Is there anything financial service providers can learn from mobile gambling?

August 4th, 2016

Mobile gambling is by no means a financial service; but gambling apps have certain aspects that are familiar to those who have used financial services. They are accessible on the phone, involve managing money, and invoke comparable mental calculations of risk and reward. Mobile gambling companies are using product features and service design, particularly communications and engagement techniques, that may be useful for financial service providers to consider. Two areas in particular stand out with potential lessons learned for financial services providers.

Rewards that feel rewarding.The gambling industry embeds multiple rewards in its interface, both monetary and non-monetary. For example, gambling companies offer small, but frequent variable rewards in addition to large jackpots. They send users frequent messaging about betting opportunities and potential wins, producing desire and anticipation on the part of customers. Social media involves similar pathways of addiction through, for example, the anticipation of opening Facebook, the pleasure of seeing new photos on Instagram or the sustained engagement on Twitter.

In contrast, financial service providers continue to offer mostly infrequent, static rewards (e.g. quarterly interest) with limited sustained interaction.

Playing” M-Shwari

One financial service that may offer more compelling rewards is the M-Shwari lending product. Customers often refer to “playing” with the product to increase their credit limit. The reward of an increased limit is small, frequent and behaviour-dependent, but not predictable.

People enjoy not just the financial service but also the pleasure and excitement of receiving an unanticipated message that their borrowing limit has increased.


Mobile sports gambling appears to encourage people to meet and interact with each other to share their knowledge about betting, both in real life and in virtual forums through social apps like WhatsApp; even though mobile-based gambling is not inherently social. The research shows that gambling interactions can provide participants with a sense of community and build trust, as members gradually feel more comfortable sharing and learning about betting strategies. Among financial services, only savings groups exhibit this level of sharing and community engagement; though there is concern that this social aspect will be lost as these groups move to mobile platforms. Mobile-based gambling demonstrates that people may still feel the need to meet physically regardless.

Financial service providers, too, need to engage customers in a more social way. It’s worth noting that the original uptake of M-Pesa was driven substantially by the social message “send money home.” Unsurprisingly, the lack of consumer engagement can affect a customer’s emotional connection to a product, as explored below.

Impact on emotional well-being

The table below compares the impact of emotional well-being across different applications. We can see that financial services today do not invoke any emotional connection between the user and the service provider, unlike mobile gambling, social media and even the mobile phone.

Impact on emotional well-being Mobile gambling Social media Mobile phone Financial services
Do I feel bad if I don’t use it? Yes Yes Yes No

Sports gambling companies use communications and engagement techniques that appear more effective than those used by financial services providers. As providers continue trying to capture customers’ attention in an increasingly competitive market, they might look outside traditional financial services approaches to new – and quickly growing – industries to gather new ideas and differentiate themselves to improve sustainable financial inclusion.

 In his book Hooked: how to build habit-forming products Nir Eyal summarizes the neuropsychological reasons why variable rewards are so powerful. For a quick overview of the concepts, see slide show here:



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