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March 29, 2023

Why does automated customer service matter for fintech startups?

The world of finance and technology is rapidly changing, and customers are increasingly looking for financial services that are reliable and efficient. By leveraging technology, fintech startups can offer top-notch services and gain an advantage over traditional banks.

However, since the 2008 financial crisis, trust in the financial industry has been eroded. Therefore, providing excellent customer service is crucial for fintech startups, from handling inquiries to resolving technical issues.

The establishment of trust through customer service can be a challenging task for fintech startups since their lack of physical presence can create a sense of insecurity for customers. Consequently, fintech startups must ensure their app (and company overall) can provide customers with extra reliable financial services, secure their funds, and help them reach their financial goals.

This blog will explore why automated customer service is especially important for fintech startups and outline specific steps businesses can take to improve their customer service.

Why automated customer service especially matters for fintech startups

Differentiate yourself from traditional banks

The utilization of mobile technology by fintech startups represents a significant competitive advantage, which can be applied to their customer service through automation.

The traditional banking industry has long struggled with poor customer service, often due to manual processes and inconsistent management. However, traditional banks are beginning to embrace mobile banking in an effort to provide more accessible financial services. A recent study by Mastercard found that 84% of people regularly use digital banking, with 63% using mobile banking apps from traditional banks and one in five using digital-only banks.

This makes it more critical for fintech startups to leverage their technological advantage and compete with traditional banks by providing exceptional customer service.

As the foundation of fintech startups is built on virtual interactions, their customers are likely to be more accepting and adaptive to automated customer services, such as live chat or chatbots, compared to traditional banks.

Additionally, the largest customer group for fintech startups is typically the tech-savvy younger generations, resulting in a higher utilization rate of automated customer services compared to traditional banks. This makes the adoption of automated customer services, such as chatbots at Algomo, even more worthwhile for fintech startups.

Incorporating automated customer services into the fintech platform should also be easier with the existing technological foundation in the company. While traditional banks may struggle with the relatively higher installation and maintenance costs of mobile banking, these are less of an issue for fintech startups.

Build strong trust with customers

Another key benefit of providing top-notch automated customer service is that it helps fintech startups establish a strong trust with their customers.

The overall lack of trust in the financial industry following the financial crisis, combined with the limited physical presence of fintech startups, exacerbates the insecurity felt by potential customers. A study by Mastercard in 2022 found that 20% of users had a strong distrust of fintech, compared to only 6% for incumbent banks.

Providing efficient and accessible customer service through automation is a crucial step in addressing this heightened distrust in fintech startups compared to traditional banks.

With automated customer service available 24/7, fintech startups can avoid situations where customers have urgent monetary issues and no one to turn to. Customers overwhelmingly agree (83%) that they feel more loyal to brands that respond to and resolve their complaints.

Each interaction with customers contributes to building a relationship of trust over time, where customers feel confident working with you and can manage their finances with ease.

A few tips to improve the customer service experience for your fintech startup

The idea is to fill the shortcomings of traditional brick-and-mortar banking institutions. It means fintech must allow customers to:

Ask questions easily.
Manage transactions seamlessly.
Raise concerns and get them quickly solved.
Switch between automated support and self-service seamlessly.
Receive highly personalised services and product recommendations.
Offer customer support 24×7 for 365-days

Below are four action points you can start to consider to boost your business.

Customer centricity

Always put your customers first.

Customer centricity demands that the customer is the focal point of all decisions related to delivering products, services and experiences to create customer satisfaction, loyalty and advocacy.  ​​Hence, the principle of being customer-centric should influence everything from your product design to marketing strategies.

The power shift between brand and customer happened during the economic downturns as customers became more selective in which brand they chose to spend their money with. The winning brands were the ones who treated their customers with respect, offered great service, and built a relationship with them that still exists today.

Self-help services to give your customers a greater sense of control and security

People generally like to have control over problems they encounter. This is especially true when it comes to financial transactions. As a fintech startup, you can give your customers the power to handle issues by themselves through a help centre.

Having a comprehensive help centre that provides as much information as possible upfront showcases your commitment to customer service and investment in the customer experience.

Allowing customers to access information and answer their own questions at any time of day gives them control over their finances. Additionally, a well-equipped help centre builds confidence in your business and products, as it demonstrates your readiness to offer continuous support.

Collect customer feedback and act on it

When you think about getting customer feedback, you may immediately think of surveys, but there are many other ways that customers express their opinions and experiences beyond that. This can include customer reviews, social media posts, support ticket trends, cancellations, and direct interactions with sales, support, or customer success teams.

Automated customer service solutions, such as Algomo’s chatbot, can also assist in gathering and analyzing customer data. The chatbot has features that enable businesses to keep track of all virtual interactions and collect important data that provides insights into customer behaviours, such as frequently asked questions.

By using this feedback to identify market trends, unmet customer needs, and opportunities for innovation, you can make improvements to your products and services to better meet customer needs and gain a competitive edge.

Build lasting conversations

When customers put their money into a fintech-related product, they are bound to expect exceptional results, both in terms of ease and convenience and a satisfactory outcome of the whole experience.

Addressing customer issues well isn't a one-off event or a random occurrence. On the contrary, it is a continuous cycle that must be handled with care and dedication.

Everything should be accounted for – positive online reviews, social media engagement, word-of-mouth marketing, especially in the all-invasive technologically led lives of people today. Hence, it helps to jot down the various interfaces through which the customers can reach out, eg, phone, email, social media, etc., and build a holistic customer service strategy.

Key takeaways

The use of automated customer services is crucial for fintech startups as it can help them establish a strong relationship of trust with customers and gain a competitive advantage over traditional banks. To achieve this, it's important for fintech startups to consider aspects such as offering self-help options, collecting customer feedback, and fostering lasting conversations.

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