A recent article in Forbes cited research which found that the Fintech industry is changing the way young people are handling their money. Rather than borrowing from the “bank of mum and dad”, as the article puts it, 18 to 22-year-olds have utilised modern finance apps and technology to help them build savings that past generations did not have at that age.

Generation Z, the research said, no longer need to rely on their parents to help support them during that time, with 35% of those in that age group and 52% of millennials having more than £1000 in savings.

The findings, Forbes says, “suggest that Generation Z are in control of their financial future and contradict the abundance of headlines that suggest that this generation, in addition to 23 to 28-year-olds known as millennials, spend frivolously on Pret A Manger and cannot save”.

There is, of course, contradictory research. The UK’s Financial Conduct Authority (FCA), found in its own study that one in ten UK adults have no savings whatsoever.

For the much-maligned millennial and the newly-adult Generation Z, the issue is debt. Mortgages, student debt and the cost of living were cited as major problems for these two generations compared to baby boomers.

What fintech provides

According to a USA Today article, the issue is not so much around money, but something arguably even harder to attain: independence. That article cited research carried out by Merrill Lynch/Age Wave which said that seven out of ten adults aged 18 to 34 got financial support from their parents in the last year, including over half of those in their early 30s.

But that same research found that what really matters to people of that age, and how they define the move into adulthood, is financial independence. And the Forbes author believes that this is where fintech comes into play, and how it might be affecting the younger demographic, Generation Z.

“It could be argued that the rise of the Fintech industry and alternative ways of managing money has led to younger generations keeping a closer eye on funds and planning for the future using the various apps that are available,” the author writes.

If we think about apps like Monzo and Revolut, the key differentiator aside from convenience is smart and accessible tracking. Rather than hours spent poring over statements which, even in the days of ubiquitous mobile and internet banking, is still how expenditure is generally presented by the traditional banks, users are told where their money is going and what they could do better.

And for one IT professional and blogger for Data-Driven Investor, Vytas Taujanskas, this means that IT bods and product developers need to think about how they build their offerings.

Designing products with an audience in mind

The blog post states that “contrary to the previous generations, Millennials have a different basis for decision making. They spend less on the luxury things, responsibly estimate when to marry, or to own a house, highlight healthcare much more than Gen X. Therefore, the challenge is to find a key to how to meet the different generation Y mind-set expectations in providing solutions to their wealth management.”

And it continues to identify how different expectations and desires are changing the products that we design: “Millennials’ affinity for technology is reshaping the service industry immensely. They are able to access all the information on the web and are prone to compare products using digital tools and find the best value for the best price.”

Additionally, Taujanskas says, “Gen Y has high standards for the brands they identify with. That is all why a high degree of transparency is necessary. It isn’t hard to do that in the digital world. Showing full details about their spending, disclosing the full cost of the service, showing the alternatives how to save or how to get more value for the money are ways to bring more transparency for the service.”

It’s clear, then, that as demonstrated by Amazon, customer-obsession is key. Most decent businesses try their best to help the customer but it’s obvious that in the tech sector – and fintech is no exception – every decision has to be driven by giving the customer the optimum experience.


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