There is little doubt that mobile is the key battleground for consumers’ attention these days.
Over 95% of UK adults have a smartphone which we check every 12 waking minutes according to Ofcom. And the pandemic has only accelerated this phone obsession. In April 2020, we each spent over 4 hours a day online, 80% of which was via mobile. Yet as we increase our phone usage, we are becoming more picky in how we spend that time. Most phone users spend 84% of their time using just 5 apps, and recent research from Nielsen shows that no matter how much time people spend on their phones, 26 apps is the ‘magic’ maximum number people will use in a month.
So what does all this mean for fintech and banking platforms looking to get a slice of a consumers’ attention? We can take our cue from the global leader in mobile, China, with an installed base of over 1.6bn smartphones. China’s app ecosystem has evolved into a winner-takes-all fashion, where two apps WeChat (Tencent) and Alipay (Alibaba) grew from their original use cases in messaging and P2P payments into food delivery, transportation, utility bill payments, lending, investing and now even Visa applications.
While the UK or US may be unlikely to see such clear winners emerge given the well established products that exist in certain verticals (Deliveroo anyone?), there is no doubt that fintechs and banks alike are rapidly adding features and services to increase the frequency with which consumers return to their apps and ultimately further monetise their user bases.
Some recent examples include Revolut adding rewards and cashback schemes, alongside its wealth functionality. Google has launched a similar rewards program in the US as it expands its Google Pay app to enable a wider scope of banking services overlaid with its expertise from Gmail and Google photos to provide novel use cases. Moneybox has also taken the rewards route, which it uses to bolster users’ savings towards retirement and house deposits.
NatWest is providing its banking customers with the ability to assess the carbon impact of their spending (Alipay’s version of this already has over 500m users) and take steps to reduce it. Other examples include previous one-trick ponies like P2P lender Zopa and BNPL (Buy Now Pay Later) lender Klarna getting banking licenses. The open banking movement is only adding fuel to the fire, as it enables third parties to better compete with banks, giving consumers more choice and increasing personalisation.
These exciting features are more-often than not powered by an emerging marketplace of third party API’s, which abstract the complicated work of building these value-add services, and deliver easy integrations that allow fintech and banking platforms to focus on the core differentiators that attracted users to them in the first place.
We expect to see both banks and fintechs continue to compete for consumers’ valuable attention and spending, as they seek to diversify their offerings and increasingly compete on each other’s turf. At Youtility, we believe giving consumers the ability to better manage personal spending is a crucial part of any super app strategy and our API’s helping control essential household contracts like energy, broadband and mobile are a key piece of the puzzle in delivering a holistic financial solution for consumers.