Anish Acharya@illscience
profitable apathy
if you thought saas-pocalypse was bad wait until computer use comes for consumer financial services and vampire squids the whole thing
there are many, many profit pools that depend on apathy/laziness and a poorly informed customer - the industry that brought you the efficient market depends on an inefficient consumer to eat
first the models will systematically exploit every customer subsidy (transfer bonuses / teaser rates), move deposits to maximize yield, open and close accounts on a whim - this industry has operated with asymmetric bureaucratic warfare through paperwork and sheer friction and the models will cut through this like a hot knife through butter
and the model will neatly route around late fees, interest charges, overdrafts, expiration of teaser rates, and any mispriced debt that can be refinanced in the market - literally just moving people out of expensive debt and into cheap debt (that they are already approved for!) would save many american families thousands per year
meanwhile vps and managers at these companies will hold on to their shrinking revenue lines the same way that executives at carriers protected SMS revenue as it collapsed to zero - they have zero chance of sticking the landing on new technology - and the smart ones will likely go for extending regulatory capture into the agentic economy
so much of the consumer financial services ecosystem is marketing via subsidies on one end and profit maximization via customer apathy on the other, and it will collapse under its own weight as the agents pick it apart
ironically the industry response to plaid was a misguided attempt to protect this very "profitable apathy" by disallowing APIs and in the end it will be agents that kill them clicking around their own UI, not the fintech aggregators they so greatly feared
the end state of this is likely a headless auction where every time you swipe your credit card, some lender bids on taking the risk and capturing the profit from that transaction - it will be a much more efficient system that will work much better for consumers, and many pockets of financial services are going to see contraction as a result
aa + 5.5
