Can banking apps change our spending habits?

NatWest has launched a new digital banking service, Bó, which aims to help people spend less and save more. We explore how the brand was created – and what its launch tells us about the future of banking

From savings apps and chatbots like Squirrel and Cleo, to digital banks that track our spending in real time, we now have more tools to help us manage our money than ever before. There’s a wealth of free financial advice available online, with vlogs, blogs and entire websites dedicated to helping us budget or cut back our outgoings. But for all this information, it seems most of us still struggle to make ends meet.

NatWest recently studied anonymised data from 7 million UK customers, and found that three out of four people in the UK are living ‘financially unsustainable’ lives – meaning they have less than two weeks’ financial buffer. This isn’t just a problem for cash-strapped millennials working entry level jobs, or people working zero-hours contracts: unless you earn over £120,000, there’s little correlation between your income and your financial position.

Surprised by these findings, it teamed up with design consultancy Fjord and embarked on a project to understand what drives our approach to money – running controlled tests and testing out various hypotheses. From their research, they identified two key factors – whether or not we feel confident managing finances and whether we take a long or short-term view of spending. They also discovered that knowing how to budget and save doesn’t make us more likely to do it – in fact, people who understand the basic principles of good money management are generally no better off than those who don’t.