Millennials gain app-titude for financial literacy
Millennials’ are becoming choosy about where they put their money according to a Fintech product founder.
As the banking royal commission uncovers stories of customer mistreatment, banks are being urged to do more to hold on to millennials, who are becoming increasingly choosy about where they put their money.
Jessica Ellerm is the co-founder of Zuper, a millennial-focused superannuation app set to launch in the first half of this year. She says millennials are anxious about their financial futures and how they’re going to build wealth, so they are turning in growing numbers to non-traditional avenues such as cryptocurrencies.
“They’re taking these bets because they think it’s the only way for them to create meaningful wealth,” Ms Ellerm told The Australian. “They look at how their parents did it, and they say, ‘That’s not available to me.’ A lot of people are turning to cryptocurrency because they’re just feeling left out.”
The executive, a millennial herself, who co-founded the app with Jon Holloway and Eran Thomson, says her generation demands more than a good deal.
“What millennials want from their banks is for them to be authentic in what they do, and do it with purpose,” she says.
“Millennials know profit and purpose can go together. For example, I’ll buy brands like Toms Shoes that give back to impoverished communities, and I’ll reflect my personality through my purchasing choice. That’s a change that’s now starting to hit the financial landscape.”
A review by Intelligent Finance found the biggest factor for millennials in selecting a bank was an easy-to-use smartphone app, while baby boomers preferred face-to-face service.
Zuper, Ms Ellerm’s Sydney-based start-up, uses a chatbot, artificial intelligence and a mobile app to stimulate millennials’ interest in their superannuation. She points to research showing only 40 per cent of millennials are aware of how much money is in their super account.
The company runs monthly “fin gym” events across the country, with free beer and wine, to make young Australians more comfortable talking about their finances. Ms Ellerm says Australia lags behind other countries when it comes to financial literacy, but that millennials see through typical sales pitches.
“I think we’re all just a little tired of being sold to,” she says. “What we really want is to learn, but in a more fun and friendly environment.”