2020 VISION for the Financial Services

As 2020 draws to a close, having brought with it a whirlwind of obstacles none of us could have foreseen, we ask those in our Women of FinTech community to look back over the year and tell us the best innovations they have seen, the impact that COVID has had on their work and then give their predictions for the year ahead... 

Mary Agbesanwa, PwC, Scale Fintech Programme Lead 

My predictions for FinTech in 2021 are... 

More purpose-driven financial services and seeing financial inclusion and ESG come even more into the forefront.

I believe the impact of COVID on FinTech as an industry will mean...

People are open more to innovation and new ideas across the industry.

The best innovation I’ve seen in FinTech over 2020 is...

Can't pick on this one!

Linda Leaney, CFO, Globcoin

My predictions for FinTech in 2021 are...

Further integration of cryptocurrencies and especially stablecoins

 I believe the impact of COVID on FinTech as an industry will mean...

The death of cash

 The best innovation I’ve seen in FinTech over 2020 is...

Paypal accepting Bitcoin – this will lead to greater adoption and comfort by the average person

Monica Nguyen, Client Services Manager, AIMS Markets

As the nation is adapting to living around the new strain of Covid and the economy beginning recovery steps to boost the economy. Other than the silver lining of the Pfizer vaccine, we are clearly not out of the woods just yet and this is how l have summed up my top 5 FinTech Predictions for 2021.

 1. Cash usage will skydive further as more merchants are preferring digital payments as a more hygienic and safer way to pay. Growth in Ewallets and online shopping continue to exponentiate.

2. Tech companies increase their market dominance by providing their services in payments, cloud, infrastructure, compliance functions across to their merchant sites giving small businesses access to a further reach outside their local community. To the customer, we will receive a seamless customer shopping experience.

3. Compliance costs will continue to drop for financial institutions as they outsource their KYC & AML functions which will lower entry barriers for start-ups into the FinTech space. Compliance companies will continue to build innovative products and services on blockchain technology and introduce biometrics checks.

4. Distributed Ledger Technology (advanced blockchain technology) will overtake legacy systems to produce CBDC (Central bank digital currencies) at the Central banks. This will reduce remittance costs and improve settlement times.

5. Peer to Peer platforms will prevail once again as people want to improve their local communities through P2P crowdfunding projects and seek a faster lending process even with a low credit scoring.  

Helen Bierton, Chief Banking Officer, Starling Bank

My predictions for FinTech in 2021 are…

2020 has accelerated the shift to digital therefore I see potential for the sector to grow 2021. I anticipate that whilst fundraising will be difficult, customers will be more likely to be swayed to switch to fintech firms as confidence in the online offering grows.

I believe the impact of COVID on FinTech as an industry will mean…

That businesses will pivot more easily as flexibility equals success. Being able to quickly adapt to the needs of customers, and staying relevant to them, allows a business to succeed. 

The best innovation I’ve seen in FinTech over 2020 is...

I have to be biased and say that the best innovation I saw this year was the Starling Connected card which we developed and launched during the April lockdown. It acts as a second debit card and a payment solution for those self-isolating. This card was a great example of thinking fast to meet the needs of customers and it has proved to be extremely popular and is even endorsed by Scope and the Royal Voluntary Society.

Zara Zamani, Head of Disruptive Technologies, Meta Bytes

The impact of COVID on Fintech:

Transparency in financial systems has been a discussion for decades. However, as the financial ecosystem got more and more centralized not only transparency was lost but also the corruption, despite existence of all tight regulations, has been piling up.

This has eventually resulted to end user’s loss of trust and demand for less centralized alternatives among financial solutions. In times of crisis like COVID-19, although a tremendous pressure was on global financial system, however, this pressure has also fastened the speed of adoption of fintech and digital finance solutions by public.

End users, who would not be an adopter of a fintech solution in non-crisis days, had no other choice to start using them. This has also supported fintech in terms of regulatory issues. Many countries like South Korea, supported introduction of cryptocurrency law.

This is the trend that is expected to stay for post COVID-19 as well, since many of these users start understanding the values FinTech is introducing to their daily life and also find a different perspective towards cryptocurrencies as well as policy makers being more aware of potentials of Fintech in introducing innovative business models.

This provides an insight for users and service providers into more decentralized and distributed FinTech solution to bring back the lost trust.

Diana Paredes, CEO & Co Founder, Suade Labs

My predictions for FinTech in 2021 are…

The increased use of technology and automation means that we will likely see more partnerships forming between financial technology providers and institutions. Data-driven approaches combined with advancements in technology such as ML and AI will inevitably improve customer experience, efficiencies and drive better business decisions.

I believe the impact of COVID on FinTech as an industry will mean…

The impact of COVID-19 has accelerated the adoption of digital technology, which may also highlight areas of weakness in legacy systems, processes, and mentality. This will encourage the uptake of digital transformation and the desire for financial institutions to increase efficiency through automation and the use of technology. 

The best innovation I’ve seen in FinTech over 2020 is...

This accelerated pace of innovation also comes with challenges. To ensure that regulations of the past do not hold back the innovations driving the post-pandemic recovery, we need more agile governance. Some of the best innovations that have come from 2020 are those that have utilised the advancements in machine learning and AI to enable more data-driven regulations.

Meri Paterson, Fintech strategy and M&A consulting, GreySpark Partners

I believe the impact of COVID on FinTech as an industry will...

Mean less than one might think, if the restrictions on working from the office stay in place for only a limited time.

Bosses will continue to prefer to see their teams in person and anyone angling for good reviews or promotions will put in face time. The same forces that made working from home slightly undesirable in the past will return.

However, if enough time passes for staff turnaround to be such that a critical mass of managers and employees alike have never known any other 'normal', those cultural preferences will start to fade away. I think, for the worse.

In the post-Covid world, we should strive to normalise working from home more, but for the most part, companies do best in meatspace - the clue is in the name.

Gemma Young, Founder & Head of Marketing, Women of FinTech

My predictions for FinTech in 2021 are…

That we will see a rise in FinTech solutions for the new economy. We have already seen the success of Buy-Now, Pay-Later options in the market, from leaders such as Klarna. I believe we will also see a rise in FinTech solutions for debt and debt collection, as well as micro-savings, as the economy begins to recover after the pandemic

I believe the impact of COVID on FinTech as an industry will mean...

Working from home will become the new normal, which will do wonders for D&I, opening up career options in the industry for those who were unable to commute each day to an office for various reasons.

From a community perspective, as we all get 'webinar fatigue', I believe there will be a rise in innovative ideas of how we can still connect on a human level while working remotely. This will see the role of marketing become a lot more valuable within companies, as we rethink how we can reach out and connect to new clients.

Felicia Meyerowitz Singh, Founder & CEO, Akoni Hub

My predictions for FinTech in 2021 are…

Increasing collaboration between fintechs as well as fintechs and financial institutions. This includes close tech collaborations between wealthtech and insurtech - historically they have close ties due to the nature of the underlying investment and retirement products.   

I believe the impact of COVID on FinTech as an industry will mean…

Further acceleration of digital solutions, providing fully streamlined propositions for clients, as well as working in complex financial services supply chains where there are multiple regulated entities servicing the end client. 

Companies following API first strategies will experience strong positioning for the future years of significant growth, due to the strategy of full integration.  

The best innovation I’ve seen in FinTech over 2020 is...

The most under-rated personalisation and customer experience: Applying solutions for single points of data consent. Clients are tired of re-entering their data multiple times for access to financial products.  

While this innovation is behind the scenes in fintech, it demonstrates complex legal and regulatory propositions tied into technology and how the world of prudential oversight coincides with data security and data sharing.  

Sharon Kits Kimathi, Editor, FinTech Futures

The best innovation I’ve seen in FinTech over 2020 is...

The general push towards more green and sustainable banking is encouraging. This time last year, the European Banking Authority published a new action plan on sustainable finance, setting out a timeline for delivering on environmental, social and governance (ESG) factors which may have spurred the rise in interest in this area within 2020.

This year saw Switzerland’s federal finance department launching the Green Fintech Network to take advantage of the growing opportunities in sustainable investment.

The Monetary Authority of Singapore (MAS) also announced the launch of a $1.25 million fintech innovation challenge centred around COVID-19 and climate change.

The UK government reinstated its plans to launch a new state-backed green bank, despite the sale of the its Green Investment Bank three years ago by ministers.

These governmental developments across the globe shows a push towards green investments being taken seriously. 

I believe the impact of COVID on FinTech as an industry will mean...

A change in how we perceive work. In the UK and US, there is a tendency to live to work, while in Europe, they work to live. Study after study shows how UK’s long working hours are less efficient than our continental peers who are more productive with fewer and more flexible working hours.

This has led businesses to re-think their traditional work-from-home policies and prioritise working fluidly and digitally. It also means that institutions will re-think the purpose of a physical office.

Kate Bohn, Innovation & Strategy, Lloyds Banking Group

My predictions for FinTech in 2021 are…

The increasing rise of the digital bank - from Neo and Challenger to incumbent-launched variants. The pull of customer demand and expectation around customer service will accelerate the delivery of the digital banking landscape. 

I believe the impact of COVID on FinTech as an industry will mean...

Every algorithm and model will need to be reviewed and potentially refreshed, as our 11 year bull market has come to an abrupt halt. The tension between capital liquidity, an increasing profitability squeeze and the imperative to accelerate innovation will require an uptick in partnerships and collaboration. 

The best innovation/s I’ve seen in FinTech over 2020 are...

Around accessibility:

TrustElevate - Dr Rachel O’Connell and her team are at the forefront of electronic identification and age verification. She is the guiding light in opening up the financial services capabilities by providing secure reliable authentication and authorisation for the under 16s

Signly - delivering accessibility is a moral imperative, not an ROI discussion. Why would anyone choose to actively exclude members of the population from an offering? I am in awe of Mark Applin and his team. 

Seema Khinda Johnson, Co-Founder & COO, Nuggets

My predictions for FinTech in 2021 are…

In the wake of many massive data breaches that have resulted in the personal info of millions of individuals being leaked on to the internet, I am certain that self-sovereign identity platforms will gain an immense amount of traction in 2021. This is because Digital IDs enable users to gain full ownership of their data, allowing users to share their personal info on a highly need-to-know basis.

Newly emerging Self-Sovereign Digital Identities are portable, allow for multi-level ID verifications, and are designed to work in conjunction with current and future payment system making e-commerce a far more holistic experience for consumers and merchants alike.

As a result, it would not be surprising to see many fintech firms being sought out by traditional financial services companies so as to better accelerate their digital transformation and enhance their overall future growth potential.

Due to the pandemic, life and work are moving online more than ever before - including community support services (such as grocery deliveries), online education, healthcare and medical screening, remote working, social care, payments, sharing our ID information (passports, drivers licenses etc) and contactless delivery.

As we move to consuming increasingly more goods and services online, a fundamental change is needed in the approach to personal data storage and privacy and security has never been more important so we’ll start to see more privacy preserving products.

Melanie Budden, Co-Founder, The Realization Group

My predictions for FinTech in 2021 are...

My predictions for FinTech in 2021 are... 2020 was the year of Covid driven digital transformation which in some respects benefited the Fintech sector. However, economic turbulence plus increasing regulation of tech and data will mean that the appetite for highly speculative investment in Fintech start-ups will decrease with investor interest pivoting to the more established firms as the focus turns to later-stage FinTechs that are either already profitable or at least can show a clear path to profitability. Additionally, we will see the Big Tech firms continuing their drive into Fintech. 2021 will be the year when we see the ’TechFin vs Fintech’ debate really start to develop.

I believe the impact of COVID on FinTech as an industry will mean…

Increased regulatory scrutiny of the sector. Regulators are taking actions as they see rising risks in the FinTech market during COVID-19 concerning cybersecurity, operational risk, consumer protection and fraud. In particular, cybersecurity is seen as increasing risks associated with FinTech activities.

The best innovation I’ve seen in FinTech over 2020 is…

The practical application of Blockchain/ DLT solutions which are starting to have a transformative effect on for example the payment and exchange trading marketplaces. I believe the next important technology conundrum is the interoperability of many disparate solutions. This is of particular interest to TRG as some of our clients are well down the road to delivering the answers to this challenge.

Nitzan Solomon, Head of Surveillance & Financial Crime Technology, Nomura

I believe the impact of COVID on Fintech as an industry will mean...

An acceleration of growth of the Fintech market.

While fintechs have certainly faced challenges during COVID, most notably with securing investments, significant opportunities were created. 

The way in which services and goods are being consumed across almost every industry has changed tremendously and with it the standards and client expectations. eCommerce and electronic payments are part of the "new normal" and Fintechs are able to attract customers and compete with more traditional providers that are unable to deliver the same customer experience. 

Financial institutions have also turned to Fintechs as they had to significantly reduce face-to-face communication and adopt new operating models to increase efficiency and support the "new normal" and remote interaction. The anticipated increase in the adoption rate of digitisation, cloud migrations, and the use of SaaS solutions that are AI/ML based in the financial industry, will undoubtedly translate to higher demand for Fintechs.

Many regulators around the world called out advanced technology and better use of data as key factors in overcoming some of the challenges posed by the pandemic, thereby providing reassurance to firms that have been more hesitant to work with Fintechs in the past.

Akua Opong, Senior Analyst, London Stock Exchange Group (LSEG)

I believe the impact of COVID on the FinTech industry will mean...

Initially, Covid 19 caused some uncertainty to Fintech companies where we witnessed share prices drop in March but now we see a slight change based around digital transformation and companies attempting to maintain operational resilience. The change in dynamics has lead to companies providing a more agile way of working compared to previous years. This has ensured that companies and the government reflect more on how these changes impact their business.

The key ways are through assessment, forecast, regulations and moving to contactless payments. We now see companies reviewing transaction volumes, funding, customer base, their products and services as well as how they obtain funding. The other key takeaways are reviewing Human Resources (especially D&I, as well as Wellbeing, is at the forefront of companies agenda) within the firms, software to perform daily tasks, security due to risks and corporate sustainability has been very important.

During this difficult time companies have fundraised and donated significant amounts to charities as they have struggled due to lack of events, public fatigue from the pandemic and staff being placed on Furlough.

Overall this pandemic has made companies re-evaluate the processes they have in place, as it allows them to assess their current strategy and enabled them to ensure they have a contingency plan that will keep them functional in any disaster. Some may have achieved this better than others but it is a step in the right direction for FinTech companies. For companies to remain operational those that thrive were dependent on how quickly they responded to Covid 19, which caused an economic shift and a gradual restructure in the FinTech industry.

Bronwen Gray, Relationship Manager, BridgeRegtech

My predictions for FinTech in 2021…

Covid has caused significant problems for the buying cycles of many FinTechs and with the vaccine, I can only assume a return to business is on the cards(or maybe that's hope). 

In 2020 we did show strong growth in the FinCrime platforms area which was prompted by the rise in Covid related crime in the sector so watch this space as the rise of the data scientist to combat FinCrime is on the cards. Synthetic data, benchmarking and behavioral model platforms(one of which is Ealax) are seeing investor and customer interest.

2021 - The 2LoD remains the biggest cost burden of the institution and problem-solving in this space is a big topic for people who see the opportunity. The aggregation will happen either by auto integration platforms or established platforms consuming the poor underperforming regtechs and fintechs thus strengthening their hold on the market. 

2021 - The NeoBank is set to rise with the recent announcements internationally of banks such as ING who are launching a Neo (aside from their Yolt open banking offering) this remains the easiest way for established banks to rid themselves of the high risk s**t, costly tech stacks they have cobbled together over the decades! Watch out locally with the FCA for permissions announcements and license announcements!! Lawyers are foaming at the mouth as these Neo are a whole new wave of revenue and dependency for their knowledge!

2021 - Vulnerable customers - The FCA has already indicated they will watch this space based on the recent sprint. Huge opportunity in this space if platforms are good enough to make an impact on customers or institutions. 

I believe the impact of Covid on the industry will mean...

Fines, fines and more fines for institutions, unfortunately! It will be like shooting fish in a barrel.

The best innovation I have seen in FinTech over 2020: Auto integration or surfacer platforms. By creating a standard to enter these "app stores" an equal access playground is created and from here innovation can really happen and be encouraged. If you have a reg change tool that isn't performing then go to your "app store" and trial/buy(subject to VDD) a new one!

Lenna Lou, Founder, The L Factor

My predictions for Fin Tech in 2021 are as follows:

As we move to a world of agile work where we will be partly working from home and partly going to the office which hopefully would be closer to home - FinTech is playing a bigger part in this. 

UK in comparison to other markets like Asia has been a little slow in adopting new technologies like 5G, 8K, bendable screens etc.

However, things are slowly changing and I believe we will be relying more and more on FinTech as we shop - more shops are only accepting cards or moving towards online shopping!

There will be more people establishing their own businesses and they will need a more agile financial service to help. 

We will still need to contend with cyber securities as well as the regulations needed for this.

In comparison to other countries like China and US, we still have some catching up to do.

Neema Amin, Business Strategy Coach, Redeye

My predictions for FinTech in 2021 are…

That traditional banks will continue to seek partnerships in the startup space to compete in the market with an edge.

Changes under the banner of digital transformation will increase with banks looking to AI solutions to reduce operational costs, increase efficiency and I want to say improve customer service because that would make sense but I see no evidence of this!

And regulations will intensify with the intro of new players, blockchain technology growing and, data ownership which will continue to be a hot topic. 

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