Why the future of TikTok affects the Fintech industry

The rise of personal finance education on TikTok is playing an important role in expanding fintech companies’ products and services to a wider audience, especially women, Gen Z and many marginalized communities.

Financial education gained new cultural relevance in 2020, primarily due to pandemic-driven shutdowns spurring increased engagement with personal finance content on TikTok. This carried over into the fintech world, with 79% of users looking for education around starting an emergency fund, improving credit scores and creating a savings habit from their fintech applications, according to Plaid’s 2022 fintech impact report.

In response to this demand, many companies such as Current, SoFi, and Step began leveraging TikTok to meet users where they are by partnering with influencers, hosting events, and offering personalized financial tips via short-form videos.

However, the potential ban on TikTok in the US could lead many communities to look elsewhere for financial education and tools, and fintech industry leaders would do well to commit.

Community values

Until personal finance content exploded with billions of views on TikTok, the average person had limited access to financial advice due to account minimums or lack of knowledge. But technology has made it possible for anyone with a smartphone to access the same level of financial guidance once limited to the wealthy and well-informed.

The most notable increase in interest has come from those traditionally underserved by financial services.

Personal finance creators like Vivian Tu (@dinrichbff) share with her 3.5 million followers, who says she includes women, colored and marginalized communities, the importance of financial literacy.

ONE examination commissioned by Forbes Advisor and conducted by market research company Prolific found that 78% of millennials and Gen Z believe they have more access to financial advice now, thanks to social media like TikTok, than they would have as part of previous generations due to their identities, such as race, gender or income.

TikTok creators have leveraged the platform to build businesses and initiate movements toward financial inclusion and knowledge sharing to cater to this untapped demographic.

For example, Tori Dunlap (@herfirst100k), the creator and founder of Her First $100K, a financial education company, has gained an audience of 2.3 million on TikTok as she established the “financial feminist” movement to inspire women to own their financial independence as the greatest tool for to combat patriarchal barriers.

Or Lea Landaverde (@latinawealthactivist) uses her platform of over 80,000 followers to break cycles of generational wealth gaps for society through financial education, a critical need given the total economic output of US Latinos was $2.7 trillion in 2019, making American Latinos to the equivalent of the seventh largest economy in the world.

And even Humphrey Yang (@humphreytalks), who quit his career as a professional financial advisor in 2012 to start his own e-commerce business, initially started posting financial videos on YouTube that didn’t resonate with users. But when he started posting shorter videos on TikTok that were more like comic skits to explain financial terms to Gen Zers, his following grew to 3.3 million.

These TikTok creators have turned value-based educational content into businesses while moving a diverse demographic of fintech-curious consumers into customers. This represents a market opportunity for fintech companies to leverage financial education content to bring the next generation of wealth builders, Millennials and Gen Z, who represent 47% of the US population, into their user bases.

By doing so, fintech industry leaders can establish themselves and their companies as financial education influencers to achieve similar success to creators like Dunlap, Landaverde and Yang.

Founders became educators

As a creator on TikTok, I’ve seen the potential for fintech companies to leverage educational content to build trust and community in their customer base, but few have stepped up.

A couple of early-stage fintech entrepreneurs have quickly discovered the potential of content creation on TikTok as a critical business strategy. This cost-effective approach offers a viable option for companies with limited marketing budgets, as it can be virtually free compared to the cost of traditional methods used by larger, established competitors.

One of the best examples on my “For You” page is the startup Alinea, an investment platform home to 55,000 investors with a user base of 78% women, 72% first-time investors, and 60% Gen Z.

Co-founders Anam Lakhani and Eve Halimi (@anamandeve) openly share their stories on TikTok, including how they grew up never talking, let alone learning, about investing as Gen Z women and children of immigrants. And they use TikTok to have conversations directly with their customers, engaging with at least 15-20 people daily.

Vrinda Gupta, a former VisaV director and current fintech entrepreneur, also uses TikTok to empower her target audience of women by sharing her personal experiences with finance.

After being denied the Chase Sapphire credit card, which she helped develop, Gupta founded Sequin Finance (@sequinfinance). Gupta created on TikTok to promote the company’s debit card while offering educational content to boost credit scores.

Fintech companies, founders and creators of personal finance have done remarkable work on TikTok to fill the financial education gap America has faced for years. More organizations still need to join the cause, especially since our goal as a fintech industry is to promote financial education and access.

Whatever is in store for the future of TikTok in the US, the platform has already made its mark on the fintech industry. TikTok has made it easier than ever for users to access educational content regarding financial wellness, creating an opportunity for a new generation of fintech creators to share their knowledge and establish a wide range of business models.

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