Making Financial Health more than a Buzzword

Tuesday, April 30, 2019

By Chandni Ohri, Director, Financial Health Network

The financial services industry has been trying to regain the trust and rebuild the relationship with their customers after the fallout of the 2008 financial crisis. In their efforts to regain trust and engage with customers, financial institutions are launching new initiatives focused on financial health and wellness.

To better understand the extent of this shift to focus on customer financial health, the Financial Health Network in partnership with Flourish, a venture of the Omidyar Group, recently undertook a survey of senior executives at financial institutions. We surveyed 659 C-suite leaders senior executives at banks, credit unions, insurance companies, retirement companies, payment networks, credit bureaus, and fintech companies. Given that senior leadership is essential to driving real organizational change, the survey was designed to measure how senior executives in financial institutions think about their customers’ financial health and to determine what — if any — action they are taking to improve customer outcomes.

The results show that, while improving customer financial health is, in fact, widely seen as a strategic priority, executives have taken few steps to execute on it. A significant gap remains between awareness and action.

Key findings from this report, “Buzzword to Business Model: How Industry Executives View Financial Health” include:

Improving customer financial health is a top business priority among senior executives.

  • More than two-thirds (69 percent) of executives surveyed said that improving customer financial health was an important strategic priority for their business.
  • Similarly, two-thirds (69 percent) said it was both “profitable” and “a way to increase customer loyalty.”

These responses were consistent across the industry segments we studied and they reflect that financial health is part of the industry parlance. We dug deeper to see how these stated priorities were translating into action and this led to our next finding.

Despite high levels of stated commitment to financial health, fewer financial institutions are taking action.

  • Only about half (51 percent) of executives said that they have launched at least one product or service to improve customer financial health.
  • Only a third (37 percent) of the respondents reported that their institutions offer low-cost, entry-level transaction accounts which are particularly relevant for struggling customers.
  • Only 35 percent of executives responded that their institutions are tracking data on customer financial health outcomes and just 19 percent are reporting customer financial health data at an enterprise level.
  • One third (33 percent) of executives stated that their companies offer products or services to their own employees to improve their financial health.

This data indicates that there remains a significant gap between the executives’ stated importance of customer financial health and what institutions are currently doing to advance it. Many executives shared plans to close the gap over the next 12 months and it will be important to track whether those plans were implemented.

Financial Institutions differ by size and segment in their actions to improve customer financial health.

  • Executives at larger-size institutions, retirement companies, and fintech companies reported doing more to improve customer financial health. This suggests that larger companies with greater resources have been early-movers in investing in financial health solutions, and that companies with more niche product suites, such as retirement and fintech companies, may be focusing on financial health as a way to differentiate themselves.

Truly delivering on financial health requires systematically organizing an institution around driving positive, measurable outcomes for all customers and often entails new strategies, services, and systems. Executive leadership is the key to enabling the necessary structural changes.

At this pivotal moment for the financial services industry, senior executives have an opportunity to leverage the interest in customer financial health to inspire genuine action that benefits customers and rebuilds trust with the institutions that serve them. This report presents a baseline of where the industry stands and where gaps remain. You can download the full report here and if you are interested in learning more about how your organization can take meaningful actions around financial health, please contact me at

By Financial Health Network on April 30, 2019.

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