Giving people the ability to have a bank account is similar to giving a child car keys. People without financial education would probably lead banks to collapse in a short time, so it is preferable instead of financial inclusion to talk about inclusive finance. Based on this reasoning, we will analyze some similarities between the auto industry and traditional banking.
To start driving a car, you have to take a test drive/driving, while to open a bank account, you only have to fill out a form. To drive a car, we need to dedicate time to be able to have control over the car, while to carry out an operation, it is only necessary to include the data of our card, address, signature, and name (in some cases, it is not necessary to sign). To drive on the streets, we must meet the requirements of a license and insurance, while to open an account at the bank, we only need to have our identity document and a little money (some accounts can be opened without money).
Continuing with the analogy and the differences, there are certain similarities; for example, some people need only a basic account, while in the automotive industry, depending on the economic possibility of each individual, some people will need a “low cost” car just to scroll. On the other, there will be people who need an account that offers more benefits or an account for their business or company; At the same time, in cars, there will be people who will want a car with a higher cost, a “prestigious brand” in addition to having greater comforts and technological advances.
Diversity in alternatives
If a person wants to buy a car, the market offers many models, which vary in price, quality, performance, exclusivity, technology, etc. However, in the case of traditional banking, each banking institution offers minimal options. This situation is because when selecting a car, many suppliers operate and distribute automobiles globally. At the same time, in traditional banking, you only have the option of choosing between the main authorized banks in the country, such as a result, banks do not have much incentive to improve and tend to practically “agree” to offer the same services, products, rates, and so on which offers the feeling that “all traditional banks” are very similar.
Importance of making a difference
As a result of these events, there is a tendency to “accuse or label” banks as “very conservative” by always offering the same products/services and having very little innovation. However, in recent years new actors have entered the scene: Fintech companies, which constantly develop new tools to offer better financial products and services globally, while on the other hand, there are social media, which offer a new standard. Concerning “user experience,” which is often used by end customers when making comparisons. Due to this, it is important that traditional banks can innovate and improve their different products or services to be more competitive in an increasingly demanding market and constantly changing market.
What do you think about this topic? What other similarity do you find between banking and the auto industry?
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