WTF: A Financial Needs Analysis and Fintech Short Story

The economy was booming in the summer of 2037. Birds were chirping, the sun was warm and welcoming, while the city was a buzz of electrified productivity.

Money flowed like never before, sweeping upwards society's living standards along with it. A state attained by compromising privacy for spending power; where all purchases made were automatically transacted as long term debts spanning decades.

"Here's your 0.2 cents Mocha!", beamed the barista. As in, 0.2 cents per day for the next 5 years. Unhinged debt cause the Global Economic Crisis of 2008, but temper the beast with near perfect customer and retailer financial data transparency to manage extremes; we get an economic nirvana.

The leash came in the form of a Financial Needs Analysis (FNA) assessment; FNA was introduced at the turn of the 21st century with a noble notion of ensuring that customers invest only on financial products that they truly needed both psychologically and from an affordability standpoint. Mostly applied to insurance protection, mutual fund and investment decisions, given the risky nature of the instrument; and also to counter false promises made by agents.

So virtuous in intent that governments decided to extend the practice to all purchases beginning 2030. Meaning, one can only buy items that they can afford, befitting their economic station in current and future life, as predicted by available data provided.

The long term debts allowed liquidity to flood the market and the economy kicked off another S-curve of growth. Some say limited only by available resources and human greed; and thus greed was put in check with FNA!

With wide spread adoption of government backed Distributed Ledger, Open Banking, under-the-skin electronic RFID tags and across the board retail API integration; allowed for KYC (Know Your Customer) processes to be immediately executed and financial needs available in real time. .

Approval and affordability assessments were instantaneous!

Advance Neural models primed with psychometric profiles siphoned from social media and bio-metrics for health also accurately predicted how much potential earnings a person may make in their lifetime.

No more manual questionnaires with page after pages equivalent of a personal financial strip tease.

Unfortunately, the consumer's financial status was also projected forward given the available computing power to crunch the numbers; resulting in constrained buying choices as well as limits being imposed on the consumer and enforceable by law.

“I mean, you can’t have your cake and eat it”, the politicians and economists argued, while human rights and privacy activists rallied before this became law.

“We have the right to be poor!”, 'Pro-Choicers' yelled.

“Debt for Life!”, countered the dissenting "Pro-Being-in-Debt-for-Life" camp in return.

Jokes on "Pro-Choice" versus "Pro-Life" Debtors quickly became the favorite of late night show hosts. As in, having the freedom and "choice" to be screwed financially due to your own ignorance versus being in debt for life but allowing algorithms to put on splurging breaks for you.

To ensure the economy do not suffer another 2008 debt fueled Global Financial Crisis; led by Lithuania and soon followed by most developed nations, the mechanics were backed with legislation. The people voted, and the rest is history. The law ensured consumer spending sustainability and in turn economic growth perpetuity sans volatility.

Businesses rapidly invested in technology to take advantage of the legislation and access to a potential buyer’s purchasing power data in real-time. Besides the loss in financial privacy, the other drawback was the compounding nature of debt, and with every new purchase, the consumer’s choices became narrower.

 “I’m sorry sir, but you can’t afford that”, droned the worn out sales agents with plastic smiles in the early days of implementation.

Thankfully, retailers realized very quickly that to say “NO” upfront was really bad CX (Customer Experience). So the real time purchasing power data was used to steer the buyer towards alternate affordable choices instead. This also allowed business partnerships to flourish and economist’s rejoiced as their dream of low transaction cost market matching came true.

Retailers celebrated too because they know EXACTLY what the customers could afford, and even if the business goes bankrupt due to mismanagement, long term assets in their balance sheet is worth something; especially when backed by another law that mandated an insurance for every purchase made in the event of death or disability. The law also included provisions to automatically vary insurance coverage and vis-à-vis premiums as financial exposures evolve over a consumer's lifetime.

A capitalistic nirvana edified by technology, driven by sustainable debt, protected by insurance and legislation.

In this economic nirvana lived Jon Mason; a successful executive, wife, two kids, and a penchant for the occasional escapade with open minded interns. Earning high six figure income with yearly growth exceeding inflation and prevailing borrowing interest rates combined - the world was his oyster.

Sipping a cup of coffee with Eric at the office lounge, he was hoping that his colleague would just leave by now; Jessica was about to walk in.

“They offered me a Kia, can you believe it!” Eric was fuming about how his choice was rerouted, a common side effect of real time purchasing power data and financial needs matching.

As financial needs mismatching is now against the law, all retailers reroute purchases to the next best option that meets the consumers' need. Retailers have no place to waffle and had to play ball as all transactions are also committed into the government run distributed ledger of transactions. 

Eric’s been excited about the new BMW for months, and as he walked into the showroom the sales agent’s Augmented Reality projector projected a Kia hologram instead.

All Eric needed to do was say “YES” or “NO”, it was that easy and instantaneous.

“Shouldn’t you be worried about the carcinoma? Get your priorities right bro”, Jon chided.

“Give me a break Jon!”, and Eric left in a gruff before frowning at Jon for bringing up his condition. You see, Eric's a complainer, so the whole office knew about it, and Jon was the type that knew how to push everyone's buttons.

Eric’s purchasing power crashed as the carcinoma detection meant he’ll need to expend income and draw on his insurance for treatment. His financial status adjusted immediately as the medical records triggered smart contract conditions in the distributed ledger.

Well, at least that got rid of Eric, Jon thought to himself, and Jessica appeared as expected.

Jon cherished the morning ritual of seeing Jessica come in, he felt like a teenager all over again, stealing a look from the corner of his eye while appearing nonchalant to avoid workmates from noticing. He's managed to even avoid being seen in 'selfies' and 'we-fies' together in the company's social media and God forbid, Jessica's personal social media.

The plans to the island getaway this weekend was all set, and Jessica’s wafting perfume only heightened Jon’s anticipation.

---

Thursday and Friday crawled by for Jon but they’re now finally at the airport.

“I’m sorry sir, you’re no longer eligible for first class, but we have a window seat in economy just for you and your partner”

“Hold on a second, wait…” Jon stopped mid-sentence. 

Why? What happened? Was racing through his mind, Jon was already panicking for a seasoned level headed executive.

His portfolio was substantial given the amount of investment and savings he’s accumulated the last 20 years. He quickly accessed his financial portfolio, while his mind bounced through a multitude of scenarios.

Did the Crypto market crashed? Or the Chinese President finally WeChat something really horrible about the Indian Prime Minister’s wife?

Rapidly tapping through his financial apps; everything seems OK, money’s still there; there’s nothing really out of the ordinary in the market.

Still confused, Jon looked up and caught a glimpse of his girlfriend smiling to herself with that silly glazed look into the horizon of someone watching videos through a pair of personal Augmented Reality sun glasses.

He should really stop dating younger women, he grumbled as his frustration worsened; Jon's meandering thoughts were interrupted when his mobile buzzed a notification.

Jessica just uploaded a selfie of them together with the caption, “Leaving on a jet plane with Mr. Big!” 

A childish reference to Sex in the City from more than 30 years ago almost blew his lid...

...but worst, the privacy setting was set to public, and facial recognition tagged Jon.

"WTF..."

End.

Disclaimer: Nothing to do with MetLife, but was inspired by new regulator guidance on Financial Needs Analysis being released across Asia. Then it dawned on me, why just the financial services industry if the intent is to protect the customer, why not everything else and how would the world be?