Designing Interactions with Digital Money

Designing interactions with digital money

1. Motivations, issues and concerns

There has been a growing interest in digital currencies and payments technologies, driven by innovations in computing and ubiquitous network infrastructures. Prominent examples including BitCoin, MPesa, ApplePay,and Venmo have hit the public imagination, and in some cases, have radically changed the ways that we are able to transact with others. Not only do these technologies often offer us new ways of interacting with money, they can also transform our understandings of how financial operations occur, how to make sense of the financial information we are presented with, and howthese new forms of money or methods of payment change our social interactions. These present critical questions for HCI and IxD–asking how we can support the design of new forms of technology that give value to money so that it is interactionally usable, but is also useful: credible as a form of financial exchange and understandable as a mechanism for economic transaction.

Bitcoin is a case in point when it comes to usefulness and usability. As it stands, the distributed ledgertechnology that underpins Bitcoin is highly unintuitive for non-experts and its design is deliberately oriented towards payment privacy and inflationary stability, lending itself to two, well publicised, primary uses for the currency: criminal behaviour and speculative investment. Neither of these functions offers much of an incentive for ordinary users to exchange their existing currencies or payment mechanisms for Bitcoin. Because of its important role as an investment vehicle, much of the development work for directly interacting with Bitcoin has meant that a substantial effort has been put into developing interfaces for managing currency trading exchanges, but considerably less into their use for everyday activity. The massively distributed computational architecture of payments-processing for Bitcoin means that delivering proof of payment is relatively slow, again limiting its potential for more routine forms of exchange. These forces–and they all arise through deliberate design choices–conspire to mean that Bitcoin is not currently in much use as a form of regular exchange, and it looks unlikely to replace the regular forms of government-backed (known as ‘fiat’) currency that we typically use to make payments with. Bitcoin is not unique in how these kinds of design choices impact on the use and usefulness of digital money systems – but by understanding both the ways that people use money, and of the ways that different system configurations afford different opportunities for interacting with money we can look to support different ways of transacting with money.

There is a huge diversity in the possible forms that money may take in the future, and it is likely that a newecology of systems will develop around niches in the financial infrastructure, each with their own opportunities for interaction design. However, there is an elephant in the room in developing alternative[MP1]digital forms of money and payment–the influence and interests of national governments, and in particular, the role of central banks in economic control and management.Their interests lie in ensuring financial stability via control of the money supply. Reductions in financial liquidity, impacts on inflation or deflation, opportunities for fraudulent behaviour, and so on, have huge potential to damage national concerns, and so the regulatory environment for financial technologies is under continuous review and tight control. Nevertheless, central banks themselves are taking an increasing interest themselves in developing digital currencies based on the distributed ledger technology (DLT) that Bitcoin is built on that integrate with their existing forms of fiat currency. That they are doing so has ramifications for all of us as citizens as we engage in our everyday lives because of the pervasive influence of money across a huge variety of our individual, social and civic activities. Getting the design right in this instance is critical to much of what we take to be otherwise unremarkable and ordinary. Indeed, as Andrew Haldane, the Chief Economist at the Bank of England states: “Whether a variant of this technology could support central bank-issued digital currency is very much an open question. So, too, is whether the public would accept it as a substitute for paper currency.Central bank-issued digital currency raises big logistical and behavioural questions too.How practically would it work?What security and privacy risks would it raise? And how would public and privately-issued monies interact?” These issues are of core concern to interaction designers as much as they are to economists.

Outside of the industrial-scale interactions carried out in the wider banking sector, the majority of the financial interactions that involve money are relatively small scale. Buying a car or a house are important, but irregular events for most people. Consider your own daily spending for example; it may involve buying fuel, snacks, bus tickets, and a newspaper. Other common forms of interaction with money systems involve checking our bank balances, changing mortgage payments, following our investments, and organising loans. The majority of our interactions with money are currently relatively small in value, or involve limited monitoring and tweaking of existing arrangements. This is not to say of course, that technology might enable more radical forms of financial intervention that upend our current practices, but the point here is to illustrate that interactions around money permeate our everyday lives, and are frequently mundane, rather than dramatic in their operation and consequences. Moreover, as economic anthropologists and sociologists have shown, such economic interactions are often heavily embedded in our social worlds (eg. Zelizer, 1994). The simple example of paying for a shared meal in a restaurant illustrates this clearly: how the bill is split is often more than a simple fractional division, and needs discussion and agreement; handing over the bill to the server may involve a discussion on the food, requests about the methods of payment or promotional discounts accepted; consideration of tipping and its consequences; manual handling of the payment media; making small talk with the server at the point of exchange; and collection of payment receipts. These are not culturally or socially sterile activities, and changes to payment media or mechanisms are likely to impact on the restaurant experience in some way. How any new payment systems are implemented here is likely to impact on people’s experience of their evening out, and the same will be true for a vast range of other events that take place over the course of everyday life.

2. Design opportunities and constraints

The financial services and the emerging financial technology (‘fintech’) industry has latched onto the potential for disruption of the status quo for industry incumbents in financial services as one of the fastest growing areas for venture capital investment. Yet, while a huge amount of effort has been expended into its opportunities for transforming the financial services landscape, the impacts of many of these kinds of technologies often fall on ordinary users for better or worse. Partly as a result of this, research around everydayfinancial interactions is beginning to receive tentative academic interest, with dedicated workshop sessions[GC2] devoted to the topic in the HCI (Kaye et al, 2014) and CSCW(Millen et al., 2015) communities. There is also a small, but growing corpus of literature on the topic of financial interactions covering fieldwork (e.g. Ferreira et al., 2015), theory (e.g. Dahlberg, 2015), and design (e.g. Vines et al., 2012).

One of the more obvious trends in interactions around money thatpresents a clear opportunity for designers to engage with lies in mobile and ubiquitous technology, where there are a number of HCI-relevant concerns.The scope of areas in which our financial interactions operate is also extremely wide,crossing many different forms of mobile financial service. Interactions with different fiat payment technologies are maturing with a raft of tools and services to support this, but as we add alternative or cryptocurrencies into this mix, complications arise with managing exchange rates, regulatory differences, and mechanisms of transfer, all of which need to be handled on small screens and conducted at a socially acceptable pace. Traditional, and now peer-to-peer, financial services that have been previously managed by face to face or phone calls are now possible to enact on apps, with the possibility of pulling on people’s social media presence in developing credit ratings. From a different angle, mobile technologies also support financial tracking in a variety of ways, notably in allowing people to lifelog their behaviour around spending through ‘quantified self’ approaches, and using algorithmic approaches, to assess what effect their financial behaviour is likely to have on their quality of life.

Given the ubiquity of money in our lives, transactional activities mustalso work over an intermittent wireless infrastructure that may involve bespoke hardware, and often be reliant on power to all of the transacting devices. While these may seem like technical challenges to overcome, the design decisions made around these also have important interactional implications. The challenge here for designers is that solutions need to be developed that do not cut across their users’[MP3]values, interests and concerns.Alongside this, the effort costs and complexity of what are often necessarily elaborate financial interactions need to be handled so that users do not abandon them. As such, developing suitable mechanisms of feedback that engender trust, inform users about risk, build in and leverage social connectivity around financial interactions, support transparency about the underlying financial infrastructures and intermediary service providers, and utilise our everyday knowledge about money, perhaps building on aspects of its tangibility and materiality are all important considerations for interaction designers.[GC4]

We also need to acknowledge that we, as financial service users, are not the only entities whointeract with our money and financial information. Organisations, and usually extremely well resourced large corporations, may have access to both our own accounts with themand aggregated user data[GC5]. Supermarkets, utility providers and banks, to name a few, have detailed knowledge about our financial arrangements and activities. Increased knowledge by organisations about our financial lives that can be leveraged by them in their own dealings has both positive and negative consequences for citizens. There are possibilities that this will lead to invasions of privacy and the potential for a degree of corporate oversight in our lives that may not be in our interests. On the other hand, information gathering by organisations could be incredibly useful to improving the financial lives of citizens through the provision of customised services, as well as to the wider societal and national interests. Returning to the earlier example of a central-bank issued digital currency, we are working on a project with the Bank of England, the Office of National Statistics and the National Cyber Security Centre(CESG) to explore their design (‘Smart Money’[1]). Such digitalisation of UK fiat moneywould allow financial transactions to be tracked at varying levels of acuity, with control over access rights to the information. As we have found, for many organisations, flows of money are seen not just as ways of tracking financial movements, but of understanding national changes, such as those resulting from government policy, geopolitical shifts, and socio-technical transformation, allowing near real-time access to economic data, and supporting the use of data mining techniques on a massively rich dataset. Systems such as this are being explored by severalcentral banks, and here too lie opportunities for interaction design (and HCI more broadly) with this material for practical use (for example, interactive visualisations and dashboards), as well as working to design systems that are publicly acceptable (covering trust and privacy concerns) and useful (for example, allowing people to track and optimise their own spending) to citizen users of the digital currency. Getting the design right of the money system is of critical importance to the national – and indeed international – interest, and is one that may offer a unique position to HCI and UX in transformational impact at a global scale. It also places new challenges to the disciplines that HCIhas[MP6]worked with to date, engaging with policy makers, industry regulators, economists and financial engineers, and a vast range of commercial and governmental organisations, each with their own interests at stake.

The Future of Digital Money?

Our experience suggests a number of conclusions and design opportunities for the future of money, and the role that interaction designers can play in developing this:

-Financial Sociality. Financial transactions are intimately bound in with social interactions. There is a rich anthropological literature on money that belies the view of money as an abstract means of financial settlement or capital exchange. We borrow, lend, pay, advise[MP7], check, gift, share, and display our wealth – all highly social activities, and transactional systems that fail to account for these activities when they are relevant are likely to offer a diminished user experience and consequently limited adoption. Digital financial interactions will almost certainly build on our social media footprint across a variety of aspects in leveraging our social capital and communicating our consumption patterns.

-Transactional Complexity.There is a tension in any form of design solution where there is complexity,andmany financial technologiesrely on complex infrastructures[GC8] or employ multi-faceted financial instruments even for simple transactions. Understanding what transactions actually involve is not trivial. Two plausible solutions are open to designers. The first of these is to provide full visibility into the transaction so that all aspects of its mechanics(including intermediaries, financial flows, risk, and so on) are inspectable; to do so through clear visualisations will allow users to understand and take control of their own finances, something that is becoming a plausible solution as banks disintermediate and financial information is made available with open banking APIs. However, utilising this information may require both a sophisticated understanding of financial services and an interest in it by users, neither of which may be true. An alternative solution may lie in providing comprehensible models of people’s personal finance, though not necessarily with a 1-1 mapping of correctness,[MP9] to provide a simplified representation that does not mislead users in the actions that they may undertake on the back of this knowledge.

-Robust Mobility: Future money and payments systems will only become heavily used and serious contenders for replacing cash if they support high levels of mobility. Yet one of the problems of mobile technology use is that it is dependent on battery life, device robustness and network availability. Designing for systems in which digital payments can occur in the absence of multiple connected devices, yet with suitable transactional confirmation to both parties is likely to become an interesting design space for transitioning towards a fully cashless economy.

The press around future digital money solutions suggests that the future of money lies in crypto-mathematical solutions, algorithmic trading, and frictionless forms of transactional engagement. Yet the history of money (eg. Zelizer, 1994) would suggest that a focus on computation and infrastructure misses a huge determinant of its likely success. It is people, and the things that they want and do, that gives value to designed things, and in this respect, new forms of money and financial service are only valuable if they can be woven into the ways that we live and act. Transactions are a form of interaction, and this places the success of future money systems firmly in the hands of interaction designers.

Acknowledgements

I would especially like to thank Jennifer Ferreira, PanosLouvieris, Leonid Ivonin, and Barry Brown for my discussions with them around the future of digital money.

6. References

Tomi Dahlberg. 2015. Mobile Payments in the Light of Money Theories: Means to Accelerate Mobile Payment Service Acceptance? In Proc. 17th International Conference on Electronic Commerce 2015 (ICEC'15). ACM, New York, NY, USA, Art. 20.

Jennifer Ferreira, Mark Perry, and Sriram Subramanian. 2015. Spending Time with Money: From Shared Values to Social Connectivity. In Proc. 18th ACM Conference on Computer Supported Cooperative Work & Social Computing (CSCW'15). ACM, New York, NY, USA, 1222-1234.

Jofish Kaye, Janet Vertesi, Jennifer Ferreira, Barry Brown, and Mark Perry. 2014. #CHImoney: financial interactions, digital cash, capital exchange and mobile money. In CHI '14 Extended Abstracts on Human Factors in Computing Systems (CHI EA '14). ACM, New York, NY, USA, 111-114. DOI=

David R. Millen, Claudio Pinhanez, Jofish Kaye, Silvia Cristina Sardela Bianchi, and John Vines. 2015. Collaboration and Social Computing in Emerging Financial Services. InCompanionProceedings of the 18th ACM Conference Companion on Computer Supported Cooperative Work & Social Computing(CSCW'15). ACM, New York, NY, USA, 309-312.