In this episode with Oliver Berthier, we discuss the irrationality of money and why behavioural science techniques are essential in wealth management.
Oliver is the CEO of Moneythor, a company that helps banks and SMEs create a more engaging experience for their clients through digital platforms. Specifically, Moneythor provides digital solutions through transforming messy data into engaging, personalized content for clients to improve financial wellness. These platforms benefit end-users and clients quickly by helping them stay on top of their finances. Looking beyond the short-term, Moneythor provides material on financial literacy that educates clients on how to be a good vendor and investor.
When building Moneythor, Oliver and his team quickly realized that people are not rational. It is this irrationality that lies at the core of behavioural economics. Rather than purely focusing on integrating technology into finance, Moneythor has actively been including behavioural science techniques to support what they do. Oliver comments that banks have traditionally expected clients to be rational, which is hardly ever the case. This is why personalized digital content is significant, helping end-users make sense of digital platforms and financial products.
The digitalization of wealth management is vital in our digital era, and Oliver notes how we all expect personalized experiences in our digital applications as consumers. Furthermore, statistics published by banks and analysts have indicated that digitally active and engaged customers are more profitable. As a result of this growing appetite, financial institutions can wield personalization as a competitive advantage. There are three fundamental techniques of behavioural science to bear in mind when providing personalized digital services. First, accessibility. Customers need to be able to quickly view their personalized data in a digestible manner. Desirability is the second pillar and often forgotten. Wealth managers need to remember that the outcome of personalization has to be positive for consumers. Finally and most importantly, the personalised advice given to clients needs to be feasible and achievable for them.
As a company that focuses on providing these personalized services, Moneythor uniquely partners with SMEs to manage their businesses. Speaking from his own experience, Oliver shares how as an SME, their own experience with digital banking has been terrible. Understanding that there is a growing demand among SMEs for more personalized financial management platforms, Moneythor has been catering to this need. There are many reasons why SMEs would want a more streamlined financial experience. Personalized data can provide insights and clarity into the business and help employers stay on top of receivables and payables. Additionally, many small businesses may not have a Chief Financial Officer running finances. Hence, while there is a lot of focus on consumer retail banking in the market, there is much scope for expansion to assist SME banking and financial management.