Kasasa CEO Gabe Krajicek testified before U.S. Congress today on a hearing examining technology uses in financial literacy efforts. In addition to highlighting Kasasa’s innovative financial literacy products (which was the reason he was invited to testify), Gabe used the opportunity to champion community banks and credit unions in front of this critical government audience.
The Congressional Subcommittee on Financial Institutions and Consumer Credit sought testimony from five leaders, asking them to (A) present their organizations’ web- and mobile-based financial literacy efforts and (B) discuss ways technology helps consumers generally manage money better.
Promoting Community Banking Before Congress
Kasasa was among other leaders in our industry called to provide testimony, which also included Visa, Intuit, World of Money, and the Government Accountability Office.
Gabe was the only one there speaking from the voice of community banks and credit unions. Thus, he used the opportunity to highlight the significance of community financial institutions.
“These institutions provide knowledgeable financial advice and serve their communities — one household, one parent, one child, one teacher, one business at a time — so all of us can achieve our financial goals,” Gabe said in his address to the Congressmen.
MoneyIsland, PiggyBot, And Kasasa 360 To The Rescue
The bulk of the testimony centered around the Subcommittee’s request for an overview of Kasasa’s financial literacy and money management products, which include the award-winning MoneyIsland online game for kids, the new PiggyBot allowance app, and the new Kasasa 360 money management platform.
One highlight hinged on MoneyIsland’s turn-key solution for schools to introduce financial literacy curriculum. The need is great, as these stats indicate:
- 87% of parents think it’s appropriate for kids to learn about financial matters in school;1
- Yet less than 30% of teachers report ever having taught financial education topics;2
- And less than 20% of teachers reported feeling very competent to teach financial education topics.2
Community banks and credit unions that offer MoneyIsland benefit from deeper engagement with local families and schools, while delivering world-class financial literacy that benefits their community for generations to come.
This distribution model through community financial institutions is another key component of these products’ success, underscored by that fact that:
- 93% of community banking customers trust their financial institution3
- Compared to 66% of Americans who feel flat-out anger toward big banks3
- 75% of consumers say they want personal financial management services from their primary financial institution, rather than from a third party4
A Suggestion To Congress: Less Regulatory Burden
Gabe concluded with a suggestion on how Congress can help financial literacy efforts succeed:
“As the pace and the costs associated with compliance and regulatory oversight continues to grow, community banks and credit unions are forced to cut services that don’t generate revenue….if there were a way to reduce the regulatory burden on community financial institutions, more organizations would be able to afford to provide financial literacy services across every small town in America.”
In addition to the live testimony, Gabe submitted written testimony that went in to greater detail on all the matters presented. You can read the full written testimony here.
The Subcommittee also engaged the five witnesses with questions after they presented their testimony. Video of the full 2-hour hearing is available online. (Note: the proceeding begins at 10:03am, which is 21:20 into the video.....so fast forward the video to that point.)
1T. Rowe Price, “Parents, Kids & Money Survey,” March 2014
2National Endowment for Financial Education, “Teacher’s Background & Capacity to Teach Personal Finance,” 2010
3Kasasa, “Consumer Banking Insights Study,” conducted by Harris Poll, December 2013
4Perter Wannemacher, senior analyst at Forrester Research, quoted in ABA Bank Marketing article “Track My Money!” September 2012.