Pounce On This Niche Opportunity In Pet Banking
4 ways financial institutions and pet care brands can partner to support pet owners
Furry friends are family — now more than ever, as the pandemic encouraged 10% of Americans to get a new pet.
Parallel to the rising trend of pet ownership is a growing need for trusted financial services partners to help pet parents plan and pay for their fur babies’ expenses. Financial institutions and pet care companies who recognize this niche need can capitalize on an enriching partnership opportunity in pet banking.
Nearly 70% of U.S. households own a pet, and only 1 in 3 have pet insurance. Approximately 27% of adults would have to borrow money or sell something if they incurred an unexpected expense of $400 or more. When you consider an unplanned vet visit could cost $800-$1500 (and sometimes more), many pet owners are left to face difficult decisions.
But it doesn’t have to be that way. Financial products and services are available that are tailored to pet owners to make planning and paying for pets less overwhelming. Now, more pet parents can keep pets they love but are worried they can no longer afford.
Pet owners now have solutions to help them manage the cost of caring and budgeting for their pets. Niche digital banking concepts like BFF Money, built by Nymbus Labs, are designed to reach the specialized needs of pet owners. This flexible solution partners with pet owners to help them save money for ongoing pet expenses, gain easy access to emergency funds for unexpected expenses and more.
Consider these four rewarding ways financial institutions and pet care companies can partner with customers to incorporate pet finances into the family budget, allowing more heckin’ fun times with everyone’s favorite furry friends.
- Plan for Known Pet Costs by Setting Savings Goals
Parents often set aside funds to take care of their children. For the 84% of people who treat their pets like children, it is important to save for their fluffy loved ones’ ongoing and unexpected expenses.
The amount of money an average American spends on their pet has doubled over the past decade. FIs can help pet parents build a balanced financial plan to withstand rising pet care costs without breaking their budget.
First, create a list of anything a pet owner might need to budget for, such as:
- Boarding fees
- Collars, leashes and accessories
- Food
- Grooming
- Preventative treatments at the vet
- Training
- Toys and Treats
Next, add estimated costs for each item and separate the list into non-discretionary spending (essentials, such as food) and discretionary spending (nonessentials, such as a sparkly dog bandana).
Set a high enough savings goal to cover all non-discretionary expenses first. Be sure to include wiggle room for unexpected expenses you cannot avoid, such as if your pet gets sick.
Now you can add space in your budget for fun spending on items like clothes and toys. Gen Zers often have the highest pet expenditures, with 47% buying specific items such as unique outfits or charming props for their pets’ social media posts.
If you partner with a financial brand that offers a pet planning tool like BFF Money, you can see at a glance whether you’re on track saving for items like pet food or your next scheduled pet insurance auto-payment. And your estimated costs can get more accurate with time as you look back on transaction history and view trends on what you spend.
2. Get Easy Access to Pet Emergency Funds
Currently, 13.6 million pet owners have pet insurance and another 10 million intend to take out pet insurance over the next six months. Cost of insurance varies depending on animal breed and health, but in 2020, Americans spent nearly $600 annually on dog insurance premiums.
Having pet insurance isn’t always enough to cover emergencies in full. Pet insurance typically includes a $500 deductible, and most policies won’t pay for any of the bill upfront — owners have to pay first and submit a reimbursement claim. So, even with insurance, some pet owners are left in a financial bind and need a loan to cover the cost. BFF Money provides easy access to loans up to $5,000 for emergency expenses with instant loan decisioning, rapid funding and competitive rates.
Today’s pets are living longer than ever — thanks to medical advances and healthier pet food. But total vet bills will increase over the life of a pet. Like people, pets may require more medical care as they age. Having access to emergency funds and adequate insurance in place can make unexpected pet health situations less stressful.
3. Earn Cash Back Rewards at Retail Pet Supply Stores
Many people already have favorite places to get their furry friends’ supplies in-person or online. Considering the recent trend of “pet humanization,” many pet parents are choosing organic or specialty foods and sustainable products for their pets.
Financial brands like BFF Money take this concept a step further by offering lucrative incentives, such as cashback on retail purchases from your go-to pet suppliers.
4. Round-Up to Help More Pets Find Their Fur-Ever Homes
Work-from-home life can be lonely, leading many people to get pets for companionship. During the pandemic, half of millennials considered fostering or adopting a new pet. As many of us continue to telecommute, our pets remain some of our favorite coworkers. But there are many more pets still looking for families.
If your clients are looking for a way to pay it forward for all the love pets pay us, rounding up purchases can help animals in need. One way to help is to donate to the ASPCA or another reputable pet charity through BFF Money. Open an account with BFF Money and select the setting to round-up a percent of your debit card transactions to donate to your favorite animal charity.
Financial institutions and brands have an exciting opportunity to help customers keep their finances on track through the ups and downs of pet parenthood. The time, energy and money poured into those furry friends is well worth it. As author Louis Sabin said, “No matter how little money and how few possessions you own, having a dog makes you feel rich.”
Now is the time to expand your consumer market reach and guide pet parents through unique opportunities for strategic budgeting and savvy pet planning. The unconditional love and loyalty pets offer in return pays us all back, in dividends.
Check out Nymbus Labs to learn more about how your financial institution or brand can launch BFF Money to help more people budget for their pet needs and explore our portfolio of financial brands available to build or buy.
