Trust. It’s a financial institution’s most important asset. Some go so far as to put it into their name.
Trust is the basis for the many roles we play with our members and customers: protector, guide, sales person, security guard, counselor and advocate. Historically in banking, trust used to be built one person at a time, over the teller line or across a loan officer’s desk. Those personal relationships still matter for firms with brick-and-mortar locations, but they are far from the only ways people develop and measure trust with their financial service providers.
Trust is now about online banking system uptime. Trust is about having easy, intuitive processes. It’s about up-to-date security protocols. And, these days, trust is especially about how we use the powerful combination of financial data and digital design techniques, as banking by phone becomes more and more ubiquitous.
WSECU is in the pilot phase of launching a new financial wellness app created by our wholly-owned subsidiary, Q-Cash Financial. The app integrates with a member’s accounts and uses customized content, personalized coaching, cognitive behavioral change techniques and intentional digital design to induce positive financial health changes. We’re excited about its prospects to help people do things like build more solid savings habits, reduce the chances of overdrafting or increase on-time payments.
This new foray in the world of apps has led us to think about the appropriate use of digital design techniques that are built intentionally to change a user’s behavior.
A Bankrate study revealed that 63% of mobile device users have downloaded at least one financial app. These range from mobile banking apps to special budgeting tools and fintech investing apps. Each seeks to make it easy to use the app and, moreover, keep you using it, if effectively designed.
Digital behavioral design is about creating a user experience based on the techniques of persuasion to inspire a user to take action. Used by apps or sites that seek to pull you in and keep you coming back for more, the techniques are wildly effective. It’s a drip, drip, drip of adrenaline when that little notification icon pings and then pings us again a little while later. Color changes, motion graphics, alerts – these are all little reward cues that make us feel good.
Habit forming? You bet. How many times have you checked something on your phone today? It’s all about the right habits being encouraged and for the right reasons. We think promoting greater financial health is a great reason to use these techniques.
In their publication “Digital Behavioral Design,” behavioral design researchers T. Dalton Combs and Ramsay Brown discuss three criteria to be mindful of when designing a set of techniques for persuasion to keep them ethically-aligned.
The qualities are:
- Transparency: Tell your users what you are doing
- Alignment with social good: Are the behavior changes you seek good for the person and/or their community?
- Alignment with a user’s desires: When we apply behavioral design to, say, a savings program, it should be what the user wants. By way of comparison, the researchers say social networking apps that utilize behavioral techniques to get users to open them for adverting exposure rather than connecting with family and friends are not in alignment with the user’s desires.
We’ve created our financial wellness app with these principles in mind. We’re clear with members about what the app does and how its features are intended to help create positive changes. We think there’s little doubt that a service that inspires more saving or fewer negative financial habits is good for our member and the greater community. Lastly, using the app is optional, at the member’s discretion and it delivers what it says it will.
There’s an additional heightened level of responsibility for thoughtful delivery of this kind of tool when we are dealing with members’ money and data. As a financial institution, we have an enormous window into members’ lives. Banking data tells a complex and personal story about members. We know how much they spend on dining out. We know how much debt they have. We might even know when their pet is sick. This is private information and detail that must be respected and protected. It’s also incredibly useful and actionable; it’s information that can become fuel for positive financial changes.
Our wellness app’s integration with the user’s accounts and accompanying data analysis is how it can find and offer opportunities to signal it’s time to roll money into savings or to watch out because the member’s monthly pattern of spending may be indicating their account is close to going negative.
Executed with the users’ best interest in mind, digital tools can deliver incredible value. And a financial wellness app like WSECU’s allows for the chance to scale financial wellness support to reach far more people than we could ever do in-person.
The power of effective digital behavioral design is something our industry should embrace – and be careful about. For WSECU, we know it’s a vote of trust if our members use the app and we intend to be cautious stewards of that trust through transparent, ethical use of these powerful digital design tools.
