For many, investing is seen as the preserve of the wealthy or financially savvy. It’s viewed as hard to understand and access.
Thanks to Mary Agbesanwa, Fintech Growth Lead at Seccl championing the transformative power of technology and how it can be used to democratize investing, more people are accessing the financial markets and making educated, informed investment decisions
In the latest episode of Payments Innovation, we discussed:
- The role of embedded investing in democratizing the investment space
- Millennials and Gen-Zers becoming more engaged in their investing
- How Wealthtech can take steps to open up investment to newcomers
- How Seccl is educating ordinary people to be long term investors
Investments sorted for everyone
Investing is no longer just for the financially savvy.
While on secondment at a Fintech, Mary Agbesanwa saw firsthand the passion and excitement that came from people taking traditional financial industries and turning them on its head. The disruptive nature of Fintech, the way it constantly challenged the way things were done appealed to her. By joining Seccl she is able to work on the frontier of innovation, helping Fintechs embrace the transformative power of technology to achieve their goals.
Seccl, helping Fintechs launch new investment products
Seccl provides Investing as a Service and is an API-led digital custodian. The company’s software and APIs empower Fintechs, advisers and investment managers to run their own investment platform and get to market fast. By connecting to Seccl’s API, Fintechs can design their app and user journey, launching their investment app in 90 days. Seccl takes care of the back end technology and executes the delivery of the investment solution, so Fintechs can focus on what they are offering, pinpointing what they should offer their core demographics, drill down on who they are targeting, and really understand what is the story they want to tell. That way, the business can begin to work on their product and the target market they are focusing on. The focus is therefore on the customer, not on the trading technology, which is handled by Seccl.
Building communities: a continuing trend
The trend is increasingly one that is not a one-size-fits-all approach. Mary Agbesanwa explained that we are seeing Fintechs and Wealthtechs recognizing that people want different things from their investments and that they need to be spoken to in different ways based on their comfort levels towards risk, and their understanding of the investment space.
It’s worth noting that if a Wealthtech’s offer looks the same as a Tier One bank or neo bank, people are going to see through this – that it’s just the same with some extra bells and whistles. Wealthtechs that win are offering retail investors something new, for example, asking whether they want to invest in charities or whether they want specific data points to help them understand their investments.
“Democratizing access to investments is key. It’s important to recognize that a lot of people don’t want help managing an estate or a huge inheritance; it’s more about wanting to know where the best place is to put their “£10,000” savings so they can pay for a wedding or put towards a deposit for a house.” Mary says. “Helping people understand true financial concepts is exciting: offering financial guidance so they can truly understand the principles of money management. This is key to helping people manage their money.”
How democratizing wealth management can start with technology
Seccl acknowledges that ‘democratizing’ is a bit of a buzzword across financial services, but it is one that Seccl is committed to. With over £800 billion yet to be unlocked in retail wealth management, and only 12% of the UK currently using investing apps, there is much space to teach people about how to invest. And this does not mean crypto! Education alongside execution is key to democratizing wealth management and investing.
Seccl is committed to helping educate people who would not normally consider investing. By being an API-led custodian and technology provider, people can embed Seccl tech into their existing Fintech app, whether they are focusing on investments as a wealth tech or a neobank. By taking care of the technology, a Wealthtech can think about people’s investment and financial journey and how they can reach out to potential investors who are increasingly blurring the lines between saving and investing.
Embedding to help people invest, and learn
Investment apps are creating an environment that is making it easier for people to invest. Mary notes that people want to do more than just invest. They want to learn and invest. For example, people might want to invest in the same place they do their banking.
APIs and embedded investments make aligning financial day-to-day transactions with the potential to invest possible. Mary mentions Amazon as a great potential example of the impact embedding investing in everyday transactions could have, and notes other providers and banks that encourage people to round up the change in every purchase to put in an investment pot.
“Imagine if every time a person bought something off Amazon, the change could be used to invest in Amazon shares. This would be a great way to drive loyalty and engagement – a customer is spending at Amazon , and surely they are going to be more invested in that company and will want to come back. A company can use investment as a lever to drive customers’ engagement.”
Mind the gender gap
A lot of investment products are targeting men specifically. The gender investment gap is huge. Mary notes that if women invested at the same rate as men, there would be an extra 3.22 trillion dollars in assets under investment by private individuals. There is a gender pension gap too. Mary says, “I am excited about the number of propositions that are hyper personalised and serving specific communities.”
Finally, a founder of the Now You’re Talking which empowers women to take control of their personal development and entrepreneurial journeys to earn more and be more confident, Mary’s excitement for democratising access is clear!
Thank you for investing your time today Mary!