I’m proud to be part of a firm that is in the business of financial health. The fact of the matter is that many more of us are struggling with our finances than most people think. In fact, 44 percent of households can’t cover a $400 emergency without borrowing or selling something. “It is these everyday people — the teachers, firefighters, construction workers and bank tellers — whom we aim to serve.”
I come from very modest beginnings. But from the time I was very young, my parents encouraged me to grab the opportunities that came my way. I guess you could say these life lessons have been relevant and prevalent in all that I do. And that’s why I am so passionate about the opportunities that we offer to our customers. We have products to support all kinds of people with all kinds of goals; for instance, Credit Journey gives unlimited access to credit scores, and Liquid helps save in fees and manage money wisely. At our branches, we welcome our customers with advice and resources to make the most of their money. And as one of the world’s largest financial institutions, we use everything in our power to boost financial health — including our employees, our branches and our digital platform.
Of course, savings is at the heart of creating opportunities, whether it’s going to school or buying a home. That’s why we’re building a long-term savings movement across America, such as National Savings Week, which helps employees and consumers better understand how to take control of their financial lives.
I hope that our customers will take the opportunities we offer to boost their long-term financial wellness. With the commitment and passion of our people and our firm, we are leading the way to help more everyday people find the financial stability to realize their dreams.
Around the world, too many people lack the tools, skills and confidence to manage daily finances, withstand unexpected emergencies or plan for the future. This is not a problem limited to low-income households. Research from the JPMorgan Chase Institute found that households across the income spectrum struggle to manage big swings in how much they earn and spend each month, as well as how to absorb the financial shock of unplanned expenses.
Sound financial health is not only important for individuals and families to thrive but essential for inclusive communities and resilient economies. Our firmwide strategy starts with leveraging our unique data, expertise and market access to develop insights into the financial lives of consumers. Armed with these insights, we are developing and bringing to market affordable, innovative financial products and services designed to meet consumers’ needs and support their financial health. We are also making philanthropic investments to scale and catalyze innovative and effective solutions for improving financial health around the world.
Nonprofit organizations play a critical role in serving the most vulnerable populations and testing new models to help low-income individuals improve their financial health. A key part of our strategy is providing seed money to support nonprofits’ early-stage ideas, scale the models that prove effective and enhance these organizations’ capacity and reach. Since 2014, JPMorgan Chase has committed more than $100 million to over 500 organizations that have collectively helped at least 2.4 million people across 11 countries improve their financial well-being.
Technology offers tremendous potential to improve the financial lives of people around the world. One way we support technology-based innovation is through the Financial Solutions Lab (FinLab), a $30 million, five-year initiative managed by the Center for Financial Services Innovation with founding partner JPMorgan Chase.
Since its launch in 2014, FinLab has hosted an annual competition to identify, test and scale products and services that address the needs of low- and moderate-income Americans. In 2017, FinLab winners focused on groups that have been traditionally underserved. For example, Token Transit streamlines public transit passes for low-income public transportation riders, Nova Credit assists immigrants to access credit by using their international credit history and EverSafe helps protect the financial assets of older Americans.
FinLab winners are making an impact: Since the program’s inception, the 26 financial technologies have served more than 2.5 million Americans with solutions to improve their financial health in diverse ways, from making it easier to save to settling debt and improving credit scores. Collectively, FinLab companies have also raised more than $250 million in capital since joining the program.
FinLab winners receive more than simply monetary support. They also get invaluable access to the skills and knowledge of JPMorgan Chase mentors. Each winner is paired with a team of JPMorgan Chase employees who volunteer their expertise and leverage their networks to help the FinLab winner get a firm footing and reach his or her highest potential. To date, more than 100 JPMorgan Chase employees have served as FinLab mentors.
Mentors work closely with companies in the areas of most need and introduce entrepreneurs to individuals and networks that often set them on the path to success. The mentorship program is a win-win: Entrepreneurs get advice that can be critical to the success of their company and, in turn, mentors have the opportunity to give back.
Our firm is supporting breakthrough solutions globally through the Catalyst Fund, an initiative of BFA with the support of the Bill & Melinda Gates Foundation and JPMorgan Chase. Through the Catalyst Fund, impact investors around the world are identifying the most promising fintech companies and then providing technical assistance, mentorship and early capital, enabling them to scale more quickly and efficiently. In 2017, the fund supported 15 companies that are providing high-quality, low-cost new products to promote the financial health of low-income consumers globally.
We are also collaborating with nonprofits and social businesses on the ground to advance financial inclusion around the world. For example, in India — where policymakers are working to accelerate the adoption of digital payment platforms — we are collaborating with the Grameen Foundation India and Institute for Rural Management Anand (IRMA) to help communities learn to use this technology. To date, the effort has trained about 15,500 women to use their bank accounts through digital platforms such as mobile phones. About 5,880 of them have already started using their accounts without any further assistance, of which 61 percent are regularly on digital channels for transactions and 71 percent have adopted new financial products.
Leigh Phillips has spent her whole career helping low-income individuals become financially empowered. Today, she is the CEO of EARN, the San Francisco-based nonprofit that focuses on building up savings for a more stable financial future.
EARN, a winner of the 2016 Financial Solutions Lab competition and a JPMorgan Chase grantee, helps families save — especially important when one emergency could mean getting evicted, losing a job or becoming homeless. “We’re focusing on helping people take first steps to build that $400 or $500 emergency cushion,” says Phillips. Once they succeed, members can work toward long-term goals such as saving for a home, starting a small business or going to college.
According to the Urban Institute, families with at least $250 to $749 on hand are less likely to miss housing or utility payments or be evicted after an income disruption. Families with $1 to $249 in savings are significantly less likely to receive public benefits than families with no savings.
EARN’s SaverLife program uses mobile technology and financial incentives to encourage saving. When a member saves the monthly minimum of $20, the program kicks in $10; members also receive weekly tips from a financial coach. EARN members increase their wealth by an average of $465 in six months. Together, members have saved $6.8 million.
The program has been transformative: Dametra was living with her daughter Yvonne in a homeless shelter. Through EARN, they saved money for tutoring, and now Yvonne is going to college and Dametra is starting her own small business with the help of EARN’s financial coaching. For Lawreece, saving money became a top priority when her son was born with cerebral palsy. She wasn’t sure how to start saving, but EARN’s incentives motivated her to try. Now she has built up a fund for her son’s needs.
Saved by EARN members
New savers in all 50 states
Average wealth increase in 6 months by EARN members
EARN’s benefits go far beyond money in the bank. “The No. 1 thing people report at the end of an EARN program is that the major benefit isn’t the money — it’s the fact that they became a saver,” says Phillips. “Once they do, about 80 percent of the folks go on to continue that saving habit. We think that’s pretty critical.”
In addition to JPMorgan Chase’s financial support, JPMorgan Chase mentors have provided guidance and support on a wide range of issues — from evaluating partnership opportunities to shifting to a product-centered approach — that have been critical to EARN’s growth. Our firm’s support has enabled EARN to expand its reach to 80,000 new savers in all 50 states, with a goal of 500,000 by 2020.
In her lifelong quest to help people become financially stable, Phillips appreciates the shift toward meeting low-income people where they are. “Programs like FinLab are really trying to respond to how people actually live, and to how they actually manage their finances, instead of trying to fit people into a system that wasn’t designed for them.”