Transacting, Fast and Slow! A Kahneman analogy to the future of fintechs

Daniel Kahneman’s ‘Thinking, Fast and Slow’ is one of the most popular books that got people thinking about heuristics & biases. When we think about it in the context of fintechs and banks, it has more than a few lessons on how consumers engage on a myriad of platforms to make decisions on their finances.

Here are three that stand out to me.

1. The Fast & Intuitive along with the Slow & Analytical: 2 systems in parallel!

The hot topic in the race for fin-tech and banking apps is the need for instant, easy and one-touch methods for payments & updates. This can be for anything from a QR code purchase to an installment payment plan or booking a deposit to making a bill payment. This infrastructure and basket of functionalities is getting commoditized fast. Features have become standard and there will be little to differentiate between apps. That’s where the pivot to content, which is credible, richer, and relevant will start taking the lead. Addressing the slow & analytical mind with a single, compelling, content-rich storefront that prevents having multiple windows open to make a decision.

2. WYSIATI (What You See Is All There Is)

SBI has branded their YONO – ‘You Only Need One’ app with this intent. For a while now, clients have wanted minimal entities to meet their financial requirements. Some of the niche fin-tech players will find better adoption if they are white labelled and inside a finance heavyweight than being standalone. As an instance, the information required to make a decision on a loan or mutual fund cannot sit in a separate website while the transaction journey is happening elsewhere.

3. Cognitive ease, the path of least resistance

Let’s face it! The world of finance, banking & treasury is complex. That doesn’t mean the need for simplifying and minimizing the clutter has disappeared. The myriad choices – combined with FOMO (fear of missing out) – makes choosing the right financial product quite an insecure decision as well. Being consumer-centric, transparent & personalized is inevitable. Providing comprehensive content tailored to occasion and persona can possibly even cannibalize revenues for banks. The trick will be to balance it out well.

Helping consumers make such financial decisions with ease will require

1. Consolidation of consumer data
2. Third-party data that provides context to the consumer data
3. Content which is credible & trustworthy

Bringing this to reality is 90% business intent and 10% technical expertise.

A word of caution – don’t try it without the 10%!