The Financial Solutions Lab, an initiative from the Financial Health Network in collaboration with JPMorgan Chase and Prudential Financial, has announced the launch of its seventh Accelerator Challenge, focused on helping people improve financial resilience and build long-term financial growth in the wake of the economic impact of the coronavirus pandemic.
The Accelerator is seeking solutions that focus on low- to moderate-income individuals and historically underserved communities that have faced systemic barriers to financial health, many of which have been exacerbated by the pandemic. Fintech start-ups with solutions focused on insurance, credit building, short-term savings, retirement/long-term savings, financial coaching, and asset building can learn more and apply through January 12, 2021. The Financial Resilience and Growth Challenge cohort will be selected in the spring of 2021.
Two-thirds of adults in the US are not financially healthy, according to the newly released US Financial Health Pulse: 2020 Trends Report, with Black Americans, people with low incomes, and women bearing the brunt of the economic burden of the pandemic. Months into the pandemic’s economic fallout, underserved communities continue to be disproportionately affected, with a majority of Black and Latinx households across major US cities reporting serious financial hardship.
“The coronavirus pandemic and economic crisis exacerbated systemic inequities and hit financially vulnerable people especially hard, and our new Accelerator Challenge aims to equip underserved individuals with fundamental financial tools, services, and protections designed to advance their financial health,” said John Thompson, chief program officer at the Financial Health Network. “Fintech solutions that can help consumers build financial health will put them on the path to building resilience, creating access to better healthcare, secondary education options, and overall economic mobility.”
According to the JPMorgan Chase Institute, Black and Latinx families have 32 and 47 cents in liquid assets for every $1 held by White families.
“The Covid-19 pandemic has highlighted and exacerbated racial inequities and structural barriers to financial stability for many people in the US,” said Sarah Willis Ertur, vice president, Financial Health at JPMorgan Chase. “Sound financial health is a critical component of building resilient households and helping connect underserved communities – especially Black and Latinx communities – with economic opportunity.”
Each selected organisation will receive $125,000; product development support to address user needs; guidance to navigate the legal and regulatory fintech environment; insights on impact and customer financial health measurement; resources for external marketing and communications; mentorship from financial services and financial health experts, including executives from JPMorgan Chase and Prudential Financial; support to further diversity, equity, and inclusion; and more.
“We work every day at Prudential to help solve the financial challenges of our changing world, and we know that increasing one’s financial resilience can have a ripple effect on other areas like physical and mental health, education, employability, safe housing, and more,” said Yanela Frias, president, Prudential Retirement. “By focusing on increasing financial resilience, we can help people in the U.S. establish a safety net that mitigates income and expense volatility, helping them recover from the impacts of the coronavirus pandemic while preparing them for the next unforeseen financial health disruptor and the ability to save and plan for the future.”
More than 200 non-profit and fintech organisations have participated in the Financial Solutions Lab’s Accelerator, Exchange, and Collaborative programs to cultivate, support, and scale innovative ideas that advance the financial health of low- to moderate-income individuals and historically underserved communities. These companies have reached more than 5 million low- to moderate-income consumers – and over 10 million consumers in total – and helped individuals save more than $2 billion to date. The Financial Solutions Lab received renewed support from its founding partner JPMorgan Chase in 2019 and added Prudential Financial as a supporting partner earlier this year.