SaverLife’s ‘fintech for good’ research was generously supported and funded by the Bill & Melinda Gates Foundation.
New Research (Coming soon): Unpacking the Consumer Fintech Experience (Neobanking, Earned Wage Access, Cash Advance, and Buy Now Pay Later)
The use of financial technology (“fintech”) has grown rapidly over the past few years, including products such as fintech bank accounts, Buy Now Pay Later, cash advance, and earned wage advance applications. These products are widely used by SaverLife members and offer new tools that may better meet their financial needs than mainstream financial products. But some aspects of these fintech products also have the potential to increase debt or destabilize budgeting plans. In this report, we explore whether new fintech options are helping or hurting the financial health of persons living with low-to-moderate incomes (LMI).
We start by examining the characteristics of SaverLife members who use fintech products to manage their financial lives, then we delve into their reported experiences with these products.
Topline findings
Finding 1: Members who use fintech bank accounts have lower incomes, are less likely to be employed, and are more likely to live with a disability than members who use traditional bank accounts.
Finding 2: Almost half (49%) of members paid overdraft fees in the prior 12 months.; mMembers who identify as Black or Hispanic and who have lower incomes are more likely to pay these fees, underscoring that lower-income people pay significantly more for banking services. Fees are the top reason for closing traditional bank accounts and using fintech bank accounts.
Finding 3: Over 40% of SaverLife members used Buy Now Pay Later in the prior 12 months. Of these members, 63% said they had one or more problems with these products, such as over-spending or missing payments.
Finding 4: Compared to members who use Buy Now Pay Later, members who use online cash advance or employer-provided earned wage advance products are less likely to own credit cards and more likely to use payday loans.
Finding 5: Buy Now Pay Later use is more associated with convenience and preference while online cash advance and employer-provided earned wage advance are more associated with paying bills on time and dealing with unexpected expenses and drops in income.
Finding 6: Use of all three short-term credit products is highest among SaverLife members with children, underscoring the need for additional financial support for parents (such as increasing and expanding the Child Tax Credit).
Research Events
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Webinar 2 — Coming in January 2025.
Financial health product design: How do we design better fintech products to meet the needs of consumers?
We will open up registration for this event closer to the date of the webinar. Please check back later.
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Webinar 1
Join us for an exclusive webinar as SaverLife explores the latest in fintech innovation, revealing why consumers are increasingly relying on Neobanking, Buy Now Pay Later (BNPL), Earned Wage Access (EWA), and Cash Advances to manage short-term liquidity needs.
