Successful fintech businesses understand their customers

Knowing clients’ wants and needs allows firms to assess if trends are scalable through market intelligence and applying its own judgement.
Andy Jury
By Andy Jury, Group CEO, Mukuru.
Johannesburg, 24 Nov 2023
Andy Jury, group CEO of Mukuru.
Andy Jury, group CEO of Mukuru.

All businesses would do well to ask whether they truly are putting the customer at the centre of all their decisions and how well they are using data to maintain this closeness to their clients to build and maintain trust.

This is important in the broader technology industry, and in the fintech industry in particular, where there may be a bias towards looking for the hottest new trend or flashy technology at the expense of solving the real-life problems of customers.

There are two ways to build a business. One is to build a product set and then find a market, while the other is to deeply understand what customers need and want, and then design solutions to meet these needs.

I’d posit that a fintech business − and this could easily be overlaid on any technology vertical − whose customer base has traditionally been underserved, does far better when it asks what customers want first and then delivers the solution, before actively walking the journey with customers to build trust.

A fintech firm needs to gain and retain trust.

Of course, to understand customers, feedback loops must be built into the business, and then the mindset of listening to customers and passing the intel along the business chain must be embedded − quickly.

This can include focus groups, or logging the steps taken by a user on a USSD menu and aggregating the results, or it might be a contact centre listening to customer challenges and methodically feeding that information up through the organisation.

This reverse-engineering, as it were, is time-sensitive. It becomes irrelevant if data feeds up to decision-makers today when the problem occurred six months ago.

A business must keep its finger on the pulse of products and services in real-time. The only way this is possible is by building structures within the business to empower people to make decisions. This means building an organisation where people know their roles and responsibilities, where they can make decisions and stray out of their lanes, and where they can revert and get validation.

If the business has built itself around the customer, it becomes simpler to inculcate this thinking and far easier to execute.

When thinking about fintech specifically, especially those that seek to serve a broad customer base, it becomes apparent that what is required is a broad enough subset of customer needs and wants addressed in 95% of the product set so the company does not have to tweak or make bespoke changes too often.

To be able to achieve this, a fintech needs to have the right modularity of its DNA sequence or product pieces. The business must ensure it is not too big, nor too small, while at the same time endeavouring to give customers some selection and self-determination for them to feel as though the product is personalised for their own wants and needs. This point is crucial for customer loyalty, and it isn’t achieved by building 13 million bespoke solutions. Rather, it is built by scaling the company’s network and current tech, to serve the wants and needs of a customer base of 13 million.

As one would imagine, at large fintech companies, we crunch a huge amount of data: 13 million customers provide a massive pool of data points to aggregate, but as long as we know who our customers are, we will be well-positioned to use all the big data techniques available to find gaps in a product set and fill them. This way, we are engaging customers in the way they want to be served.

Just how does one leverage this intelligence to build products and services? Simply speaking, it starts by looking for trends and instances of large demand pools. A business that serves millions of customers needs scale and depth behind a product to make it a worthwhile exercise for everyone involved.

With this in mind, a business that understands the wants and needs of its customers can investigate if trends are scalable through market intelligence and applying its own judgement.

In our industry, there are massive asymmetries of information because we are engaging customers at the intersection of the formal and informal ecosystem, meaning we can’t just pull up research databases that tell us the market size is “x” and people are prepared to pay “y”. In cases such as these, businesses need to build their own intelligence and apply their own knowledge and understanding of their customer base.

Finally, once a business launches a product or service, even if it addresses an important customer need, there must be trust in the market for it to succeed.

A fintech firm needs to gain and retain trust. This is done by delivering on brand promises. Whatever promise is made, ensure you deliver on it. There may well be exceedingly complex supply chains in the backend, but the proposition is simple: this is what we say you will get, and so we ensure you get it.

Of course, this becomes much more difficult when working with more customers, across more countries and with more products, but that’s a growth challenge for all business types.

It is imperative for businesses to spend enough time understanding where they are over-delivering and where they are under-delivering versus customer expectations. Where they are under-delivering, they need to make sure there is accountability and if there is structural under-delivery routinely, and if it is not contingent on someone not doing what they are supposed to do, it is an opportunity to deliver a tech-led solution to uphold the brand promise.

Looking ahead over the next few years, the trust quotient in the emerging market is going to rise exponentially, which might make the industry more competitive − but the addressable market will also increase dramatically.

Those who want the lion’s share of this market need to authentically build themselves around their customers, use data intelligently and focus on gaining and retaining trust.