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.
- 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.