Innovate Finance brought together industry leaders, fintech start-ups and financial services experts on April 10th and 11th in London to discuss the future of fintech, the latest blockchain technology development, and how innovation will shape the future.
Kicking off the conference, Lawrence Wintermeyer, CEO of Innovate Finance said that the digital space is the greatest accelerator in the history of financial services. "The UK has the blueprint for the best FinTech ecosystem in the world because of our fintech talent and leadership."
Sir Tim Berners-Lee, inventor of the World Wide Web claimed that AI will have a huge impact on the fintech industry, especially when machine-learning technology replaces humans to make logical decisions such as getting a mortgage or advising on which companies to acquire.
And James O'Riordan shared his advice to fintech companies by quoting Samuel Beckett: "Try again. Fail again. Fail better."
With global influencers, speakers and experts sharing their thoughts throughout the two days, we witnessed a variety of opinions on the future of fintech.These are our top five trends from the global summit.
1. Digitising identity and payments
One of the main takeaways from the conference was the importance of identity and how blockchain technology can assist in identification processes in payments.
Alex Shelkovnikov, Deloitte Ventures says: “Digitizing identity and payments will be a big trend we see this year, and blockchain will be crucial for digitizing identities and transactions.
“At Deloitte, we’re showcasing a prototype of an identity management platform which is enabled by blockchain. For us, identity is a huge challenge and there’s a lot of friction that consumers are facing in terms of sharing their identity with multiple parties.
“For instance, people share their identity nowadays when they want to open a new bank account. The bank compliance manager would ask for passport and utility bills, and then if you go to another bank and they ask you for the exact same thing. After you give these copies, you don’t know where those lie and who has access to them.
“Effectively, you as a consumer do not own your own identity. But with blockchain, we can digitise identities, are able to store and manage identities in a control and secured manner, and are able to share identity with multiple parties in a controlled way, even on a global basis. That’s why we’re addressing this space, because we believe this is valuable in the marketplace.
“So, one of the biggest takeaways we’ve seen from Innovate Finance and in fintech generally is how blockchain technology will enable the next evolution of services for consumers around financial services.
2. The global potential of the fintech industry is huge, but implementing blockchain has a long way to go
In his opening remarks for Pitch360, Dejan Kusakivic, Intel’s Global Head of Fintech Enabling said that when you examine the growth of fintech globally, it’s clearly a market full of opportunity.
With fintech companies brimming with innovation at the conference it’s easy to see how financial services could improve their systems and workload by implementing blockchain technology, however the general consensus was that it will be a few years until we see the tech fully implemented by mainstream financial services.
However, the potential in the fintech industry is remarkable. In her opening remarks on the first day of the conference, Deloitte’s UK head of fintech Louise Brett said that fintech can play an altruistic and pervasive role in society at large, especially in “advancing society”.
“For the disruption of exponential technologies, it’s not just the digital technologies of AI or blockchain or robotics, but also the social technologies applied to platform-based business models and the use and power of the crowd.” She continued to say that financial technology is a truly global phenomenon in an "increasingly connected world."
3. Fintechs are collaborating to address global financial inclusion
In an inspiring round of pitches on Global Financial Inclusion at Pitch360, we heard from Now Money, Nous Global Markets and Doreming to find out how fintech start-ups are combatting the issue of financial inclusion, one of the biggest opportunities in fintech. Edie Lush, Executive Editor at Hub Culture, welcomed the speakers to the stage, and shared with the audience that there are still 1.5 million adults in the UK today without a bank account. The global issue of financial inclusion could be as large as 2.5 billion people unbanked.
It was clear from all three speakers addressing financial inclusion that fintechs around the world need to collaborate in order to address this issue. Different hubs may have different strengths, and although some geographies are ahead it’s important to collaborate and work together with financial services to address these needs.
And to do so requires new and innovative companies to share their ideas with the more traditional companies that may have access to a wider audience. We saw this implicated with the idea of sharing data, accessing financial services, and utilising the technology that is provided.
4. Working with an API-based economy
Riyaz Nakhooda, Offering Manager, IBM Watson Financial Services said: “We’ve really seen the movement towards an API-based economy, where fintechs don’t really want to worry about provisioning hardware and software, but they really want to get to building and prototyping their applications quickly.
"That’s where the IBM cloud for financial services really enables these fintech companies to rapidly prototype and test out an idea and bring it market quickly. It really enables that agile type of mentally, and then allows them to further that after they’ve tested their hypothesis and bring things into production."
5. Innovation, not disruption
Louise Brett said that she notices “an increasingly connected global world, that is absolutely, particularly in the millennials, embracing the sharing economy.”
Guy Halford-Thompson, CEO, BTL Group added: “Disruption isn’t great for large companies because quite frankly they don’t want to be disrupted. Instead, they’re very keen to innovate. So it’s important for fintechs to be able to look and think how they can innovate for their clients without being disruptive.”
Adi Ben-Ari, Founder and CEO of Applied Blockchain commented: “Incumbents will be looking at technology slowly, but surely.”
Louise added: “If this new era is the digital era and the digital stage, then innovation is the act upon that stage.”