Last week, finance experts and a myriad of financial services companies attended the EMERGE Financial Health Forum in Austin. There, LendUp was named a Financial Health Leader by the Center for Financial Services Innovation (CFSI), for our efforts in measuring our customers’ financial health.
The annual conference, which lends itself well to the unveiling of this prestigious list, brings together thought leaders from diverse public and private sectors across industries. The forum focuses on topics ranging from the financial struggles of The New Middle Class, to shining a light on why women of color are so underrepresented in fintech, to exploring how the financial lives of rural Americans differ from those of urban Americans. All of these discussions sought a better understanding of how we can improve financial health in America.
But what is financial health? According to the CFSI, in order to achieve financial health, people need:
…day-to-day financial systems that build long-term resilience and opportunity. Financial health enables family stability, education, and upward mobility, not just for individuals today but across future generations.
Like LendUp, the organizations and companies represented at EMERGE are all working to improve the financial health of Americans -- but they’re approaching it in a variety of ways. While LendUp’s products primarily focus on revolutionizing personal finance for people with subprime credit scores or income volatility, there were organizations and nonprofits in attendance who are focused on researching the causes of income volatility, building technology products that encourage consumers to save at the right moments, helping immigrants secure credit by importing financial data from overseas, helping people with disabilities set up tax-free savings deposits, and much more.
While many of these organizations are focusing on specific segments of financial health, CFSI is encouraging all of them to be mindful of the overall financial health of their customers. Their research has shown that improving a customer’s overall financial health is good not only for that individual but for the companies' bottom lines.
Our own internal research has shown the same thing. In 2016, we began a robust program to measure the overall financial health of our customers, and came away with some compelling findings:
We now know that if our customers have health insurance, they'll likely avoid major financial catastrophes and be more able to make timely loan payments....
Or, if they have short-term savings, they'll typically be able to pay the full balance on their LendUp credit card even when expenses are a little higher than usual.
We even know that customers who are actively planning for retirement are generally more responsible borrowers, which means we can help them climb the LendUp Ladder faster, getting them to a state of better financial health more quickly.
We’re Thrilled To Be Named a Financial Health Leader, But We’re Ready for More
We’re so excited that these measurement efforts have led CFSI to name us a 2017 Financial Health Leader. But we want to do more; we want to look at how our products can help change behavior and help our customers make sound financial decisions. We want to promote more savings, more planning, and to see our customers develop the "day-to-day financial systems that build long-term resilience and opportunity."
This is where the CFSI network will be so helpful. We know that tech itself is not a solution to improving Americans’ financial health -- there is no one solution big and far-reaching enough for that. Tech is, however, an enabler, and part of a greater solution. By partnering with organizations that provide different services, we can encourage and better help our customers to improve their financial health. This work is already underway on our resources page, where we offer suggestions on other companies and services that can help our customers better manage their finances.
We're just beginning to scratch the surface of what's possible when many financial service providers with similar goals -- of improving their customers’ financial health -- join forces. Together, we can achieve our mission of providing anyone with a path to better financial health.
Want to partner with us to improve the financial health of your customers or stakeholders? Email us at socialimpact@LendUp.com