New Research Demonstrates The Evolution Of ‘Financial Invisibles’ Perceptions And Behaviors

Comprehensive survey dissects the factors and consumer characteristics driving both financial and product decisions, as well as the similarities and differences of four personas

BOSTON--()--Financial invisibles are those who are either neglected by or left out of the traditional financial system. Their lack of participation originates from their life circumstances, perception of their current financial stability and their outlook on the future. PYMNTS, in collaboration with Unifund, surveyed 2,000 Americans to dive into and derive insights from their relationships with credit and debt.

The survey analyzed four personas:

  • No Worries: People who have no delinquencies and can fully participate in the financial system
  • Second Chances: Those who have had delinquencies but can still participate in the financial system
  • On the Edge: People who struggle to make ends meet and have no delinquencies, but are not able to participate in the financial system
  • Shut Outs: Those who have had delinquencies and, as a result, are unable to participate in the financial system

Considered as a whole, the sample had an average credit score of 695, average income of $70,000 per year, average age of 45 and employment rate of 60 percent or greater.

All four personas were studied, but the report zeroed in on the Second Chances group. Despite sharing similar life circumstances with the No Worries subset, Second Chances behaved somewhat like Shut Outs. Seventy-one percent reported being behind on bill payments, as did 79 percent of the Shut Outs. Both tapped into nontraditional payment products when looking for alternative ways to manage their personal finances, with as many as 13 percent of Second Chances and 3.6 percent of No Worries consumers resorting to personal loans. Both expressed pessimism about their financial futures.

Other key takeaways from the July edition of the PYMNTS Financial Invisibles Report, a Unifund collaboration, include:

  • Eighty-three percent of respondents reported that their personal finances stayed the same or improved.
  • Thirty-three percent reported being behind on their bills, compared to 31 percent in Q2 2017.
  • Nearly 50 percent mentioned that their credit scores have not changed in the past year, while one-third mentioned that their credit scores had improved.
  • Seventy-five percent reported having completed higher education levels, holding an associate’s, bachelor’s or graduate degree.
  • Having access to a checking account also showed improvement, rising to 95 percent of those surveyed.
  • Fifty-two percent cited being confident in their ability to save money, while 48 percent admitted a general lack of confidence.
  • Twenty-four percent of the Second Chances group reported feeling less financially stable compared to 2017.
  • Seventy-nine percent of the Second Chances group reported living paycheck to paycheck.

To learn more about consumers’ perceptions of their financial situations compared to their realities, their reasons for choosing traditional versus nontraditional financial products and the factors influencing the decision process, download the Financial Invisibles Report.

PYMNTS is where the best minds and the best content meet on the web to learn about “What’s Next” in payments and commerce. Our interactive platform has reinvented how companies in payments, commerce and retail share relevant information about the initiatives that make news and shape the future. Our data and analytics team includes economists, data scientists and industry analysts who work with companies to measure and quantify the cutting-edge innovations in this new, dynamic commerce ecosystem.

Alexander Terzian, +1 774-219-6132

Alexander Terzian, +1 774-219-6132