By Rohan Ranadive, Senior Product Manager, Publicis Sapient and Siddharth Maheshwari, Senior Product Manager, Publicis Sapient
In the ever-evolving landscape of banking, customer expectations continue to rise, compelling banks and fintechs to innovate. A standout approach in this pursuit of seamless experiences is gamification – the strategic use of game elements, like point scoring, badges, and leaderboards, in non-game contexts. Although not new, gamification is now transforming financial services by making traditional banking tasks more engaging, shifting the experience from routine to enjoyable.
Gamification goes beyond entertainment. Financial institutions are embedding gamified elements across services to shape customer choices, boost engagement, raise awareness, educate on financial matters, and streamline processes. In retail lending, gamification offers clear benefits: it strengthens customer loyalty through dynamic rewards, helping institutions gain insights into customer needs while creating new avenues for cross-selling and targeted offerings.
The global gamification market, currently valued at $13.4 billion is expected to reach $58.8 billion by 2028, with a 26.8% annual growth rate. Within lending, gamification stands as a critical strategy to not only attract customers but also keep them engaged and informed.
Key gamification techniques and enablers
Gamification in finance utilises points, badges, leaderboards, performance graphs, and avatars to enhance the user experience. For example:
– Points provide feedback and track progress.
– Badges acknowledge achievements, creating a sense of accomplishment.
– Leaderboards encourage friendly competition, enhancing engagement.
– Avatars enable users to represent themselves digitally, personalising their journey.
– Teammates offer opportunities for social interaction and collaboration.
With digitalisation accelerating, banking institutions can now incorporate these elements seamlessly into mobile and online platforms, transforming the customer experience while ensuring it remains meaningful.
Application in lending: Real-world use cases
- Simulation games on lending products: Simulated experiences can help users make more informed decisions about their investments and loans. For example, a bank might offer a mortgage simulation game that uses real market data, helping customers understand future milestones and financial commitments. A prominent case is CommonWealth Bank which launched Investorville, a mortgage simulation game, achieving an impressive ROI and boosting financial literacy.
- Financial wellbeing: Interactive features, like simulating credit score impacts, guide customers on financial wellness. These tools can coach people on improving credit scores and foster a competitive spirit. Mobile Apps launched an application where over a million users checked their credit score within the first year, driving engagement and boosting cross-selling opportunities.
- On-spot rewards: Gamified elements, including badges, stickers, and points, awarded to customers for specific actions such as referrals or timely payments reinforce positive financial behaviors. Setting small goals like achieving a strong credit report for a defined period can further incentivise customers, helping them cultivate good financial habits.
- Continuous customer engagement: Using progress bars to track loan application steps maintains user interest throughout the process, reducing drop-off rates and creating a more engaging journey.
Impacts and benefits of gamification
The impact of gamification extends beyond customer satisfaction. For lenders, it enhances loyalty, drives engagement, and educates users in financial literacy through simplified product explanations. Gamification also aids brand building and fosters trust by creating engaging, educational content that resonates with users.
Research shows that gamification can yield substantial improvements in key business metrics, reinforcing its strategic value. It transforms otherwise dry financial products into enjoyable, interactive experiences that encourage people to explore more offerings and make informed decisions.
Future prospects and strategic considerations
As gamification continues to gain traction in banking, it’s becoming integral to sectors beyond retail lending. Cards, payments, and other areas are already adopting game-like experiences to meet the demands of today’s tech-savvy consumers. As digital banking evolves, financial institutions open to innovative gamification stand to benefit by capturing customer interest in increasingly crowded markets.
However, successful gamification requires balance. Excessive game mechanics can risk undermining a product’s credibility. Thoughtful integration of gamification is key, ensuring it complements banking services without detracting from the institution’s reliability and trustworthiness.
The way forward
Gamification presents an unmatched opportunity for the retail lending industry, offering a plethora of benefits for both customers and financial institutions. While gamification can enrich the banking experience, it is not a universal solution. Its overuse may lead to fatigue and disengagement, so financial product managers should aim for a balanced approach, enhancing experiences without overwhelming users. By thoughtfully integrating gamification, banks and fintechs can create enjoyable, educational, and impactful interactions that pave the way for a more engaged and informed customer base.