Finally there's a way to invest your pesky change in the stock market

Small change, over time, can add up.

But a dollar here and a dollar there doesn’t usually make it into our savings accounts, or investment plans.

A joint venture between Instreet Investments and US startup Acorns Grow is hoping to put small change to work, launching its app called Acorns in Australia.

The app allows users to round up their daily purchases and automatically invest the change into a diversified portfolio of index funds. Users link the app on their phone to their bank account or credit card, and as they make purchases they invest the virtual spare change by rounding up transactions to the nearest dollar. For example, if you purchase a coffee for $3.50, the app pushes $.50 cents into your Acorns account to be invested.

Since its launch in the US last August, Acorns has grown to 750,000 members. Australia is the first country outside North America to secure a partnership to co-develop and launch a local version of the app which will be in beta throughout quarter four this year.

“Acorns has always wanted to take the app to international markets and do so with a company that has strong local knowledge in the financial services sector,” Acorns co-founder and CEO Jeff Cruttenden said. “We were introduced to Instreet and quickly realised they shared our vision of solving the worldwide savings and investment problem, through simple technology.”

High smartphone penetration rates in Australia is one reason Acorn took a liking to the market. Leading the Australian operations will be finance veterans George Lucas and Tony Fay as well as Chief Operating Officer, Brendan Malone, former CAO for RBS’ APAC investment banking operations.

“In a very short period of time in the US Acorns has revolutionised how people perceive investing in shares, making it simple and making it appealing to those either new to investing or those who don’t want to deal with a broker or financial advisor,” Instreet Investment Managing Director George Lucas said.

The Australian version will charge a monthly fee and there will be no commissions on trades. The app is free and for the first $AU5,000 in an account, the expected annual fee is just $AU15.00.

“The flat fee also means users will be able to add or withdraw money without incurring extra costs, and for savings beyond $5,000, a small fee of 0.275% will be charged,” Lucas said.

Acorn’s Australian investment options will include Australian listed exchange traded funds covering Australian, International and Fixed Income markets.

“The good news is that Acorns is not an either/or proposition. Rather, it complements current investment and saving strategies that people use, such as share trading, saving and superannuation,” Cruttenden said.

Lucas added that with the Australian financial services market so focussed on superannuation, Acorn hopes to slide in with a focus on investments outside super.

“The Acorns app is also perfect for people who know little about the financial markets and will provide a selection of portfolios from low risk to aggressive. It is fast becoming an educational tool for younger or new savers and is an easy way to start building wealth,” he said.

NOW WATCH: Tech Insider videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.