The Flip Side of Digital: Are Customers “Interoperable”?

> Posted by Anisha Singh and Suraj Nair, Senior Research Associate and Research Manager, IFMR LEAD

Patel, 62, father of two, spends an hour learning how to use mobile money wallet A from his daughter. The interface, navigations and services offered are all quite new to him. The next day, he tries to pay for a taxi but finds the taxi provider only accepts mobile money wallet B. He’s quite confident he should be able to use wallet B as the knowledge of how to use A is still fresh in his mind. However, he struggles with navigating the new platform and is unable to locate certain payment options. He’s also apprehensive to try out different keys as he wants to be careful not to transfer money incorrectly. Giving up, Patel pays in cash and waits for his daughter to return home to teach him how to use mobile money wallet B.

In India, in both urban and rural settings, among men and women, this challenge is all too common, especially among older adults. New research from IFMR LEAD and J.P. Morgan finds that while digital literacy is a massive obstacle to financial inclusion, so is applying already gained skills to unfamiliar products; digital literacy does not necessarily transfer well from one platform to another.

Ongoing efforts toward increasing adoption are in vain without ensuring the usability of products and services. Usability centers on the product’s interface and how intuitive and convenient it is. Accordingly, supply-side efforts have focused on building interactive interfaces with the latest features to streamline and digitize everyday payment needs. On the other side of the coin, perhaps most important of all, is consumer digital and financial literacy. The Reserve Bank of India and the Indian Government have taken certain measures to enhance digital literacy, such as the National Digital Literacy Mission (NDLM), which provides digital literacy training to citizens across the country, and the National Centre for Financial Education (NCFE), which works to expand financial education in schools, workplaces, and the general population through awareness-building and trainings.

Despite these measures, Patel’s inability to successfully transfer digital skills between platforms is mirrored by many across the country today. This challenge is amplified when extended beyond mobile money wallets to between different types of digital applications.

A recent pilot aimed to assess transferability of skills for smart-phone owners with varying levels of mobile money usage. The pilot assessed transferability across age groups, gender, urbanicity (rural and urban) and levels of income volatility. Participants were provided extensive training on one mobile wallet (including on how to create an account, send money, collect money, and scan and pay), with the ability to freely navigate the application themselves, and then tested on their ability to perform core platform functions. Afterwards, participants were introduced to a new mobile money platform and asked to perform the same functions.

What did we find?

Building digital literacy skills by on-boarding users to one particular application is not adequate, the pilot uncovered. Participants in the 40+ age bracket, across gender, urbanicity, and income volatility levels found it difficult to transfer their knowledge from one digital platform to another. Participants in younger age brackets found it relatively easier, but still struggled with certain functionalities such as transferring money and scanning to pay. This has significant implications, not just for the individuals involved but also for the goal of a less-cash and digital India.

What should be done?

Digital literacy training initiatives, whether through common services centers, community gatherings, or other human touch agents, should consider imparting wider ICT skills rather than product or even device-based knowledge. Imparting digital literacy the way it is approached today for existing technologies such as mobile wallets runs the risk of losing effectiveness with the constant roll-out of newer features, technologies, and products. Additionally, training for older population segments should make more resources available to enhance their confidence and comfort with digital technologies, thus encouraging them to experiment with new features.

Of course, training requirements are easier to talk about than to implement, especially when considering a wide-ranging population such as that of India. All the more, service providers need to incorporate usability and digital literacy-building into product design. Training can be built into the product and customer experience. Whilst maintaining unique interfaces, each application can include short tutorials upon installation highlighting navigation patterns and features, as well as more detailed and accessible tutorials and FAQ sections. Ultimately, more digitally capable customers will mean more active customers.

Beyond the provider level, product development guidelines can be formulated to ensure basic transactional aspects are consistent across all mobile money and other digital application interfaces. In terms of standardization, whilst developing applications in regional languages is important, specific icons can be developed and used consistently across platforms to depict the basic transactions. This also helps to ensure that individuals with low literacy or who are unable to read in English can still navigate their way around and perform transactions successfully across different applications.

Finally, for all interventions, investments into understanding what consumers prefer and find easiest to use in terms of product design would go a long way.

For more details on this research and its findings, please visit the IFMR LEAD website.

Have you read?

How Successful Are Banking Agents in Bringing Digital Financial Services to New Customers in India?

What’s In It For Me? Increasing the Value Proposition of Fintech for Merchants in India

For Successful Financial Inclusion in India, Build Customer Financial Capability




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