The population of senior citizens in Singapore is growing. Fintech can ignore this crucial demographic no longer.
The modern digital economy is geared toward younger customers. Their familiarity with technology, and willingness to adopt new products, apps, and services make Millennials the perfect digital consumers.
Millennials are more than twice as likely to switch banking providers than Baby Boomers. Older customers tend to be more conservative when it comes to money matters. They present a formidable challenge for new startups, preferring financial incumbents for their brand authority and heightened perceptions of trust.
But this situation is untenable, especially in markets like Singapore. A rapidly ageing population means the customers of tomorrow will have different financial needs to those of today. Fintech firms must find ways to tailor their products and tap into older markets to remain competitive.
Singapore is entering a population crisis
Between 2009 and 2019, the percentage of Singaporean residents aged over 65 increased from 8.8% to 14.4%. In 2019, there were just 4.5 citizens of working age for every senior citizen, down from 7.5 a decade earlier. By the end of the next decade, senior citizens (those above 65 years) will account for a quarter of the national population.
Declining birth rates since the 1960s can be blamed in part. However, excellent healthcare and high living standards mean citizens now live longer. Singapore now has one of the longest life expectancies in the world at 84.79 years.
The fintech market for seniors is almost non-existent in Singapore
To stay abreast of the population shift, many banks in Singapore offer products aimed at senior citizens. Maybank Singapore launched its integrated banking package for individuals above 50 in 2019. The product offers preferential savings rates and perks fitting to a senior lifestyle as part of a push to capture the senior market.
But when it comes to fintech apps in Singapore, few of them, if any, have specialized products aimed at senior citizens. With flashy apps and slick marketing campaigns, most fintech apps are not designed to penetrate the senior population.
In stark contrast, fintech firms and banks in the west are already integrating products aimed exclusively at older customers. UK-based apps MoneyHub and Pensionbee have partnered to offer pension management tools, while in the US, Pefin and Onist provide financial planning advice to seniors and their close family members.
Seniors in Singapore are far less comfortable using online technologies, especially when related to finance. According to a VISA Singapore survey of seniors between the ages of 50 – 80, over 80% were active on social media and messaging apps, yet only 30% used mobile payments.
Only 22% had tried online shopping and 29% used ride-hailing. Card ownership is also relatively low among seniors, with cash remaining the preferred payment option due to a lack of familiarity with fintech and fear of fraud. Since they are still a minority in the fintech customer ecosystem, specialized products have not yet been forthcoming.
Fintech can empower Seniors and protect them from fraud
Unfortunately, the threat of fraud among seniors is all too real, especially in developed markets like Singapore. According to Deloitte, Singapore is part of the “Cyber Five” – the countries which are most vulnerable to cyber-attacks in the Asia Pacific region.
The elderly population presents an easy target for fraudsters and criminals, due to their lack of technical knowledge online, and the often large sums they hold in their accounts. They are more likely to share financial information with others online, enabling credit card fraud and other forms of financial scams.
This is one area where fintech can make a decisive impact. Several apps are already pioneering this in Western markets like the US and UK. Toucan and Kalgera are money management apps that help senior citizens make financial decisions with the help of a trusted family member, through secure channels.
If suspicion of fraud or unauthorized activity occurs, alerts are sent to both parties. EverSafe is an account-monitoring app that uses AI and data analysis to give early warning to seniors and their families when fraudulent activity is detected.
Singapore’s fintech firms can bridge the age divide
Apps like EverSafe, Toucan, and others offer a model for how fintech startups in Singapore can connect with elderly consumers. According to the Wall Street Journal, many of these apps are initially sought by the children or other concerned family members of seniors who need these services.
Fintech startups can market their elderly-focused services to these Millennials and GenX consumers. Besides fraud prevention, there are other avenues where fintech can make a positive difference in the lives of the elderly.
Given the physical limitations of old age, many seniors have a tough time using cash for payments all the time. Simple tasks like going to the ATM or bank to withdraw cash can be a challenge, especially to older individuals with health problems.
Online technologies can help seniors avoid this hassle. They can use fintech to take care of most purchases and bill payments online. There are already apps that automate bill payments for seniors who often forget them due to memory issues and dementia. SilverBills is an example.
Promoting cashless payments among the elderly population requires simple apps and interfaces—larger fonts and clear visual prompts will help.
Adding a “human touch” is also essential, in the form of customer service executives and video chats instead of AI and impersonal text chats. Seeing a face will often help instil confidence among seniors while using unfamiliar apps and technologies.
Outreach initiatives and education and awareness drives are necessary to build confidence among senior citizens in using technology. The Singaporean government has already shown the effectiveness of such campaigns, with the anti-scam drive for the elderly launched in late 2018 by the Singapore Police Force.
On the business front, VISA has partnered with People’s Association to conduct a series of workshops aimed at senior citizens as part of their digital inclusion initiative. The OCBC Bank has also held similar training programs for the elderly in Singapore.
But education can only go so far. If apps are not providing tailor-made products to appeal to senior citizens, they will find little reason to leave their brick and mortar banking establishments.