This is part two of a six part blog series about savings technology. Yesterday we discussed what savings technology looks like in goals-based PFM platforms. Today, we’re considering a far simpler approach– standalone, automated savings platforms.
Missed the other five savings categories? Check them out:
- Goals-based PFM
- GenZ-targeted
- Crowdfunded savings
- Advice-only
- Passive investing
These types of companies debuted in 2011 with the launch of ImpulseSave*, which was acquired by Betterment in 2013. Since that time, a few other competitors have launched and are beginning to build steam with their Millennial user base.
Standalone, automated savings
These are mobile app-based savings tools that differentiate themselves based on simplicity. The solutions are aimed at millennials and use an algorithmic
approach to determine the best dollar amount and frequency to save on behalf of the user, based on their historical spend. They use a chat-based interface for client communication and account management. Two examples in this space are Dyme, which takes a strict B2B approach, and Digit, which offers a B2C app.
- Dyme
Dyme’s B2C product is a text message savings solution for 18 to 40 year olds. The AI-driven chat capability is set apart by its unique voice and familiar tone. The app offers users the option to set the voice as standard, 1980’s aerobic instructor, sad high school teacher, or terrible parent (see image right).Dyme launched its consumer-facing app at FinovateFall 2015 and has since pivoted. The company has narrowed its focus to a offer a B2B solution and expanded its products to include text capability for customer service, financial education, account alerts, and bill pay reminders.
- Digit
This customer-facing app harks back to text banking of the late 1990’s. In fact, users don’t even need
a smartphone to take advantage of it. All they need to do it set up an account with their primary debit card and text the commands. Want to set aside an extra $10? Text, “save $10.” Want to withdraw your entire balance to pay your taxes? Text, “withdraw $1,700 for taxes.” To encourage interaction, Digit texts users their savings balance and checking account balance on a regular basis.Last month, the company expanded its platform with the launch of a Goalmojis feature that encourages users to set up and save for all types of spending goals, ranging from vacations to utility bills, simply by texting an emoji that matches that goal, for example a Christmas Tree emoji (pictured right). If the user assigns a due date for the goal, Digit will set aside money on their behalf to help them achieve it.
That’s a look at the first two types of savings technology. Stay tuned later this week for the final three examples.
*This Massachusetts-based company is not to be confused with U.K.-based ImpulseSave, whose parent company True Potential launched a similar product for the European market at FinovateFall 2014.