Millennials are most comfortable with digital technology. After all, they have grown up in the emergence of the world wide web and the introduction of the tech era. They rely on technology more than any other generation before, making it difficult for financial institutions to keep up with the demand for innovative and user-friendly products/services. Companies have raced to find what attracts the ever-changing tech-savvy generation.
Investing in the Future
Many fintech startups are creating products and services with millennials in mind with strictly mobile platforms (think Venmo!). Millennials are finally at the age where they are thinking about investing in their future. Many people think that this generation is generally apathetic to the idea of finances. Baby boomers have described the younger generation as financially irresponsible. Maybe investing is too great of a risk.
But quite the contrary. FinTech companies have emerged to provide an easy route to financial services. The creation of robo-advisors (versus face-to-face business interactions) uses algorithms to place consumers’ money in the best place. Essentially, millennials have faith that technology will solve their financial problems. And FinTech companies are providing (and solving) those problems. FinTech companies have found that tech, automation, and convenience are at the forefront of this digital generation.
And why not? Millennials essentially grew up during the financial crisis of 2008-09, unlike the baby boomers before them. Millennials tend to be more conservative with their money because of this. Though saving at a rapid speed, it is still not enough for brokers.
The unemployment rate in the United States was only at 10%, something seemingly unheard of. Currently, the most recent graduates are suffering from an unemployment rate of 44% – and it’s still on the rise. Most millennials are living back at home with their parents, something earlier generations have never seen before. Most of these recent graduates are also drowning in staggering student debt with no way out of the hole. It’s no surprise that millennials are distrustful of financial institutions, especially when many of those banks benefiting from the recession.
Millennials are begging for alternative financial solutions, and fintech companies are looking to provide a user-friendly, hands-on experience – with mobile banking solutions and investing.
AI and Machine Learning: The Future
One of the leaders of AI and machine learning is Amazon, which may be creating a hybrid checking account specifically for millennials. A recent LendEDU survey discovered that 38% of Amazon customers would trust Amazon with their banking solutions the same way in which they would trust a traditional financial institution. Who knows Amazon better than millennials…?
Upstart, a consumer-lending platform, is another fintech company who unintentionally found an audience among the millennials. Upstart uses unconventional means (i.e. employment history and education) to help consumers secure loans. Millennials tend to have terrible credit or no credit at all, making Upstart an incredibly useful tool in acquiring a loan.
This generation is leading the tech front at an alarming pace. If companies want to keep up, they will take into consideration the needs, wants, and desires of this group who truly rely on technology for everything – including what happens to their money.
What is FaaStrak?
We have eliminated the typical broker/business model. Our talent, industry knowledge and highly effective process ensures that we transform your lease business into next-generation leasing — putting you light-years ahead of direct lenders and brokers. We have created one smart credit application that connects to all lenders within the marketplace. Users can now build their business around a multi-lender approach and the customer will only have to fill out one application. The coined term “smart application” refers to the platforms ability to update in real time based on the applicant’s criteria. This way the applicant gets sent to the most appropriate lender without being shopped by other lenders.
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