April 11, 2024 Consumer Insights for Fintech Engagement and Growth

The “Bridging the Loyalty Gap” report by Tillo reveals that fintech loyalty programs are less developed than those of other industries.

In its “Bridging the Loyalty Gap: Consumer Insights for Fintech Engagement and Growth” study, Tillo, the industry leader in embedded rewards and incentives, revealed that 68% of consumers currently have no loyalty toward fintech companies. The report illuminates the vital role that incentives and rewards play in forming and expanding customer retention and loyalty within the industry. It includes insights from over 4,000 US and UK consumers.

Notably, 26% of respondents expressed distrust towards fintech services, with the most significant trust deficit in the cryptocurrency sector. The findings indicate that a sizable segment of consumers are disengaged, giving fintechs an excellent opportunity to bring in new clients and strengthen their bonds with current ones.

Opportunity for fintech companies

Fintech is a diverse and evolving landscape that includes crypto, neobanking, open banking, and Buy Now, Pay Later (BNPL).The report highlights a significant untapped market for fintechs to attract new users and presents an exciting opportunity to differentiate themselves from competitors through innovative service offerings and strategic customer acquisition campaigns.

Key findings include:

38% of those surveyed have not yet engaged with fintech companies, highlighting substantial potential for growth. Only 32% of consumers feel loyalty towards fintech brands.

The age range most-engaged with fintech services is 35-44-year-olds.

Over a quarter of respondents expressed distrust in fintech services. Of all the services included in the survey, respondents had the highest distrust of cryptocurrency, exposing opportunities for education and rewards to encourage adoption.

Fintech was the least popular loyalty category among industries with loyalty programs, which also included grocery, hospitality, beauty & retail, and travel & leisure. Fintech, which averages 1.04 memberships per consumer, compared to grocery loyalty programs’ 2.08 memberships, can learn from these other industries with more popular loyalty programs.

Incentives and rewards drive consumers to engage

Developing customer loyalty is crucial, and sign-up incentives, activation rewards, and loyalty rewards are important factors that encourage consumers to engage with fintech companies. Relevant findings include:

57% of respondents surveyed consider sign-up incentives and loyalty rewards to be influential factors in their choice of fintech service providers, with 19% of consumers more likely to try a fintech product or service if they are offered an incentive or it has an associated loyalty program.

While many factors go into creating a successful loyalty program, the monetary value of rewards offered was the main concern for respondents. Ease of use was the second most important concern, followed by the variety of rewards offered.

Gift cards stand out as the most universally attractive form of reward across all demographics, with an overwhelming 68% of consumers considering them as an enticing reward or incentive. The next most popular forms of rewards in the US were brand discounts and premium tangible features, respectively.

“Fintechs can close this ‘loyalty gap’ by using incentives and prizes, especially gift cards, which can convert skeptics into new adopters and convert infrequent users into devoted supporters,” said Alex Preece, CEO and Co-founder, Tillo. “Gift cards are the most popular and appealing reward type across all demographics, highlighting their potential as a crucial strategic asset for fintech companies looking to increase their market share and profitability.”

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