Digitising investing in the light of behavioural finance findings

Abstract

Investing is still very much the least digitised banking service. All too often, digitisation boils down to cold automation, which explains why digital conversion rates are well below those at a branch. This paper discusses that, in order to be successful, the process needs to (over)compensate the lack of human encouragement in a digital context. In this paper, we demonstrate how behavioural finance enhances the business value of digital investing. Use cases illustrate the power of insights from behavioural economics such as framing, nudging and refined investor profiling. We propose three important metrics to guide the digitisation of investing: conversion, rejuvenation and retention.