget about function. Good design is not just how something looks, but how it works. You should make sure the underlying experience is smooth and seamless before you even attempt to make a sleek version. Do not try to hide usability issues in a beautiful app. Users will catch on.

What is the users’ most important goal?

Managing complexity

DO keep it simple. Finance and banking is pretty complex by nature, making simplification a tough challenge. But if you are able to make your apps intuitive, your users will be very grateful and prefer your service over others. Everything should be clearly labeled with a simple navigation and obvious calls-to-action. Make the process as clear as possible by providing alerts before important steps, and feedback along every step. Encourage your user along the journey – everyone relates to that.

DON’T overload on features. A common mistake banks will make is load up their digital experiences with features, thinking that will please customers. The opposite is often true. The more options a person has, the more time it takes for them to make a decision and the more likely they will even get overwhelmed and abandon the process. According to the Pareto Principle, 80% of the user’s value will come from 20% of the features. Focus on the 20% and make them really great.

How do we get users excited about the app?

Onboarding

DO Make onboarding delightful. The first engagement with your user may be your only chance to win them over. The onboarding process is a make or break moment so it’s important to get it right. Onboarding should be informative, fast, and exciting for the user. One way to do this is to use a chatbot, which asks questions about the user’s goals, with simple “yes” or “no” answers. Wizard design models and interactive onboarding are a great way to welcome new users to your digital experiences. This doesn’t ask much from the user, while still capturing enough data to personalize the experience.

DON’T ask for personal information before absolutely necessary. Be careful that you are not demanding personal information such as addresses or credit cards before the user is sold on the value of your offer. Otherwise users may drop off and never return.. This could also lengthen the process more than users will tolerate.

What devices do our users use most?

Devices and channels

DO create a seamless omnichannel experience. Someone may require access via mobile devices, in the branch itself, while they’re on their work PC, or on their personal tablet relaxing on the couch. Make sure the experience is seamless across all devices by testing your app on all popular devices and practicing responsive web design. Don’t get complacent keeping up with new and emerging digital platforms (AI, smart watches, smart speakers, smart TVs). Stay current and your users will stick with you.

DON’T neglect mobile. These days everyone is glued to their phones. This is why many companies opt for a “mobile-first” design approach to ensure the mobile experience is taken care of. 47% of Millennials use mobile banking, twice as much as baby boomers. Interestingly enough, millennials are also the fastest to jump ship due to a frustrating user experience and likely (31%) to share their negative experience with others. The best way to capture and retain users under 35 is to make sure the mobile experience is running smoothly.

The demand is clear

A surge of new tech-savvy and mobile-first users has placed a clear demand on banks and financial institutions to focus on creating delightful user-centered banking experiences.These users are less trusting of typical banks, prioritize convenience and perks, and trust the recommendations from those close to them. As these users increase in purchasing power, their impact will be an even greater force on the financial industry.

While there may always be a need for physical bank branches, the demand for digital experiences is clear. Even in-branch, the modern consumer requires a user-centered omnichannel design. However, it is apparent that major generational and technological shifts have already happened, causing focus to be firmly centered on the user. Institutions that whole-heartedly prioritize the user have and will continue to come out on top.

Ready to take your digital banking experiences to new heights and start delighting your customers? Amount makes digital financial experiences that align with the way we live. The Amount platform empowers your financial institution to modernize your user experience and optimize your growth – all in a fraction of the time with no disruption. Amount’s omnichannel product suite gives your customers the freedom to apply from the web, mobile app, in-branch, or over the phone. Amount’s profit-proven enterprise framework centers the experiences around your user so you can focus on what matters most – enabling secure growth and delighting your customers.

LEARN MORE

Topics: Product