04 October 2022 |

Why Kim Kardashian’s SEC Fine Isn’t the Point


We all saw the news of Kim Kardashian being fined $1.26 million for crypto promotion. 

The headlines will draw your attention to questions like: Why is Kim K fined and not Matt DamonWhat about Elon MuskWho’s to blame for an influencer taking $250,000 in exchange for a single Instagram story promotion

Valid questions, sure. But we’re completely missing the point

Buzzing celebrities and glamorizing crypto investing shifts our focus away from the opportunity to shed light on financial education and content to help more people sustainably build wealth

I want to see fintech companies promote real financial education – like the kind that cautions others on those who prey on typically marginalized communities for a quick buck. 

We all know how much Kim Kardashian is worth. But did you know that 860 million people will live below the poverty line in 2022?

That’s 263 million more people that live below the poverty line than before the pandemic. 

That’s the equivalent of the entire population of the U.K., France, Germany, and Spain combined. 

The reason it’s easier to want to solve these problems with quick fixes – like promoting crypto investing via an influencer – is that humans are biologically prone to short-term decision-making

As leaders shaping the fintech industry, we must shift our mindset away from short-term thinking and apply it everywhere, like design processes, marketing campaigns, and product launches. 

If we’re going to navigate the financial education threat our world faces skillfully, we need a mindset that allows us to be future-conscious

How do we leverage technology and incorporate it into fintech products that help more users think about day-to-day actions’ ramifications and their impact on future generations? 

It’s called a longpath mentality

And we can leverage the pervasiveness of tech to get users more excited about automating an emergency savings account than a pump-and-dump campaign from celebrities. 

Most often, people will see a problem and say: “Oh great, let’s get in a room with post-it notes and redesign the future we want.” 

That’s not how we solve problems. 

Getting your team into a room to discuss empathy would be best. 

When we think of empathy, we often think about empathy in the present moment. 

To leverage fintech right, we need empathy for the future and past

This is called transgenerational empathy

For example, we can look back at Kim Kardashian’s Instagram story promoting crypto from a year ago and understand that everyone involved should call it wrong. 

The fact is that wrong decision happen to all of us, and understanding that allows us to look at the past and reconcile with it to create a clean slate

It doesn’t mean we shouldn’t hold people like Kim Kardashian and Elon Musk accountable. It means we put their actions within a context that allows us to process them and move forward

So we use empathy as it allows us to connect with the past in a way that will drive actions in the present by us. 

We need to approach embedded finance with empathy and redesign the future we want for users and our economy. 

So one of the things that we have to do at the industry level is to make sure that our tech is built in a behaviorally informed and thoughtful way

Behavioral finance should be a complex operator principle that your leadership pays attention to.

It’s listening for what’s not being said. It’s about getting below the surface and the why behind the actions or behavior. 

So what are the mistakes users make that behavioral finance x fintech can help solve? 

  1. Tunnel vision: We, as humans, tend to get fixated on an idea or plan, and we absolutely cannot deviate from it. 
  2. Overconfidence bias: Believing that we are not prone to biases and somehow above having biases. (This fuels every other bias on the planet). 
  3. Describing Happiness: People are generally poor at explaining what they want and have limited access to what can make them happy. 

Let’s take a personal finance application, for example. Consumers tend to mentally bucket their finances into multiple divisions: Safety netsavingsretirementspending, etc. 

So a simple solution is to add features that subdivide these accounts for users does a lot for their mental stability

And naming one of those accounts something aspiration can 2.5x a user’s likelihood of saving. 

Most healthy behavior comes with a reasonably straightforward process and a personal touch.

It makes all the difference. 

So let’s take the lessons learned from Kim K and apply them to how we’re building a better future for users via our day-to-day actions. 

Because having money isn’t powerKnowledge of money is power.