Gamification in Financial Services: Approach to Connect to the Financial World

From gyms and fitness centers to addictive mobile apps – every moment of our lives is now tracked. We are updated on the exercise habits and diet plans and this makes us connected to the ecosystem which has adapted to our interests and knows how to keep us engaged. And that’s what has been buzzing as the trendiest concept – GAMIFICATION.

A similar trend has been making inroads into the financial services industry. Here the incumbent players, as well as the next-gen fintech firms, are looking forward to adopting gamification in their business lines. According to BBVA’s innovation team, demographic data says that about 53% of the gamers are between the ages of 18 and 49 and 55% play games on smartphones which is actually the future of the financial industry. Hence, this represents an appreciable market opportunity for the financial firms to offer enhanced customer engagement by educating them on banking, payments, investment planning, and insurance, among others. The 3 key elements which have driven the financial firms to invest in gamification are:

The scope of adopting gamification doesn’t restrict itself to just offering better user engagement through gaming psychology but also presents opportunities for better product developments, proactive marketing strategies, and much more. The inception of the digital revolution has produced transformational impacts on the financial services industry and has changed perceptions to a great extent. For instance, banking which was perceived as a boring phenomenon is now a thing to do and not somewhere you go to. The gamification wave has given birth to many innovative products, enabling firms to engage more with the users. Some industry-specific instances include:

1. Commonwealth Bank of Australia has launched Investorville, which enables users to get insights from simulations of their buying behavior for real-estate properties.
2. Aviva Italy came up with a mobile app which tracks the driving behavior of the users and notifies them every 300kms through a rating of 1-10 while also providing tips on fuel efficiency.
3. Barclays launched a social credit card and a community “Barclaycard Ring” where members receive incentives on sharing suggestions and ideas for credit card features.
4. Lloyd’s TSB has a game “Innovation Market” for employees to participate in the crowd-sourcing platform. The best ideas are vetted and put into implementation.
5. Canada-based Sun-Life Financial launched “Money UP” to educate consumers on retirement and investment decisions. The game format requires players to pass levels by demonstrating their financial knowledge.

I, personally, have been using a mobile app named Walnut, which is an intelligent expense manager for me, providing weekly tips and action points to organize my finances efficiently. Alerts are generated whenever the expense from either my debit or credit card goes beyond the set monthly limit. Additionally, a monthly spending analysis is reported to track the major expenses. A month-on-month comparison in terms of line charts helps me monitor my spending habits. All these take place without any human interference as the app automatically tracks the SMSs received on my phone and sends me relevant updates. Till date, 5 banks, 3 credit card providers, and merchants like Bookmyshow, Ola, and Uber have on-boarded the app. Walnut aims to be a one stop solution for all spending, bank transactions, and bill alerts so that one doesn’t have to set reminders regularly or go and check the account balance online and then decide on how to manage finances.

The financial services sector projects a promising market for gamification in the coming years with many innovations already happening such as Roboadvisory, Blockchain, and RegTech, among others. All these disruptions seek a continuous and effective customer engagement in the most interesting way. A major financial firm in the US has launched an app where customers can use a virtual map to set locations where they wish to buy a home and, in return, the app will provide the details on house insurance, property reviews, financing facilities, and other information which would facilitate seamless decision-making. This is what we call a proactive proposal where you are already familiar with circumstantial differences and thus it becomes easy for you to make a reasonable decision sitting at home.

Another area which I believe should be gamified and presented with an interesting experience is the tax saving decisions. At present, most of the employees either hire a financial advisor to handle their tax savings or just follow the traditional investing patterns. There are a number of options available in the investment world and it is difficult for employees to try and choose a holistic mix of term plan, equity linked savings scheme, and pension funds. This particular area of tax saving can be gamified in the form of simulations which can provide an approximate idea to the customer on where to invest, how much to invest, and for what period. Users would be able to see the expected returns, set their goals while the app in itself will provide the alerts and notifications regarding premiums or re-investing in a different fund. All these features stored in one single simulation app will be a great advancement in the financial world, but as the saying goes “where there is optimism, there are bound to be challenges”. The major obstacle which gamification faces is design and layout.

Implementing gamification would be fraught with difficulties. With the increasing penetration of customized marketing, every business cannot adopt an effective gamification tool as it completely depends upon the design of the game. Since every business will have a separate set of requirements and a different hierarchical structure, the gamification solutions will only find a standard set of offering after an extent. Therefore, opting for gamification won’t be a good idea if it doesn’t impact the business appreciably. According to a study from MarketResearchNet.com, the global gamification market is expected to decline at a CAGR of 30.37% by 2021 because the majority of vendors will struggle to provide optimal solutions to the organization as each and every organization has a different set of objectives.

In conclusion, as the key players in the market such as Badgeville and BigDoor Media are moving at a tremendous speed in providing business gamification solutions all over the world, we can expect a plethora of interfaces where we would be able to design our own investment portfolio, crowdsource funds in a peer network, plan our tax saving portfolio through simulations, track parallel accounts, and many more.

“Gamification Goes Beyond an Intellectual Understanding to Forge an Emotion Connection.”

References:

Partners, Apis. 2014. “Gamification of Financial Services: Current Trends and Future Possibilites.”

Partners, Sia. 2014. Gamification in Financial Services and Learnings from other Industries. October 22. http://en.finance.sia-partners.com/gamificationfinancial-services-and-learnings-other-industries.

Pilcher, Jeffry. 2012. The Gamification of Retail Banking Sector. October 15. https://thefinancialbrand.com/25728/gamification-in-retail-banking/.

Wheeler, Karen. 2017. What is Gamification and Why it is good for Banking sector. August 8. https://www.finance-monthly.com/2017/08/what-isgamification-and-why-is-it-good-for-the-banking-sector/.