Aishwarya Ramesh

"Subscription behaviour is prevalent; on OTT platforms, dating apps": Kunal Shah, Cred

In a panel discussion hosted by Twitter Marketing, Cred's Kunal Shah along with a few others discussed the nature of the changing BFSI customer.

Episode 8 of Twitter marketing’s initiative #ConversationStarters, was a discussion between Kotak Mahindra AMC's MD, Nilesh Shah, Cred's CEO Kunal Shah and PhonePe's CEO Sameer Nigam. The session was moderated by CNBC TV-18’s deputy editor Sumaira Abidi.

The topic of the discussion was ‘understanding consumer behaviour in 2020’. The main question they attempted to answer was one of preparedness in the BFSI sector; how are financial institutions placed to take this challenge, head on, at this point in time?

Abidi began the discussion by shooting a question at Phonepe’s Nigam, asking him how his volumes had increased and if the switch from hard cash to digital transactions had increased since the pandemic and lockdown began.

PhonePe's Sameer Nigam pointed out that even while sitting at home, people still need to pay their utility bills such as electricity, gas, mobile recharges, money transfers etc – these are all staple use cases and they’re still happening.

"Transit, transport, eating out have been muted, but it’s a mixed bag. Have more customers but fewer use cases. Insurance as a category is under penetrated in India despite us having a young population that earns. We should be solving for our future but we’re not," he says.

While speaking about brand building, Nilesh Shah adds that if a brand manager doesn't constantly strive to add value in a customer's life, the brand is as good as dead. Nigam agreed, opining that a good brand outlives its management.

"How many of us know who invented Parle G or Maggi? But when the brand is in its early stages of development, its founders credibility and past work can help establish the brand," says Nigam.

Cred’s Kunal Shah notices quite a few consumer changes too. Here are some of the key takeaways about how consumers are behaving and interacting with the BFSI sector in this pandemic.

1. No matter how hard Indian fintech brands try, people still prefer international brands. Consumers trust is more natural towards global neutral platforms. These platforms allow the brands to create a personality.

2. For affluent customers, main use cases were eating out, fuelling their cars and travel and all these have disappeared overnight thanks to the lockdown.

3. Spends on e-commerce, online subscription, groceries, are depressed by 30 per cent, but its back to levels seen during February 2020 (pre-COVID). E-commerce’s penetration is at an all time high right now.

4. People are seeing interesting use cases for their credit cards – such as paying rent.

5. Subscription as a behaviour which was not common pre-lockdown is seeing prevalence at this time – both on OTT platforms and dating apps.

6. There's a peculiar pattern where consumers are spending more on their credit cards (even for small transactions) versus spending on UPI as they are trying to have additional liquidity.

7. A segment of customers who have still not lost their jobs are seeing a decrease in their expenses. They aren’t able to travel or go on vacations. We’re seeing an increase in customers opting for stock trading and using subscription services which they didn’t use it before.

8. People are also spending a lot more on getting their home office set up and fixing things that they’ve been putting off fixing, when they accept that they’re going to be at home for the next year or so.

9. Life events are the time when humans are ready to try anything new. Companies should be bold enough to try new things because this is a time when consumers are equally bold and willing to try new things as well.

Watch the full discussion below.