Demographic Shift to ‘Silver Economy’ Demands Customized Approach
Recent demographic trends in banking and financial services are causing financial institutions across the world to take notice of the needs of the ‘silver economy.’
The ‘silver economy,’ or the ‘mature market,’ refers to the increased aging populations across the world – those 55 and older – and their longer life expectancy – which has risen to 85-years-old. It also embraces that this demographic has seen and will continue to see explosive growth.
As the largest demographic challenge facing financial institutions, the mature market is driven by aging baby boomers and already totals more than 60 million in the US, according to The U.S. Census Population Estimates and Projections Report. The report also states between 2012 and 2050, the US will experience considerable growth in its older population – projected at 83.7 million – almost double its estimated population of 43.1 million in 2012.
“Right now, we are more than halfway through the retirement phase of the baby boomer generation,” said Mike Rutkowski, Managing Director in DISYS’ finance group. “As this is one of the most profitable demographics in history, the financial industry is looking for ways to make sure their boomer customer base is happy.”
With the increased life expectancy and the female skew in population, the key challenge for banks will be to design accessible age-friendly services and products. “However, to reap the full benefits, special requirements for older people that come with aging will be taken into account when designing touch points for easy accessibility,” AARP stated in a recent article.
AARP also stated in their report on banking & the aging population that financial institutions are already adapting to the silver economy by taking into account auditory, cognitive, mobility and visual impairments in the design of their new touchpoint services.
“When it comes to servicing the aging baby boomers and maintaining their business, there is a wealth of blue-sky opportunity in financial technology. Community banks are in an ideal position to experiment with,” Rutkowski said. “There are ground-breaking opportunities for institutions to be the first at making banking easier, the opportunity to create new markets and to allow more engaging applications in mobile development.”
Banking.com’s ‘Top 10 Trends in the Digital Banking Industry’ indicates that while the silver economy class was slow to adopt mobile banking, their numbers are increasing and will soon overtake the younger demographics, as more reach retirement age.
“This demographic used to rely solely on their PCs for online banking but they have moved into the mobile banking arena,” said Fernando Abreu, Application Development Director for DISYS. “Mobile application development, its customer experience, customer service and its ease of use will continue to be a focus point for financial institutions for years to come.”
Note: Digital Intelligence Systems, LLC (DISYS) is a global managed staffing and services company with core capabilities in managed staffing services, agile services, application development, business intelligence, cloud enablement and enterprise resource management within the Banking, Financial Services and Insurance arena.
DISYS’ Financial Services offerings combines a proven automation and optimization approach with repeatable assets to offer increased business value to our partners. Our financial services clients have benefitted from our catalog of intellectual property and our experience gathered on previous engagements. This means we can not only apply lessons learned in other engagements to your project risk but we can more proactively recommend solutions that are the best mix of tools, methodology and team structure to accelerate productivity in your environment.
Financial institutions continue to partner with DISYS to solve critical infrastructure and compliance problems while reducing operating expenses – all amidst a rapidly-changing business landscape.