How Localization Benefits Fintech Companies?
In case you might have not noticed, the world around us is changing and moving at a breakneck pace. Technology is shaping nearly everything around us, and this trend is expected to continue. If we take a look at some of the biggest changes on the horizon then the rise of fintech companies is definitely one of them.
Table of Content
- What Exactly is a Fintech Company?
- Why Localization is Vital for The Fintech Companies
- Best Benefits of Localization for Financial Companies
- What are some Fintech Localization Challenges?
What Exactly is a Fintech Company?
Let’s first demystify the term Fintech for you. It’s short for “financial technology”. You can think of fintech as every technology we use today for money transfers and transactions.
Having said that, a fintech company is then a business that applies technology in a creative manner to design and deliver financial services to its customers.
Some Examples of Fintech
Finance is at the core of almost anything we do in our lives, from work to socializing and everything else. So, fintech companies are using technology to disrupt this all-important part of our life, finance, in many ways. Here’s to give you a few examples.
- Payment apps: There are so many payment apps around us, such as PayPal, Venmo, Zelle, CashApp, Block, and more. These apps make payments easy and instant whether you have to pay businesses or individuals.
- Investment apps: Investment apps make use of financial technology to simplify the sale and purchase of stocks and EFTs, etc with little to no commission.
- P2P lending platforms: Small business owners as well as individuals use such platforms to borrow loans from other individuals interested in giving micro-loans to them. Lending Club, Upstart, and Proper are just a few popular names in P2P lending platforms.
Why Localization is Vital for The Fintech Companies?
The fintech industry has seen massive growth in recent years. There are various reasons for it, such as the revolution of the internet, the 2008 financial crisis, and the emergence of hand-held devices and smartphones, among others. Due to these circumstances, the number of people opting for fintech services is increasing day by day, across nations.
If we compare the fintech companies with traditional brick-and-mortar banks, then it’s much easier for fintech to expand internationally and meet the needs of the public that wants to benefit from the speed and flexibility of fintech products and services.
However, this implies a localization strategy that overcomes cultural and language obstacles. When you localize your innovative products and the related messaging for each target audience, it can truly pave the way for building a global fintech company.
Best Benefits of Localization for Financial Companies
In this part of the article, we discuss some of the top benefits that financial companies can achieve when they include localization in their global expansion.
Maximize your Outreach and Relevance
This applies not just to financial companies but to the marketing of all software products. If you just implement a translation strategy, it will surely maximize your business outreach and brand voice. But, it may not bring you local relevance in all the target regions and markets. Which the localization strategy does help to achieve.
Speaking about relevance, it’s critical to ensure success in foreign markets. Without it, you might be promoting your marketing messages and communication in the native language of your consumers. However, there is no guarantee that your message hits the right chord and resonates with your consumers.
When you consider localization, it will give each market its due consideration. Depending on the unique demands of each market, an effective localization approach will adapt your message in a way that captivates your target audience.
As far as fintech companies are concerned, they have to do more than just adapt their messaging. Their challenge is to localize their fintech products for each customer base so that they can find the products usable, engaging, and relevant to their local norms, cultures, and demands.
Improve Consumers’ understanding of your Product
This is another benefit of the fintech localization strategy. Not only will you reach new markets and become relevant but will improve the consumers’ understanding of your fintech products or services in each target market.
When you take a micro look, you come to realize that consumer habits as well as their technology preferences can vary significantly across different markets. For instance, users in one region may prefer card payments. While you will find people more inclined toward phone payment systems as you move into some other regions.
As a truly global fintech player, you must be aware of your customer preferences and make sure that each specific audience understands your product(s). They should have a clear view of why you designed your products and what role they can play in the lives of your valued consumers.
How well a financial company develops an understanding of its products depends on various factors. If you have to succeed in your efforts, you should know who makes up your audience and what their individual needs are. Similarly, it’s your responsibility to figure out ways you can differentiate your offerings from the rest of the competitors. Focus on what unique benefit your fintech product offers that other solutions on the market don’t. Determine what value your product can add or how it can enhance the traditional ways customers have been spending.
Solve Trust Issues and Build Credibility
Despite all the progress the fintech firms are making, a vast majority of consumers don’t trust online finance solutions. Consumers believe that digital banking and finance products don’t work in their best interest.
If we try to figure out what causes people to distrust fintech applications, then there are two major drivers of it. First and foremost, people are worried about their use of data. They feel reluctant to share their data with fintech companies even if they promise to deliver hyper-personalized experiences to them.
The second reason for the lack of consumer trust is related to regulatory concerns. Many consumers share that they have lost interest in fintech solutions because these solutions don’t have a bulletproof regulatory framework. Moreover, due to the fact that fintech is still rapidly developing, consumers think there is a need for more rigorous legislation.
We should also keep in mind that every new technology faces resistance to some extent, and fintech is no exception. The fact that fintech is designed to replace traditional actors like banks, makes it more special.
Anyways, whatever the consumer concerts are, the fintech businesses have to address them. And one of the best ways to do this is by speaking to consumers on their terms.
According to the CSA Research’s global study, more than 70% are more likely to shop for services online if those services are available in their native languages. This becomes extremely important with finance and banking solutions. If you’re providing financial services to foreign audiences, you should adapt your offerings according to their preferences. Plus, you’ve to inform them what steps you have taken to protect their personal data and of course, money. This way you can eliminate trust issues and become credible among your consumers.
Provide Great User Experience to Everyone
Whether it’s a financial solution or any other software product, user expectations will always vary based on markets. And successful fintech companies will have to localize their products and services for every target region.
If you wish to take your financial company outside your home market, you should ensure that you have different language versions of your products. Each adapted version should be available in its optimized form to provide the best possible user experience to everyone. This optimization can be something like making sure that no translated text breaks the layouts or interfaces.
When you’ve covered all the essentials, it’s time to tweak certain aspects of your software to fit specific audiences. This will enhance your user experience even further.
For example, you might notice that people in a certain market like to use some tools or features in fintech solutions on a regular basis. You can convert these unique consumer habits or preferences into an opportunity for yourself. Thus, you can employ a localization strategy that will improve your app’s navigation. The new navigation should provide those specific users with easier access to tools they love to use.
For most fintech firms, software localization is more like an ongoing process. So, they would continue optimizing their products to garner the best outcomes in each new geography.
Magnify Engagement and Revenue
Incorporating a fintech localization strategy brings many business benefits. With localization, you can maximize usage time, generate engagement, and grow your revenue. You can achieve this through any target actions, like transfers, payments, transactions, etc.
Your first aim should be to encourage more users to download your products and create accounts. Similarly, you can localize your marketing campaigns for various other primary conversions for your business. This also reminds us of what we discussed as the first benefit of localization above. That was related to maximized outreach and relevance.
Remember the success of your fintech business does not end by just obtaining initial downloads. If your product has to become a key component of the user’s daily life, then you should optimize its entire experience. Recall the last point where we explained how software localization can help you provide a great user experience. The same strategy in the long run can prove to be a foolproof sales strategy for your fintech products. A strategy that will keep customers satisfied, maximize retention, and improve consumer lifetime value. A strategy that’s not limited to your innovative software product but goes beyond that. It should extend to areas like user reviews, product reviews, press releases, and other areas of brand management, customer service, and reputation management.
What are some Fintech Localization Challenges?
Localization is no doubt a much more rewarding strategy as we discussed above. It can help you achieve many business benefits. Now we will explore the biggest challenges that fintech companies looking to expand internationally have to face. These localization challenges include local regulatory frameworks, cultural nuances, and brand consistency.
These challenges may affect each business differently. But it’s vital to be aware of them. This awareness will help you anticipate what troubles you might be facing down the road so you can avoid them.
Local Regulatory Frameworks
Compared to other industries, localization for the finance industry is usually more complex and challenging. This is not only due to linguistic reasons but also because of local regulatory frameworks that vary from market to market. For example, each state in the U.S. has its own local regulations. This makes it an unpleasant struggle and a company often has to navigate legal waters in order to localize its products. If the market you’re entering has more strict regulations than what your home country has, the complexity of localization will be high.
Another aspect that can complicate fintech localization is the difference in cultures. There will be cultures where people prefer cash over digital wallets and cards. If your target audience lives in such cultures, it will be hard to convince them to start using your digital offerings.
The issue that’s common to almost all companies looking to launch internationally is the use of the right tone. If users in one region respond better to a casual and friendly tone, it does not mean that users around other regions would also do so. Languages, on the other hand, also have different ways to express politeness, formality, and respect in them. The use of verb forms and pronouns can be very different between your source and target languages.
When it comes to the fintech industry, the level of financial literacy among consumers is also on the lowest side. This is something that is unique to the fintech industry. Certain target markets may require you to present your content in a more simplified way than others. Likewise, you may need to offer some sort of explanatory content that can make it easy for users to understand the financial concepts.
Finding The Right Localization Partner Matters a lot
If fintech companies want to expand their international business, they can’t ensure their success without considering localization. While localization can offer you a plethora of benefits, it often depends on who you partner with for your localization needs. Only experts in the business can help you create and implement a steady localization strategy.
When selecting a localization partner, make sure you work with a qualified agency with at least a few years of experience in the fintech industry. Having experience in the financial sector is paramount. Otherwise, you’ll get a poorly translated and poorly adapted version of your fintech software or product. A good partner will also be a certified professional who follows industry standards to protect the confidentiality of your information and provides you with quality services that set you up for future success.
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