I recently came across the concept of Financial Wellness in a Ted Ex talk by Nadeem Shaikh, who has also written about it here and brought together some further reading about it here.
You can see the Ted talk here.
Nadeem Shaikh’s argument is that a combination of technology and consumer needs has come together to generate what he calls a paradigm shift. Fascinating and potentially world changing in terms of development and the achieved of the sustainable development goals.
Consumers are increasingly looking for products and services that do not just cater to discrete need but to their overall financial wellness. This includes not only what we think of traditional financial services, but also insurance, health, education and, in some cases, energy. This convergence of needs applies to all consumers in the developed and developing world alike, whether they are affluent or under/unbanked.
A paradigm shift toward financial wellness is now possible thanks to the emergence of new business and technology models. While the traditional approach to financial inclusion has involved bringing low-cost financial products to the market, a new generation of startups is creating solutions that embed themselves in consumers’ lives instead of treating finance as a pure utility, embracing a 21st-century approach to digital financial services.
What these business models have in common is that they are essentially customer-centric rather than product-centric. They are using technology, behavior science and new business models to improve customers’ well-being instead of seeking a fresh market for tried-and-true products. And they are doing so with the goal of profitable growth, ensuring an incentive to serve the customer while finding new ways to remain relevant and compelling. For them, every customer is a profitable one. regardless of where they are on the financial spectrum.
Robin Stewart 