Financial Wellness as a Key Customer Strategy for FinTechs and Financial Institutions

Financial  Wellness as a Key Customer Strategy for both Fintechs and Financial Institutions

Individuals continue to seek out financial advice and education throughout their lives depending upon their current personal situation, milestones they have celebrated and future plans that they are embarking upon. The post-Covid world has certainly shifted the Digital Tectonic Plates for the Customer Experience and has paved the way for the “New Hybrid Reality” in which consumers are increasingly choosing technology as their preferred mode of interaction with in-person communication as a supplemental back-up when needed.

For financial institutions, this shift is where “Financial Wellness” is the rubber that meets the road. Not only does research show that financial wellness is a post-Covid priority amongst consumers, but it is also a perfect fit for the new hybrid world in the sense that financial wellness can engage consumers digitally at any stage of their lives with human support when the consumer needs it.  The focus on Consumer Financial Wellness and putting consumer financial health at the center of their business is the ONE focus that unifies all institutions and represents a major opportunity for the industry. Financial wellness is the unique identifier that allows both FinTech and Financial Institutions to not only measure their own success but their customers’ success as well. Despite stimulus packages and other government assistance programs including waived fees, loan modifications, payment forgiveness, and Paycheck Protection Programs the chances are most Americans are feeling that Financial Stress is their number one stressor and are feeling challenged in ways they can save, borrow, spend, and plan. This is exactly the universal entry point that Fintechs, Financial Institutions and Credit Unions can all focus on by making Financial Well-Being the center of their business.


Financial Wellness is the opportunity to improve the Member and Consumer Experience


Focusing on the Financial Wellness of consumers has had several challenges in the past. For one thing,  Financial Wellness means different things to different people, depending on their stage of life. The second challenge has been to measure Financial Wellness. Unlike a credit score, there is no universal financial health score that can show consumers where they stand or how to improve. This is changing with advancements in technology to the point where it is now possible to personalize the financial wellness journey by measuring consumers’ financial health and understanding their most pressing needs. This in turn enables financial institutions to offer solutions that help consumers based on their situation or level of financial health.

Some organizations and Financial Wellness Subject Matter Experts and Employee Financial Wellness Programs have commonly referred to this junction as “meeting the customer where their money is.” The journey mapping of the Financial Wellness experience is the Key Customer Strategy as it affords the opportunity to meet the consumer where their money is and focus on what matters most to the consumer.

Technology tools are also the link to “nurturing relationships” and powering up the Digital CX. With the hybrid world upon us, customers are being approached intraday and the consumer is now used to nurturing their relationship through their device and engaged with minimal human interaction. Importantly, Financial Wellness is the one epicenter that can engage consumers at the beginning of the on-boarding relationship and throughout the customer life cycle. It is the opportunity to create a life-long partnership.

According to Kevin Cimring, Founder and CEO of Paperwork,  “there is a massive opportunity for financial institutions to add value to customers, earn their trust, build loyalty and enhance cross-sell opportunities through a financial wellness approach.” He adds that, according to research, the majority of Americans are financially unhealthy, and consumers are looking to their financial institutions to provide more financial guidance, education, and better financial health outcomes.  “That’s why we’ve started partnering with financial institutions, particularly credit unions, to help their members improve their financial health through the convenience of our mobile app. Our Financial Health Score lets members track their financial wellbeing and our personalized insights help them improve no matter their stage of life. Depending on the member’s needs, services offered by the credit union can be showcased in a contextually relevant way so that members can learn about suitable products available to them and take action without being overwhelmed, says Cimring.

Financial Wellness tools can seamlessly be “baked into the technology” at the time of new account on-boarding, “nurture” existing relationships as well as be integrated into both Generational and Community Marketing outreach programs.

Cimring adds that his company is mission-driven to help everyone improve their financial wellbeing. “Our financial health program is applicable to a diverse audience and can help them in many different areas of their financial lives. It’s not about their level of assets – from graduates entering the workforce to retirees doing end-of-life planning, everyone can find insights and guidance to help them make better decisions and make sure nothing falls through the cracks”, he says.  

Recently, Bank of America was the first financial institution to be certified by J.D. Power for financial health support, a new certification developed in collaboration with Financial Health Network and focused on financial health. This is just one of several developments evidencing the trend towards financial wellness as a key customer strategy. It’s time for the financial services industry to embrace the shift, for the benefit of all.