18 August, 2020
Autonomous finance: our team's vision for the future
Vivek Madlani, CEO and cofounder.
We’re living in an age where technology is making many of our everyday experiences simpler, safer, and more convenient. Soon you’ll be able to ride in an autonomous, self driving car that will pick you up and safely drop you off at your desired destination.
As part of this shift, a new type of financial experience is evolving - one that we call Autonomous Finance.
Over the last few decades we’ve seen a lot of traditional in-person activities such as opening a bank account transformed into simple, delightful app experiences. Most of the high street banks now have apps that can serve most of the banking needs of their customers.
A lot of work that has taken place has been around laying the infrastructure for these digital experiences - such as identifying customers and moving money electronically. We call this the “infrastructure layer” of finance and it involves areas such as open banking and automated identity verification. As this infrastructure has evolved, financial regulators have become increasingly open to the use of more sophisticated technology in finance". This has been driving the “every company is a fintech” trend popularised by some.
Here, in the UK, this means we can now set up a bank account in as little as 24 clicks or an investment ISA in less than 20 steps. Essentially, once we decide that we want to save, invest or transfer, making it happen has never been easier.
But how do we make those decisions in the first place? The step before - figuring out what to do with your money - still involves a lot of friction. How much to save or invest? Which accounts are best, and when should I make my moves?
Multiply exists to answer these questions. Technology can now make decisions where once human beings were required.
We’re seeing a lot of this in the utilities space already. It is now common to switch energy suppliers via your current account rather than by going direct or through a price comparison site. It is only a matter of time before this extends to other types of products. Advancements in technology will help fill gaps in people’s skill, will, or time to help them make financial decisions, like which funds are best for them, or the ins and out of different tax wrappers.
The end point of this is Autonomous Finance: a person’s money is moved to the right products at precisely the right time automatically in line with what they want and what they need.
Autonomous finance is where the progress that has been made with infrastructure is combined with the progress made in computer decision making and artificial intelligence. It provides a customer experience that figures out what to do, and then does it for you.
In the UK there is already a name for this financial intelligence: regulated financial advice. Multiply has spent the last 4 years building technology to automatically generate, risk manage and scale financial advice to as many people as possible.
We’ve solved the decision making part of Autonomous Finance. And with the launch of Multiply Accounts, we’re solving the infrastructure part too.
As an experience, customers will tell us their desired futures, information about how much they spend, how much they work, their goals (such as buying a home), and that’s it. After that our product works out whether they should be saving, investing, purchasing life insurance, or whatever is required to hit their goals. We tell our users the specific products that they can automatically set up and send funds to. Our users then only need to tell us when something changes - if they get married, for example - whilst we automatically help them achieve their goals.
The results of this are profound.
The default setting in personal finance is bad. Most people don’t make the best use of the products available to them. They miss out on optimal returns for what they’ve earned. Very rarely are their finances aligned with the future that they want, and the majority of people don’t have the time, experience or knowledge to plug the gap.
Autonomous finance will change this - by moving money to the right accounts in the right amounts at the right time, optimised finances will no longer be a luxury.
This is our vision at Multiply - to make the default setting for finance great, for everyone.