The Financial Innovation Lab

Presented by 

Connecting experts with real world financial infrastructure and resources to test new ideas that can help promote financial inclusion. If you’d like to receive news and updates on the program, email filab@ideas42.org. Find out more about the program below. #LookingForChange

About

American Express invites Letters of Intent to submit an application for the Financial Innovation Lab presented by American Express.

The Financial Innovation Lab can help empower researchers and domain experts to test ideas that promote financial inclusion at scale on the American Express Serve® software platform, under commercial conditions, over a 3-6 month period.

This challenge is created for individuals and teams who are:

  1. Researchers from academic institutions whose opportunities to study financial inclusion are limited to lab and field tests, and/or
  2. Practitioners from non-profit organizations that perform field work (e.g. financial counseling) with few opportunities to test learnings within commercially operating financial product designs.

As a selected Participant in the Financial Innovation Lab, you’ll see your proposed intervention implemented on the Serve platform and tested on real Serve Accountholders. You’ll work with the Serve team to determine what data will help you demonstrate the effectiveness of the intervention. You’ll also be able to access and analyze test data and publish new work based on the experiment results.

Timeline

September – December 2014: Application Phase (Completed)

The selection process is divided into two phases: a general call for applications, and submission of full proposals from selected finalists.

Applications

Submit a short application (2 pages of text description) describing your idea for an intervention – a new feature or change to an existing feature – within the Serve software platform. The intervention should be expected to make measurable, positive changes in consumers’ financial behaviors. To get an understanding of the current platform, see the product overview. To submit an application, please email filab@ideas42.org. Full details of application rules and format can be found here.

After the initial submission process, all applications will be reviewed by our selection committee. Promising applicants will be invited to move on to the finalist stage and submit a more detailed proposal. All applicants will be notified via email by October 27, 2014.

Finalist Proposals

Finalists will be asked to submit test design specifics which will be reviewed in detail. Up to 5 finalists may be accepted for participation in the Lab.

February 19-20, 2015: Design Phase

Participants selected for the Lab will be invited to work with Serve design, product development, field work and technology staff over a multi-day, in-person working session. At the workshop, IDEO.org, a leader in the field of ‘Human-centered Design’, and CauseLabs, a leader in translating socially beneficial ideas into technical applications, will help Finalists refine their proposals and develop a framework for understanding and applying these tools to their own product development processes. Travel arrangements and lodging for Participants to attend the workshop will be provided by American Express.

Spring-Fall 2015: Implementation

Projects that are selected for the Lab will be tested on the Serve software platform. De-identified data will be gathered by the Serve team and provided to Lab Participants.

Post-Fall 2015

De-identified data will be analyzed by Participants and results shared.

Program Schedule

Application

September 4, 2014 Letter of intent period opens

September 12, 2014 Informational Webinar

September 29, 2014 Letters of intent due

October 27, 2014 Finalists selected, long form application period opens

December 1, 2014 Long form applications due

December 15, 2014 Lab Participants selected

Design

February 19-20, 2015 Prototyping and design workshop in New York City

Implementation

Spring-Fall 2015 Expected implementation of test and data collection begins

Fall 2015 Expected last date for tests to conclude, data reviewed and provided to Participants for analysis

Details

The Problem
Our Approach
The Serve Software Platform

The Problem

The world of personal finance suffers from its own digital divide.

On one side are researchers and practitioners. They build evidence for promising ideas about how to improve financial behavior, using lab tests or pilot programs. But they aren’t able to test their ideas under real-world conditions because they lack access to complex real world technology and infrastructure that allows people to store, manage and move money.

On the other side are financial institutions. They are the infrastructure. But they don’t always have the in-house expertise – or the time – to allow them to comb through the latest research findings and implement the most promising ideas.

Occasionally, an academic or organization and a financial institution are able to forge an effective, mutually beneficial partnership. More often, academics leave their fields temporarily or permanently and become consultants to large companies – but their knowledge and findings often become the property of the client and can’t be shared with the broader academic community.

The American Express Financial Innovation Lab aims to close this divide.

Back to top ↑

Our Approach

The American Express Financial Innovation Lab will provide a live operational setting to test technological solutions and innovations designed to improve consumer financial behaviors and attitudes. Up to 5 selected teams will be invited to participate in the Lab. American Express will implement the Participants’ experiments on the Serve software platform for testing with an opt-in population of Serve Accountholders. Lab Participants will be provided de-identified data from the experiments to validate the efficacy of the tested innovations and are encouraged to use the data in the continuation of their work and publishing. Lab Participants will retain ownership of the intellectual property rights embodied in their innovations. American Express will receive a license to use and adapt the technology, and may incorporate innovations from the Lab into its product offerings. In addition to extensive in-kind technical, design and training support, participants in the Lab will receive financial stipends of $25,000 for individual submissions, $35,000 for teams of two, and $45,000 for teams of three for their work.

Back to top ↑

The Serve Software Platform

About Serve

Serve is a cloud-based software platform that unifies multiple funding sources and payment options into a single account, enabling customers to load cash, pay bills, set aside funds, access cash at ATMs, manage budgets, send peer-to-peer payments and pay for goods and services, both offline and online. Customers can access their account online, via a mobile app and text message, as well as through using their Card to make purchases at merchants that accept American Express Cards.

Overview of American Express Serve features

Mobile Application and Website:

  • Available for both iOS and Android mobile platforms
  • Offers an intuitive user-interface that allows users to access and use their accounts from a computer or mobile device
  • Responsive design: the site automatically recognizes screen size and device type and optimizes the appearance to ensure an enjoyable user experience from phone, tablet, or desktop.

Insurance:

  • FDIC pass-through insurance for permanent Serve accounts

Fees:

  • Low $1 monthly fee, which can be waived when you use Direct Deposit or add $500 or more during your monthly statement period. (No monthly fee in NY, TX, VT).
  • Free ATM withdrawals at over 24,000 ATMs nationwide. If you withdraw money at a non-MoneyPass ATM, you will be charged a $2 fee ($2.50 starting on 10/30/14) to your Account at the time of withdrawal.1 In addition, ATM operator fees may apply. (No ATM fee in VT).
  • Add cash for FREE across 27,500 CVS/pharmacy®, Family Dollar®, Walmart®, and participating 7-ELEVEN® locations. You can add as much as $500 or as little as $20.
  • Add checks directly to their American Express Serve Account using the American Express Serve® Mobile App2 on their iPhone® or Android device
  • Card Price: $0 online; up to $3.95 in retail locations
  • No fee for a replacement Card
  • More info, including the Serve Fee Chart, on https://www.serve.com

Eligibility:

  • No credit check
  • No minimum balance
  • Accountholders must meet ”know your customer” and other applicable legal requirements

Load/Money In:

  • Cash reloads
  • Direct deposit
  • Bank account (ACH) transfer
  • Mobile Check Capture
  • Debit Card
  • Credit Card (Cash advance fees for credit card loads may apply)

Withdrawals/Money Out:

  • Free ATM Withdrawals at over 24,000 ATMS nationwide
  • Pay bills online for free and schedule recurring bill payments
  • Make NFC (Near Field Communications) payments when you add your Serve Card to the Isis Mobile Wallet

Reserve Feature:

  • Allow accountholders to separate portions of their available balance and assign specific names/titles (e.g. “My Vacation”) to each portion
  • Money can be seamlessly moved from the Master account to a Reserve through a one-time transfer or recurring transfer, and can be quickly moved back to the Master account when needed.
  • Money within a Reserve will not be pulled from when making purchases online or in-store. The money must be transferred to the Master account in order to utilize the funds for transactions.

Mobile Transaction and Balance Information:

  • Once Accountholders have agreed to the Text Alert Program’s Terms and Conditions, they can set up text alerts to notify them that another American Express Serve user has sent you money or requested money from you. You can also text Serve to receive your balance history of your last five transactions or refer a friend.
  • Accountholders can also use the Serve Mobile App and automated telephone system (IVR) to get transaction and/or balance information.

Personal Financial Management Tools:

  • Integrated into the Serve web interface
  • Customers can monitor their spending by automatically sorting transactions into categories such as bills, food, fun, shopping and transportation
  • Customers can create budgets, set spending limits and alerts, as well as set and track financial goals.

Website/Platform Performance:

  • Platform is cloud-based
  • Website page loads ~ 2 seconds.
  • Point of sale and ATM authorization performance: average less than 2 seconds
  • Growing set of APIs that will be extended to the development community

Interested Participants are encouraged to sign up for a Serve account at www.serve.com to get the best possible understanding of the platform and users’ experience. If this is not possible, please email filab@ideas42.org for assistance.

Back to top ↑

1 No fee in VT. 2 Data rates may apply.

Program Schedule

Application

September 4, 2014 Letter of intent period opens

September 12, 2014 Informational Webinar

September 29, 2014 Letters of intent due

October 27, 2014 Finalists selected, long form application period opens

December 1, 2014 Long form applications due

December 15, 2014 Lab Participants selected

Design

February 19-20, 2015 Prototyping and design workshop in New York City

Implementation

Spring-Fall 2015 Expected implementation of test and data collection begins

Fall 2015 Expected last date for tests to conclude, data reviewed and provided to Participants for analysis

Selection

Thank you for your interest in participating in the Financial Innovation Lab Presented By American Express. Applications for the Lab are now closed.

Financial Innovation Lab Selection Criteria
Example Submissions

Financial Innovation Lab Selection Criteria

Eligibility:

  • Does the proposed intervention and team meet the eligibility criteria as specified in the Financial Innovation Lab Rules?

Innovation:

  • Will the proposed intervention contribute to the understanding of and innovation in financial inclusion product design?
  • Is the proposed intervention likely to result in measurable behavior change within the measurement timeframe?

Methodology:

  • Is the proposed research methodology appropriate for the intervention and the constraints of the research setting?
  • How will results be analyzed and tested for validity and significance?

Intervention Application:

  • What is the team’s outreach and dissemination strategy for their findings?
  • Are there opportunities for continued research and/or synthesis with other research findings? How could the results be used in other contexts?

In addition, proposals will be reviewed by internal teams according to the following constraints:

  • Can the proposed intervention be implemented and tested on the American Express Serve software platform within the timeframe of the Lab?
  • Does the proposed Intervention comply with applicable regulatory and legal requirements?

Applicants are not expected to have a comprehensive knowledge of the regulatory landscape or the technical considerations for implementing a test of the intervention on the Serve software platform. Applicants with high quality proposals that can be adapted to conform to these constraints are eligible to be invited to submit a final proposal with appropriate feedback about what changes would be needed in order to be acceptable.

Potential Areas of Investigation

Saving: Almost half of Americans report that they don’t know how they would come up with $2,000 in an emergency.1 Emergency savings can make the difference between a short term financial challenge and a long term crisis. How could Serve help Accountholders better take advantage of the Reserve functionality to build financial breathing room? Budgeting: Making a paycheck last ‘till the end of the month can involve making tradeoffs among competing priorities. The costs and benefits of these tradeoffs are hard to analyze when a bill comes due or the groceries are in the cart. What strategies could help Serve Accountholders and how to balance competing financial priorities? Tax time money management: For many low- and middle-income Americans, their tax refund is the largest lump sum of money they receive each year.1,2 Helping Serve Accountholders make plans to manage and allocate that money can help set them on the road to achieving financial stability. Credit building: For many people who have no credit file or a thin file, don’t build credit early in adulthood, or who have struggled to manage loans or credit cards in the past, getting a foothold on the credit ladder can seem almost insurmountable. How could the Serve Accountholder behavior help determine which users are good candidates for responsibly managing credit, and get people started with a user-friendly starter credit card, line of credit or loan? Goal setting: When people are preoccupied with short term financial needs, it’s easy to lose sight of long term financial issues. How could Serve help people plan for periodic or irregular expenses, or set aside money for goals that are years in the future? Back to top ↑

Example Submissions

Example Submission #1- Save Your Raise

“Nudges” are most effective when they are received at the moment when action can be taken. This test detects when direct deposits to Serve are larger than average (raises, bonuses, overtime pay). When such a deposit is detected, the user receives a message within Serve by email, pop-up or by text encouraging them to save some or all of the extra amount. The test tracks the time and type of intervention and corresponding saving action and amount.

Example Submission #2 – Savings On Ice

Providing an opportunity to make a good decision for our future selves is a strong commitment device. We all expect that we will save more and spend less in the future, but when the time comes, we make the same mistakes we always make. Serve’s technology makes moving money out of savings instant. But what if you don’t want it to be? This test allows for a self-selected ‘cooling off period’; a delay of hours or days before your savings are available. It’s like hiding or freezing a credit card – the money’s there if you need it, but you protect yourself from your impulses. Back to top ↑
1 Lusardi, Annamaria, Daniel Schneider, and Peter Tufano. 2011. “Financially Fragile Households: Evidence and Implications.” Brookings Papers on Economic Activity: 83–134. 2 Mendenhall et al. 2010. “The Role of Earned Income Tax Credit in the Budgets of Low-Income Families.” National Poverty Center Working Paper Series: #10-05. 3 Tavernise, Sabrina. April 17, 2012. “Antipoverty Tax Program Offers Relief, Though Often Temporary.” New York Times: A10.

Program Schedule

Application

September 4, 2014 Letter of intent period opens

September 12, 2014 Informational Webinar

September 29, 2014 Letters of intent due

October 27, 2014 Finalists selected, long form application period opens

December 1, 2014 Long form applications due

December 15, 2014 Lab Participants selected

Design

February 19-20, 2015 Prototyping and design workshop in New York City

Implementation

Spring-Fall 2015 Expected implementation of test and data collection begins

Fall 2015 Expected last date for tests to conclude, data reviewed and provided to Participants for analysis

News

Meet the Participant teams in the Financial Innovation Lab Presented by American Express:

Team UCLA

Stephen Spiller is an Assistant Professor of Marketing at UCLA’s Anderson School of Management. His research focuses on consumer decision making and planning for the future, and in particular on how consumers mentally represent the problems that they face. Such representations affect whether consumers consider their tradeoffs when making spending and savings decisions or instead consider the decision as a “go / no-go” decision free of tradeoffs. Professor Spiller is actively sought out for statistical advice and methods workshops within the marketing community. Professor Spiller received his PhD from Duke University.

Suzanne Shu is an Associate Professor of Marketing at UCLA’s Anderson School of Management whose research focuses on behavioral economics and marketing. She is especially interested in judgments and decisions that occur over long timeframes. The types of decisions analyzed in her research include consumer self-control problems and consumption timing issues, with important implications for both negative behaviors (such as procrastination) and positive behaviors (such as saving). Professor Shu received a PhD from the University of Chicago in 2004, where her studies included behavioral economics, decision sciences, and marketing. She also holds a degree in Electrical Engineering and Masters in Electrical Engineering from Cornell University. In addition to her work in academia, Professor Shu has worked as a product line manager, an IT project manager, and as a management consultant in sales force design. She also consults for financial services companies and insurance providers on behavioral influences on consumers’ financial decisions. Before arriving at UCLA, Professor Shu taught marketing and decision making courses to MBA students at the University of Chicago, Southern Methodist University, and INSEAD.

Marissa Sharif is a PhD Candidate at UCLA’s Anderson School of Management. Her research focuses on consumer judgment and decision-making. She explores why consumers often fail to reach their long-term goals (especially self-control goals) and develops interventions to improve long-term goal performance. In two other streams of research, she investigates how memory and indecisiveness influence consumer judgments and decisions. She received her B.S. from UCLA in Psychobiology.

Team ideas42

Piyush Tantia is co-Executive Director at ideas42. Since joining the organization in 2009 he has worked closely with leading academics from Harvard, MIT and Princeton to design and implement solutions in various areas including household finance, education, international development, poverty, criminal justice and healthcare. Along with ideas42’s co-founders, he transitioned the organization from a research initiative at Harvard University to an independent 501(c)(3) non-profit. Prior to joining ideas42, Piyush was a Partner in Oliver Wyman’s Retail Banking and Finance & Risk practices. During his 14 years at Oliver Wyman, he advised clients in a vast array of retail financial services businesses including prime and subprime credit card, home equity, prime and subprime mortgage, deposits, retail distribution, microfinance, and unbanked/underbanked. He tackled a wide range of issues including strategy, customer and product value management, credit process, distribution and risk management. Piyush has served on the board of the financial inclusion organization MIX, and is on the executive committee for Innovation for Poverty Action’s Financial Capability Research Fund. He holds an MPA from the Harvard Kennedy School of Government, a B.S. in Economics from the Wharton School and a B.S.E. in Computer Science from the University of Pennsylvania.

Alex Blau is a Senior Associate at ideas42 currently focusing on challenges in consumer finance, design and decision-making, and international development. Prior to joining ideas42, Alex worked as a research analyst at Tufts University’s Friedman School of Nutrition Science and Policy, examining the exit-strategies of a number of large, Title-II funded integrated nutrition interventions in Kenya. In addition, Alex has extensive experience developing agricultural supply chains for small-scale organic farmers in the Caribbean. Alex holds an MSc in food policy and applied nutrition science from Tufts University, and a BA in political science with a focus in international relations from Brown University.

Team Berkeley

Adair Morse is Assistant Professor of Finance at the Haas School of Business at the University of California at Berkeley and a research fellow at the National Bureau of Economic Research. Her research covers the areas of household finance, corruption, and asset management. Her recent work has shaped policy on payday lending, household finance and the debate on tax reform in Greece, and the bounty provisions in the Dodd Frank law of financial reform. A number of her papers on household finance and corruption appear in the Journal of Finance and Journal of Financial Economics, where she has won, respectively, the Brattle Prize and the Jensen Prize (second prize) for the best paper in Corporate Finance. The Brattle Prize was awarded for her publication on information disclosure in household finance. Professor Morse holds a PhD in finance from the Ross School of Business at the University of Michigan and masters degrees in statistics and agricultural economics from Purdue University.

Christopher Palmer is Assistant Professor of Real Estate and Urban Economics at the University of California at Berkeley’s Haas School of Business. His current research focuses on household credit markets, in particularly what caused financially vulnerable subprime borrowers to default on their mortgages in the wake of the Financial Crisis. His experience modeling the realities faced by LMI households who are struggling to make ends meet, bringing modern econometric methodology to tease out causal relationships from household-level data, provide him with a toolkit to design and analyze our intervention on Serve. Professor Palmer earned a PhD in Economics from MIT, where he was a Visiting Scholar at the Federal Reserve Bank of Boston and a National Science Foundation Graduate Research Fellow. He received a BA in Economics and Mathematics from Brigham Young University, where he was Economics Department Valedictorian. His undergraduate thesis studied the effectiveness of post-Soviet education reform in curbing rampant unemployment and built on two years spent living in Eastern Europe. Professor Palmer has been involved outside of academia as well. He currently volunteers as a small-business mentor for a family of recent Armenian immigrants that run the best tailor shop in Los Angeles and served as the equivalent of an assistant pastor for his local congregation during graduate school. He has also supported expert witness testimony in litigation involving such areas as fraud, antitrust, and contract disputes.

Ben Mangan has been a leader in combining practice and research to yield innovation in financial services for low-income workers across the US for over a decade. He has used the past 20 years to spark prosperity and possibility in new ways, teaching, leading a consulting practice for Ernst & Young, driving organizational strategy for the early micro-payments company, beenz.com, and co-founding EARN – the nation’s leading microsavings provider for low income Americans. At EARN, Mangan founded an internal applied research institute to leverage the organization’s proximity to thousands of low-income workers and gain insights that fuel new product development at EARN. This approach has allowed EARN to expand its savings offerings nationally using a sophisticated online platform custom built for a segment EARN has identified called “Struggling Strivers”. Ben recently joined the UC Berkeley Haas School of Business as Lecturer and Executive Director of the Center for Nonprofit and Public Leadership. Ben has been featured in Time Magazine, the Wall Street Journal, Fast Company and BusinessWeek. He is also a blogger for LinkedIn’s Influencers and the Huffington Post. Ben holds a BA from Vassar College and a MPP from Harvard’s Kennedy School.

Program Schedule

Application

September 4, 2014 Letter of intent period opens

September 12, 2014 Informational Webinar

September 29, 2014 Letters of intent due

October 27, 2014 Finalists selected, long form application period opens

December 1, 2014 Long form applications due

December 15, 2014 Lab Participants selected

Design

February 19-20, 2015 Prototyping and design workshop in New York City

Implementation

Spring-Fall 2015 Expected implementation of test and data collection begins

Fall 2015 Expected last date for tests to conclude, data reviewed and provided to Participants for analysis

Apply

Thank you for your interest in participating in the Financial Innovation Lab Presented By American Express. Applications for the Lab are now closed.

For more information on project evaluation, please see Selection Criteria.

Program Schedule

Application

September 4, 2014 Letter of intent period opens

September 12, 2014 Informational Webinar

September 29, 2014 Letters of intent due

October 27, 2014 Finalists selected, long form application period opens

December 1, 2014 Long form applications due

December 15, 2014 Lab Participants selected

Design

February 19-20, 2015 Prototyping and design workshop in New York City

Implementation

Spring-Fall 2015 Expected implementation of test and data collection begins

Fall 2015 Expected last date for tests to conclude, data reviewed and provided to Participants for analysis

Rules

The Rules of The American Express Financial Innovation Lab and the Participant Agreement, which Participants are required to sign once accepted for participation in the Lab, are available for download below; applicants are advised to save a copy of the Rules and Participant Agreement for their records. Applicants should thoroughly review both documents to ensure they understand the requirements of the Lab. Should an applicant have any additional questions after reviewing these documents, please see the FAQ for more information. If a question is not answered in the Rules, Participant Agreement, or FAQ, please submit the question in an email to filab@ideas42.org.

Download the Rules

Download the Participant Agreement

Program Schedule

Application

September 4, 2014 Letter of intent period opens

September 12, 2014 Informational Webinar

September 29, 2014 Letters of intent due

October 27, 2014 Finalists selected, long form application period opens

December 1, 2014 Long form applications due

December 15, 2014 Lab Participants selected

Design

February 19-20, 2015 Prototyping and design workshop in New York City

Implementation

Spring-Fall 2015 Expected implementation of test and data collection begins

Fall 2015 Expected last date for tests to conclude, data reviewed and provided to Participants for analysis

Frequently Asked Questions

In addition to this FAQ, please review the Rules of the American Express Financial Innovation Lab thoroughly. If after reviewing both documents you still have questions, please email filab@ideas42.org.

I reside and conduct my research outside of the United States. Can I apply?

Citizens of the United States residing anywhere in the world, as well as non-citizens residing in the US and Canada, may apply to the Financial Innovation Lab. Residents of other countries are not eligible.

Can I mail my application?

Letters of Intent and Cover Sheets must be emailed to filab@ideas42.org by September 29, 2014 7:00 pm EST. All Letters of Intent and Cover Sheets must be in PDF format and must be in compliance with the formatting guidelines set forth in the Financial Innovation Lab Rules. Submissions will not be accepted by postal mail, fax or any other format. Any submissions received after the relevant deadline may not be considered. To be eligible for selection as Participants in the Lab, finalists must follow the instructions included in the Rules if they are invited to submit full proposals.

I am having technical difficulties emailing my application.

If you are having trouble submitting your application please send an email to filab@ideas42.org.

Do I need to provide a budget with my proposal?

No. Awards are in the form of a stipend coupled with design and development resources.

May I apply for a course buyout?

You may use the stipend in any way you deem appropriate, including to fund a course buyout if available at your institution.

I am not affiliated with a university or institution. How does this affect my eligibility?

If you are not affiliated with a university or institution, you must obtain independent Institutional Review Board (IRB) approval for your proposed research.

Can I submit more than one proposal?

You may only serve as principal investigator/team leader on one submission; however, there is no limit on the number of submissions for which you can be named as a co-investigator/team member.

I applied as part of a team. If I am selected as a Participant in the Lab, must all members of my team commit to attending Participant workshop?

All members of Participant teams are strongly encouraged (but not required) to attend.

Program Schedule

Application

September 4, 2014 Letter of intent period opens

September 12, 2014 Informational Webinar

September 29, 2014 Letters of intent due

October 27, 2014 Finalists selected, long form application period opens

December 1, 2014 Long form applications due

December 15, 2014 Lab Participants selected

Design

February 19-20, 2015 Prototyping and design workshop in New York City

Implementation

Spring-Fall 2015 Expected implementation of test and data collection begins

Fall 2015 Expected last date for tests to conclude, data reviewed and provided to Participants for analysis