Why Apple is the best ecosystem banking hope yet

apple pay fingerprint

Recent research conducted by the Pew Centre has found that 1 in 5 Americans find themselves online constantly. It’s hardly surprising. From our daily commute, to our desks, and all the way back home – it’s almost impossible to escape, or worse resist, the pervasiveness of the internet.

However what’s even more interesting than this statistic, is the default device we mainly choose to access the information superhighway on: our iPhone.

Startups aren’t blind to this behavioural trait of ours. In fact, today you’d be shocked to hear of a startup that wasn’t designing a version of their product for a mobile platform like iOS. This is even more true when it comes to fintech and banking, with ‘mobile’ being a hot contender for buzzword of the moment. But it’s not just hot air. Remember that old saying, ‘location, location, location’? Well, mobile platforms are todays equivalent of real-estate gold.

While Apple isn’t the biggest mobile platform in the world, sitting at 19.7% market share behind Android’s 76.6%, Apple’s iOS is arguably the most loved. Since its inception, apps on the platform have been downloaded over 100 billion times, generating $30 billion dollars in revenue for developers, with staggering profits for Apple on long the way in both app and handset sales.

The question on everyones mind now is whether Apple has greater aspirations than just being a marketplace for apps and music. With Apple Pay and Apple Watch arriving on the scene in the past year, it would seem so. With its latest products, I’d suggest Apple are at the beginning of a long term strategy to become a central actor in our lives for both our finances and our health. Or better still, the two elegantly combined.

Discovery partners with Apple Bank

In September of this year, Discovery, a global health insurance company quietly launched a partnership with Apple in South Africa, allowing its Vitality wellness program members to track their health data through the Apple Watch, then redeem rewards for good behaviour. In the same month, the company also announced they would be applying for a full bank licence, indicating that they believe they can translate the deep expertise they have in behavioural tracking via their health insurance products to banking. “People think they’re healthy when they’re not. They think they’re saving when they’re not,” Adrian Gore, CEO of Discovery stated to media outlets during the launch.

What made all this possible? Apple’s new platform HealthKit of course, a collection of APIs that allow app developers to seamlessly integrate their data with the health data Apple has been collecting on us for some time now, via the phone’s M8 coprocessor chip. The brilliance of HealthKit is that it allows developers to tap into and read to a single source of truth when it comes to a users health data, rather than build complex storage vaults themselves. It also makes sharing health data between apps much simpler, increasing the utility and value to the user. But even better for you and I, rather than tapping in and out of a multitude of apps to access various health stats, via the Apple Health app dashboard we can get a full breakdown of all our data in one place by choosing the apps we wish to sync.

Apple – building the playbook for ecosystem banking

HealthKit is another of those wonderful ecosystem relationships that seem to come so naturally to Apple, allowing them to contribute what they do best – slick UIs and painless development tools – while leaving the intricacies of health data collection to the experts. Like the App store, it’s a symbiosis that dramatically improves our experience of the ‘hero’ Apple product – the device – making us loyal to our handsets and tablets for years on end. Could there be wider applications of such a model – such as finance?

I believe so. If it’s possible for Apple to master health data collection, then it’s possible for them to do the same with financial data. Could FinanceKit emerge as the next big play from Apple? The Discovery/Apple tie up is a possible early indication that this is where Apple is heading. Health insurance certainly seems a natural progression after cementing the collection of health data via the Apple Health app, and a nice segue into the financial services sector. And let’s not forget Apple Pay is also helping iPhone holders get comfortable entrusting a larger slice of their daily financial habits with Apple.

Personally, I don’t think Apple has any desire to become a bank, as some pundits suggest. While many like to suggest fintech will make banking a free-for-all for tech companies, the compliance aspects will remain, and will be difficult for some to integrate into their DNA.

At the end of the day, Apple are all about you and me. They want to give us beautiful, elegant devices that help us make better sense of the world around us. Many of us have multiple banking relationships, and multiple financial actors in our lives. Is that really going to change? More than likely, there’ll be even more of them in our lives tomorrow then there are today. Which means we’ll all have an even greater need to find some kind of service that can aggregate our financial data in order to help us make sense of our financial well-being.

My bets are on Apple as the company who take on this challenge. With the rise of biometrics, and the use of fingerprints and heartbeats as unique financial identifiers, Apple will be, in the coming years, uniquely placed to make this convergence of health and finance a reality. Apple have won many of our hearts already. With a killer financial ecosystem product, it won’t take long to also capture our mental wallets.


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