What Banks Still Haven’t Figured Out Post Recession

By Samuel Phineas Upham

The most recent recession to befall American banks presented the problem of consumer finance on a scale not many had thought of before. According to Phin Upham, Principal at Thiel Capital, consumers face a serious problem managing their money. For people in the middle or upper classes, the concept of managing one’s money paycheck to paycheck is a little vague. This is a glaring problem in today’s society that financial technology, or fin tech, will need to address.

The Challenge of Liquidity

According to Phin Upham, consumers face a problem with liquidity. If someone needs to pay bills today, and they need to go grocery shopping tomorrow on a limited income their choices are somewhat limited. That’s because managing finances by the hour, not weekly or monthly as others with means do, is nearly impossible today. That lack of information hurts consumers who rely on mobile apps and bank cards for transactions.

Consumers also face steep fees if they can’t pay on time, or if they are caught over drafting. As Phin Upham points out, that’s akin to charging interest to consumers who aren’t taking on a loan.


In the future, consumers and banks will have a very different relationship. The key is smaller loans and other programs that banks would normally walk away from. 40-60% of the American public is not services by the banks, according to Phin Upham, largely because banks aren’t willing to go after high-interest high-risk loans. For the middle class to truly grow, it must be possible for people to get the money they need to start the ventures they seek.

Samuel Phineas Uphamis an investor from NYC and SF. You may contact Phin on his Samual Phineas Upham website or Twitter page.