Let the gamification begin ... a fintech revolution
We’ve heard a lot about gamification in recent years — the process of making everyday activities more appealing by offering the same type of encouragement that makes playing games like Candy Crush and using devices like Fitbit feel so rewarding. At Mogo Finance Technology, we believe that gamification will not only transform banking but be the decisive factor in picking the fintech winners of the future.
Banking and consumer financial services are increasingly moving to digital platforms, because digital is faster, more convenient and a better value proposition. Some people talk about bank customers who want human contact. That demographic is rapidly evaporating — millennials aren’t built like this.
For Generation Z, gaming is second-nature and they’re even less interested in setting foot in a bank. Even if bricksand-mortar branches tried to compete, it’s impossible to replicate a gamified experience in real space. Digital can be a thousand times more engaging than the real world, and we’re only at the beginning of mastering that art.
However, gamification is a two-edged sword. It can be used to drive behaviours that aren’t in the customer’s best interest. For example, typical credit card reward programs encourage you to overspend and go into debt by making you feel good about a few dollars earned in so-called reward points.
The most successful digital banking service will be the one that makes it easiest and most engaging for customers to act to their own benefit and develop healthy financial habits.
We recently developed a Platinum Prepaid Visa card that competes directly with a credit card, even though credit cards are deeply embedded in people’s consumer habits. With gamification, we can make it more fun and engaging to spend money that you do have than to spend money that you don’t have.
However, creating a great gamified experience requires far more than simply creating an app or a utility that works efficiently. We invest significant resources in ensuring that, like a real game, every element of the experience engages you and every successful interaction is rewarded.
For example, with the MogoCard you can choose your own design. Even the good feelings associated with pulling a designer card out of your wallet is actually a form of gamification. We also offer push notifications every time the card is used, providing customers with transaction details along with a balance update and an encouraging emoji. When you access your digital account, a dashboard lights up and offers gamestyle animation.
Ultimately, customers will realize that the money they’re saving by using the MogoCard is far greater than the reward points they used to earn by going into debt.
Even when checking your credit score at no cost through Mogo, a marker might light up to tell you that you’ve achieved rock-star status. The more this drives customer engagement, the more they’re learning how to positively affect their credit score and be more mindful about all the factors that might impact it.
If you access a Mogo loan to pay off your credit card debt from another company, our Mogo Level Up program rewards you for successive on-time payments. You get a notification that “you’re on fire” and eventually be rewarded with a lower interest rate on your loan balance.
There’s not a single bank in Canada that has gamified the mortgage experience to focus the customer on winning that game as we have with the MogoMortgage. If all you did at age 30 is buy a home worth $400,000 and focus on making mortgage payments over 25 years, by the time you’re in your fifties you would have a net worth of approximately $1.2 million, based on typical appreciation.
Gamification is going to encourage that behaviour and transform people’s financial lives.
The top five Canadian banks made $40 billion in net profits last year at the same time as Canadians racked up record levels of consumer debt. There should be no reason why digital platforms, transformed by gamification, shouldn’t create a next generation that reports appropriate levels of debt and record levels of assets and net worth.
David Feller is founder and chief executive officer, Mogo