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SO YOU DON’T TRUST BANKS? MAYBE YOU CAN PLACE YOUR TRUST IN TECHNOLOGY INSTEAD

Technology
  • Mike Rymanov, CEO, DSX

 

There is no doubt that fintech is bringing great changes to the financial institutions of the world. However, what about the impact that fintech can have on those who aren’t a part of traditional financial systems?

If we look at mobile technology, M-Pesa is easily the darling of the space. With mass uptake and mass mobile ownership on the African continent, M-Pesa, and the ability to pay businesses and people using mobile money has transformed entire economies. Whilst this affects millions of people, according to a World Bank and First Data study conducted in 2017, an estimated 1.7 billion people across the world remain without access to any formal financial accounts. 1.8 billion are also estimated to rely on semi-formal or completely informal systems, instead of banks, for their own financial services. These numbers are worrying.

A lack of access prevents not only full economic growth but also personal wellbeing. This is where blockchain and cryptocurrency could storm in and play a role where traditional banks have thus far failed.

 

Technology

Mike Rymanov

The pedal to the metal

Let’s start by looking at blockchain. Blockchain reduces the time and expenses of financial transactions, can support biometric identification solutions, and can completely get rid of the dependence of single third-party authorities for trust in any system’s validity. Deloitte is right then, in saying that blockchain is an accelerator for financial inclusion – quite literally.

So what about the other great technology that is based on distributed ledger technology? What about cryptocurrency? These digital tokens are often used worldwide for investment purposes – making more money out of initial deposits, so how on earth could they help those who aren’t a part of the formal financial system?

In 2018, an academic, Jan Ohnesorge wrote that “a good replacement for access to a transaction account could be access to a universally accepted and secure cryptocurrency.” He even says that it could enable payments, offer the possibility to save money, and provide a gateway to other and more varied financial services. Crucially, this would not necessarily have to be powered by blockchain to work.

However, all this said, cryptocurrency still has a way to go when it comes to user-friendliness.

 

Increasing uptake

User-friendliness drives better uptake of anything, and can therefore demonstrate the benefits that cryptocurrencies can bring. One important one is a lack of access restrictions. Ohnesorge believes that this will increase the uptake of distributed ledger technologies as, in his mind and for many others, their biggest hindrance currently is ease of use. This also addresses a potential lack of trust in traditional financial systems that is currently hindering the uptake of use in markets that use M-Pesa for example. After all, everyone knows almost instinctively how to use a mobile phone, but not everyone instinctively knows how to use cryptocurrency.

So let’s take our inspiration from the mobile world. Abra, a mobile e-money wallet, enables crypto trading on the blockchain, in an easy and simple way. All that is needed is a smartphone with the app installed – this then enables sending and receiving funds – globally. Users do not need to understand what cryptocurrencies are, or how to use them. They don’t even need to know that the app uses cryptocurrencies. Abra means that anyone with a mobile phone can be connected to the global digital economy. For those in a completely unbanked situation, you don’t even need a bank account. These thin-file citizens can then immediately start building up their financial records file, which can pave the way towards a credit record being created. Not bad, right?

 

Blockchain in the real-world

So what about the real world? Are there examples where this is already working, or is it a pipedream conceived by technologists and blockchain evangelists? Could this actually, and I mean, really help the world’s unbanked? Well, I believe so, and I’m not the only one.

In the Philippines, as many as 70% of residents are unbanked. To overcome this obstacle to financial inclusion, Unionbank partnered with ConsenSys and a number of other banks and tech companies to create an Ethereum-based payment platform for rural banks. Initially designed to support domestic remittances, the programme aims to overcome the challenges of connectivity and lack of technological resources in rural areas. But it doesn’t stop there. Project i2i also wants to build the infrastructure needed to bring rural banks into the pre-existing and internationally connected financial system, along with their customers. There are also numerous other projects that are exploring the use of blockchain to bring about financial inclusion. One such example of a low-cost financial service based on the blockchain is Stellar, which IBM has embraced in order to launch its own Blockchain World Wire, a platform that enables real-time global payments. The Blockchain World Wire currently supports payments in 72 countries.

Blockchain, and the belief in blockchain has undoubtedly been impacted by the hype train. Financial startups touting it as a panacea, and any and every industry thinking of how it can be used to better their services has perhaps diluted the value of the technology to many.

However, applications of this technology in financial inclusion are just getting started, and look to be taking off with gusto. Blockchain holds real potential to bring everyone together on one ledger-driven financial system. It could, even, be the great leveller for all – elevating and levelling up those who haven’t been a part of the formal financial system before.

Blockchain and cryptocurrency technology’s potential goes beyond investing and fully traceable transactions. It can truly become a tech for good, enabling communities to bring themselves up to levels they may never have thought possible. A change in attitude is needed, but with it can come such a beneficial change, that we may remember the dark days of finance before blockchain with shock and horror. You never know, stranger things have happened!

 

Finance

HOW TECHNOLOGY IS CHANGING ACCOUNTING

Mike Whitmire is Co-founder and CEO of FloQast,

 

The fundamentals of accounting have been around for hundreds of years. They’re not likely to change any time soon, other than adapting the way they interact with new business regulations and tax laws. But the day-to-day process of accounting has seen a rapid change in the past few years resulting from disruptive new technology. But, is this a good thing or a bad thing?

Taking the Accounting Department on the Road

Cloud-based technology is one of the most significant shifts in the modern accounting department. If 2020 has taught us anything, it’s the importance of location flexibility for businesses. With cloud accounting platforms and applications, accountants can work from almost anywhere.

Even on a typical, office-based day, cloud tech allows an accounting team to collaborate seamlessly, sharing access between several people in real-time. No need to worry about multiple versions of the financials when the current iteration is always just a click away.

Cloud technology also makes it easier to integrate apps into the base accounting software. In addition to an accounting suite, many companies use inventory software, AR/AP software, and other specialized tools to meet their needs. With so many cloud-based apps available, it’s getting easier and easier to set up an entire ecosystem of apps for your business that sync and integrate seamlessly with one another. Not only does that save time and effort, but it also reduces the chances of mistakes, omissions, and accidental double entries of data from one system to another.

 

Convenience for Accountants and Clients

For those accountants working in private practice or in the public accounting sector, technology and cloud-accounting can be a lifesaver. Files and documents can be uploaded digitally and client work can be handled remotely with no need to ever visit the client’s place of business. This makes for a more flexible and much less disruptive workday for many accountants.

For clients, this is a more convenient way to work too. They no longer need to travel across town to deliver a stack of documents and across town is no longer the limit of their accountant options. They can just as easily work with someone across the state or across the country, allowing them to find the best fit for their business needs. This is a win/win for both parties.

The New Role of Accountants

Technology has all but eliminated some part of the job for accountants, and that can be scary. As

AI takes a bigger role in accounting, many of the manual tasks are being automated. Connected bank feeds and AI can match transactions and even automatically reconcile accounts in some cases. But that doesn’t mean the job of the accountant is disappearing. In fact, it’s the beginning of a whole new role for many accountants.

But those aren’t bad things. Quite the opposite, in fact.

With their time free from the drudgery and monotony of manual data entry (and all that double-checking and second-guessing about typos and transposed digits) more and more accountants are taking on a strategic role. The numbers are beginning to take care of themselves, but businesses still need people who know what the numbers mean and can apply them to business problems.

For example, as technology makes reconciliations easier, the accounting team can get through more reconciliations each month and close the books with more confidence. They now have time to follow through with things like flux analysis and future projections. These strategic moves let the business make better business decisions, backed up by solid financial data.

 

Preparing for the New Accounting Landscape

Adapting to new technology is a key skill for the modern accountant. Those looking to get into the industry, or looking for upward mobility in their accounting career, need to seriously consider upping their tech comfort level.

Accounting degree programs are increasing their focus on technology and creating more tech-savvy accounting grads. Those already in the industry should take the hint and seek out continuing education to increase their own tech skills and understanding.

But the new accountants won’t only need tech skills, they’ll also need greater communication and teamwork skills. As they take on a more strategic and integrated role in the company, accountants will need to work well with other departments and communicate financial information to non-financial team-members. These “soft skills” have been lacking in the caricatured accountant, but they’re making a serious comeback in the new generation.

Conclusion

The future (and present) of accounting is bright. Technology is making the job easier and taking over a lot of the tedious tasks but the job outlook continues to grow. Instead of data entry and number crunching, accountants are free to analyze, strategize, and guide their clients and businesses with their financial insights.

 

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Technology

PSYCHOLOGY USED IN AUTOMATED CUSTOMER SERVICE

Humans are emotional beings; they can be grumpy, lovely, or sometimes a mix of both. It is for this reason that people in customer-facing positions strive to master the art of human psychology. The end goal is to evoke the right customer emotion and influence positive decision making.

With automated customer service, communication is between a bot and a person. But that doesn’t eliminate the emotional aspect that influences decisions. Therefore, you have to optimize your help center system to humanize the conversations as best as possible. So, how do you go about that?

In this article, we enlighten you about the psychology used in automated customer service. We share the psychological tactics that you can apply in your robotic support system to increase customer satisfaction. We also discuss the same psychological triggers that course building platforms use to influence positive experiences, and how you can leverage them.

Psychological tactics you can implement in automated customer service

Adopt a pain-numbing scheme

Pain is powerful emotional feedback that affects human decisions, positive and negative alike. Therefore, you have to design your automated support system to include pain reduction points. Some of the things that trigger pain in consumers include:

  • Missing the items that they’re searching for in the catalog
  • A hard time accessing essential shopping tools like carts
  • Difficulty comparing prices

Optimize your automated customer service software to provide quick links to common shopping tools. Also, feed it with keywords that shoppers possibly enter while searching for various items to recognize shopping difficulty. Further, add features like save-for-later so that consumers can access unresolved issues with ease in the future.

Promote instant gratification

In psychology, there’s a popular theory that discusses the pleasure principle in human behavior. It observes that we are driven by a force of instant gratification when dealing with needs, urges, and wants. So, how is this relevant in automated customer service?

First, customers love working with systems or people who respond to queries in the shortest possible time. As such, you need to design your support system to resolve issues as instantly as they come. This way, you can easily keep your customers on the site since it eliminates the need to seek help elsewhere.

Secondly, when resolving issues, most people appreciate being in control than feeling as if they need you during those moments. Your automated system should encourage self-service when attending to customers. Design it to direct your visitors to FAQ pages and resources that contain relevant info.

Apply social proof

Consumers feel more confident when buying solutions that worked for other people. In psychology, this inclination is referred to as social proof and is useful in building a sense of trust. Luckily, you can apply it to your automated customer service system to influence positive customer decisions.

For example, a buyer wants to find out more info about an item they’re hoping to purchase. You can design the support system to direct them to both the description and the customer testimonials pages. The idea is to influence purchase by proving that other consumers like the item as well.

Additionally, you can add common questions that your customers ask in the FAQ page and your solutions. Personalizing the queries helps visitors realize that you’ve assisted other consumers before. Eventually, this builds a sense of trust in your capability to meet user needs.

Leverage the Halo Effect

The Halo Effect is a cognitive bias where your feelings about something influence your judgment of its other aspects. The existence of this bias affects how you view things and make your decisions on a quick call.

In customer service, you can leverage the Halo Effect by creating positive experiences. Have an interface in your support system that’s personal to the users or emotionally engages them. Use words, colors, or images that form positive impressions at first glance. Here, you’ll instantly move the consumers from the “getting to know you” phase to the biased “this feels homely thus trustworthy” phase.

For example, if you’re in a fashion niche, rename your customer service portal to something like” “Ask a Stylist”. Doing this creates a positive assumption in the mind of your visitors that the service system/personnel has the necessary expertise. Combining this with the right dialect further builds the homely feeling.

Use the reciprocity principle

The reciprocity principle is a powerful human influence tool, as demonstrated in a 1984 book by Robert Cialdini known as Influence: The Psychology of Persuasion. The author observed that people often feel indebted to repay kind gestures. Today, marketers using psychology are still applying his ideas to boost customer conversions.

So, how can you use the reciprocity principle in customer service?

Optimize your automated support system to offer as much free expertise, time, and attention as possible. When customers receive comprehensive responses, they’re naturally obliged to purchase what you’re selling.

Your free acts of service can be subtle or announced. For example, if your support system successfully resolves an issue, you can encourage the visitor to take any action that counts as a conversion. Alternately, you can let them decide on their own the next course of action to trigger reciprocity.

 

Psychological triggers you can apply to your automated customer service

Self-love

People naturally exhibit the trait of self-love during interactions. They tend to put their desires and ambitions first, something that creates a yearning for others to show interest. If they get the attention they seek, it makes them feel important, unique, relevant.

In automated customer service, it’s possible to leverage self-love and encourage positive decisions. For example, you can design the system to call visitors by their name to increase a sense of recognition and importance. Additionally, ask questions that focus on learning more about them.

Empathy

Consumers build trust in brands that appear to understand their feelings. It’s easier to show empathy in automated customer service systems than other communication methods, like voice calls.

For example, you can set the live chat to allow you to review messages sent to visitors when sensitive subjects are in discussion.

Path of least resistance

Human beings prefer methods, actions, and solutions that offer the most convenience. You can use this psychological finding to optimize your web interface in a way that encourages visitors to chat with you.

Create an automated greeting that invites the visitor to a conversation. For example, “Hi, can I help you find the right item?”

Conclusion

Not every psychological trigger or tactic that we’ve discussed will work for you. Each brand has customers with varying personalities and temperaments. Nonetheless, the above will offer a great starting point for people who just implemented the automated customer service system.

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