For individuals, financial literacy is foundational to building a healthy personal financial plan and a prosperous future. Yet, much of this crucial knowledge has historically been accessible only to a few, rather than the many. This situation goes beyond just affordability. It also reflects the scalability limitations of various financial planning tools in disseminating this knowledge.
The status quo is changing, thanks to the rise of financial technologies, also known as “fintech.” The latest fintech applications leverage emerging innovations to combine time-tested financial strategies with the power of artificial intelligence (AI). These strategies are now translated at relatively lower cost into personalized financial plans or roadmaps. If widely adopted, these roadmaps offer the prospect of a more financially literate population in the United States. The more in control people feel regarding their finances, the lower the levels of stress they report.
Fintech expert Sri Phani Teja Perumalla is a proven leader in the multinational banking and financial services industry. With expertise in financial services and banking, software development, and digital retail, Perumalla is well-positioned to analyze the changes driven by fintech. In this Q&A, Perumalla provides insights into fintech’s likely impact on financial literacy and offers his informed predictions for fintech’s future.
Q: What are the basic components of financial literacy, and how do they relate to personal finance?
Perumalla: Being financially literate means having basic familiarity with six vital concepts: income, spending, expense or cash flow management, saving, investing, and protection. These elements are common to all individuals, and some may have more importance at different times or stages of life. Ideally, the better the quality of information available to individuals, the more effectively they can make sound financial decisions, both in the short and long term.
Q: How is the market for personalized financial advice currently segmented?
Perumalla: High-net-worth individuals have regular access to high-caliber information provided by credentialed experts. This includes investment and tax planning, accounting, and related legal matters. These advisors provide personalized financial guidance targeted to the unique circumstances of their clients. An additional advantage enjoyed by those at the top is that the advice is heavily weighted to useful, actionable insights.
Lower down the socioeconomical pyramid, people with average means experience far different circumstances. They do not have access to the same highly personalized advice. So where do they often turn? One likely source is the vast sea of financial information presented by various social media influencers. Much of this information is generalized advice, however. Average consumers often struggle to distinguish between undifferentiated financial information and the actionable advice they need. The difference between their situation and that of high-net-worth individuals is stark.
Q: Can you provide some examples of fintech applications and outline their impact on consumers?
Perumalla: Fintech is new, but the goals behind many fintech applications are much older. In other words, the behavioral goals at the core of many fintech apps are rooted in age-old concepts. For example, many children used piggy banks to save loose change at the end of the day. This was one way to develop the habit of saving regularly by setting aside money. It is, in fact, an ancient roadmap to savings.
Today, there is a microsaving fintech app, formerly known as Digit and now part of Oportun. In simple terms, this app functions like an automated digital piggy bank. Customers link the app to their bank account and set a savings goal. Its system examines this savings goal and the customer’s income, and then identifies and automatically sets aside small sums of money. The app does this silently on behalf of customers, guiding them along a personalized roadmap to increased savings.
Another fintech that isn’t far removed from the piggy bank concept is Acorns, a micro-investing tool. Customers download Acorns and explain their financial goals in the app. Acorns then takes spare change from daily purchases and channels those funds into investments. This is a cutting-edge digital tool, but the innovation behind it aligns with the cross-cultural ideal of encouraging regular savings and building assets over time.
In 2025, national surveys found that approximately one in three Americans lacks an emergency fund, and fewer than half had enough to cover three months of expenses. Fintech apps that encourage routine savings and small, automated transfers help people of average means accumulate savings, which can contribute to higher rates of financial peace of mind.
Q: As further fintech applications emerge, what additional impacts do you foresee?
Perumalla: There’s a near-future potential scenario involving an exciting marriage between long-term data about consumer decisions and scalable fintech tools. The result will be highly tailored, data-driven financial guidance. These hyper-personalized roadmaps will be delivered via users’ tablets, smartwatches, smartphones, and other devices. This could include AI agent-based financial advice, delivered through a large language model (LLM) interface.
This scenario does not downplay the technological leap forward necessary to make this possible. It will be a significant development, when and if it happens. But the democratized provision of hyper-personalized financial advice and the possibility of millions of people tapping into actionable insights that were once out of reach are the most important parts.
Fintech’s role in potential improvements in financial health
The further evolution of fintech could lead to several advantages, including improved financial health and increased overall well-being. Banks and fintechs can support this as distribution engines that deliver inclusive, low-cost, and scalable financial planning products. As fintech gains popularity, the efforts of innovators in this space will become increasingly significant. Not only will they likely benefit millions living in the United States, but also millions worldwide as fintech continues to spread.
