The world is progressing from the ‘information’ age to the ‘experience’ age. Successful companies of this era like Google, Facebook, Apple, Netflix, and Uber are thriving by delivering a superior experience to customers. Artificial intelligence, high-speed internet connectivity, online interactions, digitalization of processes, the internet of things, and new-age communication channels are revolutionizing the way customers interact with brands across industries. In the digital wallet industry also, service providers are evolving from swift and frictionless payments to delivering a holistic digital experience. The services bringing in the revolution include super and mini-apps for seamless transaction journey, AI and NLP based conversational bots for customer support, PFM solutions for customer empowerment, digital on-boarding for convenient account opening, and gamification for rewarding and engaging customers. The trends that are taking the digital wallet experience to the next level are many but the handful of them leaving an impact on the users are discussed in detail below.
The Rise of Digital Wallet Super Apps
From Asia to Africa, digital wallet apps are taking the customer experience to next level by becoming super apps. A trend that was popularized by Alipay and WeChat in East Asia, is now spreading to other regions. In June 2021, M-Pesa Kenya, Africa’s leading mobile wallet upgraded its app to super app and many other digital wallets are following suit.
In its simplest form, a super app is a mobile application that offers access to multiple services through a single interface. Thus, customers can shop, order a meal, book a train, or flight ticket, apply for a bank loan, buy an insurance plan, book a doctor's appointment, etc via a single digital wallet super app These services are created as mini-programs or mini-apps in the digital wallet app. Hence, the entire transaction or user journey takes place in the digital wallet app, providing a seamless user experience.
For example, to book a flight ticket, the customer will log into the digital wallet super app, select the flight booking mini-app, enter the journey details (start and destination, date of departure, time, etc.), select the flight from available options, enter the passenger details and make the payments, all within the digital wallet app.
With a super app, consumers do not have to download multiple apps, optimizing phone memory and saving the effort of remembering multiple passwords. Consumers’ growing interest in super apps is clearly visible. For example, M-Pesa super app has been downloaded by over 9 million of the 30 million M-Pesa active users in just 8 months.
Personalized Experience with AI and NLP Powered Conversational Bots
As a relatively new technology- conceived just a few years ago, conversational bots (chatbots, voice bots, etc.) have emerged as an important customer communication channel across industries. According to conversion rate optimization company invesp, more than 67% of consumers worldwide used a chatbot for customer support in a year. Like many organizations in other industries, financial service providers including digital wallet providers, banks, and fintech are increasingly adopting conversational bots. Juniper Research has estimated that banking-related chatbot interactions will grow 3,150 percent between 2019 and 2023.
Digital wallets are using conversational bots for multiple purposes - consumer on-boarding, payment and banking transactions, customer support, inquiries, complaints, etc. With the evolution of technology in the domain, conversational bots are facilitating human-like interactions, personalizing the entire customer experience. Conversational bots leverage Artificial Intelligence (AI) and Natural Language Processing (NLP) to understand customer queries and respond accordingly to achieve a human-like contextual and engaging conversation. Conversational bots are designed to analyse customers’ voices and inputs to recognize their intent, emotions, and sentiments and change the response accordingly for a constructive engagement. If the bot is not able to satisfy the customer’s query, it can route the customer to an agent along with the complete background of the chat, so that the customer does not have to repeat the query. Chatbots can be hosted on the website, mobile app, or social media platforms (like Facebook Messenger, WhatsApp, Skype for Business, etc.) reaching the customer on their preferred channel.
Conversational bots have multiple advantages. Bots are available 24 x 7 and respond to customer queries immediately, rather than keeping them waiting for a customer care executive. This improves customer satisfaction and stickiness towards the brand. Bots reduce the workload of the customer care team by automating frequently asked customer queries, thus helping in reducing the operational costs for digital wallet providers.
Complete Financial Control with PFM
Digital wallets are evolving from being payment instruments to financial control and wellbeing tools for customers. By leveraging Personal Financial Management (PFM) solutions, a digital wallet can provide data-driven financial insights to customers and help them to better understand their payment flows. Using artificial intelligence and behavior analytics, PFM solutions provide in-depth financial information to customers empowering them to track, control and plan their money movement.
PFM solution helps customers to monitor their income and expenses (incoming and outgoing transactions) over different periods through visual dashboards. Customers can get a detailed view of spending in various categories like utility payments, travel, food, leisure, etc. With an in-depth view of income and expenses, customers can create and track monthly or weekly budgets across categories, set up saving goals, and reduce unnecessary expenses. PFM proactively notifies customers of breach of budget or expense limit, alerting customers to take corrective action at the right time. Customers can also compare their financial behavior with peers in the same age group, area, gender, or economic group and create financial goals aligned with their peer group.
Using predictive data analytics and machine learning algorithms, PFM can forecast future income and expenses as well as provide personalized financial advice to customers helping them to ensure financial wellbeing. PFM increases customer engagement and positively impacts customer satisfaction.
A Shift to Digital On-Boarding
A few years ago, customer onboarding and KYC processes for most digital wallets were done manually by designated agents. However, the digital wallet providers are rapidly digitizing the customer on-boarding process and shifting to self-onboarding and digital KYC, especially after the advent of the COVID-19 pandemic.
With the evolution of digital KYC technology, digital onboarding processes have become simpler, seamless, and easier. One such frictionless self-onboarding journey is as follows:
- Customers download the digital wallet app and enter their mobile phones to start the sign-in process.
- Customers validate the mobile number using an OTP (One Time Password) received via SMS.
- Customers use their mobile phone cameras to capture photos of their identity documents such as national ID cards.
- Customers enter personal details and other required information.
- Customers finally take their video selfies and complete the digital KYC process.
While delivering a seamless user experience like the one described above, digital wallet solution providers also need to ensure proper security and compliance. Hence, digital wallet providers are adopting the latest digital KYC processes and technologies like Optical Character Recognition (OCR), Face Matching, Liveness Check, and ID Forgery Detection for complete security.
OCR uses a combination of software and hardware to scan the National ID, passport, or other identity documents and convert them to machine-readable text. The scanned text is used to auto-fill the KYC details in the app, making the digital onboarding process faster and more convenient. Face Matching compares a customer’s selfie image captured through a mobile phone and photo on the identity document to authenticate the customer in real-time during the onboarding process. It uses AI and Deep Learning algorithm to generate face matching scores. While clicking a selfie, Liveness Check is also done to ensure that the customer is present during the KYC and the system is not tricked using a photo or video. ID Forgery Detection authenticates and verifies identity documents and images using machine learning algorithms.
Engage with Gamification
Financial transactions are serious and boring, but they can be made engaging and fun with gamification. By employing elements of gameplay and adding rewards and surprise factors to the financial transactions, digital wallet providers can enhance customers’ involvement, increase brand recall, and motivate customers to transact more. Some of the popular gamification features employed by digital wallet providers are discussed below:
- Scratch cards: After a financial transaction, customers receive cards or coupons, which they can scratch to unveil a reward (cashback or discount or an empty coupon meaning no reward). Compared to standard fixed cash backs, scratch cards add an element of surprise as a customer may or may not get a reward and the value of cashback can vary.
- Spin-to-win wheels: After a financial transaction, customers are provided a chance to spin a wheel with multiple sections, each section representing a reward. The wheel stops at one of the sections and a corresponding reward is given to the customer.
- Badge collection: Digital wallet providers offer badges (or stamps/tickets/cards) of several types. After each transaction, customers receive one badge. Customers must collect at least one badge of each type to complete their collection and win rewards. Customers can also gift or exchange badges with other digital wallet customers, adding a social element to the game. Collection games not only increase engagement but also push people to transact more.
- Lottery: Customers must transact up to a certain amount to qualify for a lottery game. From all the qualified customers, winners are randomly selected on a daily, weekly, or monthly basis and rewarded handsomely.
- Leader board: Customers receive points for every transaction. The more a customer transacts, the higher are the points. Customers are ranked on a leader board based on the points and the customers at the top of the leader board are rewarded.
Gamification is being effectively used by digital wallet providers such as Google Pay in India to increase customer engagement and is being adopted by multiple digital wallet providers globally.
Conclusion: As competition in the digital wallet industry increases, a service provider who can deliver a holistic and superior customer experience will triumph. In the experience age, it has become essential to keep the customer experience at the center of the growth strategy.
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