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What role for banks in a sharing economy of social capitalism?

I was struck yesterday, as I presented my themes around Digital Bank at a conference, that there’s one area I’ve discussed for a long time, but not blogged about much in-depth.

That is the collision of community with commerce via the sharing economy.

The theme starts with the fact that capitalism is not what it was.  The integration of East with West, and the blending of communist and capitalist economies, resulted in this interdependency between America and China and, after 2008, saw the collapse of traditional capitalism.

The never-ending self-interest of working purely for the personal dollar at the expense of all others is not the priority of the global culture anymore.

This is demonstrated by @Anonymous, Wikileaks, Bitcoin and the internet economy, but that internet economy is also a reason why the traditional forms of capitalism have died.

The internet economy blossomed around the same time as the financial crisis, to create a social network on a global scale.

Just as Lehman Brothers collapsed, Facebook flourished.

This led to other developments to change and morph capitalism into something new and different.

A form of social capitalism emerged.

Social capitalism is one where the 99 percent have a voice via change.org and tumblr.

Most importantly, social capitalism is a part of integrating community and commerce.

Just as we no longer have a work-life separation, we no longer have a commerce-community separation.

We have melded work-life, commerce-community, via facebook and twitter.

We share personal lives and work lives with family and workmates.

We go to bed checking for the latest emails with actions and updates with likes.

We wake up the same.

We might work till lunch, and then go do some house chores; or we do house chores till lunch and then do work.

We work from home and we home from work.

Nothing is separated anymore.  The world is integrated, as is work and life.

This leads to the final mind-meld of the society with the economy.

The sharing economy is an emergent trend of social capitalism and the networked world.

Sharing economics works on the basis of taking unused resources and redeploying them to where they can be leveraged.

This article The New Sharing Economy illustrates it well, with the idea being that like cloud computing providing on-demand service, the sharing economy can provide on-demand anything.

Rather than buying cars, hotel rooms and more, you just rent time and space on-demand through apps like Airbnb and Lyft.

Between the shift from formal structures to informal infrastructures and the move from commercial capitalism to sharing economies, the world has changed and banks need to change with this.

Banks historically existed to purely enable commerce.

They became integral to economic prosperity.

Now, they have to become part of social wellbeing.

Being socially useful in a sharing world of social capitalism.

Wow!  Is this happy-clappy or core mainstream?

I’ll be interested to see how it all pans out.

About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

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4 comments

  1. Great article, Chris. It can be done, within reason, of course. The new model can translate to dollars and (community) sense to do the right thing. Has happened in several credit unions and organizations (Tom’s, Whole Foods, StarBucks, etc)
    Social Purpose + Business Performance = Sustainable Community Model of Benefit and Value.
    Social Purpose is about creating healthier, wealthier (consistently improving lives), and wiser point of view and actions when it comes to sustainability. Business Performance is a must, so reasonableness of profit comes into play with your market audience (and not at the expense of a larger and more vocal community).
    FI System and industry must realize who the “increasing” consumer is in a customer-centric world as the internet of everything makes the world smaller and more interdependent.
    The world economy of scale will come to this industry of control. This time from the more than vocal outside in and will impact banks and corporations to become much more social, probably internal before external ~ breaking down silos, moving from hierarchal to heterarchal, and busting at the seams with diversity. And that type of diversification will have a whole new meaning.

  2. Great article, Chris. It can be done, within reason, of course. The new model can translate to dollars and (community) sense to do the right thing. Has happened in several credit unions and organizations (Tom’s, Whole Foods, StarBucks, etc)
    Social Purpose + Business Performance = Sustainable Community Model of Benefit and Value.
    Social Purpose is about creating healthier, wealthier (consistently improving lives), and wiser point of view and actions when it comes to sustainability. Business Performance is a must, so reasonableness of profit comes into play with your market audience (and not at the expense of a larger and more vocal community).
    FI System and industry must realize who the “increasing” consumer is in a customer-centric world as the internet of everything makes the world smaller and more interdependent.
    The world economy of scale will come to this industry of control. This time from the more than vocal outside in and will impact banks and corporations to become much more social, probably internal before external ~ breaking down silos, moving from hierarchal to heterarchal, and busting at the seams with diversity. And that type of diversification will have a whole new meaning.

  3. There is a growing movement around currencies that are issued by communities in exchange for the time given by people who undertake volunteering type activities.
    The intention is to link them to a marketplace that can transact in both fiat and community currencies.
    So a measure of value, a means of payment, a social network and a marketplace combined could unlock the sharing economy and complement/counterbalance the function of money, that tends to work against community.

  4. There is a growing movement around currencies that are issued by communities in exchange for the time given by people who undertake volunteering type activities.
    The intention is to link them to a marketplace that can transact in both fiat and community currencies.
    So a measure of value, a means of payment, a social network and a marketplace combined could unlock the sharing economy and complement/counterbalance the function of money, that tends to work against community.

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