Building Digital Trust in Financial Services

Last week, frog and CFSI (Center for Financial Services Innovation) teamed up to host a panel on the future of trust in financial services. Moderator Rob Levy, VP of Financial Health for CFSI, opened the discussion by imploring our panelists to “look both backward and forward” to understand how we got to the current climate of distrust in financial services, and how we move forward to begin mending those relationships with customers. A decade out from the financial crash of 2008, Rob cited that a mere 28 percent of Americans are “financially healthy”, with over 40 percent not even able to cover $400 of emergency costs.

Right now, we are seeing a convergence of digital products that promote ease and accessibility, news of data breaches and misuse in the headlines, a large percentage of Americans still feeling the effects of the recession, and rising demands from consumers for transparency. So, how do we begin to design for trust in the digital age?

While all of our panelists agree that the fundamental tenets of trust have not changed, the stakes are much higher in the digital age. “Opportunities to lose trust have amplified,” said Alex Sion, Co-Head of D10X, Citi Ventures, making every customer interaction and experience highly valuable. frog’s own Toshi Mogi added that within the four pillars of trust, empathy and customer centricity are increasingly important, on top of competency and reliability. Lisha Davis, Head of Innovation studio for Vanguard, pointed out that it’s not just about being customer-focused anymore. Rather, companies like Vanguard are re-evaluating the ways in which they approach digital transformation to incorporate clients as key stakeholders in the process to ensure they are being truly customer-centric.

Another theme that came up is the changing demographics and generational shifts in customer profiles. Citi Ventures has key initiatives to address “Economic Vitality,” and “Modern Living.” Sion explains these initiatives are helping customers gain control and understand their credit as a first step to reaching economic vitality, while also creating accessible digital products and services that adapt to modern life, which is no longer predicated on the traditional “nuclear family.”

Along with this shift in demographics for the younger generation of investors, we are also seeing a major shift in the nature of work. These changes mean new needs are arising in the market. For instance, there is an increasing percentage of the workforce becoming “non-traditional employees” or NTEs. Without support from employers in the form of 401Ks or benefits, how can financial institutions start catering to these audiences? We’re also seeing rising mistrust amongst younger generations who may be put off by traditional investment models. Bridging these “trust gaps” will take more than just cool apps or CX geared at Millennials and Gen Z’ers.

While many companies have made major strides with digital transformation, we can’t expect flashy new fin-tech alone will solve the problems arising in the industry. The crisis in trust is much more deeply rooted than that, and will take real efforts on the part of our financial institutions to understand their changing customers, and how they hope to interact with finances and investments in the future. Digital first does not mean humans never. It will take financial institutions, fin-tech and strategic design firms like frog to address this issue from the customer out in order to forge ahead in designing for trust in the digital age.

For more on Designing for Trust in the Digital Age, download the full report here Designing for Digital Trust Insight