#FinancialLiteracy #Personalisation / Broadening the Reach of Financial Literacy Through Hyper-Personalization

Behavioral economics is the field of study which acknowledges that people are irrational beings… In addition to being irrational, most people struggle to understand financial products and services. According to Standard & Poor’s financial literacy survey, only 33% of the world is financially literate.

The study concluded the following: among the four topics that define financial literacy, inflation and numeracy (in the context of interest rate calculations) are the most understood. Worldwide, half the adult population understands these concepts. Knowledge of risk diversification is the lowest, with only 35 percent of adults correctly answering that survey question…

There are two approaches to improving financial literacy –
(A) making it easy for people to understand concepts when needed (B) do the job for them but give them full control as needed

The first approach is straightforward education, so let us explain more about Approach B. One way to address users’ lack of financial knowledge is to eliminate (or at least minimize) their need to learn new information. This is possible if the products we build can make the best financial decisions on behalf of the user with the right set of guiding principles such as ‘do unto others as you would have them do unto you’ … the products we build must be fully aware, conscious, fair, transparent to all users, and above all always making decisions in the best interest of each individual. …
In a world where users’ financial data is decentralized … and that users can provide permissions to trusted sources whenever they want will accelerate the hyper-personalization of content. In this ideal world, the user’s financial information could be assembled simply by a single tap/touch/voice command and entities such as content providers, publishers, and third-party applications can leverage the appropriate financial data to contextualize the content to users. This context awareness is critical in bridging the gap between the need to educate people on finance vs. doing it on their behalf. In short, the decentralization of data and financial applications (DeFi) partly makes the hyper-personalization of content come to reality.