What should a great financial app contain?

Dare I say it, but this year is shaping up to be the year of the financial “super app”. So far this year, I’ve seen no less than seven companies talking about creating a great app.

Now let me be clear here. I’m not talking about a super app like WeChat and Alipay in China. These companies offer just about everything in one app, from buying groceries, booking trips, carpooling, and every kind of financial deal you could think of.

Some people have said that America is not a place to adopt super apps. And that’s probably true if you think of the Chinese model where these super apps look more like complete ecosystems akin to the iOS or Android operating system.

But I think there is a real opportunity for a leading fintech (or bank) to develop a great app for finance. As I said before, many have started this journey.

Which begs the key question: what should a great finance app contain?

Given recent advances in open banking and integrated finance, we have the technology to create a truly compelling super app.

Here are 20 things I would like to see included:

  • Digital bank account with debit card – all standard offers available today.
  • High Yield Savings Account – high yield means keeping pace with the federal funds rate.
  • Peer to peer payments – being able to interface with multiple p2p payment networks.
  • Set savings goals – with separate buckets to park that money.
  • Buy now, pay later – built-in BNPL functionality.
  • Shopping – this could be integrated with BNPL but should include the most popular stores.
  • Loyalty programs – there should be a central place to manage them.
  • Instant transfers to external bank accounts – why isn’t this already standard?
  • Consumer loans – the super app will have enough data to offer instant loan approvals.
  • Credit Cards – offer a selection of rewards and no-fee cards.
  • Overdraft protection – no overdraft fees and the ability to instantly access up to $100.
  • Stock trading – this is no longer optional for serious financial application.
  • Crypto trading – should be able to buy and sell major crypto tokens.
  • Debt Management – ​​Help consumers manage all their debts for optimal interest savings.
  • Access to Earned Salary – get early access to a portion of your paycheck to pay for emergency expenses.
  • Credit Establishment and Monitoring – providing a pathway for establishing a credit score.
  • On-ramp to DeFi – it’s probably a while away, but I think it will be needed for a great financial app in the future
  • Connect outside investments – the super app should be able to see all/most of your investment accounts.
  • Open bank connections – see all the places where your bank account information has been shared.
  • See the full financial picture – dashboard with KPIs to give you a clear picture of your net worth and progress in your financial life.

This last point is of particular interest to me. Most businesses today measure a range of key performance indicators, and many small business apps have helpful dashboards that show business health at a glance. But we don’t really have an equivalent concept for consumer credit KPIs beyond a credit score.

I would like to see the awesome financial app provide more financial insights. It should answer the number of weeks or months we can cover with our savings, the evolution of our free cash flow, the total return on investments (if any), the evolution of our debt burden , etc

Who is closest to developing the super financial app?

We’re still a long way from any company coming close to the functionality I described above.

PayPal is probably the closest, but they only have about half the features I’d like to see. SoFi, which just hosted the Superbowl in its shiny new stadium, has potential as they probably have the widest offerings of the new breed of fintech.

Chime, the largest digital bank in the United States, still has a long way to go with a limited feature set so far.

MoneyLion is also a company that I watch closely as they continue to add new features regularly.

In Europe, Revolut has the widest range of features, so we don’t want to count them here.

Deep dive into the financial super app

FT Partners published a excellent report titled The Race to the Super App earlier this month. He suggests two different models or paths for a financial super app.

For my view of the super app, only one of their models makes sense, but what I liked about this report is that it looks at the offerings of all the important fintechs in the space.

Eventually we will have many great financial apps. I don’t think it’s a winner in all categories. There are probably 2-3 businesses that are getting serious traction and several more with enough customers to make their business profitable.

I also think that fintech companies will be able to charge for this service. A subset of features should be free to encourage mass adoption, but a full set of features might be so valuable that a monthly subscription will be viable.

A final note. A company does not need to create all of these features in-house. There may be partnerships where a third party provides the processes, but resides inside the super app from the user’s perspective. With that in mind, it could well be a bank creating the ultimate long-term financial super app. But so far, fintechs are leading. The race is on.

Rosalie M. Dehner