Seniors find fintech

The

past 14 months have witnessed, among other changes, a much greater embrace of financial technology, or fintech, by Americans age 50-plus.

More than half (53%) of adults 50 and older are using their smart phones for financial transactions. In 2019, that number was 37%, says Lisa Marsh Ryerson, president of the AARP Foundation.

“As many older adults stayed home during the pandemic to protect their health, fintech tools became increasingly important to accomplish everyday tasks such as making mobile deposits without going to the bank,” Ryerson says. “To meet this need, AARP Foundation and Chase developed a library of free online resources like videos and virtual workshops to help people with everyday banking tasks.“

Mobile banking has been growing for years among consumers of all age cohorts, due to the conveniences it offers, reports Greg McBride, chief financial analyst with Florida-based bankrate.com.

“Since the start of the pandemic, however, the appeal of mobile banking has probably been greater for those age 50-and-older due to social distancing, concerns about being out in public and restrictions on bank branch access and availability,” he adds. “Even in a post-pandemic world, there is no going back. Mobile banking will continue to grow and is the way consumers of all ages will increasingly bank in the future.”

Pros, cons

The ability to bank from the convenience of home on their own schedule is particularly appealing for consumers who have limitations in access to transportation or physical capabilities, say banking experts.

Another upside is the ease of depositing checks, which has traditionally been a very common teller transaction, says Kevin Karrels, head of consumer banking for Dubuque, Iowa-based HTLF, a geographically diverse group of banks. The mobile app permits customers to make deposits on their mobile devices, eliminating needs for trips to the bank or ATM.

In addition, because older adults can be targets for identity theft, they can benefit from early warnings of unauthorized access. “Notifications of account activity provide additional security and peace of mind that customers’ accounts have not been targeted,” Karrels says.

Some people prefer paper statements but they can be stolen from mailboxes. Enrolling in electronic statements eliminates that risk, Karrels says. “Everything is stored electronically, further protecting information. Customers can also enlarge documents on their mobile devices to make reading easier,” he adds.

Not having to write checks or take bills to the mailbox makes life more convenient as physical limitations creep in with age, McBride says. “Automating much of your daily finances is particularly helpful for those at risk of cognitive decline,” he says.

Mobile banking is particularly important for lower-income older adults, Ryerson adds. Among the 56 million low- to moderate-income adults age 50 and older residing in the U.S., only 17% are financially healthy. “Helping this vulnerable population manage their finances, track their income and expenditures and even make a budget using technology can help them build and maintain their financial health from home,” she says.

As for barriers, digital security has proven a concern for older users, says Hannah Gdalman, associate at Chicago, Illinoisbased Financial Health Network.

“Asking users to enter sensitive personal information, such as a Social Security number, can raise warning flags,” she says, adding that some older users of mobile banking are reassured by transparency about why the information is needed and how it is protected.

The biggest hurdle may be getting accustomed to the technology, McBride says. However, many older adults keeping up with their grandchildren on social media are adept on their smartphones.

Going mobile

Adopting mobile banking is not difficult. It’s very likely your bank or credit union already offers mobile banking. “So, the older adult probably doesn’t have to change banks or open an account at an online bank,” says Ken Tumin, founder and editor of Charlotte, N.C.-based DepositAccounts.com.

Ryerson suggests older adults who don’t know how to use mobile banking and other fintech tools, or are using them for the first time, visit the aforementioned AARP Foundation and Chase library of free online resources, accessible in both English and Spanish. (fintech.aarpfoundation.org)

“The tools are easy to use and designed to help people stay connected and strengthen their financial health,” Ryerson says. The fintech resource online hub provides videos and virtual workshops on mobile banking, depositing checks remotely, detecting scams, creating a budget online and more.