Author: tpta

Financial Technology has disrupted the world in a way not many could have predicted, it has also broken down business barriers around the world. Mobile and digital payment applications have breached the world while still being in only one physical space. However, fintech has the mass potential to do good as well as disrupt the current environment. Companies such as M-Pesa created in 2007 have created an infrastructure for people in Africa to utilize mobile pay and become more financially literate.

However, moving forward, how do we keep the trajectory of fintech moving towards the unbanked? The Fintech Stage Inclusion Forum will be held in Jakarta in late March to bring together Fintech startups, investors, and financial institutions to help collaborate and keep this momentum moving forward.

Keep a sharp lookout for the new collaborations and innovations coming from this conference and in the near future. I’m excited to see how this conference will impact the landscape of creating opportunities for the unbanked.

 

Source: http://fintechnews.sg/9202/fintech/fintech-can-key-driver-financial-inclusion/?utm_medium=email&utm_source=fintechweeklycom

In every era there is one defining company that paves the road for the entire industry. Social media had Facebook and ride-sharing had Uber. Many critics have yet to come to a solid conclusion if that company has been found for fintech yet. While many different companies have propelled the banking business far, it does not have a clear cut path for who is the “Facebook of Fintech”.

Some have argued that CapitalOne is that industry shifting company that has impacted Fintech, but many disagree. Although CapitalOne was one of the first movers for data-driven marketing for the banking industry, it does not exemplify the technological age in which Fintech has propelled itself into.

The company does have a variety of online banking tools and mobile apps that contends itself to be in the FinTech industry and has been consistently ranked in the top 20 for App Annie’s.

However, have we had that “game changer” start-up that has shifted the world of Fintech? According to a recent twitter 68% said we have yet to see that happen.

So, let’s all be on the lookout for that monumental mover that will take Fintech to a whole new level.

Source: http://bankinnovation.net/2017/03/is-bankings-uber-moment-coming/?utm_medium=email&utm_source=fintechweeklycom

The world of Fintech is constantly changing. The more competition there is the more each company needs to add to their value chain in order to be successful. As the barriers to entry for start ups in the Fintech world become increasingly more difficult to overcome, one start-up has just received 1.2 Million in funding and is one to look for in the future to set the standard.

Hiatus is an app that connects to your bank account and tracks your monthly autopay subscriptions. It notifies you before you pay for the subscription and allows you to unsubscribe through their interface. However, they are not the only start up to do this. Trim and Truebill also provide this service, so what makes Hiatus different? Bill Negotiation.

With the users permission, Hiatus reaches out to reoccurring bill’s companies in order to negotiate a lower deal for the user. There is no change to the service, instead Hiatus repeatedly reaches out until a deal can be made. Each user saves about $137 a year through this system and the only catch is that Hiatus charges the user half of what they save. So, if the user saves, $137 because of Bill Negotiation feature, Hiatus take $68.50, so the user still saves $68.50 per year.

Source: https://techcrunch.com/2017/02/23/hiatus-raises-1-2m-in-seed-funding-to-track-and-negotiate-your-reoccurring-bills/

With the Fintech industry grossing over $8 Billion globally. It is interesting to note that venture capital has had more impact in Asia than in the US in the recent years and the reason is policy. The US has many innovative fintech startups that are very interesting to potential investors, however, the political hoops created, seem a little too much for the investors to get behind and so they have been investing in Asia more so than America or Europe.

America’s legal system can be a pain to many foreigners. It not just about what rules, but whose rules. There are federal and state laws and understanding what each state entails can be a daunting task. And another issue is that the government does not make a substantial effort to better communicate and integrate with the innovative fields.

The government has tried to address this with the Financial Service Innovation Act of 2016. However, the traditional financial institutions are notorious for their influence over government policies in the financial sector and this is not a good outlook for Fintech.

The frustrating issue is that people in high positions tend to look out for their best interest and do not see the bigger picture of advancing and moving forward and many times that means change and leaving “traditional” ways of doing things behind. I’m looking forward to the bright future of Fintech, but it seems, others are looking to line their pockets.

 

Source: https://techcrunch.com/2017/02/16/us-regulatory-environment-threatens-the-rise-of-fintech/

The words “fintech” and “artificial intelligence” have been Silicon Valley buzzwords that are thrown around casually in conversations at the local Starbucks for the past few years. But, these two, seemingly high level words that about 1% of the population truly understand, are beginning to merge together. Artificial Intelligence (AI) is becoming the future of banking.

AI is just starting to be utilized by banking companies around the US with uses such as compliance and anti-money laundering with an emphasis on employee misconduct detection. According to Henri Arslanian, The major appeal of this new integration was cost reduction and compliance, AI is “replacing human fund managers/traders”. However, it is quickly over taking other aspects of banking as well. HDFC bank has been experimenting with “conversational banking”, where they use AI to interface with the consumers through chat boxes. With AI becoming more and more utilized everyday, what comes into play is the age old idea of technology vs employee.

The idea of human clashing with technology is not a new one, but unlike the plethora of movies that describes the AI takeover, this is happening in real time. No, no, no, we are not going to be taken over the AI robot overlords… yet, you can remain calmly seated. We are in the age of technology that can essentially make the everyday employee obsolete. In today’s day and age, in this particular political climate, it is easy to see everyone’s concerns about job security. The real question is where to draw the line between technological advances and the very real human employees. This is something that AI and the banking industry will be testing out these next few years.

 

Source: https://letstalkpayments.com/ai-most-defining-technology-banking-industry/?utm_medium=email&utm_source=fintechweeklycom

There is a huge untapped market out there that Fintech has yet to try and penetrate: the unbanked. The consumers that do not have bank accounts and whose financials are basically off the grid. However, with the vastly developing technological age that we live in, the unbanked have adopted the use of the smart phone.

In “Uber-Competitor Grab Plans $700 Million Fintech Investment in Indonesia”, Das stated, “Of Indonesia’s near 250 million people, only 75 million have bank accounts”. And with this huge untapped market, there is a huge potential for fintech.

“We see this huge, unbanked population becoming bankable. If we can…give access to those won don’t have access to credit, it’s a massive opportunity.”

– Anthony Tan, CEO & Founder

Grab, Uber’s number one foreign competitor, saw this opportunity and has invested $700 million dollars in Indonesia. They are planning on also investing in smart phone distribution to get more access to the working class people with emphasis on “mobile payment and financial services” (Das). To spread the work load of exposing an entire community to these relatively new ideas, they are also investing $100 million in start-ups in Indonesia. Indonesia is a perfect starting point for this new market penetration because it coincides with the government’s plan on becoming the largest digital economy in the area by 2020. With the support of the local and federal government, Fintech could explode in the region. However, if other countries want to follow this model, I don’t believe it would be viable because of the different political and economic levels of the different countries around the area.

Source: https://www.cryptocoinsnews.com/uber-competitor-grab-700-million-fintech-indonesia/

As technology is becoming more prominent and as the fintech industry is booming, bots are digitizing and performing mundane, everyday tasks in the banking industry. This new system is in its experimental phases right now, but will soon be permeating the banking industry.

The banking industry hasn’t been disruptive for a while now and something new is in the air. Although bots are being experimented with in compliance functions for banks, Alan McIntyre, a bank manager at Accenture believes that it will soon become an “indispensable technology”. These bots have possible implications in many departments including Finance and Human Resources.

Although I am all for the advancement of technology in all sectors, there is a human aspect that people fail, or refuse, to see. With the advances of such technologies and how these bots can possibly “fully run these departments”, there will be a huge worker turnover in the banking industry.

The banking industry has stayed relatively constant with its processes these past few years and to completely disregard the working class population when switching to these automated systems is saddening. I recommend a way of keeping employees and implementing these systems. I hope these banks will introduce new learning programs for its employees and invest in their future at the bank. Teach the working populations new techniques and tasks in order to stay current and be an asset in their bank instead of dismissing them when the bots can take over their jobs.

 

Source: https://www.americanbanker.com/news/beyond-robo-compliance-how-bots-will-soon-permeate-banking