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Micro-investing: reducing barriers to entry

Micro-investing: reducing barriers to entry


3 years ago

3 years ago


Mastercard and EveryoneInvested – a wealth tech spin-off of KBC – have partnered up to offer European banks technology that will enable customers to invest their spare change. Helping to reduce barriers to entry for interested investors, this partnership highlights the growing demand for easier and convenient methods of investing. By making investing simpler and accessible to more people, asset managers and finance brands can begin to build authentic relationships with clients from the beginning as well as widen their client pool. So, how can your asset management firm or finance brand reduce barriers to entry through micro-investing and what are the benefits?

Mastercard and KBC: making micro-investing easy

Mastercard and KBC have joined forces to make investing a quick and easy process anyone can access. While clients often will have to open separate investment accounts, Mastercard is offering European banks the technology for customers to simply invest their spare change from every purchase. This is not only a simple, low-risk option for investing but it also helps educate customers about the investment process and is a method of investing that requires little to no thought.

As Jurgen Vandenbroucke, MD of EveryoneInvested, says, “We are on a mission to get everyone invested. Lowering the barriers to entry is one way to improve financial inclusion. Micro-investing linked to payments has proven very successful at KBC Group.”

Reducing barriers to entry

“ The Australian micro-investing market doubled between 2020 and 2021 with 1.3 million accounts created, with the same trend occurring in the UK and USA. ”

Micro-investing is the perfect way for asset managers and finance brands to reduce barriers to entry. While apps like Spaceship, Raiz and Wombat Invest have seen astronomical success, Mastercard are making it even easier by integrating micro-investing into consumers’ bank accounts. And people want more micro-investment options. In fact, the Australian micro-investment market doubled between 2020 and 2021 with 1.3 million accounts created, with the same trend occurring in the UK and USA.

Micro-investing helps reduce barriers to entry as it removes a number of limiting aspects of the financial industry. Areas your finance brand or asset management firm should look to remove or make easier, in order to reduce barriers to entry, include:

  • Time – Individuals don’t want to feel like they need to do mass amounts of research before creating an account or making an investment. Helping to make processes simple and stress-free will help your brand acquire more clients and customers.
  • Cost – Reducing costs to consumers will encourage customers and clients to see your product and service as low risk, helping to build leads and improve your customer acquisition.
  • Digital – Ensuring you have an easy-to-use digital platform will encourage more consumers and clients to utilise your products and services as it’s easy to access and manage at any time.
  • Customer service – Individuals want high-quality and easy to access customer service at every stage in their financial management journey. By ensuring your customer service is accessible and a valuable asset to consumers, this will help you build authentic relationships and improve trust and loyalty.

Consumers want easy financial management

At the heart of it, to reduce barriers to entry your firm or finance brand needs to make investing and managing finances easy every step of the way. Looking to improve customer service, reduce time and costs for consumers, and ensuring your digital platforms are easy to use are the first steps to helping reduce barriers to entry.

The increasing need for micro-investment options indicates the growing demand for consumers wanting easy ways to invest and manage their finances. By responding to these needs your finance brand or asset management firm can help acquire new customers, build loyalty and help form authentic consumers relationships.

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