Can an app stop people falling into debt?

How we interact with our services is changing, apps are breaking out from the confines of their screens. Are they about to live up to the initial hype and could an app actually stop you falling into debt?

I didn’t speak the local language but the post announcement groans from my fellow passengers on the Delhi Metro meant there was some kind of problem and we had to disembark (the groan is universal for “service cancelled”), that’s how I ended up on the sweltering platform of a station I didn’t know in a city I was barely familiar with. At this point I was pretty much lost, the signs were useless now, the announcements less so and getting to my destination was not going to be as easy as I thought … then I received a tap on the shoulder, a friendly nudge from a chap who had taken an accurate guess at my destination and pointed to where I should be.

That’s all it took, a simple nudge and my journey became a whole lot easier.

Nudge theory is a well-known concept in behavioural psychology and that little tap on the shoulder is replicated in the world around you by designers, architects and engineers everywhere. This experience got me thinking about one of the apps I have been looking at lately, Cleo.

Is Cleo the step in the right direction?

Cleo is an app which sits above your bank accounts and credit cards (which it accessed through banking APIs) and resolves to sort your budgeting out, keeping you on top of your spending. Its primary interface is the Facebook Messenger app which and it uses this to guide you through your monthly spending.

Prompting you through the Messenger app it lets you know of upcoming bill, gives regular balance updates and tracks your spending letting you know your balance, what is left of your budget and if you have spent more or less that last weekend.

You can ask questions such as “Hey Cleo, what is my balance?” and “What is left of my budget this month?” and it will respond in a timely fashion with the headline information you need. You can even ask it comparative questions such as “How much have I spent compared to last month” and it will give you the detail.

Should you believe the hype?

Apps have long promised to guide us and improve our day to day lives but have so far never quite lived up to the hype.

However, those unobtrusive and almost seamless little nudges provided through the week letting you know just how much you overspent at the weekend or what bills you have coming up do have real potential to have a positive impact.

As apps and services break out from the windows which have traditionally contained them and start interacting, not just communicating, with their users it is quite possible that an app could help stop you falling in debt. Of course, much like my friend on my nearly aborted train journey your app does need to know where you are going...

Talk to our Head of Finance, Chris Neal, to help you shape your wealth and fintech propositions by utilising our expertise in Research, Design, Validation, Development and Integration services.

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