In addition to new innovation and technology, the fintech industry is breaking the age barriers and is having customers across all age groups. And during this period of gloom, we have understood the importance of money. Thus, it is important to plan our finances for a better and secured future. As digitalization has killed the age boundaries of banking, we have witnessed the popularity of this space amongst the teenagers.
Hence, the teenagers have now become the ‘digital natives’ as they are ones who are more familiar with the online world. For example, we have seen children at a very young age are inclined towards phones and internet which further provides a massive opportunity for Industry players to have an innovative business model that caters its services to teens and in return provides profitable business growth.
Looking forward to the upcoming years while adapting to the new normal, following are the expected outlook for the fintech space that caters to millennials.
Financial literacy a must
Financial literacy should be considered important in order to use knowledge and skills for effectively managing money for lifetime financial well-being. Thus, financial literacy is a combination of financial awareness, knowledge, skills and necessary behavior that makes effective financial decisions along with prosperous well-being. Since money is considered to be an essential commodity the need to understand the true essence of money management is a must. Inculcating financial intelligence amongst young generations will strive to ensure enough monetary planning for a better future.
Many fintech players offer tools to both parents and children to help teens learn about money management and basic financial concepts. It is beneficial to induce financial literacy at an early age as it helps teens evolve and make wiser financial decisions to build a strong future.
Investing guidance for teens (and parents)
Investing is important for the younger generation because it allows them to put their money into something that will yield a profit. Parents need to take special care on what knowledge they want their kids to learn, and how that knowledge would benefit them. Making teens well versed with the importance of money and teaching them various ways to manage their penny is crucial. Therefore, the best way to accumulate wealth is to save and have a well-thought-out investment strategy with a specific goal in mind.
For teens it is pivotal to make them understand the need and importance of money management. As social media influence is mostly found among the younger generation, there are various content and resources available that tend to catch the interest of teens. As responsible parents it is important to make kids learn about the vital money lessons. Although investing can appear complicated to adults at times, in order to get started, one must instill the value and necessity of financial literacy in teens from an early age.
Fintech in semi urban and rural areas
In the post pandemic world, consumers are moving towards using mobile wallets and contactless digital payments. With technology advancements taking place across the globe, digital services are expanding into the semi urban and rural areas. In addition, semi urban areas are picking up with fintech services and rural areas are adapting, which will show growth for fintech in these markets as well.
Teens will begin to participate in household financial decisions
The tremendous popularity of fintech apps/wallets in recent years has opened up a plethora of opportunities for firms to target children and teenagers as the next growing customer category. Because of their heightened interest in technology and devices, adolescents have become the sole decision makers for everything online in most households. This is also due to the pace at which technological developments have taken place in the fintech space parallel to digital space in the past decade which let teens adapt easily.
As with the pandemic, when people were confined to their homes, it was usually the children or teenagers who made decisions about online purchases, gadgets, and food.
Fintech companies that cater to teenagers have a bright and exciting future ahead of them. More innovative solutions and the use of technology to clarify key money concepts for children will only increase competitiveness in the industry. Furthermore, businesses will employ innovative strategies for kids to make the experience more enjoyable while also influencing them to understand money management concepts.
The writer is Co-founder, Pencilton.
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