34 Data-Backed Reasons to Build Investment App
Azoft Blog 34 Data-Backed Reasons to Build Investment App

34 Data-Backed Reasons to Build Investment App

By Ilya Kataev on November 2, 2017

Reasons to Build Investment App

The mobile audience is craving to achieve more using their smartphones. Mobile banking is not enough, people want to have more control over their assets. They want to invest in stock market and help their capital grow. Microinvesting is the hot topic nowadays, making entrepreneurs crazy about building investment apps.

We dived deep into financial market research and surveys to gather 34 solid reasons why you should be considering an investment app development.

Investment App

1. They tend to not keep cash in banks

According to research by Go Banking Rates, 69% of americans have less than $1,000 in their saving accounts.

2. And are not very fond of traditional banking

46 percent of millennials fail to open bank accounts. As for the banks, this rejection can potentially mean the loss of significant future revenue opportunity from mortgages, credit cards, auto loans, and savings.

3. They see no difference between banks that market to them

53% of customers can’t see any unique value proposition in their own bank.

4. Y-ers tend not to stick to a single bank during their lifetime

18% of millennials switched a banking provider in last year.

5. Banks think Y-ers have no money. That’s not true at all

According to Credit Karma, 15 million Americans considered by credit bureaus to be “thin files,” which means that they have too little credit history to generate a credit score.

6. Millennials are more creditworthy than you think

AdAge says Generation Y will spend an estimated $10 trillion over their collective lives. Young people aged 17-34 today will reportedly spend more than $200 billion annually starting in 2017. According to Bureau of Labor Statistics, by 2020 Y-ers will represent 46% of the workforce.

7. Branch location is no longer a key factor for them

Only 13% of Gen Y cited convenience as most critical in bank selection. Convenience is only slightly more important to Boomers, with 20% citing convenience as most influential in their bank choice.

8. Y-ers care about money

And according to a recent Fidelity study, 39 percent of millennials worry about their financial future “at least once a week.”

9. Young and wealthy

Because of this high liquidity — a $7 trillion by 2020 — millennials are pretty attractive customers for financial institutions.

10. Millennials care about their investments

According to the research by Invstr, 70% of respondents admit that they feel worried about their future finances.

11. They tend to manage their funds online

Gallup revealed that 72 percent of millennials use online banking services on a weekly basis — compare that to the 21 percent of Gen Y-ers who have never paid a bill with a check in their lives, according to a Western Union study.

Acorns app

12. Online investment is a trend

77% of those who invest in stocks said that they did the majority of their banking and investing operations online.

13. Nothing is OK about the current state of the investments market

35% of respondents said that they don’t feel ok with stock investments and 38% mentioned that they feel barely comfortable.

14. People don’t like mutual funds

According to Forbes, between 2001 and 2012, 7% of mutual funds were failing every single year. And within the same time period mutual funds have raised their fees by 84% – from 0.62% of assets to 1.15%.

Online Banking

16. Tech giants are in the spotlight

According to a study by BBVA, 73% of respondents feel more excited about new financial offerings from the likes of PayPal, Google, Apple and Amazon than of their banks.

17. We are going to pay in other way

Blumberg Capital: 70% of respondents say in 5 years, the way we pay for things will be totally different.

18. Online banking is the most popular channel

81% of Millennials and 72% of Boomers interacted with their bank online in the past 30 days.

19. Chatbots are widely used in fintech

According to Bloomberg, by 2020 over $2.2. trillion of personal assets will be managed by robo advisory services.

20. People tend to care about the human factor less than ever

According to Medallia Institute, Boomers care about the human interaction more than Millennials do. Boomers are 2.4 times more likely than Millennials to cite an interaction with a bank employee as driving a positive experience, and 1.7 times more likely to list bank employees as a top source of frustration.

Human Factor

21. Something is terribly wrong with banking

According to a study by BBVA, 71% of respondents would prefer visiting a dentist rather than going to bank.

22. 1 out of 3 millennials don’t care about banks at all

Millennial Disruption Index, a three-year survey of over 10,000 millennials, states that 33% percent of millennials believe that they will eventually not need a bank at all.

23. Banks are supposed to adapt or fade away

According to a recent survey by Blumberg Capital, 60% of Americans feel banks fail to keep up with their needs and 57% believe traditional financial institutions will not exist as they do today within their lifetime.

24. Almost everyone loves Fintech

Blumberg Capital: nearly 75% agree that FinTech provides consumers with more power over their finances.

25. And online banking

Blumberg Capital: 70% of Americans believe that new solutions such as digital banking, online lending, payments and financial services, are making financial transactions easier than ever.

26. Tech treats underbanked and wealthy people equally

Blumberg Capital: 65% of Americans agree that FinTech levels the playing field by providing access to services previously only available to the wealthy.

27. Fintech companies are considered to be helpful

Blumberg Capital: 69% of Americans think the latest tech for financial tools will help everyone be better off financially.

28. People want banks to be more transparent

Blumberg Capital: 74% of Americans agree that it would be helpful if there was an automated and customized way to make sure they never miss a payment and always minimize the total interest expense on their loans.

29. And focus on SMB rather than enterprise

Blumberg Capital: 80% of Americans agree that financial institutions need to focus more on helping the average consumers and small business owners rather than the top 1% and big business.

30. Banks are simply expensive

Blumberg Capital: 79% of Americans stated that they want access to flexible borrowing options that minimize their interest payments.

31. And demand too much interest

Blumberg Capital: 59% of Americans said they would borrow from or loan money to a friend or family member to grow a small business if it meant paying less interest to banks.

32. The underbanked are craving for banking services

Blumberg Capital: 76% of Americans believe that financially underserved people such as those with low FICO scores or bad employment histories need access to options for loans/credits outside of traditional banks.

33. Traditional banking is not a must anymore

Blumberg Capital: 33% believe they won’t need a bank at all.

34. Innovation will come from outside the industry

Blumberg Capital: 50% are counting on tech start-ups to overhaul the way banks work.

Takeaway

That being said, traditional banks deliver less products and services than people require. Tech companies shouldn’t miss the opportunity to come up with their innovative ideas and disrupt the market with microinvesting app. Thanks to the modern technology stack, even the most daring business ideas can be brought to life with a decent domain knowledge.

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