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AI Education: Teaching Gen Z financial literacy

Posted:Jul 29, 2022 13:40 Category: AI , Fintech , Payments , Posted by
Kyle Galea

Education is one of the most vital aspects of growing personal wealth. From knowing what to invest into and when to figuring out how to read market sentiment, financial literacy is objectively a pillar for the financial freedom and stability that youth starting out in the job market strive for. While inflation and a chaotic geo-political environment makes it difficult for Gen Z to safely start accumulating a net worth, this generation does have some powerful new tools to fight back against a hostile investing environment. Enter; Artificial Intelligence.

AI Education: Teaching Gen Z financial literacy

Seeking to close the wealth gap between the generations, financial players ranging from established legacy banks to visionary fintech startups are utilizing the latest advances in artificial intelligence to assist, onboard and educate Gen Z clients. Through cutting edge AI-based applications, these neo-banks and fintech ventures allow this burgeoning customer-base to benefit from services ranging from responsive chatbots, enhanced KYC protocols and intelligent automation which could range from portfolio rebalancing to advisory services. The head of financial services for Infosys’ North American branch, Dennis Gada, elaborated on this phenomenon by telling leading tech media outlet ZDNet that

“Gen Z are completely digitally native. For them, banking or financial services is an extension of their lifestyle… the more digital a bank is, the higher their level of trust.”

Conversational AI: Humanizing financial literacy

As digital natives, Gen Z respond better to automated support than previous generations. Having grown accustomed to AI systems such as Alexa and Siri, financial players are starting to see conversational AI as the next step in comprehensive customer support. With ambitions beyond simple chatbots, the next generation of this support layer could include voice recognition, personalised advice and the ability to dive into backend security for solutions.

Predictive analysis is another vital area for the growth of the financial service ecosystem. These could range from automated warning for potential overdraft charges to expense forecasting and account monitoring, including ever useful portfolio management tools. This is even leading to service contract negotiations mainly powered through AI with subscribers benefiting from recouping savings.

Approaching saving, the Gen Z way

As per a 2022 internet-based review by Investopedia of 4,000 adults on the topic of investing and personal finance, the review found that:

  • The majority, approximately 54%, of Gen Z adults hold an interview of some sort or another.
    Almost a fourth of Gen Z adults hold digital assets and stocks with one out of every ten adults owning an NFT.
  • Gen Zs tend to have positive expectations about consuming and saving.
  • Gen Z adults who have a wage of more than $50,000 tend to be more confident in their financial literacy (57%) in comparison to the Gen Z workforce that makes below $50,000 (39%).
  • 33% believe that they have a basic level of knowledge pertaining to financial literacy (borrowing money, loan management, debt refinancing, budgeting etc.)

 

Gada again chimed in to elaborate on this demographic focus.

“We see a lot of investment firms focus on Gen Z to give them alternatives with robo adversary techniques. Using lifestyle requirements, they are recommending the kind of investments to save money and how savings can be automated”

Information sourced from ZDNet.com

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