Finance 2.0: What the New World of Finance Means for You


The technological and innovative developments that have seen the dawn of light in recent years are appearing fast. They don’t just improve the way we live and work. They even rattle at the foundation of our societies. One core area that’s been shaken up massively these days is the finance sector.

Since the Renaissance, banks have been the heart piece of our financial system. They controlled who received a loan, deposited our salaries and savings, and to some extent even became the financial backbone of governments. As a consequence, businesses, parliaments and private people relied heavily on banks. And so, banks received a lot of freedom to do whatever they liked and do their business however they liked. To get an overview of the finance and banking system and how it evolved until now, let’s first take a look at this short video:

But we’re now seeing a trend in a different direction. More and more new banks and financial tools are appearing on the consumer market that have a social mission. Cryptocurrencies are slowly becoming normalized and institutionalized. And discussions about universal basic incomes (UBI) are getting louder.

What does this mean for our society and for us? Let’s take a look.

Finance 2.0 and what that means for you

What defines this new kind of finances, are the following things:

  • Decentralized: Central banks are centralized. That means everything money-related is centered around one or a few organizations. In the new world of finance, this is changing. Cryptocurrencies work on the blockchain and not in the financial system monitored by banks, for example. And as new fin-techs appear, the power and influence of the old dinosaurs banks weaken. The power of finances gets spread out.
  • Democratic: A new form of loan system is also emerging. Peer to Peer loans allow individuals to borrow money from their neighbors and fellow citizens. So the borrower doesn’t pay interest fees to a bank, but to a trusting individual. The borrower gets their loan, and the lender is payed by their trust. This democratizes finances and builds up trust.
  • Human-centric: For years, banks could do what they liked because everyone needed them. But now, startups are putting a stronger focus on creating solutions that work for users. Financial solutions are becoming more personalized and insightful. They aim at helping people gain financial health and good money habits, instead of exploiting them. They see people as people and not just consumers.
  • Social: Apart from peer to peer, we also see debates about Universal Basic Income and Shared Economics. Both are trends that focus on the social responsibility, ethics and foundational equality. The divide between rich and poor increases day by day and is one of the biggest social challenges we’re facing today. Banks have done little to revert this trend. But finance 2.0 might give us the tools to do something about it.

So generally speaking, finance 2.0 has a lot to offer us normal people. It’s hard to say yet how these new financial structures and institutions might handle a financial crisis. But we may hope that the more our finances are spread out and the more everyone is involved, the more stable our economic infrastructure will be.

We have by far not reached the end of financial innovation. A lot is still to come for sure.

If you want to read more about megatrends of our society, head over to other blog posts, for example this one about the future of mobility!

Enjoyed reading this article? Ever invited a pirate for a coffee? Now’s your chance.

Tagged as banking, finance, innovation, megatrend

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