It is an exciting time to be a designer.

We design not just the emotional, delightful aesthetic occupied by clever illustration, typography, and use of motion, but also apply the psychological and behavioral change considerations of design thinking.

Moreover, the intersection of science and art that defines our craft is so much more than aping the look and feel of current trends. It is an appreciation of why art movements occur and how design trends evoke certain emotions. It is being sensitive to user intent, understanding a system inside and out, removing layers of abstraction, reducing pain-points, surfacing the right feature at the right time. In that way, the value of design, and the application of design thinking in the financial industry is at a crossroads, where full service brick-and-mortar institutions are circled by nimble start-ups focusing on launching discreet products with narrow scopes.

All financial institutions, regardless of age, size, and function, facilitate the management of assets, liquid or otherwise. So before we delve deeper into this discussion on designing in this space, a primer: “Money has three functions: it is a store of value (that is, somewhere you can put your life savings), a unit of account (that is, a measure of value), and a medium of exchange (a way to transport value).” As designers in this space, our goal should be to measure and reduce the complexity of these interactions.

The Old School

In one corner of the internet, we have a number of brick-and-mortar institutions, each hobbled with over a hundred years of technical debt. They’ve underinvested in infrastructure, their technology is old, and they’ve become slow and bureaucratic. Worst of all, their ideas are stale and the user experience is dreadful.

Meanwhile, their customers’ expectations, shaped by their interactions with other apps and services, grow ever-aware that their interactions with the digital solutions of their bank of choice aren’t cool. These banking apps are judged not just against other banking apps, but also against every other app in their device’s ecosystem. The disconnect, meanwhile, is that brick-and-mortar banks continue to do just the opposite: compare themselves to other banks, as they should for other finance-related metrics, instead of all digital services in their ecosystem, regardless of industry.

The New School

That brings us to the other corner of the market. Square, Venmo, PayPal, Circle, Stripe, Facebook Card, Amazon Wallet, and Google Wallet exist in the same cohort as brick-and-mortar firms as legally recognized financial institutions. The difference here, besides their organization’s age and size, is that design is a core part of each of these startups’ DNA. Though their product suite may not be as robust, each is poised to erode away the consumer-base for niche financial services, namely money movement.

It’s surprisingly difficult to move money today, and the experience of paying for something online is just about the only part of the internet that hasn’t changed dramatically in the past few years. Greg Bockman, Stripe

Understanding Technical Debt

Banking, like the health industry, is broken, in that compelling product design is often compromised by regulations, limitations of aging back-end technology, and bloated business processes. Nevertheless, there is so much opportunity for a player in this space to be wildly successful. Much of the problem—the shortfall in product design—may be organizational, in that design is not part of the conversation in a meaningful way.

A huge obstacle to success that we see for larger businesses is the relationship between organization and the systems that it builds. There’s a term in software engineering called Conway’s Law. It’s a term someone said in the ‘60s that wasn’t intended as a joke but is usually invoked as a joke today. It’s an observation that big complicated organizations are only capable of creating software systems that mirror the organization.

The devil is in the details.

As noted, some brick-and-mortar institutions aren’t used to working with designers and struggle with how to incorporate them in multidisciplinary teams. The situation isn’t entirely dire; others have tried to address this. Capital One, for example, hired Daniel Makoski, founder of Google X’s Project Ara modular phone, as its first vice president of design. Makoski and his team will have to navigate the organization in such a manner that design finds itself in the mission, as a part of the Capital One’s DNA, for his tenure to succeed in being more than window dressing.

Conversely, new entrants in the finance space have the ability to build their teams and technical architecture in a thoughtful manner. In many cases, these teams tend to focus on narrow slices of the industry, measuring and reducing the complexity of transactions along the way.

If I want to schedule some bill payments, schedule a transfer to savings and then schedule a P2P payment to my sister, there is no one place to initiate all these transaction or see the scheduled activity. If I want to know how much money l have left, I have to do the math myself, and then keep track of all the dates when the money will move. If Google were a bank, do you think they’d have that experience figured out? Jamie Armistead, Bank of the West

The irony here is that the difficulty in conducting certain transactions may the saving grace for traditional financial institutions. Customer movement from one bank to another is notably inelastic. (When was the last time you moved your checking account?) That, combined with the legal, fraud, and insurance protections afforded to most account holders give users a piece of mind that is difficult to quantify.

Fraud prevention alone would kill most start-ups.

The vested technical debt of the older institutions, and the debt and lessons younger ones are beginning to incur, are probably why the industry trends tech-first rather than design-first.

And perhaps that is where the disconnect lays. Modern financial institutions are, in many ways, software development firms. They are home to some of the best white hat security analysts and proprietary back-end systems; their data scientists are armed with algorithms that can predict future customer behavior based on previous account and credit history. In sum, financial institutions invest their energy in storing, analyzing and protecting data, a formula that often elevates back-end processes before front-end considerations.

Enter the Gatekeeper

Therefore, for designers to succeed in this space they need to be aware of the full-stack; they need to be mindful of how back-end technologies inform the front-end. The designer in this environment needs to be familiar with how and what a given database stores, along with its hooks, calls and APIs, for example, so that they can present information in a compelling manner.

Designers in this environment aren’t just pushing pixels.

They need to insert themselves into the conversation at the ideation phase and remain with the product throughout its entire lifecycle. Working with engineers, the designer sees the raw, unadorned thing and can validate assumptions that inform decisions across the full-stack before the product is ever skinned. It’s about knowing what we’re going to build as well as how we’re going to build it.

Regardless of whether it is a brick-and-mortar financial institution, or a start-up, product design in this space should focus on experience and behavior change, not so much the brand and the identity. It is understanding the difference between how to use something, as opposed to how to market it.

Design thinking can reveal opportunities that users may not have considered, predicting intent before the user voices it.