An average user has 2.5 finance apps on their phones, one of which is likely to be a tool for managing personal finances. It’s hard to overestimate their value, especially now. But to develop a beneficial solution that your consumers won’t get rid of after a couple of days as it happens with the majority of mobile apps, you need to create something that would engage and capture. Functionality comes first, but you can find your competitive advantage by studying the current trends in personal finance app development and people’s expectations. See what’s popular in personal finances and what other financial app developers do and analyze whether you can exploit it for your project.
We also have a more bird’s view sort of digest on how to build a personal finance app that covers the various aspects of the process. You might want to check it out too.
#1 A friendlier attitude and trust establishment
It would probably seem to you like there’s nothing new in this area. Every now and again there are write-ups that proclaim the next year as a “year of a customer” with the companies taking care to introduce their new, more user-centric approaches. It looks though that 2020 has finally proved to be a real year of empathy with so much going on in the realm of social justice. So it doesn’t come as a surprise that the financial companies whose well-being depends on how much their consumers trust them, make use of this trend that has had a major impact on our society. If a more friendly human approach means making those companies more successful and profitable, then be it. The end result and everyone’s benefit is what counts. For example, the SAVVI Financial tech-enabled finance platform claims to owe its success to user-centrism. They combine computation processing, applied analytics, and a personal disposition towards clients to help them determine their best course of action and devise a custom plan which addresses their individuality.
You can achieve a friendlier and more trust-instilling attitude in financial application development by incorporating a respectful copy, functional aesthetics, giving users the freedom of choice, catering to their needs, giving them an up-to-date product that would show them that you are eager to adopt new approaches, and making them feel safe.
#2 Demand for investment opportunities
When the pandemic struck, we started to spend a lot more time online than before. Many people found new activities using their phones. Add to that the state of the stock market that had fallen during the first months of the pandemic and it becomes clear why so many new investors finally saw the opportunity to take part in stock trading. Plus, more and more services now offer the ability to make bite-sized investments, i.e. get a portion of stock if just one piece costs thousands of dollars, like in the case of Amazon and Booking Holdings.
Investment services became one of the leading personal finance trends. Take the flourishing Robinhood app that allows you to invest in stocks, ETFs, and options. It makes the list of the most noticeable new apps of recent years. It looks like your finance management app will benefit if you add some investment opportunities to it. Some of the money management apps have been offering investment options for some time, of course. Others like Personal Capital are sort of vice versa. They are primarily investment tools with an added option to track expenses. Either way, you might want to look closer into this promising opportunity.
#3 The (new) rise of voice technologies
Yet another FinTech trend that is getting on well in the wake of the pandemic. According to Visa, over the past three years, the popularity of voice assistants has doubled: in the world, more than 30% of consumers use various services with voice assistants, and 10% make purchases with their help. Over the past year, the number of people using voice solutions based on artificial intelligence to pay for goods and services has grown by a quarter.
A simple UI with the possibility to make entries with your voice is what can make users of other money management solutions try a new one, it’s their natural fit. For example, major existing apps for personal finance like YNAB or Moneytree enable voice commands in their apps through Alexa or Siri. Or conversely, you can ask your virtual assistant to sum up the results for the month in one form or another, and the application will read out all your expenses or income for the period by voice.
Some large finance companies and institutions are actively developing voice technologies using in-house resources and putting together their own teams. Others are buying other companies with proven technologies and expertise. Voice-enabling technologies save time, make things easier, are more efficient, and have a future in FinTech.
#4 AI and chatbots
Millennials, i.e. a group of mid-20s to late 30s, though not currently in possession of as much wealth as Gen X’s and Boomers, now form the majority of the workforce and are to inherit the greatest wealth in the world’s history. More to the point, they prefer to avoid dealing with banks in physical reality. What’s more, as stated in the survey conducted by Vanguard, they are twice as likely to make use of robo-advisors than the members of older generations. Along with Gen Z, younger people are more tech-savvy, being exposed to technology from a very young age. For members of these generations, growing up in a hyper-digital world, AI and chatbots are nothing new among FinTech trends, it’s something expected. Same as with ATMs which were once just as new and unprecedented, artificial intelligence becomes the norm.
So it’s wise to adapt your digital strategy to the needs and expectations of the most work-active part of the population and the one who is going to take their place next. According to PWC, 63% of consumers believe that AI will help solve complex problems. 41% see AI replacing humans as financial advisors. AI helps to improve personalization while chatbots are used to make customer service faster and more useful while helping to economize on hiring real people for tasks that can be equally well performed by robots.
In our article about tips on personal finance app development, we gave an example of such a startup that makes use of AI capabilities on personal finance app development, it’s named Olivia AI. Other examples of similar startups include Penny, Plum, MyKai, and MajorCoins.
#5 It’s all about AR and VR (again)
Augmented and virtual reality is a curious case of being both overhyped by some and undermined by others. Take a look at the data about VR and AR headset shipments though:
This Statista survey claims that sales of AR/VR headsets accounted for around 5.5 million units in 2020 and will reach a staggering almost eight times more in the next five years. They witnessed their latest spike in popularity in spring 2020 amidst the lockdown when AR and VR became a hot ticket once more after spending many years in the niche status with people seeking ways to safely entertain themselves and connect with others. For example, the gaming virtual reality market in the United Kingdom experienced tens of percent growth each week in March 2020. It’s not all about games though. AR and VR are becoming a hot topic again in a variety of industries. Read our article on 2021 Design Trends to learn more about ways to use new technologies for work and entertainment. Some experts believe that now might be the tipping point for the development of AR and VR solutions for the years to come. Companies that would manage to ride this wave now will emerge as winners. Many leading global tech companies like Sony, Intel, Google are seriously interested in AR and VR investing in thousands of patents with the largest number of them owned by Microsoft — over 10 thousand as of 2020. Apple is reportedly developing its smart glasses, dubbed as Apple Glasses, too.
You don’t have to own a headset though, they are just a good marker of this subject’s popularity. Many augmented and virtual reality capabilities are already on your iPhone. Regarding the usage of AR/VR tech in financial digital solutions, then, taking into account its relative novelty, many of the designs are at the moment just concepts.
Still, many already found their way into real products.
It was definitely a new experience getting my debit card from @acorns with an AR engagement.#banking #AR #debit
@psb_dc @BrianRoemmele @BrettKing @rshevlin @SpirosMargaris @Visible_Banking @cgledhill pic.twitter.com/GcmWCPP7Fv
— Jim Marous 💯 (@JimMarous) August 24, 2020
Use cases of AR/VR in financial app development include anything from providing the information on the nearest ATM location to delivering powerful visual 3D experiences of advice on financial matters and investment opportunities. AR/VR can make the presentation of large heaps of data more accessible than ever before making the interface of a particular personal budget app even friendlier and facilitating the process of decision making.
#6 Gamified FinTech
In a 2019 American Psychological Association (APA) survey, Stress in America, 6 of 10 U.S. adults said their biggest personal stressor is money. That’s understandable. Managing your expenses, budgeting for the future, and trying to make the best of the current situation is something that presupposed the popularity of financial advisors of varying degrees in the first place, from software to personal real-life coaches. That’s why some finance companies have been trying to find a way to ease the tension and find approaches that would make the task less complex, more welcoming, and even for want of a better word, fun.
One of the trends in personal finance is gamification, i.e. when software development companies use concepts from the gaming industry creating serious services and applications to engage, retain users, and much more. Here’s where millennials also come in. Their motivation from early childhood was not based on duty and correctness, but on passion and reward. They have an excellent idea of what levels, quests, awards, and achievements are. The same goes for Gen Z. Gamification is an excellent tool for making complex software easier. Badges, levels, points, leaderboards are a reward in themselves, and perhaps is partly what might make people revisit an application on a daily basis.
One of the most prominent examples of financial companies who apply this approach is again Robinhood. They drew millions of users to financial markets with a colorful app that makes trading seem to empower instead of intimidating. They were so successful with it though that they may have gotten too far and are now facing critique for making financial operations seem too easy with a number of people making wrong decisions that seriously affected their lives. Still, it doesn’t make gamification bad per se. There’s no reason for not learning from their mistakes and incorporating gamification techniques more wisely, developing a personal finance app of your own.
#7 Educational financial apps for kids and young people
Many people are interested in personal finance apps for kids, teens, and young adults. They feel like the fact that they weren’t adequately taught how to manage their finances early on is now affecting their well-being and it’s in their power to help their kids avoid ending up in a similar situation.
We need financial literacy and political literacy to start being taught in a serious manner in schools and with approved material by real experts! But don’t bet on that happening, you better learn it and teach your kids or they won’t have a shot at financial independence!
— Omar Oropesa (@OmarSnsd) October 29, 2020
Who should teach children the basics of financial literacy — parents or school? Today this question can be solved with the help of personal finance apps that are designed specifically for kids. They have a different approach than the ones for adults and feature designs full of brightly colored illustrations, animations, friendly characters, elements of gamification, and more. In our times, parents want to give their kids the ability to manage their finances from a young age and avoid some of the problems that they have to face. You can capitalize on this personal finance trend.
For example, last summer, the digital challenger bank Revolut introduced a new kid-friendly money management app and service. It aims to encourage financial literacy among children from 7 to 17. Their account gets controlled by parents.
Traditionally, finance seemed to be of a somewhat bulky disposition, slow to change, and heavily-regulated. However, along with medicine, finance is one of those industries that showed an upward trend when the pandemic hit. Reality is revolutionizing the way we manage money and interact with financial institutions and tools. Technology does the same in response facilitating and speeding up the development of financial solutions, giving rise to more technological wonders. This is a beautiful interactive process that makes FinTech even stronger with every passing year. Personal finance app development is a promising area that all the same has some room for improvement and innovative approaches.
Have an idea for developing a personal finance app but not sure where to start? We know to apply both the fundamentals and the new FinTech trends to help you create a product that brings value. Contact us today to get your free consultation.