Sharing with friends gets digital, including splitting the bill

Banks need to be saying “You’ve got a friend in me”

Even a few years ago, when friends shared moments together, it was often in person – whether at the movies, sharing brunch or hanging out at the mall, and of course, splitting the bill. Over the past two years, the pandemic has evolved new digital ways to share moments with friends, supported by technology.

Take cricket for example, a sport that brings India together. In 2019, Hotstar’s motto ‘Koi Yaar Nahi Far’ led them to devise ways for friends to watch the matches of the Indian Premier League(IPL) together during the lockdown, and create a social yet digital cricket-watching experience.Disney+Hotstar rolled out a ‘watch with friends’ feature, where groups of five could watch the match on a video call. They also collaborated with the food delivery start-up Swiggy to allow viewers to order food from the Hotstar app, without missing any part of the match.Even hanging out at the mall is taking a digital turn, with platforms like Wormhole that alert users when someone they know is shopping. Their avatars can then discuss, compare and interact with each other as they would do at a mall.

Digital native Audiences

For millennials and gen Y, adopting digital experiences isn’t new; they are the first generation of digital natives, having learnt technology instinctively. Going online is their first response, even when it comes to money and banking. We took a poll, asking people about their preferred way to ‘split the bill’ or share money with friends. Over 53% of respondent over Twitter preferred to do this via a digital wallet, and 25% chose online bank transfers. Only 10% chose cash or cheque and 10% would use a payment via a messenger app. This reaffirms the current changes in the way customers view banking, with a trend towards digital and online-first approaches. Also interesting is the fact that cash or cheque payments are firmly on their way out, being replaced at the same pace with the upcoming trend of payments via messaging apps.

Integrating with Customers’ Life Journeys

Customers are viewing banking as part of their broader life journey, and banks must reciprocate by becoming part of the customer’s journey, positioning themselves for the real life moments. Instead of waiting for the customer to request medical insurance, the bank needs to be a wellness partner. Primary needs and real life events are what define consumer’s experiences with banks, and they can no longer wait for the customer to walk into the branch and ask for a loan, or an investment plan.

Or take the case of sharing a moment with friends. After a good time, everyone wants an elegant and easy solution for splitting the bill that doesn’t ruin the moment – how are banks offering a solution? Multiple bank mobile apps offer a basic transfer funds functionality, but despite it being more convenient than a cheque or an ATM, it doesn’t serve the purpose of the ‘life moment’. Splitting a bill with friends after dinner is easier to do on the very social apps used to connect and communicate with friend circles on.

This is the thinking that digital banks and neo banks are applying – a customer first approach and digital first design. Liv., a digital-only bank launched by Emirates NBD for millennials, has a ‘Split Bills’ feature that allows users to split bills with other people send payment notifications to their family and friends via social media channels, which include WhatsApp and Facebook.

Keeping Pace with Changing Behaviors

Banking, like every other consumer service, needs to keep pace with consumer’s behavior, lifestyles and preferences. Taking a look at the customer’s life and having a comprehensive strategy that maximizes digital engagement can position their products such as payments, co-branded offers, reference programs, home loans and insurance. The only way to service customers in such a connected manner is with a platform business model strategy and strategic partnerships.

To win in this evolving digital environment, banks need to put in place a sound ecosystem approach that allows them to create digital experiences, based on the life moments of the customer. When starting a new job, can the bank partner with lifestyle apps to offer support with a new wardrobe? Or when a baby is born, are there ways to tune into new parents’ thinking about college fund investments? A number of banks are taking the lead in nurturing an ecosystem to build their business. Emirates NBD Liv. provides the millennials in UAE access to a daily feed of information specific to their lifestyle along with relevant offers. Banks can also choose to participate in larger ecosystems through collaborations with Apple Pay, Google Pay or Amazon. They can monetize them through revenue sharing, higher customer acquisition and lower cost of operations.

The institution of banking has changed from the traditional brick and mortar establishment, to an evolving relationship that must accompany the customer on their phone, in their lives, reading their minds and being there at the right time. As this notion develops, banks that embrace this new dynamic relationship armed with a strategy that maximizes digital engagement and leverages the power of ecosystem has the first mover advantage. What customers want is a financial partner, a friend along their journey. Are banks ready to fulfil this friendship paradigm with customers or are they still waiting at the branch office in a suit, bestowing favours on those whom they find worthy?

Bridging a New Skills Gap in New Ways

Youth, which this article defines as those between the age of 10 and 30, play a huge role in the economic, demographic and sociocultural progress of a nation. One of the most important ways of nurturing the potential of this group is by providing the right skilling so they can maximize their employment opportunities. Unfortunately, while raw talent is available, there is a huge shortage in skills and employability in most parts of the world. The challenge before governments and other authorities is to match talent with skills, and in some cases, to even create the talent pool before upskilling it.

This mismatch is not singular, but has many layers to it. Splitting the youth population into key sub-segments, it becomes clear that the 0-15 group stresses the academic infrastructure of a country because of its need for education; the 15-24 group stresses the employment sector because of its need for jobs; whereas the 24-30 cohort makes demands on certain industries, such as automotive and housing, because of its desire to own vehicles, homes, etc. All are inter-related – a strong education sector produces skilled, job-ready people, who will go on to be more productive, and earn enough to meet their consumption needs. In theory, at least. In practice, there is a large mismatch between capacity and capability standing in the way of this progression.

There is also a mismatch between the legacy market infrastructure supporting education and industry and the digital technologies of the day. This gap was especially exposed by the pandemic when education and employment were forced to go remote overnight. Another issue is that the education sector is geared to impart theoretical knowledge but not the practical training and skills that the youth require to work productively in the real world. While on the topic of work, the young adults (~ 18-24) entering employment bring fresh minds and thinking; however, they find no avenues for this talent since most employers are still trapped in an industrial-era mindset that curbs innovativeness and imagination. The older youth (~ 24-30), many of whom decide to become entrepreneurs, face hurdles on this path because of the mismatch between their funding needs and funding sources, and also between their risk-taking ability and a risk-averse environment. There is simply not enough encouragement for these potential employment generators to pursue their dreams.

These gaps can be closed to a significant extent through skilling. What will that take in a post-pandemic world?

The pandemic has put a new spin on skills, and their seekers and providers.

Skills that were important, have diminished, to be replaced by other capabilities. For example, in banking, face-to-face interaction and in-person service are no longer that relevant when remote working and social distancing are the norm. So now, frontline staff need to be trained in building relationships, trust and rapport through virtual interactions.

Traditionally, skill providers brought years of experience to their workshops, relying on in-person presentations, role play, and group participation to impart training over several days. Now they need to reinvent themselves to be effective in a virtual training room, which presents challenges such as “Zoom fatigue” limiting sessions to a couple of hours and difficulty in assessing body language. Skill providers need to find ways to engage learners for extended periods and enable talent while working remotely.

Even the skill seekers have changed. They no longer want prolonged technical or functional programs, or long stints in college. Platforms, such as Udemy or Coursera, have changed the game by providing bite-sized, modular, on-demand training, that the new skill seekers are increasingly gravitating towards.

What is the best way forward in this digital, remote-only skilling paradigm?

Here is one idea: Every country has some type of employment exchange; in the past, this was a physical institution where job seekers submitted paper applications that were collated into a database. Government and private organizations used these databases to fill positions, while educational institutions connected with those with learning requirements.

Using digital technology, it is possible to elevate these national databases into a comprehensive global database for employment, apprenticeship and training. Then, any organization in any part of the world, would have equal access to this massive talent pool. With all work and learning happening remotely, this would become a conduit for global skilling and employment, free of visa and travel restrictions. The database could evolve into an online platform marketplace for talent, skills and jobs, enabling the best matches between seekers and providers. With no constraints, such as reservations or quotas for minorities or other groups, this would promote equal opportunity. And since the database would be accessible from anywhere with internet or mobile connectivity, it would go far in promoting inclusion. Based on the success of other platforms, one can expect this one also to scale up rapidly and sustain itself well into the future. It is a new solution befitting the new skilling problems of a post-pandemic world.