Millennials are the first generation to grow up with the internet. They are born after 1982 and before 2004 and they are used to relying heavily on the internet and digital technologies to do almost everything including online shopping via Qoo10, Amazon and Taobao, listening to music and watching media via Spotify and Netflix, communicating with friends via various social media such as Facebook, Twitter and Instagram and sharing a ride via Grab. Here are the three reasons why we think millennials love alternative investments.
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Millennials are early adopters of new technologies
Millennials are the largest group of consumers today. For a generation that has never been exposed to a world without computers, they are more likely to embrace new technologies. In comparison with generations before them, new technologies are approached with much less caution. With the increasing cost of living, millennials are utilizing online marketplaces such as Carousell and Airbnb.
Blockchain and cryptocurrency, as well as P2P investing, are therefore new technologies that have been gaining traction with millennials. This can be observed in the increase in bitcoin investments.
Millennials embrace the rise of the sharing economy
With the rise of digital platforms, it is evident that millennials embrace the concept of the sharing economy. If you’ve ever hailed a ride with Uber or booked a place to stay on Airbnb, you have taken part in the “sharing economy.” The sharing economy is an economic model that involves any type of Peer to Peer (P2P) activity of acquiring, providing or sharing access to goods and services that are facilitated by a community based online platform.
The world’s largest content sharing platform, Facebook, creates no content of its own and the world-wide accommodations provider, Airbnb owns none of the properties it provides. These are just some examples of how technology has made the sharing of assets easier and cheaper. This results in reduced transactions costs, enabling services and products to become less costly and available to more people.
This trend is observable in Fintech and especially in the P2P lending space. P2P lending allows anyone to lend money directly to companies that are requesting a loan without going through a traditional financial intermediary. In exchange, lenders earn interest on the sum they invested and businesses gain access to funds from investors much more quickly in comparison to traditional financial institutions. P2P lending requires fewer employees and no physical branches. As a direct consequence of this digitalization, businesses are able to obtain the funds more quickly.
Millennials prefer online transactions over visiting brick and mortar stores
Having grown up with technology, many millennials prefer texting than making a phone call. Online shopping is also more common than going to a shop. It is no surprise that alternative investments, such as cryptocurrency and P2P investments, which offer a familiar digital presence, would also be a form of investment embraced by millennials.
Did you know?
Almost half of the investors on Funding Societies are millennials!
Funding Societies is Singapore’s leading Peer-to-Peer lending platform. We provide business financing solutions to small and medium enterprises (SMEs) and we offer investors a unique class of investments where investors can earn up to 14% in returns per annum. Investors can monitor their investments on their mobile devices through the Funding Societies app on the Apple App Store and the Google Play Store. Furthermore, Funding Societies investors can enable an “auto-invest” function. Investors just need to define their investment criteria and they will be automatically allocated any new investment that matches their investment criteria.
Join Funding Societies as an investor and start financing local businesses!
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