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Factors Affecting Customers Lifetime Value of Fintech Services
Bhavani Sri Ramya M
Assistant Professor
Integral Institute of Advanced Management
Email: ramya.madhura@gmail.com
FINTECH ERA
Fintech is the thriving industry of present-day industrial world. Beginning from a small street vendor to precious gems dealers, majority of the transactions are accomplished through fintech services worldwide. Gone are the days where customer used to visit any shop or service with their wallets full of cash. The present-day mantra of any customer and the business world is “cashless”. The fintech revolution has ushered the customer into the era of cashless, be it withdrawal or deposit of cash.
The fintech industry has strengthened its roots in India during the global crises 2008. The crises have brought in the essential innovative transformations known as Fintech.3 in every field be it financial or marketing. Awareness on the usage of digital and online services has gradually advanced due to the increase in the presence of private players. The smart phones have ushered the era of digital banking which has brought in financial inclusion of all unorganised sectors. Mobile banking and internet banking were the first steps in our economy’s shift towards fintech services. Integration of multiple services of the financial institutions have initiated the online presence of the customers. The markets have gradually shifted from product centric to customer centric. Customer has become the God in the eyes of all services. Demonetization is the primary driving factor for the growth and development of the fintech services in India. Mandating banks and public on the limited usage of ATMs for cash withdrawals acted as a catalyst for the changing of the mindset of the public. Promoting of the fintech services by the Prime Minister internationally and nation-wide has given the public the assurance on the security of using them. The RBI has opened the financial sector for the private fintech startups like Paytm, phonepe, google pay which were based on the existing international fintech companies like PayPal and Visa. The new entrants of fintech services have revolutionized the entire outlook of financial inclusion. Technology has become inexpensive, readily available at the hands of customers. Smart phones carrying the features of scanning technology, 5G technology have made the transformation towards the fintech services effortless.
The emergence of UPI (Universal Payments Interface) has brought India into the global arena of fintech services. India is expected to have a $1.3 trillion fintech market by 2025. The BNPL (buy now pay later) model has resulted in the expansion of the markets and buying behaviour of the customers. Credit cards have changed the customer’s buying patterns. The pay later option has amplified the customer life time value with a product. Gone are the days when the prospective lead of a product or a service will turn into as customer on payment of cash. Cashless transactions have impacted the buying behaviour twin-fold. First, the customers usage number per service is increasing and the second is the retention which is related to the customer life time.
