Using FinTech and coaching to improve financial wellness

By Audrey Perrott

Consumer Action launched two financial health and technology programs in 2020 and 2021 with support from the Federal Home Loan Bank of San Francisco, Desert Credit Union and Capital One. The programs included mini-grants for four nonprofit partners in Arizona and Texas to provide financial coaching or counseling, distribute Consumer Action’s FinTech guide, measure changes in financial health, and distribute FinTech tools that help individuals to address a specific financial health need (e.g., saving, planning, spending or borrowing). The Capital One project included a matched savings component.

The mini-grantees included Greater Phoenix Urban League (GPUL), Administration of Resource and Choices (ARC) of Tucson, Easter Seals of Greater Houston (ESGH), and Catholic Charities Dallas (CCD). All told, Consumer Action served nearly 200 clients and nonprofit staff through these two projects.

In the Arizona project, community-based organization (CBO) staff completed intake and prepared budgets for all 114 clients. The average FinHealth score for the 123 individuals was 43, which is considered to be on the lower end of financially coping. The project yielded an adoption (or take-up) rate of 41% (the percentage of clients who downloaded and used a financial app). The tools used include Esusu, EveryDollar, Albert, CreditWise, Mint and SaverLife. The majority of the clients signed up for Esusu, EveryDollar, Mint and CreditWise. Twenty-one clients signed up for tools that help you save. The average amount saved was $345.63. The rest of the consumers signed up for tools that helped them budget and monitor credit. Consumers who used Esusu had, on average, a credit score increase of 34 points. (At a point in the project, both Arizona agencies had to redirect their efforts to addressing the crisis housing needs of their clients.)

As in Arizona, the Texas CBO staff completed intake and prepared budgets for all clients. The average FinHealth score for the 76 individuals was 51, which is considered financially coping. The tools offered were CreditSmart Essential, CreditSmart Homebuyer U, CreditWise, Digit, EveryDollar, Mint and SaverLife, though participants also used various other financial services apps (such as those offered by their banks and other financial services companies). The majority of clients used CreditWise, EveryDollar and SaverLife. The take-up rate at the three-month mark was 53%; it was nearly 92% at seven months, when additional staff members were trained to support their clients in using the various FinTech tools. Forty-four clients saved an average of $1,085.48. Thirty-four clients received a savings match of $100, five clients received $50, and four clients received $25.

Consumer Action is pleased with the outcomes of both projects, and will continue this important work. We are grateful to our network partners for their collaboration, and to our sponsors, Federal Home Loan Bank of San Francisco, Desert Credit Union and Capital One, for their generous support. Without them, we could not have undertaken this worthwhile project.

If you are interested in collaborating with Consumer Action on a FinTech innovation project or supporting our financial capability and/or consumer education programs, please contact Consumer Action’s executive director, Ken McEldowney, or Audrey Perrott, director of strategic partnerships.