What was our wish? For a year that is far from normal, with many of us being socially isolated, our first ‘obvious’ choice would have been: To be able to meet people in person.
As much as we have lamented the hassle of travel and as much as we appreciate the convenience of virtual conferences, after months of being cooped up in a house (many of us with small children doing distance learning), we can’t wait to actually be out and about to attend a live event, to have a cup of coffee or share a meal with our colleagues — rediscover the joy of serendipity moments.
Which brings us to: purpose.
While there is no lack of discussions about the importance of investing in technologies, how much of that is driven, first and foremost, by the pressure to improve the bank’s bottom-line, and how much is driven by an urge to make things better for the customers? For those who struggle to make ends meet and put food on the table, how much can a shiny metal card or a flashy user interface help?
The answer is simple: It won’t.
Sorry to bust your bubbles. Good aesthetics may be pleasing to the eyes; but they won’t remove worries from our lives.
Our wish, similar to last year, is to hold a hyper focus on customers. Just saying that you are customer-centric is not enough. For that next AI project that you are contemplating, or the upgrade in IT systems that you’d been budgeting, how much of that will drive direct benefits to your customers? How much of that will help to remove their financial uncertainty and improve their long-term well-being?
When we seek to rebuild — how do we build back better? Can we focus our efforts on small businesses, gig economy workers, immigrants and essential workers — all those who have been left behind and forgotten in the midst of chaos — those who need our help the most?
Actions speak louder than words.
Speaking of investing and change, we’d vote that “Digital Transformation” is probably the most overused buzzword of the year in the FinTech world — perhaps after “New Normal”. Or would it be “Data is the new oil”? Although, we would argue that data is more like the new fuel needed to run the big AI machine.
If 2020 is the year when we get a first glimpse of the superpower of data, perhaps 2021 will be the year we finally leverage alternative data to find thoughtful solutions to drive financial inclusion — beyond extending credit and beyond more “buy now pay later” offers?
Will data finally lead to contextual dialog with bank customers, since we all have to move on beyond the “how much did we spend on coffee last month” and “here is another credit card that you don’t need” niceties?
Will we use data to empower — or to exploit?
Let’s cut to the chase.
Can we leverage technology to create sustainable solutions to help lower income workers build wealth, and find alternatives to payday lenders for emergency expenses? How can we equip everyone with tools and information, in order to make better and more informed choices?
Will we know, for example, finally understand how our current actions impact the long term viability of our planet? Will there be ESG metrics to guide our way? It is this yet another set of industry acronyms that add up to more incumbent profit?
In the ideal world, we would love to see the momentum and passion to change continue post-COVID, from wealth tech to pay tech; from community banks and regionals to big banks and big tech. After all, what’s stopping you other than inertia — and the comfort of the status quo?
Speaking of the world, can we all agree that the FinTech world is much bigger than what happens in the U.S. and Europe? There is so much happening in the Far East, the so-called emerging markets. Not only opportunities to invest, but opportunities to learn. Without the shackles of the past, some of those regions have grown leaps and bounds in terms of FinTech adoption. What lessons can we gain from them? And how can we make the pie (of inclusion) bigger and better?
The future is bright. But for whom?
With much fanfare, the future of work is finally here. Unfortunately, working from home is just a privilege for some. Many essential workers are risking their health (under the disguise of flexibility and freedom) so that we can have our food and services delivered right at our doorstep.
As the Digital Hustle series of reports from Flourish Ventures have shown, many of these independent workers are suffering financially as well and are unable to make ends meet due to fluctuating income.
Will financial services finally pay attention to this overlooked demographic? Can institutions go the extra mile, and use bank resources to educate and help small business owners establish themselves? Our good friend Paul Loberman certainly thinks so.
From getting their business online, helping them market themselves, and growing their customer base, to increasing their revenue, and providing meaningful connections with other customers, financial institutions have a role to play — beyond offering a loan.
The last point is especially true for credit unions and community banks, who can power local economic recovery and empower consumers and businesses with technology and their deep understanding of their communities. It’s time to ‘step up’ and reimagine the business models; it will take more than relying on core providers to drive true change.
And while we are at it, let’s re-define community, and expand beyond geographical limits. It is prime time that we find meaningful solutions for the banked and unbanked. It is prime time that we find sustainable solutions to bring about economic equality for all.
Access to food, shelter, water, and the Internet should not be a privilege — but a right. COVID-19 and the necessary switch to digital has only highlighted this urgency.
“If 2020 is the year of social distancing and disruption —
may 2021 be the year of reconnecting.“
The FinTech genie lives amongst all of us. As demonstrated in the movement around sustainability and of Black Lives Matter, financial institutions can work together systematically to serve their communities in new ways. Profits and purpose can play complementary roles; financial wellness can be — and should be — at the heart of more business models.
Every action has a reaction; every choice we make charts a path towards a future that is yet to be written. We have the power to do what is right for our industry and our society at large — across all continents and cultures. For this new year and beyond, let’s unleash the power of technology for good, and rebuild better — together.
And resonating Jim Perry’s one wish: That 2021 presents the opportunity for us all to gather somewhere, anywhere, in person, to raise a glass in celebration that we made it through 2020.
Till then, sleep soundly and have a good FinTech dream. (Just don’t ask us for a dictionary.)
“I have had a dream, past the wit of man to say what dream it was.” A Midsummer Night’s Dream, by William Shakespeare
By Theodora Lau & Bradley Leimer of Unconventional Ventures.
Thank you to everyone in our community who has contributed ideas to the FinTech genie. While we might be socially distanced, we are still connected, more than ever. And we are grateful for all of you.
Unconventional Ventures helps drive innovation to improve systematic financial wellness. We connect founders to funders, provide mentorship to entrepreneurs, strategic advisory services to a broad set of corporates, and broaden opportunities for diversity within the ecosystem. Our belief is that anyone with great ideas should have a chance to succeed and every voice should be heard. Visit unconventionalventures.com to learn how you can partner with us today.