Which types of financial technology are gaining ground with consumers — and which can actually help them do better financially?
”Breaking New Ground in FinTech: A Primer on Revenue Models that Create Value and Build Trust,” a new report from Omidyar Network and Oliver Wyman, examines new practices from consumer fintech firms that are pairing their revenue strategies with value creation for consumers to gain a competitive advantage in making inroads with consumers and in future-proofing their businesses.
With 140 million American adults struggling with some aspect of their financial lives, whether it be getting their bills paid on time or putting away money for emergencies, they could definitely benefit from fintech that helps them do that — although attendant fees and interest on financial products and services, to the tune of some $175 billion, stand in their way.
But according to the study, the right combination of financial-health focused fintech products can save at least $2,000 a year for the average household with a median of $45,000 in post-tax income. However, delivering this benefit at scale means that mass-market fintechs have to come up with economically sustainable revenue models that also reinforce consumers’ trust rather than threaten it — something not easily done with consumers ranking the industry as “least trusted.”