In 2019 an estimated 5 billion people had mobile phone devices and more than half of those were smartphones. In emerging economies, mobile phone ownership far outweighs personal computers. So can you harness the reach of mobile phones to help people save money?
People use mobile apps to prompt good behaviour
Mobile apps can be personalised and they are with us at all times. Approximately one in ﬁve smartphone owners has at least one app to support their health-related goals, and 38% have downloaded an app for physical activity. Last years FinTech report said that Finance or Budgeting apps come second only to health and fitness when it comes to engagement and recurring use. One-third of users drop off after a few months but still return with the right prompt so there is a big opportunity for the right tool and messages to help people save.
Mobile messages can make people more financially aware
Smartphones have changed the way we manage our daily lives, and if real-time analysis and notifications can help create good fitness habits and remind us to move or meditate, it can also help us recognise and adapt better spending habits and financial awareness.
American Economist Richard Thaler wrote an article on financial literacy back in 2013 for the New York Times, saying that the successful delivery of financial education was about ‘just in time’ messaging that is offered at the crucial time of the decision-making process.
Useful messages could be advice to student loans just before graduation, or tips on mortgage options before buying a house as well as smaller buying decisions like the right insurance for a holiday or what to look for when buying a car. Smartphones can make the system more user-friendly, thus ‘making it easier for people to make sound decisions’.
Think about your own customer base; do you have data around their spending patterns, savings habits and what they might be saving money for? Can you provide relevant and personalised mobile messages that will help them save more and spend responsibly?
Tracking financial health outcomes
During Financial Literacy Month in the USA, a Center for Financial Services Innovation study showed only one-third of Financial Services companies offer any sort of products to help with budgeting and only thirty-five per cent of executives said their institutions are tracking financial health outcomes. This is despite less than 50% of the population being financially literate and most living paycheck to paycheck.
Whilst there is a graveyard of mobile finance apps built in-house by banks and superannuation funds, the high adoption rate of mobile banking apps, micro-investing and micro-savings apps in the USA, UK and Europe shows us that there are millions of people keen to optimise the funds they have, to save more or to pay off debt.
Mobile-first service design means you can create an experience with meaning, send personalised nudges and measure the impact they have on a customer’s finances.
What our user stats say
Young people might be the highest adopters so far with fintech products in general, but our user testing has found that adults in their forties to fifties use automated savings for multiple goals including travel and shared family savings. In fact, they are the bigger savers, they Round-up more (by an average of 5%) and have a larger number of active goals (we currently allow for 6 goals). Users on Android access their savings app slightly more often than iPhone but they both start off at an average of three times a week and then flatten off to once a week after three months as their savings stabilises and they understand spending patterns.
Mobile-first is inclusive
More than half the world is unbanked or underbanked so mobile phones provide access that can help overcome geography and excessive cost. In her article for American Banker, Jen Tescher, the President and CEO of Center for Financial Services Innovation talks about the huge financially vulnerable population, saying that they “need access to high-quality products and experiences built to help them succeed by people who truly understand their financial situations and foibles. They need real-time advice and guidance, tailored to their specific situation and immediately actionable.”
Mobile delivery of financial services can address the needs of individuals in a more cost-effective way that is also scalable.
Navag8 makes saving and investing an experience
We all know from our own experiences that smartphones have become an essential part of our daily lives. Think of how they changed travel and the way we document it, communication and how we talk to each other, health and the way we track it.
We built Navag8’s core functionality to be around micro-savings to address the need of customers and the gap in the market by financial service providers. We saw for many years that mobile was how all finances would eventually be managed and that the right app could help people actually save without thinking.
The mobile phone is now with customers at every step of the sales funnel and the ability to be a shopping mall as well as a wallet is problematic. What we can help you do is turn customer transactions and purchasing into a practical lesson about saving and responsible spending, so both your business and customers benefit in long-term.
Get in touch to find out how.