Gen Z money app Quirk launches personality tests to its users

The news: The Gen-Z-focused money app Quirk provides financial guidance through personality tests, per AltFi.

More about Quirk: The UK-based app launched to the public this week after accumulating 10,000 beta users. It received £300,000 ($412,600) in pre-seed funding in January 2021.

• Users take a personality test through the app which assigns them to one of four types: optimizer, explorer, artist, or blissful.
• Quirk’s personality test is based on the “Big Five” personality traits: extraversion, agreeableness, openness, conscientiousness, and neuroticism.

Quirk also uses the open banking platform Plaid to get a picture of users’ financial situations, and partners with digital insurance broker Anorak to educate younger generations on insurance products.

Targeting Gen Z: The app focuses on user spending and aims to help Gen Z navigate the increasing cost of living, from rent to groceries. But its emphasis on personality traits reflects its desire to put mental health first when it comes to finance.

• The app doesn’t push for daily engagement, which contrasts dramatically with most banking and money apps.
• It points out that forcing someone to strictly follow a budget causes anxiety and makes them less likely to stick to it. Quirk prides itself on not shaming users for the financial decisions they make.
• It also carefully curates its social media presence since so many Gen Zers look to it for financial advice.

Giving up personal data: Both digital and incumbent banks have increased the degree of personalization in their offerings as a means of engaging customers and gaining their loyalty. But Quirk’s personalization tactics raise some questions around data security and privacy. By gathering personality traits and focusing on mental health, the app ends up with access to some pretty sensitive personal information. And it might not be clear how it’s using that information.

• Quirk claims to use “bank level” privacy and encryption standards, and works with read-only access into users’ financial accounts.
• It also says it never shares data with third parties.

Though that doesn’t mean the firm isn’t using personal data to develop new products or inform new models. Nor is any firm safe from hackers or cyber attacks. Earlier this year the UK adopted the Digital Markets Act, which outlined rules for Big Tech, especially around data privacy. But smaller fintechs are trying new tactics to differentiate their products, and a lack of regulation around the data they collect could open users up to risks.

The big takeaway: Quirk is hitting a sweet spot for Gen Zers, but lack of accountability and privacy concerns will make it harder for the app to succeed.

• According to our research, finances are a main source of stress for Gen Z, and the stress will only heighten as the economy worsens and inflation increases the cost of living. We also found that 28% of Gen Zers rely heavily on social media for advice.
• Quirk’s attempt to lessen stress around money topics might be softer than competitor app Cleo, which uses wit and sarcasm to keep users on track, but there seems to be no clear method for holding Quirk’s users accountable.
• And the type of insights the app might glean from users via the personality test might make them uneasy about how much a technology company knows about them.