User Experience design as an industry is taking the world by storm; investment in
nurturing this talent for differentiation is critical for the BFSI industry’s survival. Luke Reed, Founder & Managing Director of Tech Circus describes to Zoya Malik, managing editor TFT, UX demands coming from retail and business consumers and how these traditional institutions must respond to threats posed by challenger banks and retail giants that are not only stealing their customers but that deliver UX so much better.
Zoya: What are Tech Circus’s objectives and the excitement surrounding FinTech Design
Luke: Tech Circus is an Events and Education company running around 70 meetups annually throughout Europe and host five conferences in London and New York. We are the first platform where industry leaders in FinTech can talk about their products from a design perspective. Business leaders, digital leaders, design leaders and designers exchange ideas can create powerful user-centric products, enjoy networking, doing business and getting straight to the heart of a niche target audience.
Zoya: What can you tell us about the state of UX design for the banking and finance industry in the UK and globally?
Luke: The rise of digital has revolutionised the finance sector. Consumers are becoming more impatient than ever, they want financial services to be on demand, smooth and easy to use. Digital user experience design has never been more important. Going back a few years, banks and FS companies ignored this and left huge gaps in the market for challenger banks to enter with well-designed, customer-friendly digital products that won over a huge audience, mostly due to their great user experience. This was the turning point in the design-lead revolution within banking and finance. Now the legacy banks are playing catch up.
When Monzo created its “card freeze” system years ago, the banks copied them so that their customer could have a far easier service than phoning in to block their card – this is just one example of where design changed the entire service level. After seeing millions of customers leave, the legacy banks (and other FS companies) began to realise why they needed to bring design to the front of the business. They are now digitally transforming more radically than before, by bringing in the top talent from Silicon Valley to create their online products, whilst investing heavily in teams.
They are also poaching key players from within the industry; Starling Bank’s co-founder Megan Caywood recently got snapped up by Barclays, Dan Makoski was headhunted from Walmart in the USA. There is a war on design talent and those who get the best minds in the industry, will create superior products and win customers. The UK is leading this field, however America is catching up, so we have decided to create a conference there too. Design is taking over, whether the banks like it not; they are going to have to become more creative if they want to keep their customers.
Zoya: What are the areas in which banking and finance needs greater investment into UX?
Luke: I would suggest that FinTech’s which do not invest in user experience do not deserve to be in business – if you don’t have a digital platform that meets your user needs you cannot expect to be taken seriously in this market.
Banks and finance need to invest in the user experience on every digital product they create; if the product is not user friendly then everyone will jump ship onto the next thing. More and more digital challengers are coming into the market and people will be spoilt for choice. Consumer expectations to have a fast and easy to use service are rising. You only need to look at Amazon to see how the physical shops have been disrupted by great online user and customer experience.
We are seeing a trend now where banks and FS services are closing branches and going online just like the shops, the difficulty is that banks are not traditionally digital, so they must transform from being a Blockbuster into a Netflix within a short space of time. User Experience is not visible, it’s the feeling someone gets when using the product, which is often linked to the design of the product. Netflix is very user-friendly and easy to use, most banks up until recently were not, but they are embracing change and becoming more user-centric day-by-day.
Think iPhone vs Nokia – was Apple’s technology that much better to topple the world’s largest phone provider, who had been doing it for years? No, but they had Don Norman at Apple, who coined the term user experience. This is why they have become the leader in many tech fields. Expect the banks with the best user experience to be the most used in the future – it’s already happening with the likes of Monzo and Starling, but this is just the start.
“I would suggest that FinTech’s which do not invest in user experience do not deserve to be in business”
Zoya: How does the banking and finance industry need to compete in terms of UX against digital giants especially for retail and payments and money transfer?
Luke: I personally think there will be some huge changes in Finance and a lot of the larger institutions will have to buy up the disruptive FinTechs in order to maintain a prime position in the market. It’s essentially a question of build or buy? I believe they’ll try to build their own product and buy up anything that threatens them. The one thing they will not be able to buy is the likes of Amazon, Google, Alibaba etc, who are all currently creating their own payment systems. The next year will be very interesting to see where it all goes, I expect most of these systems will end up being the finance equivalent to Google Plus – no one will adopt them. Banks are institutions and people are very wary about where they keep their money, there will always be a need to invest money where it feels most safe.
Zoya: What is the scope for FinTech startups into the UX industry? What are the new trends for them to peg their USPs?
Luke: From a design perspective, I feel anticipatory design will set start-ups apart from the rest, meaning creating delightful user experiences by understanding user needs and eliminating needless choices. A lot of other industries use anticipatory design, going back to my Netflix example: they know what films you want to watch next by analysing your past behaviour. I predict FS companies will be using more and more anticipatory design and psychological principles in the design of their products.
Luke: I am a big fan of blockchain and cryptocurrency as an investment eco system. I think the investment created from coin offerings is a great example of a smooth, simple to use, user journey. I have tried to find designers from blockchain companies to speak about the design of the products that they have created, and realised they are virtually non-existent. It’s sure to be a big thing in the future, however at the moment it doesn’t seem to be the focus. I am sure this will change in the coming years and when it does, UX designers will be all over blockchain.
Zoya: What is lacking in the education of UX designers? What more is needed at secondary and tertiary levels?
Luke: The UX industry suffers from a supply and demand issue, there are too many jobs and not enough experienced people to do them. Companies such as Red Academy and GA do a great job in training people via vocational bootcamps. The biggest issue seems to be that UX teams tend to be quite small, and having the time and effort to train someone is difficult. This has created a lack of junior roles in the market. We need graduate schemes where juniors can learn and grow into a role. Until more of these schemes are put into place, there will be a huge hole in the market with not enough experienced professionals to fill the vacant roles. It’s good news for the experienced designers though; due to this demand User Experience is one of the best paid roles in Tech.
Zoya: Can you point to new and up and coming FinTech startups that are leading the charge for UX for the banking and finance and related industries?
Luke: Other than the obvious challenger banks who are revolutionising the banking world, I am seriously impressed with Finimize – who I have asked to come and speak at the FinTech Design Summit. These guys have created a community of investors, who they give investment tips to and then offer the chance to invest, and it’s really successful. Another thing I really respect is that even as a small company, they have an in-house design team who are creating their product. Most new FinTech’s raise money and then get an agency to create the product. This is how you end up with the same product as everyone else, but just with a different user interface and brand name.