Some of my favorite moments are spent speaking with fintech founders looking for banking partners to help them bring their dream to life. Late last month, I met with a founder of a payments-related fintech, and he explained how his offering would help his customers achieve financial wellness through payments and loyalty. I probed on the “why” of his business and the higher purpose of his work, and he replied, “We aim to help each of our customers become more affluent, you know, wealthy.” This conversation leads me to today’s question, “Can fintech help us achieve an affluent society?”

Commonly understood, an affluent society is one in which all the people’s material wants are easily satisfied. Individuals have two paths to achieve affluence; they can be easily satisfied by obtaining and possessing much or desiring little.

The economy, which we all support and operate in as members of the industrialized, capitalist society, depends on this idea of never-ending growth to support individuals’ insatiable desire for more. In his book “The Affluent Society,” John Kenneth Galbraith argued that it was essential to maintain production; this held unemployment down. However, companies had to artificially stimulate demand for products and services of decreasing value to do so. The “direct link between production and wants is provided by the institutions of modern advertising and salesmanship,” he wrote. “Their central function is to create desires — to bring into being wants that previously did not exist.”

Yet, read out of an economics textbook, and you’ll find the purpose of economics as a course of study is to “seek to solve the problem of scarcity, which is when human wants for goods and services exceed the available supply.” Modern capitalist societies, however richly endowed, dedicate themselves to the proposition of scarcity. This is a problem entirely created and designed by man.

Don’t confuse a low standard of living with poverty. In his paper “The Original Affluent Society,” American cultural anthropologist Marshall Sahlins wrote, “We are inclined to think of hunters and gatherers as poor because they don’t have anything; perhaps better to think of them for that reason as free. Their extremely limited material possessions relieve them of all carriers with regard to daily necessities and permit them to enjoy life.”

Poverty is not a certain small amount of goods, nor is it just a relation between means and ends; above all, it is a relation between people. Poverty is a social status. As such, it is the invention of civilization.

So, a central question of economic wellbeing for people comes down to getting more clarity on the question: “How much is enough?” When it comes to fintech solutions, founders have the power, tools, and means to create solutions that help individuals determine whether they have “enough.” It’s not an uphill battle. It’s a matter of supporting already emerging conscious consumer values. Here are three ways fintech can support an affluent society.

1. Create solutions that support intentional consumerism.

Consumer attitudes are trending toward simplicity. As one op-ed writer for the LA Times noted, “Our lifestyle choices have the power to bring about individual and collective change to our mental health and well-being. To build generational wealth. And to make a difference in the world future generations will inherit. Living more consciously has allowed me to regain control of my finances as well as my sanity. I have also learned to live more sustainably, which benefits me and the environment.”

• Help consumers get ahead of their spending.

Countless dashboards show past spending patterns and their effects. What’s needed are tools that can project the impact of future spending, so once consumers have set goals, they can see how future choices will impact progress toward their goals.

• Focus solutions on sustainably providing for human needs.

One area to explore is nutrition. Climatarian eating is a new eating lifestyle that is emerging. The premise of this eating regimen is about eating for the health of the planet, with choices based on environmental impact. While this eating trend might be in its infancy, it will continue in relevance as younger generations in particular increase their concern for the planet. Participation can include everything from eating pasture-raised, to buying more local and organic ingredients to reduce carbon emissions from transport, to eating a plant-based diet with crops that are good for soil.

Embedding fintech into enablement solutions in this sphere is an example of using technology to enable affinity. The view of people as mere consumers isn’t satisfactory because it only addresses a part of human beings. Affluence considers the possibility that people have a range of material and non-material needs. The first priority of fintech is to help people recover a broader vision of what are their real needs. Fintech can help lead this difficult process of cultural and commercial innovation so that a different ethical foundation for commercial activity based on low impact, long-term use and sustained yield can emerge.

As we end 2022, we will read our fair share of forecasts and predictions for 2023 and beyond. As a foresight practitioner, I’m asked to weigh in on the same, providing my perspective on the future of banking and payments. The issue is my crystal is as cloudy as the next person’s, and providing predictions is as much luck as anything.

Before I go further, I’d like to distinguish between complex and complicated problems. Complex problems, such as global warming, span space and time to such a degree that humanity can’t solve them; they can only be managed. It’s unknown how long it will take humans to fully define global warming, let alone define a solution set to ‘solve’ it. Complicated problems, such as “How will my institution need to evolve in the face of fintech?” can be solved using existing methods and approaches. They may not be easy, but they’re solvable.

As we go about solving complicated problems in financial services between now and 2030, I can only think of one thing I see with certainty from now until 2030: the never-ending creation process, this ongoing process of seasonality, birth and death, creation and destruction. In science, it’s also known as the natural process, nature, and regeneration. It’s the notion that all life, all universal mass, and matter are connected.

A significant trend that will impact our work between now and 2030 is that, Increasingly, people realize that humanity is not separate from nature; we are only a part of it. This realization has significant implications for society and, in turn, financial services. The choices we make and the actions we take today and beyond have long-term impacts on the state of nature in which we’ll all exist. It will take new thinking – Seventh Generation thinking, the notion of how the seven generations that came before us provide the foundation of what we have today and how the decisions we make today will lay the foundation for life seven generations into the future.

How can humanity manage this complex problem? – maybe by addressing a complicated problem.

The international trade-based economy’s purpose may transform from growth for growth’s sake toward a “net zero impact” system. The transformation will go beyond carbon emissions to measure areas of impact that have yet to be developed. Think about the work we do. If we as an industry are wildly successful in increasing financial inclusion, virtually eliminating poverty, and helping individuals build wealth, to what end? What is the ultimate goal of what we do today? Is it to breed more consumers? Is the historical consumption model of the industrialized northern hemisphere the beacon that all newly created middle-class citizens worldwide should aspire to? It’s important to consider because the present economy isn’t sustainable. This transformation could manifest itself in three ways.

First, governments could become more entrepreneurial – governments are uniquely positioned to address long-term problems with long-term solutions. We would see a shift from the government’s current role of providing technical efforts to counter market failure to the idea of public purpose guiding policy and business activity. This shift would result in outcome-based policy-making, steering change to meet society’s challenges, offering rewards to businesses willing to help “make it happen,” financing high-risk early investments that businesses tend to shy away from, and being recognized as active investors and share in the rewards.

Second, communities will increasingly develop localized solutions that benefit the land and its inhabitants. The concept of “local public value” will become quantified. There will be increased citizen involvement in the form of citizens’ councils to guide policy in areas such as localized food production, community-owned decentralized energy production and storage, land use, infrastructure spending, and education—all of these efforts directed toward the purpose of building vibrant, resilient communities.

Finally, individuals will want to live out their passions consistent with their values. While we see this manifesting in some personal financial management solutions today, this concept will further embed the financial goal into experiences.

A final thought – we, who build, use, and deploy technology to our customers, need to remember that technology is only a tool. We generally think of technology as tools to control something. I challenge us all to develop and build tools that enable – enable contribution, enable coordination, and enable cooperation among individuals and communities. I challenge us to use finance to nudge and influence society toward a shared better future.

The warming climate will force civilization to rethink the definition of prosperity, abundance, and lifestyle.  Among the industries that will see significant change is where and how food is produced.

Food that most people eat in rich countries, and increasingly in poor- and middle-income ones, is a product of a highly globalized economy.  While the proportion of undernourished people worldwide has declined from 15 percent in 2000-2004 to 8.9 percent in 2019, modern food production is highlighted by the spectacularly varied food choices from any place on the globe.

Today’s global food supply chain requires a large proportion of the planet’s surface devoted to farms and pasture. Further, this industry is driven by an energy-intensive system, where pesticides are abundant, intercontinental shipping cheap, and food processing an advanced industrial undertaking. The challenge is that a green energy revolution would be qualitatively different from any energy change in human history. It involves moving from more concentrated to less concentrated energy rather than in the opposite direction.

With the rate of world population growth slowing, the primary question is not whether we will have enough food but whether we will adjust our food systems to be sustainable and fair to all.

Future food systems will need to be economically, socially, and environmentally sustainable.  

Economic sustainability means that the activities performed by each participant of the system are commercially or fiscally viable, including reducing food waste. Social sustainability refers to the equitable distribution of the economic benefits across all actors, taking into account cultural traditions, nutritional value and health, workers’ rights and safety, food security, animal welfare, and institutions. Finally, the system will be environmentally sustainable if it is neutral or positively impacts biodiversity, water, soil, animal and plant health, carbon footprint, water footprint, food loss and waste, and toxicity.

To reach these goals, the food production system will need to respond to changing consumer tastes, more efficiently manage production resources, and move toward a more localized “farm-to-table” supply chain. Synthetic food production techniques that enable this evolution are “precision fermentation” through genome sequencing and gene editing, microbe-based biochemistry for food preservation, a greater variety of meat and milk substitutes from plant-based ingredients.

Land and aqua farming techniques are being employed to manage resources better. Permaculture, a food production system that mimics how plants thrive in natural ecosystems, reduces the waste of resources and increases production efficiency while lowering the chances of diseases affecting plants and vegetables through crop rotation and crop diversification that contributes to healthier soil and improved soil pest control. Vertical farming systems employing aquaponics and hydroponics are soil-less growing processes that are more resource-efficient than other farming techniques, and they use much less water. An added benefit is these controlled environments are usually near the point of consumption, such as urban environments. Agroforestry is a land-use management system that combines trees, shrubs, crops, and animals on the same land, increasing crop yields and decreasing the need for chemical fertilizers and pesticides. Bioremediation uses microbes to extract pollutants from soil and water. Emerging aquafarming techniques include systems that create an upwelling of cooler waters to stimulate algal growth that enables enhanced seaweed production.

Filling gaps in the world’s food web requires unlearning some tastes and preferences, and evidence abounds that consumers’ food preferences are changing. Plant-based diets are hitting both ends of the food spectrum. High-end eateries are putting out vegan tasting menus, and fast food joints are serving up fried vegan chicken and meatless burgers.

The amount of meat eaten globally is growing, but less so in more prosperous countries than poorer ones. The share of people who identify as vegetarian, vegan, or “flexitarian”—meaning their diet is centered on plants but not entirely eschew animals’ eating—is rising. In Britain, the number of vegans more than quadrupled from 2014 to 2019.

These shifting values represent a moral statement: the belief that participating in the hyper-rationalized, hyper-calorific, hyper-processed industrial first-world food system is wrong. People want what they eat to say good things—both to others and to themselves. This is neither an ignoble desire nor a new one. There are dietary restrictions set down in Leviticus and Deuteronomy.

What will a slap-up menu from 2021 look like to people in 100 years? They may marvel at the idea of a slab of ribs when the meat they eat has never seen a bone, skeleton, or even a blood vessel. They may pity dining choices limited to a small number of living creatures—no fried, giant crickets, or cultured, cured panda ham. They may be astounded at fruits and vegetables sourced from far away rather than coming—as all the finest produce does—from a farm just a few floors below the restaurant. They may shudder at the risks of eating line-caught fish or grow envious at the idea of a world where the climate allowed coffee to come from beans grown on hillsides rather than from yeast which still doesn’t quite get the flavonoids right despite a century of genetic tinkering.

Some will deem the cruelty and environmental damage done by their ancestors’ diets unimaginable and unforgivable. Some will be thankful that the technologies described above have become mainstream. In either case, it will be evidence that humankind is managing tolerably well, both delighting the palate and lying lightly on the conscience.

The Business Imperative: What’s the Bigger Picture?

My accidental journey to becoming a foresight professional started with a business need and a fortuitous visit to a futurist conference.

In 2014 I was asked to step out of the day-to-day of the business I helped launch and assume the new role of Chief Strategy Officer.  The role was mine to define, but it rose out of the need for our organization, a provider of financial services, to become deliberate in our growth.  We had grown from a business plan in 2007 to a balance sheet that experienced 1000% growth and made the Inc. 500 in 2012. I was struggling to find ways to somehow see the bigger picture, but I knew our clients, community-based financial institutions, were disappearing at the rate of one a day and our products and services alone were not going to reverse this course. 

My business coach was a member of the World Future Society and she invited me to join her at their annual conference in 2014.  She told me to float in and out of as many sessions as I could to get a flavor for the discussions. On that Saturday, I attended presentations from foresters, military strategists, educators, spiritualists, and sci-fi authors covering an incredibly diverse range of topics.  I strayed in and out of almost all the sessions, and what struck me was how many of the same trends were influencing the future of their respective industry, albeit with different implications. 

A New Toolkit: How Can I Identify Signals of Change?

I took it all in, and the following week my coach called me to debrief.  I told her it was the most mentally stimulating conference I had ever attended.  As I reflected on what I experienced, my main conclusion was that while each industry was facing a complex and uncertain future, there were a far smaller set of trends, that if understood and followed, could provide me with insights that could allow me to articulate possible futures for my industry and company.  The following year I attended formal training where I learned about biases and practiced environmental scanning, trend definition and implications, pattern recognition, and scenario development.

A New Approach:  What’s My New Purpose?

With the knowledge of trends and a foresight toolkit, I felt equipped with a new way to approach my work.  My role and work continued to transform which resulted in my pursuit of two specific purposes. 

1. Create a diverse set of possible future states that allowed our company to develop strategy within a context.  For the first time we could create a vision of our preferred future and strategies to intercept that future. Our planning discussions centered around the implications of key trends and our SWOT analysis was conducted in relation to those key trends.
2. Create a future-focused organization, which resulted from my desire to practice and become more proficient with the tools.  I learn best when I teach methods to others. So, I took six people out of their day jobs for a two-hour lunch and learn to introduce them to foresight and share the initiative.  We then met for an hour every two weeks for six months where we defined an issue to focus on, “the future of lending”, learned to collectively scan, analyze trends, identify first and second order implications through the use of the futures wheel, and drafted three scenarios.  The team then presented the scenarios to the executive team as a group of subject-matter experts to inform the company’s 2016 strategic plan. The executive team found the scenarios provocative and thought provoking. This was also the first time these team members had the opportunity to present to the executive team.

A Fraud Analyst, A Collections Representative, and a Marketer Walk into a Bar: What’s Their Common Language?

My first team was made up of a fraud analyst, collections representative, financial analyst, customer service representative, credit underwriter, and marketer.  They were from diverse cultures and crossed three generations. The month after they presented to the executive team, they were asked to talk about their experience at the monthly all-staff meeting.  I asked employees to see me if they were interested in joining a second round of foresight. I received responses from four employees who wanted to repeat the experience and 15 new participants. 

Over the next 18 months, I led three rounds of foresight training and when the company was sold in early 2018, half of all employees had gone through the program.  The most interesting observation for me was how the language of foresight made its way into project teams, especially when the team was issue-solving and considering alternatives.

A Look Into My Future: What’s Next?

I have since moved on to a community-based financial institution, and we’re committed to avoiding the plight of the “one a week” in our industry that disappear through a sale or merger.  While the context foresight provides is critical in mapping out our next 36 months, I’m more convinced than ever before that our success hinges on our ability to successfully integrate strategic foresight into the organization:

• Creating awareness around our biases
• Understand how disruption is born from shifting values structures, and a way in which to identify those shifts
• Look beyond manifestations and ask “why?”
• Challenge each “why?” by asking “if it’s true, then what?” 

Whichever combination of futures unfold, one thing is for certain, my future is to be seen leading from a place of curiosity and as a fellow explorer.

This blogpost was first published on February 2, 2020 by Kedge in their Futures Speaks blog.

I was thrilled to have the opportunity to speak with Terry Ammons on his Groundbanking podcast and share how Sunrise Banks is expanding its mission to empower financial wellness through partnerships with FinTechs. Check it out on iTunes, Spotify, or his website here: https://lnkd.in/dzWmgtg #fintech #communitybanks #financialwellness

An article in The Atlantic earlier this month reviewed the origins of sharing in society and concluded two things – the sharing economy was the norm, not the exception for most of human existence, and today’s sharing economy is not really a sharing economy.

While it appears novel today, sharing in society has been taking place since the times of the hunter-gatherers. Work by Lewis, Vinicius, Strods, Mace, and Migliano (2014) say these societies adopted the social norm of ‘demand-sharing’, whereby food brought into camps were claimed and divided among group members, even those who rarely hunted.

This is explained by the nomadic lifestyle inherent in the hunter-gatherer society. Families who shared while on the move through widely varying climates survived, while non-sharing and sedentary families tended to die off. As civilization migrated to an agrarian society, towns sprung up, trades specialized, homesteads were established and the idea of private property took hold.

Today, globalization is transforming the aspirational futures of millions of citizens of developing nations. These aspirations will help fuel the growth of the middle class in Africa and the Middle East to leapfrog in technology, entrepreneurship, and educational models. The Organization for Economic Cooperation and Development (OECD) forecasts the world’s middle class will grow from 2 billion to almost 5 billion people by 2030, with most of that growth coming from developing nations. The world’s buying power is shifting toward this growing middle class and these aspirations will fuel the demand for assets.

The sharing economy that has emerged recently is remarkable in the face of globalization, but the basic necessity driving social norms that allow ‘sharing’ are little changed from the early days.  It’s survival.  Today the threat is not death by starvation, it’s running out of usable natural resources.

Today’s ‘sharing economy’ is in reality an extension of flea markets, swap meets, garage sales, car boot sales, and second-hand shops.  The difference is that today this system is internet-enabled, accessible through mobile technology, and promoted through social media.  Known as ‘collaborative consumption’, it doesn’t involve sharing in the pure sense, but involves “consumers” and “obtainers”, who do not only “obtain” but also “provide” resources to others.  As the Atlantic concludes, “Ownership is still private; everything is rented, not truly shared. The sharing economy might be a significant step toward more efficiently tapping into the wealth of physical things owned by individuals—as opposed to corporations—but it’s still vastly different from the kind of sharing that defined humanity for tens of thousands of years.”

Today sustainable consumption is forming a virtuous partnership with collaborative consumption for the benefit of mankind.

After the New England Patriots earned another trip the to Super Bowl, CBS aired the premier of Hunted.  For those who are unfamiliar with the show’s premise, “Hunted follows nine teams of two in a real-life manhunt as they attempt the nearly impossible task of disappearing in today’s vast digital world as highly skilled investigators combine state-of-the-art tracking methods with traditional tactics to pursue and catch them. From searching their targets’ homes and scouring their internet and cell phone histories, to identifying behavioral patterns, Hunters in the field and Command Center investigators work together to identify clues to potential hiding places and collaborators that can ultimately lead to capture.”

What’s fascinating to me about the show isn’t the game, it’s the technology available to both the law enforcement teams and the contestants that make it virtually impossible to escape traceability.  It’s not only the tools at the disposal of law enforcement but also the tremendous digital footprint we generate continuously when we possess operating computing and mobile devices.

Last evening I read in Bruce Schneier’s book Data and Goliath, that by using public data from the 1990 census, a computer scientist found that 87% of the U.S. population could likely be uniquely identified by their five-digit ZIP code combined with their gender and date of birth.  We’re not talking deep dark personal data here.  Upon reflection, I guess this shouldn’t surprise me too much. According the the US Postal Service, there are 7,489 people in the average zip code, so the odds of one of 7,489 people being male and having my birth date are really small.  What does fascinate me is the means to store and process the data so cheaply enables a data scientist with various lists to identify me.

Does the sharing economy use this type of data and analysis?  Absolutely.  In fact, it relies on it.

I have spent the better part of my weekend reading many fine posts, papers, and articles on trust. The more I read, the more I believe that trust is contextual – it has different meanings based on the situation one is trying to define it.

I’m curious in your response.  Complete the sentence, “I define trust as…

Today I’ve been pondering a comment I overheard recently – “the internet is made up of  only marketplaces and communities.”  Okay, profound, but isn’t the real world made up of marketplaces and communities too?

Out of this background, I’ve been thinking about players who have successfully turned a marketplace into a community.  Big sharing economy websites like Uber and Airbnb have created a situation where money is dealt with in advance, so the experience, when it occurs, goes from being transactional to social.  When people act on a social level, they are more open with each other and can build relationships.

Is it as simple as the act of changing money that takes the joy out of experiences?

Boy, I’m glad I got that out of my system…

The Sharing Economy (or the Gig Economy, or the Collaborative Economy) is a model that’s disrupting inefficient industries in ways that provide a more convenient experience for the consumer and change the nature of work for the provider.  The Economics and Statistics Administration of the U.S. Commerce Department issued a report in June 2016 defines this sector through the four following characteristics:

• They use information technology (IT systems), typically available via web-based platforms, such as mobile “apps” on Internet- enabled devices, to facilitate peer-to-peer transactions.
• They rely on user-based rating systems for quality control, ensuring a level of trust between consumers and service providers who have not previously met.
• They offer the workers who provide services via digital matching platforms flexibility in deciding their typical working hours.
• To the extent that tools and assets are necessary to provide a service, digital matching firms rely on the workers using their own.

As the implications of the sharing economy are being debated, one area is getting a good amount of focus from researchers and the press.  It relates to whether the sharing economy is simply bringing more wage-earning opportunities to more people, or whether its net effect is the displacement of traditionally secure jobs and the creation of a land of part-time, low-paid work.

I believe it’s in this debate that reputation, of both the buyers and sellers, will prohibit a race to the bottom in terms of quality provided by the provider and lowest price provided by the buyer.  In other words, a favorable provider reputation will extract value out of this efficient value chain through a higher demand for services which the provider can ask a higher price for than a similar provider with an unfavorable reputation or none at all. Conversely, a favorable buyer reputation will demonstrate value for the buyer through more options at a lower cost than a buyer with a limited or unfavorable reputation.

I think it’s time to explore the notion of online reputation.  More to come.