Forget selfies. Would you turn to Snapchat for financial management? Well the app is betting on its 100-million strong userbase to do just that, according to a new report.
Although Snapchat’s new year’s resolution is to concentrate on advertising, it is also allegedly developing robo-advisory tech — algorithms that will let the app manage its customers’ money, starting with exchange-traded funds (ETF). Snapchat is keeping silent on the matter, fuelling further speculation as to whether the service will be spun off into a new app or integrated into its current platform.
Robo-advisory technology basically allows users to invest in financial products directly from their smartphones. ETFs are being targeted as a starting point since they trade like stocks on exchanges, resulting in more accessibility than mutual funds.
Similar smartphone services are either currently being offered or developed by finance companies such as Acorns and Wealthfront, which have both seen a spike in demand for their offerings. The supposed advantage for Snapchat is an existing app that has access to a large pool of financially inexperienced millennials.
“The opportunity to deliver financial services for social media platforms is amazing and potentially disruptive, especially in its ability to engage a millennial consumer set that’s still emerging,” Reginald Browne, head of ETF trading at Cantor Fitzgerald, told Reuters. Snapchat has thus far declined to comment on the report.
Even if the rumours are true, Snapchat faces a potentially tough battle in any attempt to convert its legion of users into investors that trust it to handle their economic interests. After all, we’re talking about an app built on disappearing messages that is still perceived by many as a hotbed of NSFW visuals. Detractions aside, Snapchat is intent on monetizing — and attracting an untapped market of investors could prove a lucrative part of its strategy.