Why The “Super App” Is The Key To Customer Acquisition and Retention for Financial Institutions

Why The “Super App” Is The Key To Customer Acquisition and Retention for Financial Institutions

Financial institutions have made significant investments in their digital banking capabilities, working to provide customers with all of the banking capabilities of the branch/contact center through the mobile channel. Prior to the pandemic, there were often large discrepancies between the quantity – and quality – of offerings that different institutions provided via the mobile device. The forced shift of many consumers to the digital channel (in the wake of lockdowns and temporary branch closings) has accelerated the adoption of the technology and created more parity among FIs in the marketplace.

For institutions that have successfully gained that foothold with their customers through their mobile banking app, they may be wondering how they can now build on that success to both attract new customers and create deeper, more meaningful relationships with their existing customers through the channel. The key lies in expanding the range of services provided, effectively growing a mobile banking app into a “Super App.” 

So, what exactly makes an app a Super App?

The concept of a Super App is based on the consumer’s preference to manage a wide range of everyday services and functions through a single, trusted source rather than be forced to download an individual app from every retailer and/or service provider they work with. This trend has already gained momentum in other countries, most notably in Asia where popular Super Apps combine everything from ride sharing services, to movie and concert tickets, to grocery shopping, to travel (airline/hotel), to bill payments and P2P payments, to insurance and even highway toll payments – all through a single app.

Consider the now fragmented experience of a consumer booking a weekend getaway to another city. It probably involves online research on the location and activities, use of a hotel rewards app to search for and book lodging, use of an airline rewards app to search for and book flights, use of a restaurant reservations app to book meals, use of an event ticketing app to purchase concert or movie tickets, and maybe engage with their mobile banking app to check balances and move funds to cover some of the costs for the trip. Then once they arrive, the use of an additional ride sharing app to move about the city, and a P2P payments app to split the dinner bill with friends.

What if all of that could be accomplished through one single application? And what if all of that could be accomplished through that consumer’s mobile banking application?

By the very nature of their customer relationships (highly trusted, regularly accessed, centralized financial management), financial institutions are uniquely positioned to play the role of Super App for U.S. consumers. In some ways they’ve already begun to establish that perception among their customers through tools like bill pay. A logical progression would be to incorporate additional services that can create meaningful positive impacts on consumers’ daily lives, like bill negotiation services, subscription management services, and personal data and online privacy management.

The rise of open banking and the adoption of APIs has made it much easier for disparate applications to communicate seamlessly with each other and has set the stage for a Super App environment. The reality is that someone is going to meet this need for U.S. consumers. Today, Super Apps exist as either a significant market opportunity, or an existential threat, to financial institutions and their ability to successfully engage with their customer base. Bankers must ask themselves if they want to play the role of Super App for their customers, or simply be relegated to the sidelines as a payments warehouse or just one of many apps that are bundled together within another provider’s Super App environment.

At ApexEdge, we have proven experience in helping financial institutions better engage with their customers through the digital channel – and do it at scale. To learn more about how your institution can start down the Super App pathway, contact us.

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