DATA PERFORMANCE
STRIKING THE RIGHT BALANCE IN
CUSTOMER
DATA
Rich customer data helps fintechs and financial service providers to personalise their products – but ask for too much , and you risk the dreaded dropoff
WRITTEN BY : ALEX CLERE
The relationship between a user and a fintech begins with data . Customers enter their details , and the extent of that data collection has the power to define a fintech ’ s relationship with that customer for the user ’ s entire lifecycle . Collecting poor or insufficient data can hamper fintechs , yet asking for too much in the first instance can be prohibitive as well .
Indeed , according to research from software company Fenergo , a third of financial institutions report losing customers due to a slow or inefficient onboarding process . In reality , it is likely to be higher – it is , after all , a statistic that many providers shy away from acknowledging . It ’ s a problem , Fenergo says , that costs the industry US $ 10bn a year in lost revenue .
Balancing personalisation and data collection The question of how much data to collect is a constant balance between observing the fintech ’ s business requirements and respecting the customer experience . Asking for too many details at first signup puts customers off , as Alistair Dent , Chief Strategy Officer for data consultancy Profusion , explains : “ You can either have an involved and detailed data collection that few people complete , or a simple and quick route to signup with more customers about whom you know less .
“ Over the last 10 years , fintechs have tended to migrate to the latter end of this spectrum . The argument goes that if you sign up more customers , you can collect information as you go ( progressive signup )
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