Attentiveness, agility, and focus are no longer considered optional; they have become fundamental service standards that customers now anticipate from their service provider.
The mainstream nature of digital has enabled providers to automate personal experiences like never before. Tailored experiences tend to resonate deeply with clients and are more likely to foster loyalty and better engagement.
Open Banking offers a unique window into your consumer’s world, providing insights that can improve customer experience, financial wellbeing, and improve customer satisfaction.
With such insights, businesses can gain an in-depth understanding of consumer spending habits, preferences, and financial health. In turn, companies create personalised payment plans, offering flexible pricing, or unique incentives tailored to individual consumer needs.
They can even drive a dynamic subscription service that adjusts monthly costs to the customer's circumstances, ensuring affordability and increasing customer retention.
Traditional payment methods such as card payments or Direct Debits often come with rigid structures that can hinder innovation. Open Banking payments allow for more versatility, security, and control, all at the customer’s fingertips.
That versatility allows businesses to consider alternative models in which consumers pay according to the service they want to experience, or their financial circumstances at that time. Perhaps they want additional content during their favourite sports season, they might want to take a payment holiday, or pay a premium for continued coverage when overseas.
Our partners are developing commercial models that improve payment experiences for their customers. They are seeing reduced costs by benefitting from a near-immediate transfer of funds as well as a reduction in transaction fees.
What’s more, micro-transactions, which were often cumbersome with older payment systems due to processing fees, are becoming more viable and efficient through Open Banking payments, unlocking opportunities for businesses to monetise small-scale repeat services or digital goods.
The subscription economy is booming. From digital content platforms to monthly beauty boxes, consumers are increasingly leaning towards this model.
With Open Banking payments, the potential for innovation within this space is profound. Businesses can provide dynamic services based on real-time financial insights or even offer mid-cycle upgrades and downgrades, ensuring consumers always get value for their money.
Payments play a critical role in customer engagement, whether that is the convenience of Apple Pay or Google Pay, the flexibility of Buy Now, Pay Later, or the age-old favourite, Direct Debit. But associated with each is higher cost, the question of affordability, and the rigidity of scheduled payments that will be 60 years old in 2024.
Being customer-centric doesn’t mean pigeonholing customers into your defined groups, it means treating each as an individual and offering a range of payment options suited to them.
So, a utility or telecoms customer who is paid weekly doesn’t want to be confronted with a bill every month. They might prefer to pay weekly. It shouldn’t cost them more – as is often the case with services aimed at the financially under-served, it should reflect their circumstances, and it has to be a fair deal. Businesses will benefit from offering the right choice, those that offer first will reap those benefits.
Imagine receiving real-time payment notifications with personalised offers attached, or loyalty rewards instantly credited after a purchase. Such integrations not only improve the user experience but also provide businesses with additional touchpoints to engage, reward, and retain their customers.
While the advantages of Open Banking payments are vast, its true potential can only be unleashed when businesses partner with pioneers in the field. The fintech landscape is bustling with options, but choosing a partner that's agile, trusted, and at the forefront of innovation can be the differentiator.
An agile partner ensures that as your business evolves, your payment solutions evolve with you. Whether it's integrating new features or pivoting to entirely new models, agility ensures that your payment solutions remain relevant, efficient, effective, and tailored to your customers’ needs.
A pioneering partner ensures that you're always a step ahead. In a rapidly evolving fintech world, being with a company that has built an enviable reputation for consistent innovation means you'll have access to class-leading solutions, ensuring you're always offering the best to your consumers.
Lastly, trust is paramount. Open Banking revolves around sensitive financial data, and partnering with a trusted entity ensures that data privacy, security, and compliance are always upheld. A trusted partner is more than just a service provider; they're custodians of your consumers' trust.
Open Banking payments aren't just a new way to transact; they're a catalyst for reimagining how businesses interact with consumers. The essence of any innovation is to place the customer at the heart of propositions. And in this journey, choosing the right partner – one that's agile, attentive, pioneering, and trusted – can make all the difference.
This editorial piece was first published in the Open Finance Report 2023. We encourage you to download the report and find out the latest trends and developments in the world of Open Banking and Open Finance, as the road to Open Data continues.
About Mark Munson
Mark Munson is Divisional MD for Moneyhub Payments. In a career spanning over 20 years in global consumer payment, he has developed a reputation as a consumer payment expert with an emphasis on innovation, proposition design, and operational management.
Moneyhub Payments combines Open Banking, Open Finance, and Open Data technology to facilitate transactions that are faster, more secure, and lower-cost. From ecommerce and retail to savings and investments, the applications of Open Banking payments come in the form of VRPs, account-to-account immediate payments, and payouts, providing a friction-free experience for the customer.
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