Opinion: Nick Harrison, Director, first direct

In time 2018 will be seen as a pivotal moment for banking as it took its first steps into the new world of Open Banking. first direct has been at the vanguard of this, seeking new ways to provide amazing customer service.

Among the changes we’ve been introducing in this space, our work with third party provider Bud to create a pilot app, artha, gained the most headlines. We’ve taken our time in developing this offering, working within the Financial Conduct Authority’s Sandbox to pioneer features customers will value, but in a way which still feels unmistakably first direct. For us it has been an incredibly fruitful experience and the feedback from customers has been extremely positive.

Over Christmas I was delighted to receive some direct feedback from a customer, let’s call her Aimee, who had joined first direct in 2018 and had been so motivated by her experience she wanted to get in touch. Not every customer writes in, but her experience to date is not untypical of customers in the current environment.

Aimee was keen to tell us most of her experiences with first direct were digital: making a contactless payment, using the mobile banking app to track her spend or withdrawing cash from an ATM. She went on to explain that she’d been one of the pilot members of artha and that she’d loved the ability to aggregate all her different bank accounts in one app. She could easily track of her spending habits and set up a holiday savings list so that she could keep a much closer eye on her holiday fund.

If we’re honest, we know very few people wake up in the morning and think ‘I can’t wait to do some banking’ so it’s a great feeling to hear that you’re making a positive impact. The timing of this feedback got me thinking about 2019 and how Open Banking and the use of partnerships will begin to change the way financial services support and serve consumers in the future.

In 2019 I expect to see an acceleration in the release of new services for customers by a large number of financial service providers. As the partnership model between banks, established digital players and fintechs becomes a much better trodden path and consumer awareness of Open Banking increases, there will be an acceleration in the release of new services that help consumers to better track their finances, spending habits and goals.

For most banks, this will start with account information services that allow customers to see all of their bank accounts in one place. However, this is only the start of the journey as the real value-add for consumers comes when that important information is utilised to help them get on with their lives.

What do I mean by that? There are parallels between the automotive industry and financial services. Just as the automotive industry is moving more towards cars that can drive themselves, I expect to see financial services move in a similar direction and provide products and services that help consumers by making better financial decisions for them based upon their goals. There’s still a long way to go and a lot more customer co-creation required before this becomes a reality but the artha pilot has shown us consumers really value personal and relevant notifications on their spending and savings habits.

If we know a customer’s goal in life, such as saving for a house, and we know their typical spending habits, then we should be able to help them manage their money and achieve their goal faster. Developing customer relationships and supporting consumers in this manner is popular as it enables customers to better manage their finances, frees them up to get on with enjoying their lives and builds a deeper level of trust based on emotion. I hope to see this vision become a reality as we progress through 2019 and beyond.