Etsy have announced a partnership with an emergency saving service, BlackRock in an effort to understand Etsies financial changes, helping them build a saving cushion with the support of a goals-based financial app. The solution will debut in “early 2020” in the US through Etsy’s seller platform ahead of the possible wider rollout.
The move will see the marketplace taking an essential step towards their sellers’ long-term financial well-being by conducting research on their merchants’ money-related issues.
Etsy sellers face considerable challenges in managing the ups and downs that come with running a retail business. They may earn quite a bit over the holidays, for example, and then sell less in January.
It can be difficult to predict future sales, and an unexpected emergency may create a significant financial strain for the sellers and their families. Some 40% of Etsy’s full-time sellers lack sufficient emergency savings to cover their expenses for three months, and 35% of the sellers have not started saving for retirement.
Some 56.7 million people work independently, often struggling to manage the income volatility that can accompany this type of work. According to the McKinsey Global Institute, temporary and contract work has accounted for all net employment growth in the United States since 2008. As more people work outside traditional employment, new strategies are needed to ensure everyone can build financial security, regardless of how they earn income.
Etsy attribute the new collaboration to the financial volatility their sellers may experience. It will build on the marketplace’s longstanding commitment to helping their sellers manage the challenges that come with self-employment. For example, in their white paper, Economic Security for the Gig Economy, Etsy laid out a policy agenda to build greater economic security for the creative entrepreneurs. With this pilot, Etsy aim to turn some of these ideas into concrete actions and share their findings with others working to solve these same difficult challenges.