Fintech
FinTech and CU innovation agendas are geared towards members of Generation Z
A key goal among FinTechs is to innovate new products that extend their brand reputation and market reach. For example, FinTechs are expanding their mobile features and capabilities and improving user experience to retain existing account holders and attract new customers.
Many, but not all, of these institutions have also aimed to attract Gen Z consumers. This digital-first generation represents a growing market opportunity in 2030 and beyond, but some FinTechs don’t see the appeal. While 62% of FinTechs say attracting more Gen Zers is extremely important, 95% of CUs say the same.
These are just some of the results of “The fintech innovation agenda,” A PYMNTS Intelligence AND Velera (formerly PSCU/Co-op Solutions). The report examines how these financial intermediaries are innovating to meet consumers’ financial needs at CUs and other financial institutions. The report is based on a survey of 101 FinTech executives who provide services to CUs, commercial banks, community banks and individual consumers. Conducted between October 16, 2023 and November 10, 2023, the survey examined FinTechs’ innovation priorities and plans.
Other key findings from the report include:
FinTechs test new products internally 2.5 times more than external consumers.
FinTechs understand the importance of providing high-quality products and services. One strategy used by 44% is testing innovations with employees as part of the payments innovation process. Only 17% say testing with real customers is part of their process.
FinTechs are driving growth by expanding their mobile capabilities and improving user experience.
FinTechs report a number of strategies to improve their chances of retaining existing members and attracting new ones. Data shows that nearly 7 in 10 respondents believe improving mobile capabilities is critical to achieving their growth goals. Furthermore, 6 in 10 invest in emerging technologies for the same reason. The report explores how these institutions appear to have digital-first consumers in mind as they develop their innovation programs.
Regulations and technical challenges represent the main obstacles to bringing innovations to market.
FinTechs face challenges that can slow their ability to launch their innovations. For example, 34% say regulatory compliance is a challenge when bringing innovations to market. Notable shares identify the integration of different systems and complex internal decision-making as challenges. Few mention lack of resources and even fewer say lack of budget is the biggest challenge.
FinTechs consider many factors as they build their innovation roadmaps for the next three to six years. One thing they seem to agree on is that innovation is key to retaining and attracting customers. Download the report to learn more about how FinTechs are using innovation drive growth.
See more in: banking innovation, credit cooperatives, CU, Digital bank, News Featured, Fintech innovation, FinTech, News, payments innovation, PYMNTS Intelligence, PIMNTI news, PIMNTI study, Velera