Luxembourg: The New User-Friendliness

The term user-friendly seems to have first emerged in the 1970s, with some sources crediting a 1976 paper on something called the "G-EXEC system" and others saying that Harlan Crowder, an American software designer, coined the term in 1972. Either way, it comes from the computing world, where it is still at home: today, we speak of apps, websites, and robo-advisor platforms as being user-friendly. (Or not).

Since its debut, however, the term's realm of usage seems to have broadened, as is evidenced by statements like a marketplace should be user-friendly. I suppose that this makes sense because, ever since the 1990s, there have been marketplaces that are strictly online, complete with vendors, shoppers, and advertisers. Being online, their shoppers are also users, so the whole experience can be user-friendly.

Expansions in the definition of this term are, I would argue, enabled by changes in what is conceivable as "digital" at all. Originally it was keyboards and basic software, but then it grew to whole social spaces, like the nuanced and transactional marketplace. That was a big change for just two decades—and now here we are, again two decades later, and the change is equally remarkable. Digitalness in 2018 is more rampant than ever, it's embedded deeply in our infrastructure, and I feel enabled to say that user-friendliness can be measured in something as broad as the whole world of finance.

Indeed, the workings of finance have blurred with computing down to a minute level: there is no banking, trading, etc. in their modern senses without apps and websites or, at the very least, computer programmes. Somewhere along the way, merely participating in a financial transaction started to mean being implicated in complex technological operations. In fact, you don't even need to be in front of a computer to be a user, anymore. By virtue of having a bank account here, a payment app there, or maybe an online trading portfolio, you're always connected, always concerned, always a user.

In this article I want to trace the past, current, and future forms of user-friendliness. Such a flexible, durable, and persistently relevant term merits attention, and I call on fintechs to take note: user-friendliness has defined us as much as we have defined it; it is extremely dear to customers; it can now describe everything from a keyboard to a zoo; and it's about far more than just an easy-to-use interface.

The couch potato dream

In the 1990s, one of advertisers' favourite images was of people doing chores without leaving the house—all thanks to computers. From paying bills to buying concert tickets, ease seemed to be what our culture, embodied in Homer Simpson of course, wanted most of all. Certainly, in my lifetime, doing annoying tasks from your own sofa has been widely accepted as the ultimate dream—the ultimate user-friendliness.

But this is, at the same time, a problematic simplification. Ease has never been more important than security, for example, and what really allowed you to enjoy your eBay purchases from your own sofa was knowing that your online payment was safe and that the seller was legitimate. There were certainly instances of fraud back in the '90s, but it was, in a sense, a simpler time. New online capabilities were not too difficult to grasp: you mostly knew where the digital part ended and where reality began. For example, you'd book a concert ticket online and then print a real ticket and go to the actual show. Or you'd send mail online, and a real person somewhere else would read your exact words.

Today's wave of fintech is no longer so simple, however, and users know it. It isn't just ordering cat food from Amazon anymore: fund managers are settling transactions on blockchain platforms; e-commerce sites are onboarding users using tools that automate complex KYC/AML regulation compliance; insurers are using big data to learn their clients' lifestyles and to adjust rates and rewards accordingly; banks are using chatbots to disseminate information.

Incumbent in this change, again, is what is digital. The definition has broadened from keyboards and software (1970s onwards), to websites and shopping (1990s onwards), to fund settlement and regulatory compliance (today).

And as the stakes go up, users are more suspicious about the ease that companies continue to promise. Indeed, they can no longer so easily see where the digital parts ends and where reality begins. They know (vaguely) that KYC/AML regulation is real, but how a platform complies with it via automated onboarding is pretty much impossible to measure from your own sofa.

Look past the dazzling technology

All of which brings me to my point: the future of user-friendliness is not ease. It's integrity. Many fintechs fail because they are too dazzled by the worlds busted open by new technologies like digital ledgers, artificial intelligence, and so on. They're still working on the Homer Simpson model: Imagine doing this without leaving the sofa! They forget to properly contextualise themselves in their sector, to find the right expertise, to find a real purpose in the world itself. Tech for tech's sake is a dark path.

And finding contextualisation and purpose is always getting harder. Let's compare Amazon to a young fintech I've heard about recently. What’s staggering is how much simpler Amazon is. Sure, the global tech giant is worth billions, but its business can be summed up in about three words: selling stuff online. In contrast, this young fintech uses natural language processing to trawl social media feeds for data, which it then translates into emotional output, from which it extrapolates concrete stock tips. I mean, go back in time to the '90s and describe that to someone! You'll be asked to leave the house immediately, or at least to stop blocking the TV. There's a new episode of Friends on.

Indeed, consumers are now confronted with whole new types of companies. Forget about grandpa being confused with his new phone—people in their twenties are confused these days by some of these abstract companies. Online shopping was, in comparison, easy to stomach because the concept of shopping was so established. But people today have learned to be sceptical: our first question is no longer Do I have to leave to sofa for this? but rather What does this company actually do? (After that, it's How are they making money off of this? and How is my data being used? and Are these good people?) In other words, we now identify more with Lisa Simpson than with her father.

Therefore, fintechs, you need to see through the buzzword mania. People get all jazzed up about blockchain but, ultimately, customers don't respect blockchain. They might respect a platform that uses blockchain to do something, but it would depend entirely on the "something".

User-friendliness today is still about ease, but it's also about safety, moral worth, and relevance. This is how finance itself is evolving, too. To return to the idea that finance itself should be user-friendly: it's not just websites and apps that can be user-friendly, but (for example) regulations. Consider new IDD regulation in the insurance sector. Before you invest in an insurance product, the distributor now has to assess your profile and match you with a product that suits you—if there is one. If you're about to do something stupid, they'll stop you! Or at least warn you. This makes investing far more friendly to users by offering them protection. By making them secure. And trust me, this is far dearer to customers than being a couch potato is.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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