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Designing Gamification Features in Fintech Products

by Kevin KimDecember 23rd, 2022

Too Long; Didn't Read

Gamification is a “standard” that every Fintech product (and digital banking product) must have. Gamification features can shape user behavior. Points, rewards, and exciting features help users comply with policy terms better. Games may require or enable users to interact with other players and give them a sense of living in a community.

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In general, digital products are developing in a way that improves user experience and engages more users. A trend that's on the rise is gamification. Investing in gamification has increased by 60% from 4.91 billion USD in 2016 to 11.94 billion USD in 2021, according to Statista. It seems gamification is a “standard” that every Fintech product (and digital banking product) must have [1] [2] [3].

Below are some references to help you better understand the gamification field in Fintech. In case you already know what gamification is, you may skip this part and move to the section Design gamification feature for Fintech application.

TLDR;

Fintech's typical application areas [4][7]

Encourage saving (Goal saving & Round-up)
Encourage better daily financial management (Everyday spending & budget management)
Increasing financial literacy
Motivation and training
Insurance risk management. Gamification features can shape user behavior. Points, rewards, and exciting features help users comply with policy terms better.
Community building. Games may require or enable users to interact with other players and give them a sense of living in a community of a financial service (similar to membership in a Bar club). For example, users can be rewarded if they successfully refer participation codes to their friends or relatives.

Top 10 gamification features for fintech apps

Some commonly used digital banking strategies are leverage points, leaderboards, challenges, and milestones.

There are some examples,

Gamification from the Business View

The conversion rate of companies applying gamification in operation is 700%, and 50% of startups say it is part of their strategy, according to Finances Online.

"These interactive programs are part of an important strategy for MoMo to move towards Vietnam's first super app," said by Nguyen Manh Tuong, executive vice president of M_Service, the owner of the MoMo e-wallet , Forbes Vietnam.

Customer retention

Good products provide experiences that meet customers' needs and offer after-sales programs to create loyal values. In the last step of a customer journey, customers will think about their experience, bad or good, whether they are worth sharing and recommending to others, or whether to continue using its products.

After-sales or reward policies are the most common way to help retain customers. However, it must be carefully considered that these actions only affect the outside and do not solve the core problem of whether the quality of products/services satisfies customers.

How might we make customers feel comfortable and entertained during and after using the features intrinsically?

Build good financial habits

Fintech companies or banks all have a common fundamental goal of helping customers' personal financial lives better. Products for consumption, borrowing, savings, or investment are designed to satisfy customers' best interests and to help them get better means making the company better.

However, not all customers have the capacity and knowledge to manage their finances and control spending well. That is why customer training is essential.

How might we train and guide clients to have good financial habits that are simple, easy to understand, and take effortless to learn?

Gamification from the User Experience view

Corporate "Give Away" events effectively promote and attract users. Every year, on the occasion of the Lunar New Year, Fintech in Asia (Wechat of Tencent, Alipay of Alibaba, or Vietnam fintech such as MoMo, ZaloPay, Viettel Pay, ...) all have games such as "Lucky draw", "Shake the tree". [5][6]

The design problem here is simply creating a game like what the market is doing. Do this over and over and over every year? Are users interested in continuing to play those games? Developing a community is attracting new users and retaining them afterward.

MoMo designed a gamification feature that was "unsuccessful" when their customers—winners were disappointed with the outcome, as opposed to the engaging gameplay they had created.

Emotion and Monetization

Funny moments below show users shaking phones to earn some "lucky money" during the Lunar New Year festival — It is enjoyable.

Is the reward commensurate with the customer's effort when participating in the game? What value does the featured designer want to bring to the client (financial and emotional components?)

Design gamification feature for Fintech application

Design goal: improve LTV

In business, the primary problem is to reduce acquisition costs, retain new users, and form a habit of using the product with customers.

Attract and retain new users
Increase the number of transactions, CASA (some companies benefit based on charging transaction fees and holding CASA)

In terms of user experience, based on each level of Maslow's hierarchy of needs that the feature wants to achieve.

Motivation to maintain good habits for personal finance
Get well-deserved rewards for user achievements
Filled with joy, pride, and excitement

Strategy and design challenges

How to design a gamification feature that customers feel "desired" and attached to the product.

The basic idea (Hook Framework) :

Invite friends, give free "initialization money", learn helpful (financial) knowledge
The gameplay is attractive, easy to join, and has a challenging level (B=MAT)
Rewards (money, incentives)
Emulation/honorary rankings, badges, …

Make it fun (6–11 Frameworks)

When joining a game, funny is the highest level each person aims for, such as happiness for entertainment, self-satisfaction, or a bonus.

Hard fun: players overcome different obstacles in the game. The primary emotion involved is pride.
Easy fun: player enjoyment is directly related to experiencing all the different aspects and activities in the game world. The primary emotion involved is curiosity.
⭐️Serious fun: these games capture the player's attention entirely to finally change their inner mood and, in doing so, succeed in avoiding boredom. The primary emotions involved are Relaxation and Excitement.
People fun: these are multiplayer events where the social aspect of being together plays an essential role in defining the overall experience. The emotion involved is entertainment.

From what can be observed, Fintech usually aims for two levels of "Fun": Hard fun and People fun. These directions ensure a good viral element. However, the real difficulty is creating and Getting experience at the Serious fun level-what this article wants to share. It will not focus much on gameplay (such as the lucky wheel, map quests, "Pokemon GO", roll dice, shake/tap, lucky draw, collection, ...).

Free to Play and Play to Earn

Any player can participate, and the chances are the same
The effort spent (when playing) must be rewarded or exchanged accordingly

Segmentations — Designing for each type of player.

Anyone does not want to be a loser. However, the truth is that each person's physical and financial "capacity" is different, so the approach and goal when participating in the game are different:

Losers: this group has poor gaming skills or may not have much time to play, simply for fun, not focusing on winning or losing; this group has low LTV.
Fighters: this group wants to play to win; prizes are the #1 priority, and they spend more time playing than others. This group of players is an inspiration to other groups of players.
High rollers: this group is rich people with less time to play, "playing for passion"; they only need prizes to collect, pride, bragging, or entertainment.

Required data for analysis and design:

Win ratio: winning rate when playing a game
RTP (Return to Player): The reward is worth the spent effort (game fee and time). The more the reward compared to the cost, the happier the player is.
Hit Frequency: Users have to play more to win more. Users can "buy" time with acceleration options (Boost game).
Time between games: total time the player will spend for a game. At a particular time, this factor affects the player's playing behavior, more or less, continuously or intermittently.
Games per week/day: How much time a player spends playing during the week/day.
Time to activation: Time for the first payment. how long does it take to play to get the first converting transaction?
Number of shares: measure the effectiveness of the social level (viral).
Number of friends: measures the ability and size of the player set.

Rare and Randomness — Game balance

According to Marx's definition of a commodity, the restriction to gain is a characteristic of the commodity. It manifests itself as "Rarity and Randomness". In game design, the balance factor (experience, in-game financial flow for buying and selling items, ...) is expressed through the opportunity distribution chart (Gaussian distribution or Normal distribution), which helps the ecosystem work naturally and automatically.

The value of random brings the element of surprise; the change every time the game is replayed makes it more attractive and stimulating. However, there is a Love-Hate attribution of randomness for game designers when they want to intervene intentionally (pseudo-random) to enhance the experience for various purposes, such as rewards.

More for users, or want to increase the difficulty of the challenges, and so on. That term is called "Game balancing" by combining mathematics and psychology. In another article, I will illustrate how to design a good game used in the above Fintech products.

Conclusion

The design goal of gamification for Fintech applications is to improve Lifetime Value (LVT) while educating and motivating customers with good financial habits.

Design Strategy: Make it fun, mix F2P with P2E
Designed for three segment groups: Losers, Fighters, and High rollers
To balance the game in terms of experience and financial flow, Randomness and Scarcity are needed to keep the ecosystem running naturally and automatically.