Recently I was on a panel discussion about financial inclusion (follow the discussion on LinkedIn or see original post) and was asked about what things might look like in a hypothetical future where everyone was fully included in the economy. I replied that what's interesting about addressing financial inclusion is that it forces you to look at the way that services are provided - whether it's accessible screen readers or finding ways to accommodate cash-based workers and businesses.
And I think that will lead us past thinking in terms of, how can we adapt our existing channels to make them more accessible. But rather, is there a better way to solve this problem for everyone?
“Rather than saying “ok we made you a wheelchair that can climb the stairs” it should be, “forget stairs, here’s an elevator.””
Rather than saying "ok we made you a wheelchair that can climb the stairs" it should be, "forget stairs, here's an elevator." It's not about adapting to what advantaged or enabled people use, but rather innovating for everybody.
It's not saying, "here's a set of products and services we offer, and look we even made them accessible." It's about meeting people where they are, in their daily interactions, and figuring out how to be there to help them.
We'll go to you, rather than asking you to come to us. And that's the key - to really be more accessible is to flip the current relationship model on its head - not just directionally but structurally.
“The future is about finding ways to embed ourselves in the channels that people use everyday and are already comfortable with.”
The future is about finding ways to embed ourselves in the channels that people use everyday and are already comfortable with. This leads to a focus on the user's end goal, identifying the user journeys that lead there, and reducing friction in the moment.
“It’s about FX - the financial experience.”
It's about the experience because the financial products and services that people use are a means to an end, not the end goal itself. So don't make it about selling those products and services separately, make it part of the experience of achieving that end goal.
You can see this already happening across industries, driven by applying tech to the central problems facing users:
Set up shop more easily, get paid faster
Online merchants are focused on setting up a storefront, not a bank account. So why not be able to get that bank account as part of setting up their store, just like they set up inventory management and order fulfillment? That's what Shopify is doing with Shopify Balance, simplifying setup and helping merchants get paid faster.
A bigger safety net for rideshare drivers
Uber Money built its proposition around the particular needs of its driver base - immediate access to earnings, cash back on gas purchases, greater overdraft protection to allow drivers to fill up on gas before a shift (60% of drivers go negative six times a month), discounts on auto maintenance, and so on. All of this puts financial technology to work to make it easier for drivers to offer rides on demand.
With insight into driver revenue and spending, it's also positioned to potentially offer loans based on more informed approval decisions, and with global reach, it could also facilitate lower cost remittance (given that some drivers send as much as 25% of their income back to their home countries).
Checkout faster, with less risk of buyer's remorse
One of the banes of online shopping is entering all your credit card details. Klarna solves this by reducing it to entering your email address, and by giving shoppers 30 days to pay, consumers have time to receive their purchases, try them on, and return them without a hit to their wallet or spending power.
Even shoppers who don't have a Klarna account yet can take advantage of this seamless process at checkout time. It essentially shifts the credit card application process to the point of purchase rather than applying in advance - a good example of putting finance into the process rather than making it a thing you need to get separately.
At this point, we can likely identify some defining characteristics of this new FX:
It recognizes the user's end goal as the priority - Using Klarna as an example, people want to buy something.
It's about being built-in, not bolted-on - To help people buy something more easily, Klarna is built into the checkout process.
It creates a win-win situation - Not only are shoppers happier with the simpler, faster process, but the stores are happier because it increases ecomm conversions.
Soon we'll be moving past neobanks and challenger banks trying to improve the UX of traditional banks - which is more of a facelift than a business model - and into more and more companies creating this type of FX of sustainable value.