12th May 2016

The CFRM Toolkit: Methods for understanding consumers in a changing world of finance

Consumer finance globally is undergoing a process of rapid change. With the rise of digital finance, consumers’ choices are no longer limited to products available in their place of residence. Gone are the days when our only options were local banks and moneylenders.

Instead, those of us who have a digital device and Internet access can choose from an enormous array of products from all around the world. Insurance, savings, peer-to-peer lending, cryptocurrencies, and currency exchange services are just some of the services at our disposal. Even without Internet, millions of people are accessing new financial services through ordinary mobile phones. Consumer finance has gone global.

How can we understand consumer behaviour in this changing environment? Consumer choices can be difficult enough to understand at the best of times, and this explosion of product choice only promises to make our research more complex. We need to adapt our research methods to this new digital environment in order to keep abreast of how consumers make choices, what new risks they face, and what further financial services are needed.

To assist researchers working in consumer finance, Gawain Lynch and I created the Consumer Finance Research Methods Toolkit for the Institute for Money, Technology, and Financial Inclusion (IMTFI) at the University of California, Irvine. This toolkit is part of the larger Consumer Finance Research Methods Project, for which we produced a provocation paper and series of blog posts outlining major issues in consumer finance today.

The CFRM Toolkit features six methods used in consumer finance research: Ethnography, Verbal Interviews, Object-Centered Interviews, Financial Diaries, Digital Research, and Experiments. For each method, we describe what the method is, its strengths and limitations, and provide links to further information.

To showcase cutting-edge research, we present extensive case studies for each method to demonstrate how each methodological approach can be used to understand aspects of consumer finance. The case studies are drawn from research carried out in different sectors of consumer finance around the globe: academic, commercial, and non-profit research. They show how each method can be applied on its own, or combined with other methods, to find answers to some of the trickiest problems in consumer finance research.

The CFRM Toolkit is currently available in a beta version. We would like to invite you to road-test the toolkit and send us your feedback. Did you discover any new methods to incorporate in your research? Which case studies were the most illuminating? What’s missing? Your suggestions will be incorporated into a second version of the toolkit, which will also be made available freely to everyone.