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Mobile App Development Case Study for the Biggest Microloan Organization with a 14B USD Loan Portfolio

Table of content
About the client & story behind Request to Devlight Expectation Our solution The process of value creation Results and Outcomes Conclusions

About the client & story behind

Moneyveo is the biggest microcredit company in Ukraine. They are the main hero of our today’s store — the client. Let’s look closely at them.

As stated above, Moneyveo is the absolute champion in the MFI\microcredit business in Ukraine. They are completely digital and online, there are no physical branches in Ukraine. But what there are is a lot of happy clients and loyal employees. Numbers will say it all:

  • UAH 1.6 billion — the amount of net income Moneyveo got during the first half of 2021 (the most among competitors) 
  • UAH 37.5 million in net profit
  • more than 700 employees
  • 1.8 Ukrainians regularly use the services
  • 6 million loans issued in the service
  • 28 billion hryvnias issued in total

It is a large, modern, and properly organized company. And it allowed them to think about diversification and new directions of development.  

Why did the client decide to develop the solution ?

Moneyveo’s business model was really effective. And, in fact, it was one of the fastest growing on the market. But over time, the pace of growth slowed down and by August/September 2021, Moneyveo realized that they had hit a glass ceiling. The volume of the market that they had didn’t allow further expansion. The target audience has exhausted itself. It was no longer possible to grow at such rates as they grew before.

The time has come to look for new solutions. It might be a new business model or differentiation options that would give the business a new push for growth. They weren’t certain at the moment about the direction they were going to move. But they knew for sure that they had to act. 

The obvious decision for the client was to move further into fintech, a promising field in which they already had considerable experience. Namely, to create a neobank that will touch the target audience that is opposite to the one they had at the time. These are customers with medium and high incomes. They also are interested in credit products, like the main target audience of Moneyveo, but on completely different terms.

The client set himself the task of expanding his business, diversifying his product portfolio, and entering a new market.

Pros and cons of current solution

Moneyveo’s main products were loans. It was the main pro of the solution that brought it a big success. But through time it has exhausted itself and didn’t allow further scaling of the business and the target audience, as already stated above. And thus, from being pro it became a con. 

The cost of attracting clients was higher than the commission income from one client. And overall the country’s population was decreasing. The target audience was running out and there were no signs of an influx of new people into the market. There was no one to work with for new clients further. 

Moneyveo is a fully profitable company. Without creditors, credits, or obligations. It meant that they had a sufficiently powerful resource to experiment, invest in new niches and try to enter new markets. And they decided to stop at neobank.

Users behavior and new trends

Neobank is the main fintech trend from 2016 until now. The business model is clear, the product too, and the client understands what it is and how to use it. The cost of attracting a customer is not too high, and the possibility of the business model calculation is very accurate. Especially in Moneyveo ‘s case as they had a lot of data: how much it would cost to acquire a user, how long they would stay, how much revenue the product would generate and etc.

For the end client, it is a clear, obvious, and expected product, which is why Moneyveo’s team chose neobank and not some other financial product. 

Competitive landscape

The neobank market in Ukraine was very competitive at the time (as it is now). But let’s look at the landscape of 2021 when the project was at its very start. 

We had an absolute neobank leader in Ukraine — Monobank. At the time they had 4 million customers (25% of the market). PrivatBank is a classic player, but they also had their digital solution and had from 4 to 6 million customers according to various estimates. And there also were products with much smaller volumes: Neobank from Concordbank, Sportbank, Todobank, Izibank, Sense Bank from Alfa Bank.

Competition in the market was very high. And the market was divided by business models. Some projects were based on lendings and installments (and Moneyveo was among them). They knew their target audience as well as their target audience knew them and were used to them. Other players were projects with mixed business models such as PrivatBank or AlfaBank. Keeping this image in mind, we understood that in order to enter the market, it was necessary to find a very sophisticated solution. On the one hand, it had to be very logical, on the other hand, it had to be really necessary for the user.

Another important statement is that the Ukrainian banking market was definitely driven by loans. This was the most obvious and understandable business model — free issuing of a bank card, free issuing of a credit limit with a grace period, for example, 55 days. This is how it works: you provide a credit limit, and a person leaves the grace period and starts constantly paying interest for using the credit limit. This results in constant income from the client to the bank.

Moneyveo had a large credit machine and an understanding of how it all worked. They made a key bet on large credit limits with a long grace period as the main competitive advantage. And it has borne fruit. But in order to maintain the growth rates of the company they had to start looking for new directions of development. 

Request to Devlight

How they came up with the idea?

Our cooperation with the client started long before this project. We’ve been working with the client since 2017 by providing different consultations on the implementation of mobile applications, improving the performance of their mobile applications, on some design solutions, etc.

The Board of directors had approved the idea of creating a neobank as a way of diversifying business in August 2021. Right after that, the Moneyveo team contacted us as they knew that we were one of the leaders in the neobank development in Ukraine. At first, they requested a series of consultations. At this stage, we conducted a market survey and user profiling for them. This allowed us to take a more focused look at the market opportunities, possibilities of Moneyveo in that market, and, of course, Ukrainian users. The survey helped us to better understand their problems, values, motivations, and pains. And how the competitors’ products satisfied all these and what can we do to find our own niche and occupy it. 

Exact request

The plan was to first conduct a series of consultations and if they prove we share the same values, worldview, level of competence and see one common goal in this project, we would move forward to the next stage, which is a large discovery. This part includes market research, research of customers and competitors, and the development of a future digital product based on the unique value proposition. And other tasks of this stage would be:

  • to make a high-fidelity black-white prototype
  • to test prototypes on the target audience in order to make sure we are making the most accurate, understandable, and usable interface for the client, before the development stage
  • to create a technical task based on it, which will include the technical and functional parts for the creation of the product

After the discovery stage, the UI and development stage would have to start.

Customer thoughts and references 

CPO, CBDO, and two project managers — representatives of the clients who walked with us all the way side by side. Guys had extensive banking expertise. They really had a great, big, strong background in banking, including a deep understanding of the banking market, methodology of the products, and the correctness of the formation of certain bank operations and transactions. They had solid core business knowledge.

What they also had is a vision and a wide understanding of what the new product should be. They needed our expertise to sharpen the blurred vision and combine it with their thoughts and desires and the results of our research. As the result, we had a clear understanding of what the product should be, its user interface, and a mobile application.

The client was actively involved at all stages: whether it was the creation of a value proposition, some discussion, or research — we always worked as one team.

The client’s team saw the competitiveness of the market as one of the biggest challenges in this project. We did not have the opportunity to enter the market with a mediocre product. And a product that wouldn’t cover the needs of the user fully or would perform poorly in covering users’ needs wouldn’t work either. It’s everything or nothing. The expectations of the end user are very high. The market has set a very high bar of competition.

How to make the right impression on our end user from the first contact? All client’s thoughts and all our work revolved around this question. We cannot create a second impression, and trying to change a bad first impression will be very expensive.

How to make such a first impression that the client really wants to stay with us? This is a key question for the client. And it includes everything: UX, functionality, product content, and the entire customer experience.

Expectation

Product performance

The client’s expectations were more than clear. Their goal was for the new neobank to become neobank #2 in 3 years in Ukraine. We started our work in August 2021, so the plan was to become a #2 neobank in Ukraine in August 2024. 

2.5-3 million active customers were expected, which would determine the product’s performance. The payback of the project was also expected at the level of 2-2.5 years at most. The business model built by the client’s team confirmed that with the basic scenario that we pictured for ourselves  2-2.5 years would be an adequate period for payback.

Deadlines

We planned to finish the active session of market research and discovery in 6 months. So the deadline for it was the middle of February 2022. Our team fully met this deadline. By that time, Moneyveo already had all the artifacts and materials that were agreed upon.

By August 2022 the product was expected to be released.

Devlight’s service

Ownership and living role in conducting discovery and building product value and the product functionality model — this was our service. As well as adaptation of all the artifacts that we got as a result of research to a mobile application by creating interfaces ad designs. At the other stages, our responsibilities would be completely leading the development of the mobile platform on both iOS and Android. And after that further work with the product and development of the product after the release.

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Our solution

Research & preparation. Series of meetings with client.

An important phase of the preparation for the project is to immerse in the client’s thoughts. To do so, we held 5-6 online meetings with the client to understand their technologies and business model better. It is very important for us to understand that we share the same picture with our clients: how we see competitors, how we evaluate the players and their competitive advantages, how we understand what drives the competition in the market and how should we develop our product. It is crucial for further success to be on the same page with the client at the very beginning of the cooperation. So the final goal of all these consultations and preparatory talks was to develop a common vision of everything: from potential user profiles to product expectations. 

What the clients’ team did at this stage: 

  • commissioned an in-depth socio-demographic study of Ukrainian bank users in 2021, which gave us an understanding of the market. 

This research allowed us to see a detailed list of the costs of Ukrainian bank users, to understand from which banks to which banks users transfer money, and why exactly they choose those banks. We spent 2 meetings discussing this research.

What we did at this stage:

  • prepared a trend canvas synchronization exercise. Before starting our cooperation with the Moneyveo team, we did a synchronization exercise that we do with all clients — we filled out the trend canvas in order to understand the banking market in Ukraine better, synchronize our values, mission, and drivers of the future project, determine the market context in which the future product should exist, and also generate the first ideas.
  • prepared a large study of competitors on the market. Used the Porter Diamond methodology. This allowed us to analyze the market for existing players as well as their strengths and weaknesses
  • Analyzed new players who are just entering the market, their market entry strategies, their expectations about the strengths and weaknesses of competitors, and about the target audience
  • Analyzed substitute products that could replace our product, and other services that users could start using instead of using neobanks
  • analyzed the competitive forces that exist on the market now and that is driving the market further

A series of these preparatory synchronizing meetings allowed us to develop a common vision of the current market situation, competitors, and market drivers. With this, we could start moving further to in-depth research. After we were immersed in the thoughts of the client, it was time to immerse in the thoughts of users. 

Solution hypothesis and internal discussions 

Meetings with Moneyveo team gave us a better understanding of their technology, product, capabilities, vision, and passion. With our extensive experience working with Ukrainian non-banks and our understanding of the market, we realized that we can reach our final goal. We can create a really necessary to the user and functional product that will be based on the lending model, but we called it «advanced lending».

The Ukrainian banking market of 2021 was entirely credit oriented

As of 2021, the Ukrainian market was entirely loan oriented. Users willingly took loans for everything from personal expenses and small household purchases to cars and businesses. Loans were part of the culture. It was normal, an everyday phenomenon that customers were really well familiar with.

But offers that existed on the market didn’t satisfy users enough. They were unpersonalized and monolithic. We realized that we can play a competitive fight exactly on this weakness. Depending on the scoring, we can provide various users with flexible credit limits, or large limits for a long grace period. For example, a large credit limit of UAH 100,000 for 100 days — it was absolutely unique on the market. We could have achieved this quite easily due to Moneyveo’s extensive expertise in the credit business.

The ability to effectively work with credit scoring and possible risks was one of the strongest points of Moneyveo’s business model. These strengths allowed us to admit a hypothesis of a flexible product credit engine, around which we could build a defining competitive advantage for the product.

Of course, this hypothesis had to be tested on the key target audience. But at this stage, we were already quite sure that it will become the basis of our proposal.

Proposal structure and Final discussion with the client 

Before our final handshake, we prepared the proposal for the client. Here’s what it looked like:

  • It was assumed that we could build a really highly competitive product that the user needed basing on working with credit limits
  • We acknowledged that we had to enter the market with a highly functional product, talking about added functionality, as well as the list of functions and its usability. We aimed for absolute leadership. We also understood that we had to release a product that the client would love at first sight. For that, we had to research the best practices of neobanking in Ukraine and the whole world, and then implement these practices in our product.
  • It was planned to conduct at least 100 in-depth interviews to identify those micro needs of users who are not satisfied with other products. The market is mature and competitive, and the competitors have really professional teams that know their job. There were no obvious insights in the market, like some feature X that would attract the audience of, let’s say, gamers, because no one else has it. There were no such features. All products on the market were functional, although they differed slightly in depth in functionality and usability. But, as stated above, the market was at a stage where super obvious deep insights weren’t easy to find. So we realized, that the key to success could be working with micro needs: an additional tick or dot when transferring, shortening some flow by one click and adding some functionality for small groups. Due to the closure of a large number of such micro needs, and due to usability, we would be able to create a highly competitive product. And thus, be remembered as a really necessary valuable product in the users’ eyes.

The client was completely satisfied with our proposal and strategy. Our commercial proposal and deadline were accepted and we began our work.

The process of value creation

The process of value creation in this project consisted of a lot of stages. Let’s start with the first one:

Deep competitors research

We already had some info about the market and competitors, but it was time to go even deeper. We carried the competitors’ analysis out according to the following criteria:

  • analysis of banking products, tariffs, commissions, cashback, loyalty programs
  • a separate comparison of credit products
  • the speed of opening an account and the speed of issuing a card to start using
  • analysis of the application functionality and its usability 
  • analysis of the User acquisition model, retention model, LTV model, awareness model
  • analysis of app downloads amount, reviews, and other product metrics that we could get using the Data.io service

Deep research of the target audience from open market sources, users’ needs determining, pains, motivations, and expectations regarding the future digital product.

  • profiling of users according to socio-demographic characteristics
  • description of specific customer jobs for each individual profile
  • determining which services currently close specific User Jobs
  • analysis of user comments on PlayMarket, AppStore, Facebook, Twitter, and Instagram pages of competitors
  • analysis of the reasons for opening an additional account in another bank
  • study and description of criteria for choosing a new bank (rational and emotional)
  • creating custom hypotheses based on the information obtained above
  • preliminary prioritization of target groups

Conducting exactly one hundred in-depth interviews to test, refute, or confirm user hypotheses

  • Sorting user hypotheses
  • Creation of a survey script for in-depth interviews with respondents
  • Formation of the respondent base
  • choosing a reward for interviewers for conducting an in-depth interview
  • scripting and systematization of data, and development of an analytical note based on surveys

Ideation session, systematization of ideas that we received based on research and in-depth interviews

Through the entire process of interaction and research, some ideas were created. By respondents, the team, ideas that came from analyzing all the available sources on the internet. And we collected each of these ideas right away. 

We put these ideas on the dashboard and it already had more than 170 ideas even before the start of the ideation sessions. Our task was to consider if we wont to place them in the product, and come up with more ideas if needed. Each idea went through the process of discussion, brainstorming, analysis, and understanding of its feasibility in the future product. This process reduced the final number of ideas to 25, which were supposed to be the basis of the product.

Creating a product’s value proposition. Testing the value proposition on respondents.

All the preparatory work has been completed. The moment has come to carry out the most important exercise — creating a product’s value proposition.

As a basis, we took the Alexander Osterwalder framework. It is a strategic management tool to design, test, build and manage products and services. Before the start of the workshop. Our team completely filled the right side of the value proposition canvas, using the ideas we selected during the ideation session. And the results of in-depth user interviews and competitor analysis were included here as well.

The workshop with the client’s team lasted 5 hours. During this time we managed to generate enough ideas for services, and pain relievers and gain creators to say that the product’s value proposition was ready.

Creation of user stories based on the value proposition, formation of the product backlog

This stage included the formation of the product backlog based on VPC, sorting using the KANO model, and determining the volume of the first release. And, after that, the approval of first release by the client team.

Since the value proposition of the product was formed, we approved the list of services, functionality, and pain relievers and gain creators of our future neobank. The time has come to form a product backlog and move towards its detailed study.

This work took about 2 weeks. As a result, we received about 640 lines of the product backlog, which had to be sorted to understand its impact on the future product.

When performing such work, we at Devlight usually use the Kanno model, which allows us to analyze each functionality for its purpose in the future digital product:

  • mast-have functionality
  • delighters
  • wow effect

After several conversations with the client’s team, we decided on the scope of the first release. It was based on the team’s budget and deadline expectations. Thus, we approved the scope of the first release of the product.

After that, we moved to write user stories and acceptance criteria for each element of the backlog. At Devlight, this type of work is typically done by a team of business analysts, project managers, and quality assurance engineers.

And here comes the result of this stage of work:

All work on gathering all the requirements for the future digital product was done by that time. And, the phase of active prototyping and usability testing began.

During the prototyping phase, we use the Figma environment, where we create high-fidelity black and white prototypes. It allows us fully reproduce the user experience of the future digital product and the user’s interaction with it. Each element of the backlog is also worked on in detail by a team of product designers, project managers, and business analysts to create the best possible digital user experience.

At this stage, we usually receive 400-500 black and white screens. We combine them into an interactive clickable prototype and later use them for usability tests with the target audience.

Before the start of the development, we use the Maze service to fully test the entire interface for user understanding of:

  • customer flow
  • interface buttons, actions, pop-ups
  • general interface convenience

And thus, we get an understanding of how obvious and user-friendly our future digital product will be. As a rule, usability testing gives us 3-4 iterations of changes. It allows us to be completely sure that the target audience will perceive our future digital product positively.  

At this stage, the black-and-white prototype was agreed upon and approved by the client. And we moved forward to preparing for the engineering work, namely designing the API methods using a UX-driven ADI design approach. For this, we use the Postman environment. The result of this work gives the entire team comprehensive information about which integrations should be carried out and which data points from the client side should be created for the product functionality.

The API project serves as the basis for the entire product development cycle, which is why we at Devlight are extremely careful and meticulous about this stage.

Limitations and challenges

Problem faced us during the process

The process of research, interaction, and discovery went quite smoothly, as the workflow was built right both from our side and from the side of the client. With such a client who showed tolerance and didn’t add haste, we got a very good work pace. This allowed us to complete the preparatory phase and the discovery phase without any problems.

Biggest challenge we met while creating the solution

Working with respondents was the biggest challenge for us, as it was the largest piece of work. We conducted the exact amount of 100 interviews. But after it was done we still had work to do: it was necessary to transcribe them, systematize, and find insights.

Respondents had great motivation to be genuinely involved in the interviewing process as they were rewarded for it with a gift certificate. As respondents were happy to share a maximum of their thoughts and insights, the interviews lasted a bit longer than we expected. Each interview lasted approximately 1,5 hours.

Our decisions to solve the problems. 

Our decision was to connect additional interviewers to complete the process on time. There were so many materials that we received after this phase that our whole team had to work for several weeks without days off to analyze them and find the insights needed. But after weeks of hard work, we managed to finish the work at the expected deadlines and get the expected results from this stage.

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Results and Outcomes 

Process of solution launch and going live

The deadline for discovery was February 20, 2022. On February 10, the entire process was completed and the results of it were handed over to the client for approval. 

We presented the results of the discover the Moneyveo team with inspiration. The management board of Moneyveo felt our excitement and was sure that this product has to be built and released. All doubts that existed before that disappeared. We saw the green light in front of us and we were ready to move forward to the next stage.

Meanwhile, the branding agency was finalizing the work on the development of the name, visual, key message and color guideline for the product. We were waiting for the results of their work to start the UI design phase.

But then the war started. 

Compliance with expectations

The entire process of interaction with the client was as productive and efficient as possible. We didn’t have any tension, except, maybe, during the interview conducting phase. Due to long work with respondents, we had to spend twice as much time as was expected. But we still managed to meet the deadline. A little (or not so little) overtime works wonders. 

Clients’ feedback

The management board was expressed by our presentation, they stated that the results exceeded their expectations and they recognize the overdelivery we’ve made. They also stated that they had the urge to continue moving forward in this project with us. 

We overdid the expectations the most at the prototyping stage. Two very experienced designers worked on it, and every time we presented the result, the client was shocked by how detailed everything worked out.

Some market numbers, proofs, and results

  • More than 100 user interviews with
  • The total duration of the interviews — 120 hours
  • 250 customer hypotheses were developed
  • At the ideation session, we worked on more than 400 different ideas
  • Less than 10% of them were chosen to be the basis of the product
  • 660 screens for the prototype were developed

Conclusions 

Market & Users Insights

The market was and still is very competitive. But we managed to find a unique competitive advantage and the niche for our successful work in the market. That was our most important and biggest insight.

After close work with the target audience, we clearly understood that despite there were a lot of different products in the market, clients still were ready to consider and try our future product. Flexible crediting and management of their own credit mechanism is what would give us users’ attention and interest. 

What we’ve learned from this project? 

  • Satisfying a large number of users’ micro needs can become the driving force of a product.
  • Customer interviews should be planned to take at least an hour, preferably for an hour and a half.

Our skills shaping after the case. 

Retrospective

We realized that customer interviews require more time. Customers genuinely wanted to share, they were involved in the process and wanted to be a part of the product creation. 

That is why working on our next banking projects we invested more time in this phase.

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