In 2014, the financial services industry is looking to technology as a vital link between financial capability and under-resourced communities. Investments in these technologies are imperative to alleviate economic disparity and create better, safer options for the underbanked. Bridging the fiscal divide is a challenge we all share.
The truth is that the fundamentals of family economic success are simply not taught as core components of our public or private education systems at any level.
Until the recent creation of the Consumer Financial Protection Bureau in 2011, there was no single mandated federal government agency responsible for protecting, much less nurturing, family and consumer livelihoods.
Innovation means asking the question of how we use technology and available resources to bring to scale and make accessible the impact of financial health and coaching into our everyday lives.
The good news is that tech companies and social justice movers alike are recognizing that the keys to financial empowerment are already in people’s hands, via their smartphones.
Smartphones often serve as the sole computing device for low- and moderate-income individuals and families. A recent neighborhood survey conducted by the nonprofit Mission Economic Development Agency (MEDA) in San Francisco’s Mission District showed that, while 74 percent of homes had access to the Internet—in the heart of tech savvy SF—95 percent of homes did have access to smartphones.
So, how can technology take advantage of this opportunity to replicate the intimacy and immediacy of a one-on-one financial coaching session, complete with next steps, goal-oriented encouragement, cultural competency and real-time technical support and proficiency?
MEDAPulse, a multilingual communication app and winner of the recent Cities for Financial Empowerment’s national hackathon competition, is a step in the right direction, along with the runners up in the competition. There was much interest in developing financial apps for the underbanked: regional hackathons took place in Chicago, New York and San Francisco throughout the summer, drawing in over 110 participants. Regional winners then presented their ideas virtually to a panel of judges at a site hosted by Bloomberg LP in New York.
Here is the breakdown of the apps developed by the final three nonprofits and tech teams at the hackathon:
San Francisco: Developed MEDAPulse, a web application that is built in Rails, AJAX and hosted on Ninefold. The application creates visual action plans and enables coaches to send texts to clients to remind them to complete steps (to further their goals). Clients can now receive high-impact, low-touch financial feedback and next steps no matter where they are in the palm of their hands, demystifying the financial system through real-life goals and daily practice.
New York: Metas.org is an online platform that uses a badging system to help clients stay engaged with financial counseling services and achieve long-term financial goals. Through the completion of modules, based on the Financial Empowerment Center counseling model, participants complete quests and earn badges to compete for recognition and prizes.
Chicago: Developed an app that facilitates credit building and improves communication between clients and their counselors.
These apps are powerful communication tools for financial coaches to track the progress of their clients’ fiscal action plans by incorporating such features as sending automated, personalized, reminders to help keep clients on financial track. The two-way functionality allows both coaches and clients to ask questions and provide feedback immediately, driving individual client goals towards completion without sacrificing quality and situational complexity.
Frequency and content of apps are amendable and defined by coaches and clients during standard, in-person sessions, expanding the versatility and sustainability of the live coaching experience through interactive, mobile engagement.
Tech is poised to help the underbanked. There is no better time than the present.