Welcome back to our course on FinTech Disruptive Innovations: Implications for Society In this module, we're looking at the diversity of impact and today's session we're looking at young versus old or the diversity of age and its impact on technology adoption and FinTech adoption As we think about young versus old it's useful to think about a variety of different age differences and how these different groups will react differentially or differently to technology innovations to FinTech new ideas to new opportunities and challenges how they react not just to technology but also to changes in privacy or changes in access changes in convenience, changes in infrastructure As we look about ages there's five categories that are often used to think about age groups and how people behave differentially Mature, Baby Boomers, Gen X Gen Y and Gen Z. Gen X often the group that follows the Baby Boomers and grew up with PCs early in their lives Gen Y, frequently referred to as Millennials people that grew up around the time of the year 2,000 as being young adults at that time they've grown up with technology smartphones have become a part of their life Gen Z, those that have never known a world without technology like smartphones for whom a smartphone is just a basic assumption of life and it's hard to even understand how people lived without these technologies Now, as we look at these groups they react differently to technology Mature people are comfortable with letters face to face technology they grew up with cars that's part of their assumption They may look and say the world is different than their elders their world has changed during their lifetime and it has, a lot During the mature people's era they've seen the world go from modest infrastructure and transportation to flying around the planet in a matter of a day That's a major change and transformation but this transformation revolution dominating a lot of their life and saying "This is amazing," technology in terms of internet and communications maybe not quite as readily adopted maybe some resistance to that So, mature people, for example to adopting ATMs, found them a little bit worrisome at first This idea of trusting digital, trusting printouts trusting branchless banking, maybe highly resistant to this group Baby Boomers growing up with PCs with phones, with TVs or at least early PC adoptions More comfortable sharing a lot of things about TV shows or communicating a lot but not really, their life wasn't based around personal computers at least not at a young age So, a little bit later in life to adopt some of these technologies emails fine, letters not as expected beginning as part of a technology era but a little bit older in some of their views a little bit closer to mature than some of the Gen X. Gen X people in the 40s to 50s now in that age group More comfortable with PCs early PC adopters, early email adopters early ecommerce adopters, much more comfortable with technology much more comfortable with new ideas new innovations, new approaches When you talk to banks and say "People like their branch, people are comfortable with their branch," that is absolutely true for mature customers that is largely true for Baby Boomers that is less true for Gen X and that's not at all true or very little true for Gen Y and Gen Z who are going to say "Don't care, don't need it, I'm not worried about that." When you get down to Gen Z down at the bottom of the spectrum they don't even understand a world without technology and so the idea of an app is very different than the idea of a ecommerce website they feel emotionally connected to their phones they feel highly integrated with apps I would as a Baby Boomers or Gen X type era would look and say, "App, ecommerce same thing," Gen Z not the same thing, not the same feeling not the same technology, not the same approach very different, it feels completely different This is on my phone this is on somebody else's PC and so this doesn't work the same I'm very comfortable doing a lot of my digital communications on a desktop with a large screen Gen Z saying, "Why would I want to sit down at a desk, when I can have my mobile phone or my tablet," and so much more interconnected personally with the devices much more close to them and much more comfortable with a small screen I look at a small screen and say "I can't see it, I'm too old. Give me a bigger screen." So, a difference in culture something say a difference in age So, we see a much more willingness to adopt FinTech amongst Gen Z At a glance of Gen Y the later age groups are much more willing to change and do new things adopt new apps, but sometimes this age group doesn't work the same across different cultures Sometimes, culture difference can be larger than age differences So, you may see that within China, for example there's a surprisingly high adoption rate for new payment systems amongst older people, who are saying "Sure, I'll pay with my smartphone. No problem. Happy to adopt this new technology. It's so much better than cash," and you would go to the US and say "If I look across American society or European society and say, who's adopting cashless society? Who's jumping on to Venmo? Who's using these apps for payment with their phone?" It tends to be Gen Z maybe Gen X, not Mature Older people are saying "It took me a while to get used to a credit card, I'm okay with that, but don't ask me to jump on to using PayPal for everything and certainly don't ask me to move to Venmo, instead of my bank, that's too much, too big, too far, not going to go there." But in China, "Sure, Alipay. No problem." Older people very ready to adopt Sometimes, these differences across culture are less than age differences In general, that's true but it's not always true So, if you look across European society US society, you would say "The difference between German and UK teenagers, is less than the difference between old people and young people, in either country." So, age matters more when you're talking about most cultures but there will be some differences that are substantial and large So, if you're looking about large culture divides, you're saying "India, rural village, will old people jump on digital payment?" Yeah, if it gives them food if it gives them access to business if it gives them a bank account and they had nothing before old versus young no longer matters as much as a village suddenly has access to banking and they didn't have banking before and it's now on their phone Adoption rates can be very rapid amongst Mature people when they're alternatives are not that good and they're not replacing something that's great they're replacing something that is not very good with something that is much better So, you can leap frog over to technology disconnects or technology deficits with new tech to replace processes that were not as good That can be true of Japan doesn't have to be just India We said, Japan is largely in some ways a cash society that can lead to a very big difference in adoption rates as maybe older people start to behave more like Gen Y or Gen X than like Mature people because their alternatives are very inferior to the new tech So, their willingness to adopt and change may be bigger in crossing traditionally age differences but culture matters, age matters they're not independent of each other Now, as we look at Gen Z these are the young people these are people 15 to 20 years old they're in university now they have very different attitudes than any other group that are surveyed in Western societies If you look at US or Europe, Gen Z's behavior Gen Z's answer to questions is very different than other groups They say, "We don't care about data privacy. We don't worry about mobile payment trust. We don't worry about sharing data or oversharing of data. We think differently about apps and apps are our life, our lifeblood. We're not interested in PCs and laptops, don't even have a place in our life to a large extent." The future, the market opportunities the growth is going to come with the young and FinTech will impact will start with the young and it then begins to solely transform the world If you look at how Microsoft Office penetrated it penetrated with the young and only later became dominant for the world FinTech can do the same thing and we can penetrate and start with the young But it's going to change our world over time as the young get older and older people start to jump on the trends of young. Thank you
