Banks Boost Subscription-Management Services

A number of banks are building subscription-management services into their digital offerings as they look to provide consumers with greater control of an increasingly-complicated spending segment.

The so-called subscription economy has grown considerably over the past few years. In the UK alone, subscription services are predicted

recurring payments. There is a clear need for centralized subscription-management tools, and providers are storming into the area.

There are already some great examples and established workflows. At the very least, customers should be able to cancel subscriptions directly from their bank app as well as clearly identify the provider of the bill. Lloyds, for example, recently added a bill and subscription-management section to its app, with clear differentiations and functionalities. The bank’s separation of standing orders and direct debits is a useful way to distinguish between household bills, recurring payments and subscriptions.

Monzo recently added a feature to its virtual cards whereby customers can sign up for free trials and set auto-delete dates, in-app. Automatically cancelling a subscription when the free trial period ends is without doubt a useful feature, but it still entails a manual process that requires a premium account (yet another subscription). 

Monzo’s auto-delete function is a useful tool for customers looking to end subscription relationships when a free trial period ends. Source: The Digital Banking Hub

To truly make these services useful to customers, banks and financial institutions should look to make bill management fully serviceable in-app. That involves moving away from just making the subscriptions viewable – as is the case with a number of providers – and instead allow the user to actively make a variety of changes.

Some market participants go even further a handful recommend new providers if they recognise that the customer could get a better deal elsewhere. Aggregation platforms such as Snoop track users’ recurring payments, recognize the type of subscription, and actively recommend better deals. Tools such as these are now mostly limited to third party apps, but could be the next step for major banks.

Aggregation platforms like Snoop look to provide customers with better subscription deals. Source: The Digital Banking Hub

The most advanced bill management tools negotiate and switch services in-app. US-based Truebill, for instance, not only highlights and tracks customers’ bills across their aggregated accounts, but actually uses artificial intelligence to negotiates cheaper prices and switches provider on behalf of the customer.

A potential stumbling block for providers that offer up replacement deals is customer trust; the service needs to provide neutral alternatives, or the customer may suspect they are being presented with a less competitive, affiliated brand.

Bill and subscription-management tools have come a long way in a short time, but there’s huge potential for banks and financial institutions to offer better services. With more market participants recognizing the possibilities within the swelling subscription economy, financial-management tools look set to become much more sophisticated. Those providers that help customers keep on top of both their recurring and individual payments will profit. 

Anne O'Leary
Research analyst, London
anne.oleary@curinos.com
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