PRESS RELEASE: CFSI Identifies Household Cash Flow as the Focus for its First Innovation Challenge
Wednesday, November 19, 2014
SAN FRANCISCO–(BUSINESS WIRE)–The Financial Solutions Lab at the Center for Financial Services Innovation (CFSI) today announced that household liquidity, the management and alignment of income and expenses, will be the focus of its first innovation challenge.
Millions of Americans have difficulty managing their household cash flow. This indicates that uncertain or volatile income and urgent expenses challenge households across the income spectrum. Moreover, nearly one-third of Americans encounter significant variation in their income over the course of a given year. This hints at the fact that household liquidity is not a problem that affects just part-time, self-employed, and/or seasonal workers—the reach and impact is far wider. Acknowledging this evidence, the Lab recognizes household liquidity as a financial challenge ripe for innovative, technology-driven solutions.
“Household cash flow challenges create a stressful and often expensive balancing act for millions of American families,” said Sarah Gordon, Vice President of Innovation Labs at CFSI. “But there are talented entrepreneurs and non-profit leaders who are leveraging technology to solve this problem. By focusing on this issue for our first challenge, the Financial Solutions Lab can serve as a powerful platform to help innovators build new solutions.”
The Financial Solutions Lab will play an integral role in building the financial technology ecosystem and will remain focused on improving financial health for all Americans. The Lab believes that technology can solve many of the more vexing challenges that weaken the financial health of Americans, including the challenge of managing household cash flows.
Exploring innovative ideas related to improving day-to-day income and expenses, building emergency funds, and improving open access to lower-cost, higher-quality small dollar credit options are just a few ways in which the Financial Solutions Lab community will approach solving for household liquidity challenges.
“JPMorgan Chase is eager to begin working with Lab participants that are not only passionate about solving this issue, but also committed to building scalable solutions,” said Janis Bowdler, Senior Program Director for Financial Capability and Community Development, JPMorgan Chase. “After meeting with entrepreneurs, innovative nonprofits, behavioral economists and countless others, it’s clear that household liquidity is an ideal issue for the Financial Solutions Lab to tackle.”
The Financial Solutions Lab is a cross-industry initiative catalyzing the development of innovative, technology-enabled strategies, products and services that align with consumers’ financial needs. In addition to announcing the focus area of household cash flow, CFSI is actively assembling a community of leading financial technology entrepreneurs, innovative nonprofits and consumer advocacy groups, behavioral economists and academics to provide ongoing guidance, share best practices and support the development of scalable financial solutions based on the Financial Solutions Lab’s winning innovations. Strategic advisors ideas42 and IDEO.org are playing an ongoing, critical role in supporting the Lab, particularly as it pursues household cash flow challenges.
Early next year the Lab will announce the opening of the first innovation challenge focused on household cash flow. The challenge will award winning organizations with capital, technical assistance and connections to industry leaders to assist them in building better products and services that can have a national impact.