Name: How to make financial services accessible for underserved communities
Uploaded: 2023-06-07T14:40:51.885Z
Duration: 414.11
Description: Ben Maxim, Chief Digital Strategy & Innovation Officer, MSU Federal Credit Union, joins us to share what business and technology trends excite him the most and talks about how to make financial services more accessible to underserved communities. Stay up to date with the community on https://finovate.com/ Find out more about FinovateSpring on http://www.finovatespring.com/

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Ben Maxim.vtt

English

{{00:00:05}}
David Penn: Hello, I'm David Penn,
research analyst with Finovate.

{{00:00:07}}
We're here at FinovateSpring 2023
in San Francisco, California.

{{00:00:11}}
Joining me now is Ben Maxim and he's the
Chief Digital Strategy and Innovation

{{00:00:14}}
Officer with MSU Federal Credit Union.

{{00:00:17}}
Ben, thanks for stopping by.

{{00:00:18}}
Ben Maxim: Yeah, thanks for having me.

{{00:00:19}}
David Penn: Yeah.

{{00:00:19}}
So first of thought, maybe we
could start off with you telling

{{00:00:21}}
us just a little bit about what
the work that you do at MSU F C U.

{{00:00:23}}
Ben Maxim: Yeah, absolutely.

{{00:00:23}}
So

{{00:00:24}}
We, partner with fintechs is a lot
of the, a lot of the role we also

{{00:00:27}}
build and test our own internal ideas.

{{00:00:28}}
So we, build out prototypes or
partner with fintechs to use their

{{00:00:32}}
technology put in front of our members.

{{00:00:34}}
And get some real early in the
product lifecycle feedback through our

{{00:00:37}}
innovation lab called the Lab and MS.

{{00:00:38}}
U F C U.

{{00:00:39}}
David Penn: Fascinating.

{{00:00:40}}
So there's a lot of things going on here
at Finovate, a lot of different companies.

{{00:00:42}}
Absolutely.

{{00:00:42}}
A lot of different sorts of innovations.

{{00:00:44}}
What are some of the business and
technology trends that are really

{{00:00:46}}
capturing your imagination these days?

{{00:00:47}}
Ben Maxim: Yeah, absolutely.

{{00:00:47}}
So really I think everyone's
talking about ChatGPT and really

{{00:00:51}}
behind, that's generative ai.

{{00:00:52}}
So what can that do to really change
the future of how we work, how we

{{00:00:54}}
interact, how we produce content really.

{{00:00:57}}
So I'm very interested to see
how we have the technology now,

{{00:00:59}}
how do we actually apply it?

{{00:01:00}}
How do the different companies come in
and actually put the use cases to it?

{{00:01:03}}
A lot of exciting up there and I think
there's a lot that can also happen

{{00:01:06}}
with AI and really the personalization
and taking what we used to call PFM

{{00:01:10}}
and making them more insights and more
insight driven and letting you know,

{{00:01:13}}
consumers, users unlock their own data.

{{00:01:15}}
And then also as financial institutions
allowing us to be able be better

{{00:01:18}}
enabled to get our own insights
about our own members as well.

{{00:01:20}}
So anything that's really letting
us as the institution or our users

{{00:01:23}}
unlock data and do something with
it is really what's exciting.

{{00:01:26}}
David Penn: Yeah, there's something else.

{{00:01:27}}
And we're hearing quite a bit
of that here at FinovateSpring.

{{00:01:29}}
Now one of the things that you have been
talking about here in your presentation

{{00:01:32}}
had to do with financial inclusion.

{{00:01:33}}
Absolutely.

{{00:01:33}}
And I'm wondering if maybe you
could share some of the key points

{{00:01:35}}
that you brought up in your talk.

{{00:01:36}}
Ben Maxim: Yeah.

{{00:01:36}}
One of the, interesting being
a, credit union and really most

{{00:01:39}}
community financial institutions were
founded with this kind of sense that

{{00:01:43}}
we're supporting our communities.

{{00:01:44}}
There, there was a failure in the
banking at some point that we're

{{00:01:46}}
trying to solve with an innovative
way to deliver financial services.

{{00:01:48}}
So we were started out of the Great
Depression out of a desk drawer.

{{00:01:51}}
Professors at Michigan State
University couldn't get loans,

{{00:01:53}}
so they pooled together.

{{00:01:55}}
Someone needs a hundred dollars, they
all came and brought $10 each, and then

{{00:01:57}}
there's your loan for a hundred bucks.

{{00:01:59}}
Now fintechs are doing the same thing.

{{00:02:00}}
They've identified different kind
of niches that the big banking

{{00:02:03}}
system is not helping consumers
the way they think they should.

{{00:02:06}}
So really, how do we then
enable our communities?

{{00:02:09}}
How do we provide more financial
access is really the kind of

{{00:02:12}}
qualifier put to financial inclusion.

{{00:02:13}}
So how do you provide more financial
access and how do you provide more

{{00:02:16}}
financial literacy education and
the power to combine those two.

{{00:02:19}}
And then for FinTech and community
financial institutions to

{{00:02:22}}
partner to really deliver that
to their communities is really.

{{00:02:24}}
The key here.

{{00:02:25}}
Yeah, it's interesting.

{{00:02:26}}
David Penn: I always love hearing the, in
the origins of, credit unions, these small

{{00:02:28}}
banks because they're always these just
groups of people coming together, taking

{{00:02:31}}
care of themselves, and then growing
into some, incredible institutions.

{{00:02:34}}
I'm curious, we talk about
personalization, we talk about ai,

{{00:02:37}}
these sorts of things, and then
we talk about financial inclusion.

{{00:02:39}}
And one of the things I'm curious
about is what are some of the things

{{00:02:42}}
that people who are on that under or
unbanked really need out of financial

{{00:02:45}}
services and a lot of things that
financial services seem ready to give

{{00:02:47}}
them, but what do they really need?

{{00:02:49}}
Ben Maxim: Yeah, I think really one
thing we're doing at our institution,

{{00:02:52}}
so we have a team of financial
educators and some of them have come

{{00:02:55}}
from these un underserved communities.

{{00:02:57}}
And what they're saying is, I
don't want the bank to come in and

{{00:03:00}}
tell me what to do with my money.

{{00:03:02}}
I don't want to hear from,
I don't trust the system.

{{00:03:04}}
So how do you get them
to trust the system?

{{00:03:05}}
Is the first thing.

{{00:03:06}}
So yes, we have all these tools, we
have these things, but if no one trusts

{{00:03:09}}
the system, it's not gonna matter.

{{00:03:10}}
So how do you then go talk to the people
in these underserved communities and

{{00:03:13}}
create a product that's tailored to them?

{{00:03:15}}
And I think one of the things that
we talked about in our talk yesterday

{{00:03:17}}
about inclusion is, there is the
sexy money or whatever is going

{{00:03:21}}
towards the high affluent, you can
get the ROI and maybe really quickly.

{{00:03:24}}
Maybe there's not as much ROI
here, so maybe the VC dollars

{{00:03:26}}
aren't being spent this way.

{{00:03:28}}
So how do you then take your success
and then also use that and leverage it

{{00:03:32}}
and, measure the ROI in a different way?

{{00:03:34}}
So you're helping more people,
get more people in the system.

{{00:03:35}}
And then as an financial institution if
we build stronger communities, ultimately

{{00:03:39}}
we're all gonna be stronger for it.

{{00:03:41}}
And, by you having these
technologies helping build the trust.

{{00:03:44}}
And I think that's where the community
of financial institutions have done and

{{00:03:46}}
made some legwork into building that
trust with the underserved communities.

{{00:03:49}}
How do we then leverage that to get
them more trusting of the technology

{{00:03:52}}
that can then help them, but again,
not make, not making sure to take

{{00:03:55}}
one solution for everybody, making
sure it's tailored to that audience.

{{00:03:59}}
David Penn: Yeah.

{{00:03:59}}
It's really interesting.

{{00:03:59}}
We hear a lot of times talk about trust
in, financial services and a lot of it

{{00:04:02}}
takes on some of a high minded kind of
attitude and relatively sophisticated

{{00:04:05}}
folks who've got different theories
about things that we don't think

{{00:04:08}}
about, that fundamental level of.

{{00:04:09}}
I've not ever received great
service from financial service.

{{00:04:11}}
So that's why I don't trust them.

{{00:04:12}}
Absolutely not.

{{00:04:12}}
Something more grand and being
able to get at that most granular

{{00:04:15}}
level is no, we can work together.

{{00:04:16}}
To get things that you want is
something I think that really needs

{{00:04:18}}
to be underscored in the conversation.

{{00:04:19}}
Exactly.

{{00:04:20}}
Absolutely.

{{00:04:20}}
Yeah, absolutely.

{{00:04:21}}
So we talked about some of the
things with regard to financial

{{00:04:23}}
inclusion in terms of barriers.

{{00:04:24}}
We tend to talk about them
socioeconomically for understandable

{{00:04:27}}
reasons, but we also know that there
are other barriers that may have

{{00:04:29}}
to do with age, certainly Sure.

{{00:04:30}}
That have to do with
ethnicity and gender as well.

{{00:04:32}}
And I'm wondering how do we factor
those into this conversation?

{{00:04:34}}
Ben Maxim: Yeah, absolutely.

{{00:04:35}}
So when I first started our innovation
lab, a lot of fintechs you come

{{00:04:37}}
across, they're all we're trying to do.

{{00:04:38}}
Four millennials, gen Z, no
one's doing anything pretty well.

{{00:04:41}}
So we, came across a company called
Silver who was trying to take some of the

{{00:04:45}}
same stuff with financial education and
literacy, but for pre-retirement planning.

{{00:04:49}}
So the founder of that company, her father
had just gone through this experience of

{{00:04:52}}
trying to retire and figure out how to do
Medicare and all these different things.

{{00:04:57}}
That was like a near
impossible process for her.

{{00:04:58}}
And she had all the time and resources
to buy this giant book and read it

{{00:05:01}}
and like still didn't understand it.

{{00:05:02}}
So she wanted to make it simpler, right?

{{00:05:03}}
And provide more access
to the information.

{{00:05:05}}
Another company we partnered
with was during the pandemic.

{{00:05:08}}
Which actually is great for that time, we
had to close our branches video banking

{{00:05:11}}
solution, but it also is an inclusive.

{{00:05:13}}
Solution.

{{00:05:13}}
If you're home bound, you need
someone to drive you to the,

{{00:05:16}}
branch to talk to somebody.

{{00:05:17}}
Now you don't have to wait for
that person to come pick you up.

{{00:05:19}}
You can have your mo, you can do almost
like 95% of what you can do over this

{{00:05:23}}
video experience and then go to an
atm or have somebody get, pick up.

{{00:05:26}}
The actual cash is really
the only thing you can't do.

{{00:05:28}}
But with that video, you can
have that same experience on

{{00:05:30}}
your schedule and your time.

{{00:05:31}}
So that's providing access
for a different group.

{{00:05:33}}
But it could also be for parents.

{{00:05:34}}
It's not just for people who can't drive.

{{00:05:37}}
Maybe you don't wanna load seven
kids in the car or you're at home all

{{00:05:39}}
day and it'd be great to just talk
to someone for five minutes and you

{{00:05:41}}
don't have an hour and a half to get
everyone in the car and go over there.

{{00:05:43}}
So yeah, there, there's all kinds
of ways that you can think of

{{00:05:45}}
access and not just socioeconomic.

{{00:05:47}}
That's absolutely true.

{{00:05:48}}
David Penn: That's great.

{{00:05:49}}
And I really appreciate the
point that you brought up.

{{00:05:50}}
A parent is a subgroup citizen.

{{00:05:52}}
Speak I like my colleague got two young
kids and just hearing the way that she

{{00:05:55}}
has to negotiate her workday with those
two  little kids is just incredible.

{{00:05:58}}
I can imagine how a video option
like that just takes a whole swath

{{00:06:01}}
of trouble off of your plate.

{{00:06:03}}
Exactly.

{{00:06:03}}
Very, interesting.

{{00:06:04}}
And finally by finishing up, we could
talk a little bit more about technologies.

{{00:06:07}}
Again, we talked about generative
AI and, a lot of others.

{{00:06:09}}
Decentralized finance is something
that's still is still hot despite

{{00:06:12}}
some of the setbacks of late.

{{00:06:14}}
Is there a role for decentralized
finance in financial inclusion?

{{00:06:17}}
Ben Maxim: I think so.

{{00:06:18}}
Yes.

{{00:06:18}}
And I think we have the
opportunity to design the future

{{00:06:21}}
of money and the future system.

{{00:06:23}}
And we hopefully will take the opportunity
to learn, take the lessons we've learned

{{00:06:27}}
in the current system and not just
recreate them in the blockchain, right?

{{00:06:31}}
So let's not just create a new
system that's the same as the

{{00:06:33}}
old one with new technology.

{{00:06:34}}
Let's actually create a new system.

{{00:06:35}}
And I think we're at the, we're at
the cusp of being able to do that.

{{00:06:38}}
We just gotta be smart about
it and actually be intentional

{{00:06:40}}
and make those decisions.

{{00:06:42}}
David Penn: Interesting.

{{00:06:42}}
Something to look forward to for sure.

{{00:06:43}}
Yeah, absolutely.

{{00:06:44}}
Thank you for spending
some time talking with us.

{{00:06:45}}
Very appreciate.

{{00:06:45}}
Absolutely.

{{00:06:46}}
Thank you.

{{00:06:46}}
Thank very much.

{{00:06:47}}
And thank you for joining us as

{{00:06:48}}
well.

David Penn: Hello, I'm David Penn,
research analyst with Finovate.

We're here at FinovateSpring 2023
in San Francisco, California.

Joining me now is Ben Maxim and he's the
Chief Digital Strategy and Innovation

So first of thought, maybe we
could start off with you telling

us just a little bit about what
the work that you do at MSU F C U.

We, partner with fintechs is a lot
of the, a lot of the role we also

So we, build out prototypes or
partner with fintechs to use their

And get some real early in the
product lifecycle feedback through our

So there's a lot of things going on here
at Finovate, a lot of different companies.

What are some of the business and
technology trends that are really

So really I think everyone's
talking about ChatGPT and really

So what can that do to really change
the future of how we work, how we

So I'm very interested to see
how we have the technology now,

How do the different companies come in
and actually put the use cases to it?

A lot of exciting up there and I think
there's a lot that can also happen

with AI and really the personalization
and taking what we used to call PFM

and making them more insights and more
insight driven and letting you know,

And then also as financial institutions
allowing us to be able be better

enabled to get our own insights
about our own members as well.

So anything that's really letting
us as the institution or our users

unlock data and do something with
it is really what's exciting.

David Penn: Yeah, there's something else.

And we're hearing quite a bit
of that here at FinovateSpring.

Now one of the things that you have been
talking about here in your presentation

And I'm wondering if maybe you
could share some of the key points

One of the, interesting being
a, credit union and really most

community financial institutions were
founded with this kind of sense that

There, there was a failure in the
banking at some point that we're

trying to solve with an innovative
way to deliver financial services.

So we were started out of the Great
Depression out of a desk drawer.

Professors at Michigan State
University couldn't get loans,

Someone needs a hundred dollars, they
all came and brought $10 each, and then

They've identified different kind
of niches that the big banking

system is not helping consumers
the way they think they should.

So really, how do we then
enable our communities?

How do we provide more financial
access is really the kind of

So how do you provide more financial
access and how do you provide more

financial literacy education and
the power to combine those two.

And then for FinTech and community
financial institutions to

partner to really deliver that
to their communities is really.

David Penn: I always love hearing the, in
the origins of, credit unions, these small

banks because they're always these just
groups of people coming together, taking

care of themselves, and then growing
into some, incredible institutions.

I'm curious, we talk about
personalization, we talk about ai,

these sorts of things, and then
we talk about financial inclusion.

And one of the things I'm curious
about is what are some of the things

that people who are on that under or
unbanked really need out of financial

services and a lot of things that
financial services seem ready to give

Ben Maxim: Yeah, I think really one
thing we're doing at our institution,

so we have a team of financial
educators and some of them have come

And what they're saying is, I
don't want the bank to come in and

I don't want to hear from,
I don't trust the system.

So how do you get them
to trust the system?

So yes, we have all these tools, we
have these things, but if no one trusts

So how do you then go talk to the people
in these underserved communities and

create a product that's tailored to them?

And I think one of the things that
we talked about in our talk yesterday

about inclusion is, there is the
sexy money or whatever is going

towards the high affluent, you can
get the ROI and maybe really quickly.

Maybe there's not as much ROI
here, so maybe the VC dollars

So how do you then take your success
and then also use that and leverage it

So you're helping more people,
get more people in the system.

And then as an financial institution if
we build stronger communities, ultimately

FinovateSpring

Case Study

Ben Maxim, Chief Digital Strategy & Innovation Officer, MSU Federal Credit Union, joins us to share what business and technology trends excite him the most and talks about how to make financial services more accessible to underserved communities. 

Stay up to date with the community on https://finovate.com/ 

Find out more about FinovateSpring on http://www.finovatespring.com/ 