In recent years, the country’s financial services sector has seen significant technological transformation. Until now, traditional banking and insurance institutions have been at the forefront of this sectoral expansion, improving their functions and capabilities while maintaining the same underlying business model.
Users are keener to accept financial offers with better technology leverage that simplify traditional conventional financial products and services, thanks to the fast rise of fintech enterprises in India. With this in mind, Fintech firms are concentrating their efforts on younger, tech-savvy customers who are more likely to utilise fintech to enhance traditional banking services.
The most basic notion of money management is planning: why and how it is important to prepare for funds, and how it can help children and teenagers become financially wise.
Many fintech firms are now using technology to come up with creative approaches for difficult money concerns in order to ease the burden on parents and children. The use of technology to add a feeling of fun and ease of use to the planning process is steadily shifting the paradigm. As a result, aiding children in building sound financial habits at an early age will enable them to mature into financially responsible individuals later in life.
The second crucial element of the process is budgeting, which is similar to planning how to spend money wisely. Money is separated into multiple baskets dependent on the importance of the assignment in order to better control the spending habits of the young. Budgeting allows teenagers to prioritise their spending habits in a more sustainable way by putting money aside for future use. Fintech companies are constantly experimenting with the latest technology in their in-built apps to provide kids with a fun and easy way to learn money management skills, such as through games, chore incentives, and reward points.
To successfully introduce the concept of saving, fintech companies are designing games and activities that encourage children to save more money rather than spend it by providing non-monetary rewards and a sense of ownership. Teens can grasp the worth of money and manage their finances successfully in the future with frequent tracking of their spending habits and an analytical analysis of weekly/monthly data. As a result, these fintech apps benefit both teens and parents by establishing good money management practises in teens while also relieving the pressure on parents to spend and watch the pocket money allocated to their children.
The one critical step toward building a strong foundation of financial literacy among youth is to invest money in the correct tools and financial services. When one thinks of investment, there are a number of questions that come to mind.
As a result, Fintech companies are using a more simplistic technical approach and smart activity concepts to teach children how to make good investment decisions. They will understand the fundamentals of investment products and services, as well as how they work in practise.
Fintech has formally been identified as a major trend that will revolutionise financial services for the better, regardless of who the intended audience is. All essential parties who are part of the financial ecosystem should promote financial education and awareness among teenagers.
By promoting and evaluating programmes that improve digital and financial literacy while taking into account their unique features and benefits. Fintech companies are using technology to collect enough data and patterns of their financial behaviour to offer in a more interesting and useful format, as well as meaningful suggestions on how to enhance their financial literacy.
The author, Ashish Singh, is Co-founder and CTO at Pencilton. The views expressed are personal
(Edited by : Anshul)
First Published: IST