Innovation series gathers stories of some of the most innovative social businesses around the world that work with the dual aim of profit and impact. Businesses committed to doing good stand out from the crowd because most customers feel good about supporting socially proactive companies. They also achieve a boost in productivity since employees who know their work tangibly affects the lives of others are more likely to go above and beyond. It is hoped that the series will impart useful knowledge for greater institutional support for activities with social innovation impact. Read about SEV’s new investor-led initiative – a social venture builder.
Social business: ImpulseSave
by Joanne Willemin & Yusuf Jaffar
ImpulseSave is a mobile app that enables users to save money easily and regularly in low amounts. Launched in June 2012, it was created to incite people to change their impulsive purchases into savings to help them reach their financial goals.
The app makes use of familiar and simple acts of online consumption and converts them into saving habits. When creating an account inside the app, users can define specific goals – going on a holiday, paying back a loan or buying a new phone, for example – with a precise amount of money that needs to be saved in order to reach them. A personalised dashboard becomes then available which enables users to see the amount of money they have saved and the progress they are making in reaching their goals.
Users can top-up their savings accounts online, through the app or even via text messaging. They can do it whenever they want to with amounts as low as $1. The application also has an automated weekly saving feature.
Innovation to emulate
Modern technology has made consumption easy for everyone but saving is more difficult because it is less integrated into people’s lives. Poor spending habits cause average consumers much loss in the long-term in terms of their goals as even small impulsive purchases will eventually amount to significant money.
Instead of solving a problem, ImpulseSave benefits society by preventing one that could arise from overconsumption. “Impulse saving” empowers people to resist the consumerist society and focus instead on their true objectives. Those who feel they do not have the budget for a big expense can be proven wrong: the app shows them that it is possible to save money to fulfil one’s wishes through saving regularly in small amounts. This is particularly helpful to people from low-income groups who lack proper financial education and young persons who are inexperienced in budget management.
Impact to date
The startup behind ImpulseSave had been backed by Techstars and acquired within a year of operations by Betterment, an investment platform for savings. The concept of saving regularly in low amounts has been since then applied in the investment context to encourage people to save more for retirement. ImpulseSave’s average user saved more than two times per week through the apps, with a total of about $3,000 per year.