Millennial Financial Literacy and Fin-tech Use: Millennial fin-tech use
Given the availability of fin-tech that has fundamentally changed how individuals can conduct and manage personal finances, the 2018 P-Fin Index survey included questions to gauge smartphone use for a number of transactional and informational financial activities. These questions also enable examining how fin-tech use relates to financial literacy and personal finance outcomes.
The 2018 P-Fin Index survey asked respondents with a smartphone whether they used their device frequently, sometimes or never for four transactional activities:
• Depositing checks into a bank account.
• Sending and/or receiving money from friends, family or other individuals.
• Paying for a product or service in person at a store, gas station or restaurant, i.e., making mobile payments.
• Paying bills.
The survey also asked about smartphone use for four informational activities:
• Checking credit score.
• Comparing prices or product features when shopping.
• Getting personalized investment advice.
• Tracking spending.
Paying bills is the most common transactional fin-tech activity among millennials with a smartphone; 33% frequently use their device to pay bills, and an additional 35% sometimes do so. The next most common transactional activity is depositing checks, followed by sending/receiving money and making mobile payments (Figure 4).
There is little consistent variation by demographics in fin-tech use across the eight activities. For example, females are more likely to use their smartphone for five of the activites, males are more likely for the other three, and sometimes the differences are slight (Appendix Figures A4 and A5).
Age is a demographic where there is a consistent pattern in fin-tech use—seven of the eight activities are more common among older millennials than younger millennials, with the useage rate of the eighth being the same. However, the difference is slight (only 2 or 3 percentage points) with four of the seven. The fin-tech activities where use notably differs between older and younger millennials are paying bills, comparison shopping and checking credit score (Figures 7 and 8).
There is no consistent pattern related to financial literacy levels. Some fin-tech uses appear more common at higher financial literacy levels, while other activities appear more common at lower financial literacy levels. Nor is there a consistent pattern within either the transactional or informational group (Appendix Figures A4 and A5).
These findings show that the eight fin-tech activities examined, which vary in purpose and nature, attract different users with different needs and economic circumstances, potentially indicating new opportunities for fintech developers.