Fintech Radar

Instacart Looks to Unlock Shopper’s Unspent FSA/HSA Savings

Instacart is driving sales with consumers rushing to use flex spending funds before they expire. The grocery aggregator announced Wednesday (Dec. 7) the launch of a pop-up online shop for items eligible with Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs), featuring items ranging from COVID-19 home tests to over-the-counter medications to sunscreen. With this move, the company is leveraging consumers’ anxieties surrounding the often-confusing process of using unused funds in these accounts to drive end-of-year sales. “We want everyone to have access to the food and products that help them thrive,” Sarah Mastrorocco, vice president and general manager of health at Instacart, stated in the announcement, calling the new in-app features are an example of the company’s focus to grow its health-related offerings. “Our Instacart Health initiative [includes] technologies like product tags and health-focused Pop-Ups that can make the shopping experience more seamless, convenient, and connected,” she added. The news comes as online wellness spending takes a hit, with inflation and the economic slowdown causing many to cut back even on their healthcare needs. Research from the August edition of PYMNTS’ ConnectedEconomy study, ConnectedEconomy Monthly Report: Paycheck-To-Paycheck Consumers Digitally Disengage, which draws from a survey of roughly 2,500 U.S. consumers, found that mid-income consumers living paycheck to paycheck and struggling to pay their bills were 19% less likely to make wellness purchases digitally than just two months prior. Similarly, low-income consumers living paycheck to paycheck and struggling to pay their bills were 11% less engaged in the same category. Read the report: ConnectedEconomy Monthly Report: Paycheck-To-Paycheck Consumers Digitally Disengage Yet the opportunity for businesses such as Instacart looking to drive healthcare spending is still there, as many consumers continue to engage with their wellness needs via digital channels. The September edition of PYMNTS’ Connected Wellness study, Connected Wellness: What’s Next In The Connected Economy, which draws from an August survey of more than 3,000 U.S. consumers, finds that 57% are using digital tools to maintain their physical and mental health, up from 52% in November 2021. Projected to the population as a whole, this amounts to 10 million more consumers digitally engaged with their health. Get the study: Connected Wellness: What’s Next In The Connected Economy This particular pop-up is far from Instacart’s first attempt to drive sales with consumers who feel overwhelmed and confused by the constraints placed on certain kinds of payments. In September, when the aggregator first launched its “Instacart Health” platform, the company announced features to make it easier for consumers to see which digital purchases would be covered by their Supplemental Nutrition Assistance Program (SNAP) Electronic Benefits Transfer (EBT) funds. These initiatives come amid a difficult year for Instacart, as worsening economic conditions have many consumers paring back their spending on luxuries such as same-day delivery. Research from the October edition of the Consumer Inflation Sentiment study, Consumer Inflation Sentiment: Consumers Buckle Down On Belt-Tightening, which drew from a survey of more than 2,600 U.S. consumers in September, found that 66% are cutting down on nonessential retail spending, and 58%, are cutting down on nonessential grocery spending. Amid this belt-tightening, reports circulated in October that Instacart has pulled back on its initial public offering (IPO) plan amid one of the worst years for such listings in more than a decade.

PYMNTS · un ora fa

Fintech Radar

US lawmakers introduce bill aimed at reporting on crypto miners' potential environmental impact

Federal Reserve Forms Group to Promote Request for Payment Functionality

Banks grow more open to open source software

DMI finds CBDCs not targeting cross-border payments, huge potential in Metaverse

SEC Division of Corporation Finance Reveals Sample Letter Sent to Companies on Crypto Asset Disclosure

SEC Tells US-Listed Companies They’d Better Disclose Crypto Damage

OCC's Hsu says 'now is not the time to be complacent' on risk management

Instacart Looks to Unlock Shopper’s Unspent FSA/HSA Savings