Can Credit Karma Help Us Manage Our Money?

Behavior change is hard. Actively changing another person's behavior is even harder. But there are plenty of companies out there that have been able to crack that code. They understand that people don't always or even rarely act rationally. I'm Kristen Berman, co founder of Irrational Labs. Over the years, we've helped countless companies understand and leverage behavioral science to increase the health, wealth, and happiness of their users. The idea behind the Science of Change was to create a podcast that demystifies the psychology of decision making. So here's how it works. Each week, I get to chat with visionary product and organizational leaders to uncover their insights about user behavior and how they've managed to change it. I match this up with some of the latest research in the field to get to the bottom of our core psychologies. So let's dive in and unlock the secrets behind the science of Change. The Science of Podcast is presented by Setsale, the world's number one revenue execution platform. At the beginning of every episode of the Science of Change, you hear me say behavior change is hard. And that's true.

It is.

But on this week's episode, we talk about something that could take the cake. Behavior change as it relates to our finances. I mean, just start with this. Most loan payments and household bills are due monthly, despite the fact that almost 70% of businesses pay their employees weekly or bi weekly. We're making each person do a dance with their paycheck. They need to calculate how much they can spend on daily expenses and then how much they should be putting aside to pay their bills and their rent or mortgage, and how much they should save for the future. This is an incredibly difficult math equation. So it's no wonder American banks collected nearly $12 billion in overdraft fees in 2020. My guest today is Kyle Thibault, a product manager at Credit Karma and the growth lead for their latest initiative, Credit Karma Money, a challenger banking service that gives users access to both spending and savings accounts. And operate just like any bank account. There's a debit card for daily purchases and you can use it to pay your bills. Challenger banks are all the rage right now in the fintech world, but Credit Karma seems to have a leg up. They have a pool of over 100 million users for their credit monitoring service, and they have been fantastic at running a B testing, looking at data, and applying it back to their product. Credit Karma is basically coming into the game with the idea and vision to automate our finances for us. It's the behavioral science dream. Make it easy. That's the Credit Karma ultimate goal. And it's what Kyle and I talked about. We touched on how they incentivize their users to both save and spend. We talked about habit formation around our finances. What does and doesn't qualify as a habit? Spoiler alert. Savings is not a habit. Most exciting, he shares with us four actual signup flow experiments Credit Karma has run and and the results that drove conversion boosts. There are billions of investment dollars banking on someone to come along and do what nobody's been able to do, make our finances easier. Credit Karma's off to a good start. So the question is, how will they do it? So at the base level, this CK money, it's a checking account with some savings capabilities as well, is that correct?

Yep, exactly. So we started as a savings account first. That was our zero to one, hey, can we actually handle people's money versus just kind of talking about it? And so with that, let's start with savings because it's a little bit easier. And I think it does line up with the brand pretty nicely in that people are having a really hard time saving. I think everyone's heard that stat of more than 50% of people don't have $400 in an emergency fund in the US and so we thought, well, certainly we can help people with that. And with the trust that Credit Karma has, we think that people will listen to us when we say, you know, like, help build your emergency fund and we'll give you a great interest rate while you save.

So maybe we just actually start there is. How has that been going? Are people saving? How frequently are they saving? How much are they saving?

Okay, so Credit Karma has over 100 million people that we have a relationship with. And so for us to be able to just market directly to our members allows our savings account to be something that we're able to grow pretty quickly. Like I said earlier, product market fit was something we were trying to figure out. We figured it out really quickly. And then from there we just. We went pretty strong on scaling that out. The value really was there to people because they trusted us and they trusted us with their money. So when we look at when people save, I think there's actually some pretty interesting pieces that I think make sense when you look back on it. But maybe when we were first working on how do we market this, we weren't quite thinking about the. Just the normal behavior of like a savings cadence. But when we would look at deposit frequency and time of day and day of week, surely it all lines up to payday. So we see Some of our biggest days by like 2x on Fridays, and particularly the last Friday of the month, when people make the biggest deposits into their savings.

Is that because people have already automated that to come out at a specific day, or are they, like, remembering the moment their paycheck comes in? They say, oh, shoot, let me stick some of this into savings before I spend it. How do you think that actually happens for people?

So I think it's actually been a bit of a mix between people manually triggering deposits into the account and then us doing it for them in the feature we have called automated deposits. What's interesting about that is kind of goes back to the whole trust thing, where we find that people are really curious about the count. They love the higher interest rate that we pay, but they're maybe like, still trying us out at first. But what you see over time is as people make sort of these regular recurring deposits themselves, they see, okay, this is working. This makes sense. Now just automate this so I don't have to think about it. And when we talk to people about who've actually set up automated deposits, they tend to say, you know, I actually really like being able to put something aside a little, kind of out of sight, out of mind, especially when it comes to savings, because if it's easily accessible, people feel like they're going to spend it more. And so we're kind of creating this artificial barrier with the product that we didn't really expect. People feel comfortable that they're going to make progress there and, like, be consistent about it. So we've seen that in general, those people who set up automated deposits are growing their savings month over month. We're not seeing a step up or step down or just sort of like any irregular behavior with it. It is pretty much up and to the right. And I think for different segments, it can be going up pretty quickly, or it can be going up a little bit by a little bit. And I think that's a win for us no matter what, that people are just putting money away and trying to save.

So there's a conversation going on in behavioral science about savings and whether or not it constitutes a habit behavior. Habit researcher Wendy Wood finds that about 43% of what people do every day is repeated in the same context. Usually while we're thinking about something else, we're automatically responding without really making decisions, making coffee in the morning or reading the news when you open your computer. But saving money when it's not set up as a reoccurring transfer is a lot harder than that because you have to think about it, you have to decide when to save, how much to save, and then log into your bank on a certain day to make the transfer. So there's a question of whether or not we can make savings a habit. And the general finding has been probably not. You actually need to trigger people and remind them to save to get them to think about it. This is the antithesis of a habit behavior. In fact, there's research that shows when you remove the alerts and reminders to save, people stop saving again. This typically means it's not a habit because you're not doing it without thinking. So what's your point of view on this? Can you make savings a habit?

I think we've found a way to make savings a habit. One of the things I was talking about earlier was we noticed that there's a really strong organic deposit behavior around paydays. So we thought, well, why don't we figure out if we could do some nudging around those paydays and, you know, convince people to put some money away before they go into the weekend. And so we've created the savings boost program where just by depositing a dollar for that month, you're entered to win $20,000 for that month. And so we see that that has driven a significant lift in people saving. And again, it's not necessarily just people who have it set up for, from an automated or recurring fashion, we're seeing a lot of that being people coming in and making that one time deposit. Because we've removed so much of the friction from getting that going, we send them a push notification or we send them an email that with the CTA that's clearly called out, make a deposit to enter. And you know, within one click they're at that deposit screen and they can choose how much they want to deposit.

So Kyle is describing Prize Linked Savings. This is a clever innovation in recent years that ties prizes to with savings deposits. Walmart pioneered prizelink savings accounts in 2017 and they've saved their customers over $2 billion. So it's possible that Credit Karma system could create a habit. It would require that the allure of prizes is enough to train us to keep coming back time and again. So actually, let's move from savings to spendings. Maybe you can talk about the value prop for CK Money. CK Spend. CK checking account.

Yeah, so the name is Credit Karma money as sort of like the umbrella. But we have those two accounts. We have a spend account and a save account. So, you know, the checking account is Called credit karma money spend. And the goal really there is to allow members to take small steps towards their goals. We aim to help better manage their day to day spending and develop those good habits. I think more than a traditional checking account, we allow members to progress towards their goals by rewarding good behavior. And I think with what we're doing with instant karma, we see that even using everyday transactions, the things that they're already doing, we can try and help them improve their credit scores.

So can you describe what instant karma is?

Sure, yeah. So instant karma is the most exciting thing that I've worked on so far here at credit karma. And essentially what it does is it randomly reimburses members for using the card on transactions they would make kind of like everyday, purchase wise. So it all happens pretty much instantly as the name suggests. But imagine just going up to the register to pay and your bill's $50 at Target. As soon as you swipe, a bunch of stuff happens in the background and it determines whether or not we're going to cover your entire purchase. And that's it. The money shows up after a few checks are run.

So if I'm a credit karma money user and I'm swiping how soon until I get this refund? Like, is it, you know, within five or ten purchases that I'll get something interesting or do I have to wait to 100 or 200? How soon or how many folks are actually getting the benefit of the instant.

Karma you can win on your first transaction? A lot of people do. I remember telling one of my friends, hey, you should check out credit karma. And he messaged me later that day when he got his card and was out on a date and he had won his entire dinner back. I think it was like $180 because he'd got wine as well. And he's like, yeah, first one I won, amazing. So yeah, first one. There's an equal chance that you would win for every single transaction. The more you spend or the more transactions you make, the more likely you are to hit an instant karma.

So this is kind of like a lottery or prize length spending. Lotteries tend to be pretty motivating. In the design of lotteries, there's usually one choice. How big is the prize? The size of the prize usually determines how frequently you can win. Large prizes attract people to buy a ticket, but we know we probably won't win the mega ball. On the other hand, small prizes like scratchers, we believe we can actually win. And we do. It's fun and once we do, we may keep coming back think slot machines. So I asked Kyle where credit karma falls on the big versus small prize decision.

I think instant karma has stumbled onto something a little bit more nuanced. I don't think we're ever going to have an instant karma go off as like a $300 million win or anything like that. It's going to match what the transaction is up to. The card limits, which is, I think today is $5,000. And yes, we've paid out many $5,000 transactions in just a few months that we've been running. But the way we look at it, it's definitely a lot more smaller purchases, and it's basically directly reflective of people's normal spend. It's not often that people are going out and spending $5,000 on a down payment for their car, which we've seen dozens of happen, and we have actually covered those. But it's more of just like the everyday stuff. It's your coffee, it's your groceries, it's your gas. It's not these crazy big purchases. And I think that was a lot of the feedback we got internally was like, oh, what if people make all these crazy payments and ends up being millions of dollars on all of these huge things? And I think when we looked at the volume and the way the statistics work is the curve tends to reflect the curve of how people spend. And that's exactly what we've so far. So nothing strange has happened. It's just been perfect reflection of everyday activity.

Do people who win earlier, are they more sticky? So imagine your friend probably was like a user for life. Now if you had to wait for 100 swipes, maybe not so much.

This is a pretty interesting thing. I think we've seen both, not necessarily in the data, but when we actually talk to people. So early on, when we first launched the product, we quickly pulled in people and talk to them who have won. And there was. There were a few interesting nuggets we got there, which was one like, you know, people have won early. They're like, oh, I want to keep doing this. This is great. What? No other bank does this kind of stuff. Like, I can't believe you would just give me the entire purchase back. Most of the time I'm getting like a few pennies. When I buy something, you're giving me the whole thing. That's amazing. And then the other one that we heard was, oh, I got it. I'm glad I got it. I won't get it again. So clever, right?

Yeah.

Not necessarily using the past to predict the future here, which was, I think people thought maybe you could only get it once. And that was. It was sort of like this way of marketing the product where if you got it, you got the reward. And that was your signup bonus, because people are so used to seeing signup bonus with credit cards. So we made a pretty quick change to the product, which people reacted to extremely quickly as soon as we launched it, which was, okay, well, we show all the winners. We have, like, this leaderboard of recent wins. It shows, you know, where they're from, how much the purchase was for, and what their first name is. So we added an extra little section that says, you know, how many times this person has won? Because I think well over 50% of people have won more than once. We wanted to highlight that in the product. And immediately after that, we started getting feedback which was, hey, this person's won seven times. I haven't won once yet. Like, I'm still trying. I can't wait to win. I think that there was some early feedback that we had that we wanted to make a quick adjustment on to let people know, like, you know, instant karma is here to stay. It's not a marketing gimmick. There's no catches here and that you can get it all the time. And that's what we really want. We want people to get, you know, whole chunks of the pie, not just a tiny little fraction that, you know, takes years to. To get something substantial. And I think we're seeing a lot of surprise and delight from people in the way they talk about it on social feedback they give to us, as well as just comments about it on TikTok and random stuff like that. So we know we're making people super happy, we're doing the right thing. And it's something that also is driving the right behavior that we're hoping that credit karma money does.

So back to the basically instant karma developed maybe as a value proposition to get folks to use the card. I'll highlight the basically kind of using a new debit card is a classic problem in the fintech or bank area where you're basically getting someone to sign up for a card and now not only do they have to sign up for it, they have to do something called activate, and then they have to use it. Not only use it, but they have to use it on a continual basis. So maybe talk us through how you're helping people get over those barriers.

I think one of the notes I made earlier was that with savings, we noticed that people were sort of trying us out. You know, I think we're able to see roughly how much money they're putting in. And for us, a goal would be that they're putting 10% away. We didn't get there immediately, but we saw that over time, after they tried us out and they liked us, they would make bigger moves over from probably another savings account or, you know, they would just focus more on that habit of saving. I think the same thing exists over on the spend side, which is that we kind of have to get into the user's mindset here is they've. They've gone in, they've showed intent and into something that they like about our account. And there's a bunch of value props that we offer, but there's probably one that really stuck out to somebody. They've gone through the process of giving us their information, which, you know, I think a lot of the information we collect to open a bank account is highly regulated and it's highly sensitive. But someone's gone through and spent the time to do this. There's some really important steps that we have to make in order to like, quickly get them to the value of that account, which is probably the debit card first, right? They need to. At the core of this, it's a spend account. They want to spend money. So we think about all of the things that they need to get that account ready. Those things have to happen really, really fast. So we need to get them their debit card as soon as possible in through the mail and delivered to their home. And we need to let them know that, hey, your card sitting in your mailbox, Go check your mail. Because not everyone checks the mail every day. We need to give them access to digital wallet. We know that Apple Pay is on fire right now. It's growing like crazy. That was something that was a part of the MVP for spend. We had to have a digital wallet there because we knew that there was a time between when they opened the account and the card would arrive, that we needed something to be there. And the next piece is we need to make sure that when people make a deposit or they move money into the account, at first it all happens super fast so that there's no waiting or just sort of the joy of opening something new going stale. You know, I think whenever you get a package in the mail, like you want to open it quickly. Whatever it is, you want to quickly set it up and try it out. And we have to be just like that as well as a bank account.

Great so some of it's speed by which people get the card maybe as fast as possible, but if they don't, they have the backup plan for digital use, and then just let's make transferring money fast as kind of people would expect it.

I think the information we collect in order to get people into the account, it does tell us a lot about their intent. If they make it through, we feel like it's really up to us to lose this person's trust. They're definitely here to try us out and give us a shot because they trust the Credit Karma brand. And so we need to do everything we can to remove friction and make things super fast.

I think you're fighting against what most either startups or new products fight against, which is just status quo. So they may love you, but they probably are just in the habit of pulling out their other debit card and swiping it. And so you're fighting this uphill battle of the thing that they've always done versus the new thing that they want to do and trying to convince them not only just one time, but every day to pull out their card. It is a hard battle.

Yeah. And I mean, I think people use different cards for different things. We see how many credit cards people have. They tend to have a variety across different categories in which they can be incented on. Some are better for restaurants, some are better for travel, some are better for gas. I think we wanted to take a lot of the thinking out of that and really just make it across the board good for everything. And I think that's something we've landed on with the way that Instant Karma rewards members.

That is a trade off. Right. If it's good. For one thing, people understand how and when to use it. If it's good for everything, potentially they use it more, but it will take a little bit more onboarding to get them to switch.

I was saying this earlier to a friend. I got sick recently and I had to go to the pharmacy to pick up some cough syrup. And there were so many options, I sat there for about 15 minutes trying to decide which one I should use. And when you actually start looking at them, they're all kind of the same, but they all market themselves as something different. And so we just feel like when you're overloaded with decision, it takes a lot of time to figure out what to do. And we want to just make everything as simple as possible so that you're not sitting there thinking, oh, should I use this card? Or should I use this card or this card? It's like one card, one account, and we're really on our way with that.

Okay, so if you were to compare the cough syrups and you think about yourself and Chime, how are you different than Chime or similar fintech that has created a debit card?

Yeah, I mean, it seems like everyone is a fintech these days, but I can really only speak for us. And I think that what we really have built over the last decade is just like really good, solid relationships with people by helping them out. And they trust us because of it. And we care about our members first. We care about their privacy, we care about their safety. All those things that we do every day here are for the member. And it really does radiate through all the conversations we're having. So that trust is huge. You know, people don't want to have to open up, download another app, create another account, get another thing in the mail and have to figure it all out. Like we have over 100 million members already that have that relationship with us. They know who we are already. They know they can trust us. And to trust someone with their money, you know, I think you really only have one shot at it. I think it's really important that you, you put up a very good first time user experience and create a good first impression because if you fail on that, you'll never get them back. It's not like maybe you ordered a bad pizza, but you love that place and you'll go back and try it again. This is your livelihood, this is your money. It needs to work 100% of the time. And that's something that we've earned over the last decade. And that's what's really translating into a very successful product for us.

And so let's actually think about that. So folks come to credit karma for debt. So the mental model is kind of like, help me get out of debt, manage my debt, think about my fico, the one number that you can use to buy a home. And so how does that work with spending? We have the idea that we're encouraging people to use the card with instant karma. How do you guys think about helping them manage their spend or manage their money?

So one of the things that credit karma does really well, you know, other than the free credit scores, is tell you the credit factors that go into it, right? And like some of the biggest ones are on time payments. How often are you making payments on on time? Those are sometimes things that people just need to be reminded of that there's a payment due. And you should make it, because if you don't, it's going to harm your credit. And so like, just imagine if you had, you know, a checking account that lets you know when your next payment needs to be made and reminds you of how much it's going to be. And maybe it makes the payment for you. You know, that goes from just, you know, driving awareness to the payment, which credit karma is great at, to actually helping you take action. Now think about all the other factors that exist for a credit score. Things like credit card utilization, age of account. You could look at number of accounts. Now just draw the line to where a checking account could actually help with all of those. I think that's really the goal of how we intend to be the best checking account for your credit score.

Here is where I got tactical and pitched Kyle my wish list banking feature. One that is so easy to do, but no bank currently does it. Text me my balance every day Attention is a scarce resource and many times we pay attention to what we want to spend money on versus the money we actually have to spend. I'd love to see an experiment where we figure out if just texting people their balance will help. It's not the robots manage my finances vision, but it could be a small step in the right direction. And it seems to work for weight. If you step on the scale in the morning, you're less likely to gain weight compared to those who don't weigh themselves daily. We are what we pay attention to. So what does Kyle have to say about this?

I think one, it's super easy to do. We have the data, we have the delivery mechanism. We just need to build the thing along with the list of all the other things we want to do. We do send notifications for every purchase you make, so we do show the money going out. And if you've dropped below a certain amount, we let you know, hey, like, you have a low, you have a low balance. Consider topping that off because it does take some time if you need to make some more purchases. We've kind of heard two different sides of this, I think. One, some people are not confident with their financial situation to just have real numbers show up on their screen. And not everyone has their notifications set up in a way where they aren't displaying information that others could possibly see if your phone's sitting on the table.

So.

So we're not 100% convinced that everyone wants to have their balance displayed on the front door of their phone. So, you know, it's something we'd want people to be able to opt into. And that's just something that we've got to build more control for the member before we start sending stuff automatically. I mean, we do send some things automatically, like things that you'd want to be alerted to. If someone got a hold of your card and was taking it and making purchases and, you know, you didn't authorize any of that, we'd want to show you those notifications. So we do have spend notifications so you can quickly, you know, go in, oh shoot, this is not something that I did. I'll lock the card. I'm going to order a new one. I'm going to make sure that those transactions are not something I'm responsible for.

Kyle's really hitting on something that is a great debate in behavior change. How paternalistic should systems, or in this case an app be? Behavioral scientists tend to fall on the more paternalistic side of things. We would say people may not realize the benefit of seeing their balance until they actually experience it firsthand. It's not intuitive that it would be that helpful in managing our money. In fact, many times people think the opposite. If our balance is low, we want to avoid looking at our balance. This may feel good in the moment, but it isn't going to help you prevent overdraft. So I understand Credit Karma's approach of not completely defaulting people to getting these notifications, but there's probably some experimentation they could do without having to opt in to see if sending notifications that show your account balance really does help people reduce their spend. And speaking of experiments, I have to give credit where credit's due. No pun intended. Credit Karma is one of the best companies I've ever seen when it comes to running experiments, doing a B testing, and really digging into the data to see what their users want and what drives their behavior. So I was really excited to get to this point in my conversation with Kyle where I basically just told him to start running through as many a B test results as he could think of. At this point, I could have kept him talking all day. Is there an AB test that has surprised you? Or any kind of experiment where the results are either counterintuitive or generally more helpful than you would have imagined?

Oh, so many I have to jog my memory. So counterintuitive. I think like my favorite one to talk about is this notion of multi step flows versus single page forms. And I think it's also changing a lot. So depending on where you earned your PM chops, what type of business, what's the common platform I think people are going to have different views, but it's very counterintuitive and like a common misconception that more screens equals more friction. We've done a ton of experimentation around this because we've had to, you know, like, there's a pretty hard signup flow. The requirements to open a new bank account are pretty personal. It's the stuff that people don't really like to give out. But we've seen higher friction screens perform much better when they're broken up into single screens with a focus on answering just one question at a time. A great example is the Social Security number. You know, you have to collect that per regulations when someone's opening an account, one approach would be to just have all of the fields in the form on one screen so people can go through and add their name, address, et cetera and SSN all on one screen. But on mobile, which is now pretty much 90% of our traffic is mobile, which is up from the low 80s just a year ago, so it's increasing greatly. This doesn't work, obviously. The screen sizes are much smaller. So having a really long form that people are scrolling around can result in a lot of like tap errors. They may tap into the field and then it opens the keyboard and then they're having to close it and move things around and then there's like a lot of stuff that they're scrolling back and forward and reading. And we've seen this, we've seen all of this in real time. We study this like crazy. We've taken these screens and we've broken them up into like four screens and we see better conversion pretty much every single time. So I'd say like, you know, don't be afraid to experiment with things that are very counterintuitive because there's probably something else underlying it. You know, when people are asked to enter their ssn, they sometimes have a few more questions and so having that space to answer them on the screen, super helpful. Like, hey, is this going to pull my credit if I enter my ssn? I think a lot of people associate SSN with one, never give it to anybody, and two, it's used to pull credit, which for some people pulling credit is actually pretty harmful for them. It's a soft pull. Usually it's fine. If it's a hard pull, it can make your score go down a little bit. So putting that messaging in there to say, hey, this is super Secure, we use 256 bit encryption and this will not affect your credit. So it's not only we're not pulling, it doesn't even affect. It is super important and has led to significant increases in people actually getting past those screens.

Keep going. Any more A B test findings that you can share?

Yeah, this is another one that was really interesting that we've run recently. One of the fields that we have to collect is your job title. But because the list is from kind of the banking world, it's not super applicable to the jobs of today. I don't know when the list was written, but maybe it was written in the 90s where it was just vastly different job titles. We took a pretty naive approach to it where it was like, let's just sort it from A to Z. But when we started looking at people using that screen, they spent like 32 seconds on that screen which is like, I don't know, it's like 10 times higher than any other screen. And we're like, why are people spending so much time on this screen? And what they're doing is they're looking through the entire list to see what most closely matches the job that they have. And believe it or not, the jobs that you and I both have would most closely map to mathematics or science. But you wouldn't know that when you first saw mathematics science, you'd have to go and eliminate all of the rest. So you'd have to actually think about all of the jobs that you may most closely matched to and then just like go through and eliminate them. You know. You know it's not healthcare, you know it's not food service, but there's a few others that it could be. Is it management, Is it engineering? Unclear. So what we did was obviously order doesn't matter because you're not going to actually be searching for something that your title is just simply not there. And then if you are going down that hunt, you have to go through and eliminate things. We decided let's just rank it by popularity. And what that did was I think we cut the time on page down by like 50%. People were able to much more quickly find what they were looking for. So that saved a ton of just like mental load. And then they also saw what was most likely going to be theirs within the first opening of the picker. So that was pretty interesting. I think we just got over the point that alphabetical order, which is sort of the default in most things when you're building it, is just like not good here.

Any findings on getting people to come back or use the card? How would you like once they maybe have activated any Learnings on driving retention.

I think speed is super important. So, you know, we're trying to change your relationship with money. And I can quickly go grab a $20 bill out of my pocket. If it's there, I can quickly go grab my debit card from my pocket. Those types of actions need to be super reflective in the app as well. The app needs to load super quick. You need to be able to find out what your balance is very quickly. You need to be able to make deposits into your account super quickly. And we do see a strong correlation to activity based on speed, because you're not necessarily coming and checking your credit score once a week. With credit karma money, you're checking in on your stuff multiple times a day. And if it takes a really long time to do any of those things, then you're just going to slowly find other ways or maybe even just totally disconnect from the product. So making things incredibly quick is my whole spiel. I mean, if you think about what technology does, at the end of the day, it just makes things happen faster and with greater scale. I always like to say that if I wanted to see photos from your vacation, like, 15 years ago, we'd actually have to know each other. We'd have to set up some time to sit down. You'd have to have gone and printed them, all of these steps in the middle, and we'd actually have to, like, you know, share some time together to see them. And now that can all happen instantly because technology, like, the beginning and the end are the same. Just all the steps in the middle are completely removed. So, like, if you just take that idea and apply it to anything in the analog world, that's how technology solves those problems. And, you know, we need to also be right there and making things with much less friction, much fewer steps, and much faster.

That's a nice mantra. Humans do things that are easy. We take the path of least resistance. And so technology allows that, but we just have to build it. Banks, if you ever try to, like, set up a credit card, automatic payment, Very, very difficult. There's probably good reason for this, right? They don't necessarily want us to pay in full every month. And so is there a world by which credit karma offers a credit card?

Credit karma is a platform for a lot of different financial products, and we're always trying to find the best ones that match people. So, yes, we offer ways to get personal loans, credit cards, home loans, auto loans, auto refinance, all of the things, but it doesn't mean that we're offering all of the things to everybody at the same time. We spend a ton of time and resource on figuring out where you are in your life cycle, where you are in making progress. And we only give people recommendations to things that we think are actually going to make an improvement because we actually see if people are making improvements or not. We have access to the credit score over all time. So we can see did those things that we did actually help people or not. And then we learn over time the right things. And we've spent over a decade doing this, learning what is the right thing to show people. And so we intend to always be independent. And this third party platform that just connects people to financial products, we have the eyeballs for a reason. We've done all of the right things, we've built trust, we help people make progress. Those eyeballs are just being connected to the people that can help them the most. And we're sort of in the middle making sure that we're making that right connection.

So maybe we'll wrap it up with a question that we've asked other guests as well, which is when you think about the future of money, where are we going? And I'll give you this context as kind of a thought starter. One of the first feature films was actually filmed from one angle. And that's very interesting because you could say you could just move the camera. It'd be much more interesting if you move the camera. And yet kind of the first people doing the film just never even thought to move the camera because we're used to photography. And so you can kind of think that those types of differences and we're currently viewing money in this way and we don't even realize that we could be moving the camera. Could happen to us in 10 or 20 years where we look back on today and kind of are surprised at our either lack of understanding or just lack of something.

Yeah, it is a very interesting analog to think through. I think I said a little bit about it, which is I'm a huge proponent in speed. And just like time to event or time to action. Having all these things like money move fast is hard. You may ask, why can't you just do it? A lot of it is around being able to do it safely. We want to be able to move money between you and me, between you and the coffee shop and back and all over the place safely so that there's not risk in the middle of someone taking advantage of that. And this is when you're starting to talk about money at scale. It invites Bad actors into the mix. And so you really have to be taking care of that type of stuff. So I'd say like, whatever the future looks like, it's going to be instant. But I think one of the things that we try to look for is where at in people's life is money being thought of. And you know, luckily for us, it's thought of kind of all the time, all day. Which means that we have so many problems to solve to get rid of that. I think the future is really not getting people to think about money anymore. And that could mean that we're doing it all for you. It could mean that you're not having to worry about your paycheck before you make a purchase for groceries. Maybe you're getting paid as you go every day as that you do work. And maybe when I make a payment to somebody, it happens instantly and I don't have to worry about the weekend or maybe there's a bank holiday in the middle or all of these things that are just sort of like the old world. So I think that the foundations is really like everything happens instantly and safely. And then when we can get there, a lot of the stuff that's built around this legacy slow moving money can just go away. And you may not need to spend as much time thinking about it. I'm not sure how we're going to solve making everybody more money. Right? Like that's sort of like a really hard problem to solve as a company. But I remember my mom always telling me, it's not what you make, it's what you spend. And that's something that we can have a pretty big impact on. And we see it today. You know, we see that when people are winning instant karma, they're more likely to use the debit card than another card. And thus their credit card utilization goes down and then their score goes up. And like all of these things that we're doing is to try and help people and to help them spend responsibly. And like that's definitely the future of Credit Karma. Money is to help people make that progress. And I have a pretty good insight that we're going to help do all of this really, really fast so you don't have to think about it anymore.

That was Credit Karma's Kyle Thiebaud. So look, money is a big problem. We've put people on the moon and we've developed technology that has made just about every aspect of our lives so much easier. But somehow we haven't developed solutions that really help us manage our paychecks. It's kind of shocking and a failure on our part. That's why I really enjoyed chatting with him about Credit Karma money, because the idea behind it is really behavioral science at its core. 4 It's about defaulting people into good financial behavior, which is just a fancy way of saying it helps you pay off your bills at the right time for the money you have in your checking account. This is something that is exceptionally difficult for people to do by themselves because our paychecks and our bill due dates rarely align. So I think Credit Karma is actually solving a massive problem if they can do it right. Defaults are the ultimate behavioral science hack, but there's literally nobody in fintech or banking that has completely automated the full stack of savings bills, rent, payments, investments, everything. So we don't have to worry about them. But I worry that they're in a position where they're aiming a bit too high in trying to shoot for the moon. It may be a challenge, at least at first, to get consumers to either trust them. Remember, Credit Karma does try to upsell you credit cards whenever you log in or go through all the steps of friction that are required to automate and optimize our finances. I applaud them for taking it on. The larger commercial banks most of us use certainly aren't, and given their laser focus on data and AB testing, I wouldn't rule out Credit Karma as being the first solution to crack that code. The Science of Change podcast is presented by Setsale act on the moments to lead to a sale. Visit them at Setsale co or on LinkedIn to learn more about the world's number one revenue execution platform. This podcast is produced by me, Kristen Berman and Studio Pod Media. Our Executive producer is Rachel Roberts and all episodes are written by Jack Hewer.