AI-Powered Savings Apps: A New Competitive Necessity For Banks

While traditional banks advertise a 0.05% interest rate for deposits in their savings accounts, a growing number of consumers have turned to a new crop of mobile apps--automated or "self-driving" savings apps--to help them save. In a recent consumer study, Cornerstone Advisors found that savings apps like Acorns, Digit, and Qapital help consumers save an average of $600 a year above and beyond their regular level of savings--and one in five users saves more than $1,000. At a 0.05% interest rate, you'd need $1.2 million in a savings account in order to earn $600 in a year. These new apps help consumers figure out how much they could save (above and beyond what they're already saving)--and then take the money out of the user's checking account and put it in a savings account. The popularity of these tools shouldn't come as a surprise.