Banking apps have long since evolved beyond simply checking balances, making payments or managing financial products. Banks are increasingly expanding their apps with services that support customers in their everyday lives.
These solutions are often referred to as Value-Added Services (VAS). But what exactly are VAS, what types of services can they include, and why are banks adopting them?
What Are Value-Added Services in Banking?
Value-Added Services (VAS) are products and services that are not traditional banking products but form part of a bank’s offering and are available through its mobile app or online banking platform. They are usually provided in cooperation with external providers.
In practice, the line between a banking service and a value-added service is not always clear-cut. VAS can include both non-financial services and selected financial products or services that extend a bank’s core offering.
What Types of VAS Can Banks Offer?
The range of Value-Added Services is broad. Banks can offer services related to transport and mobility, telecommunications, shopping, travel, entertainment, insurance and public administration, among others.
The scope of VAS depends on the bank’s strategy, customer needs and the technology and business partners available to it.
Examples of VAS Available in Banking Apps
This list is by no means exhaustive. New services may emerge as customer needs change, technology develops and new partners become available.
It is also worth remembering that implementing VAS should not be about trying to create a single “super app” that replaces all others.
The value of VAS lies in their ability to address specific customer needs and make everyday tasks easier. Their selection should be based, among other things, on user needs, observed trends and changes taking place in the market.
Why Are Banks Developing VAS?
There are several reasons why banks are expanding their apps with Value-Added Services. One of them is increasing the frequency of app usage. Customers can find not only financial services in their banking app, but also solutions that are useful in their everyday lives.
VAS can also strengthen the customer relationship. When a particular service is available directly within a banking app, customers do not need to use another service or install a separate app.
Another important factor is the ability to better understand customer needs and tailor the offering to their behaviour. For banks developing VAS, this is therefore not only a way to expand the functionality of their apps, but also an element of building long-term customer relationships.
VAS and the Development of Beyond Banking
The development of Value-Added Services is part of the broader beyond banking trend, in which banks are expanding their role beyond traditional financial services.
A banking app can become a place where customers not only manage their finances, but also take care of selected everyday needs. For banks, this creates new opportunities to build customer relationships and develop offerings that go beyond traditional banking products.
Why are banks increasingly moving beyond traditional banking, and what role can VAS play in their strategies? We will explore this topic in more detail in the next article.
Summary
VAS are not a single type of service, but a broad category of additional services that can extend the functionality of a banking app.
Their development also shows that banking apps can play an increasingly important role in customers’ everyday lives.
At FINANTEQ, we have been developing solutions related to Value-Added Services for more than 15 years. Based on our experience, we see VAS as an important element in the development of modern mobile banking.
Are you considering the potential of VAS for your organisation? Talk to our experts to explore the possibilities.
