Debit is diverse, innovative, and already here
Imagine a future where the average consumer has three or more debit accounts, and banking is personalized and seamlessly integrated into our lives.
Not only is this scenario possible, it could be what many consumers want. Research indicates consumers are interested in banking contextually.
Because of value-driven, mobile-first user experiences, they’re interested in staying within the technology or e-commerce ecosystems they’re already in, for example Venmo or Square Cash — opening up potential for multiple financial accounts and debit cards.
This creates opportunities for technology companies and brands looking to create seamlessly integrated user experiences and deepen customer relationships. In 2020, numerous platforms will consider offering their own debit products for several reasons:
Debit gives consumers what they want. Consumers love debit. In 2018, debit was the most popular payment type, accounting for 28% percent of payments.
Brands that offer debit are meeting their customers where they are. This is especially true for those who are doing so in ecosystems where the consumer is already receiving or spending money, as more people have a growing desire to compartmentalize their money via multiple debit and banking relationships.
Debit can drive customer stickiness. Nearly a third of consumers are open to non-bank debit alternatives. Many are willing to try services from brands they trust that provide engaging, simpler experiences. Mostly, consumers want a seamless experience within the channels they’re already using. Online investment platforms are tackling this head on — their fee-free platform might win customers with a relationship that helps them achieve financial goals, while integrated debit with perks like cashback rewards keeps them engaged daily.
Debit could increase worker retention. The way the average American earns income is changing. Fewer workers get one paycheck from one employer, but rather earn from multiple platforms and demand to be paid for work as they earn. For companies that pay gig workers, it’s important to understand 73% are willing to leave a marketplace if unsatisfied with its method of pay.
But pay can be an asset in keeping workers — think Uber and Lyft. There is competition to retain and attract drivers for each. Adding a debit product for drivers that allows immediate access to earned wages and cost savings is another way for companies to increase retention.
Today’s most innovative fintech solution isn’t new but a tool that’s already in consumers’ wallets — debit. It’s being seamlessly integrated into digital-first experiences in a way that’s fresh and exciting for the consumer. And it has the potential to drive new attitudes toward contextual banking relationships, financial engagement and loyalty.