Fintech InnovationIs Innovation Everything in Finance? Or, Should Experience be Seen as More Important?

September 29, 2023 | 9 min read

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Fintech Innovation

In a Nutshell

Innovation is highly valued in payments and finance. However, is innovation more important than experience? Let’s take a closer look at the divide between high-tech expectations and prioritizing a safe, simple, and secure customer experience.

Marrying Experience & Innovation to Meet Customer Needs

Innovation is undeniably a crucial value to possess in the fintech space.

Every financial institution should be aiming to stay one step ahead. Whether that’s in outsmarting the competition or dodging new and developing fraud. The end goal is always to make life easier for the customer. But here's where things can get a bit tricky.

Everyone in the finance sector loves to throw around buzzwords like “transformative,” and aim to look like they're on the cutting edge. It's all well and good to aim for a dazzling, next-gen product. But, sometimes we miss the forest for the trees. What truly matters is how effective that technology is at delivering a smooth, hassle-free experience to the customer.

Maybe it’s time that focus should shift away from simply being the most innovative or disruptive force in the market, and toward creating tech solutions that genuinely make customers’ lives easier? After all, a happy customer is often loyal, and that's a win-win for everyone involved.

The “Innovation Fallacy”

Fintech Innovation

Remaining at the forefront of technological advancements is often cited as a priority, especially in the financial sector. The allure of being perceived as transformative or cutting-edge is compelling. However, there's a risk of losing sight of the fundamental objective: fulfilling customer needs effectively and efficiently.

Innovation thrives in environments that minimize bureaucratic constraints and welcome a level of calculated risk. However, unbridled experimentation without a structured management system can result in good ideas getting lost or misdirected. Furthermore, businesses might end up losing sight of basic best practices in the interest of “disrupting” the market.

This is where the stabilizing forces of experience and accountability become invaluable. They provide the essential scaffolding that supports the innovation process within the banking sector, enabling it to reach its full potential.

The danger of diluting focus by pursuing multiple initiatives simultaneously is very real; doing so often leads to resource constraints that can inhibit, rather than encourage, meaningful innovation. Ultimately, competitive success hinges on the institution's ability to concentrate its investments in areas that will have the most significant and immediate impact on customer satisfaction and operational efficiency.

What Customers Need

Fintech Innovation

The menu of options for  new features ranges from sleek online and mobile banking to budgeting tools, options for cryptocurrency, and even AI chatbots. It's a lot to consider.

But what are customers actually looking for? What’s the primary feature that banking customers want? Well, if recent surveys are to be believed, the answer is pretty clear-cut: people want simplicity.

In these surveys, when folks were asked to pick one thing they'd really like their bank to focus on, the top answers were telling. About 19% wanted an easier way to talk to a real human for customer service. Not far behind, 17% were looking for a more straightforward way to handle everyday banking tasks on their own.

So, here's the essence: customers aren't necessarily dazzled by all the bells and whistles. A lot of them might not even know exactly what they want in a banking service. But they do know they want banking to be easy and hassle-free. They're not looking for a complicated experience; they want something that's user-friendly and gets the job done efficiently.

Shifting Focus

Fintech Innovation

While chasing every shiny innovation out there is tempting, it's often more strategic and feasible to zero in on a select few. The fewer objects you're juggling, the more you can direct your resources and attention in a meaningful way.

Financial institutions have access to a treasure trove of opportunities at their fingertips to enhance customer experience.

Imagine ATMs and online banking platforms powered by artificial intelligence for top-notch fraud detection. Or, mobile apps armed with visual analytics that give users crystal-clear insights into their financial health. FI can even streamline those busy bank visits with efficient check-in kiosks. The possibilities could stretch on and on.

But here's where the magic of data steps in. You gain invaluable insights by tuning into how your clientele interacts with your services. This knowledge lets you pinpoint which innovations will smooth out the customer journey and where your efforts are best invested. Knowing how to leverage these insights takes experience.

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Experience: More Important Than Innovation?

Banks need to keep in mind that it's not about whose technology is most innovative and disruptive. Rather, it’s about whose technology delivers the best and most efficient, friction-free customer experience.

Experience and innovation hold significant value in the field of finance. Each has its unique set of advantages. That said, there are reasons why experience might be considered more important than innovation in some contexts:

Risk Management

Risk management practices are crucial in finance. Experienced professionals have the ability to assess and manage risk more effectively based on a long history of observing market patterns, economic cycles, and regulatory changes. An approach without a grounded understanding of these fundamentals can lead to significant losses.

Regulatory Compliance

Finance is a highly regulated field. Experience in navigating these regulations is essential for maintaining compliance and avoiding legal repercussions. Innovation can sometimes push the boundaries of what is allowed or acceptable, thereby introducing unnecessary risks.

Client Trust

In finance, the trust of clients and stakeholders is paramount. Experience can foster that trust much more readily than innovation. Clients are often more comfortable investing their money with someone who has a long, proven track record.

Skill in Execution

Experience often leads to a refined skill set that can make financial operations more efficient and effective. In contrast, innovation may introduce new methods, but lack the assurance that they will be executed smoothly.

Understanding Market Dynamics

Experienced professionals have a nuanced understanding of market behaviors and can adapt their strategies accordingly. While innovation can provide new tools for understanding the market, it can't replace the deep knowledge gained from years of direct experience.

Avoiding Common Pitfalls

People with experience have typically made mistakes and learned from them, allowing them to help others avoid common pitfalls. Innovators, especially those without sufficient background, may inadvertently commit errors that those with experience could have easily avoided.

Economy in Resource Allocation

Financial decisions often involve allocating scarce resources. Experienced individuals are generally better at prioritizing these resources effectively. This allows them to maximize returns and minimize costs.

Long-Term Vision

Experience often grants professionals the ability to see beyond short-term gains and assess the long-term impact of financial decisions. On the other hand, innovation can sometimes focus too much on immediate outcomes at the expense of long-term stability.

Team Leadership & Management

Managing a financial team or department requires more than just technical skills. It requires people skills, organizational knowledge, and leadership. These are all qualities that are often honed through experience.


Experience generally leads to more consistent results. In finance, consistency is often more highly valued than occasional bursts of brilliance. After all, it’s better to see regular, predictable positive results, rather than infrequent and unpredictable wins.

Let’s be clear here: the spirit of innovation is undoubtedly important for the advancement and competitiveness of the financial sector. However, the nature of finance often gives experience a more immediate and reliable form of value. It’s also true that the most effective financial professionals find a way to balance both experience and innovation, applying lessons from the past while remaining open to new methods and technologies.

Leveraging Both Experience & Innovation 

Marrying customer needs with innovation in the banking sector requires a delicate balance. The idea is to create an environment where technological advancements enhance the customer experience,  rather than complicate it. This must also be done within a transparent, ethical, and compliant framework. 

Banks can achieve this by:

Understanding Customers’ Needs

  • Customer Surveys & Feedback: Periodic surveys and customer feedback sessions can offer insights into what customers actually want, rather than what the bank thinks they want.
  • Design: The user interface should be intuitive and easy to navigate, whether online or in an app.
  • Omnichannel Experience: Customers should be able to switch between different channels (mobile, online, in-person) smoothly. Data and functionalities should sync in real time across all platforms.

Prioritizing Accessibility

  • Mobile Banking: Customers expect a seamless mobile banking experience. In response, apps should be user-friendly, secure, and offer nearly all the functionalities available on the bank's main website.
  • 24/7 Support: AI-powered chatbots can handle a variety of queries and issues at any time of the day, thus improving customer service.
  • Personal Finance Tools: Advanced algorithms can offer personalized advice on budgeting, investing, and retirement planning directly through the bank's interface.

Improving Customer Service

  • Train Staff: Even with the best technology, human interaction remains important. Staff should have ongoing customer service training to help customers use digital tools.
  • Accessible Customer Support: In addition to digital means, customer service should be easily accessible through traditional channels like telephone and in-branch services.

Measured Implementation

  • Pilot Programs: New features should be rolled out gradually, possibly through pilot programs that allow for real-world testing and feedback.
  • Soliciting Feedback: Implement channels for collecting customer feedback after launching a new feature or service. Analyze this data to make necessary adjustments.
  • Phased Rollout: Once tested, new services can be introduced in stages to different customer segments, constantly tweaking based on feedback and performance metrics.

Regulatory Compliance

  • Compliance Checks: Every innovation should undergo rigorous compliance checks to ensure it meets all legal and ethical requirements.
  • Data Security: With digital innovation comes the risk of data breaches. Banks must prioritize cybersecurity measures to protect customer data.

Monitoring & Updates

  • Performance Metrics: Continually monitor how well the new features perform post-launch, and consider whether they meet predefined objectives.
  • Regular Updates: Technology is always advancing. Regular software updates can offer new features and improved security to ensure a good customer experience.

Merging technology with a deep comprehension of customer needs allows banks to seamlessly integrate innovation with enhanced user experience and service. Though it demands a consistent, long-term commitment, both the institution and its clientele stand to reap significant benefits.

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