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FinTech shows off its range
The second day of the 2017 Innovate Finance Global Summit saw 24 FinTech start-ups compete for a £10,000 prize in the Pitch 360 competition.
In opening the competition, Intel’s Global Head of FinTech Enabling, Dejan Kusalovic, said “when you look at the global growth potential of the FinTech marketplace, it is clear there is a large opportunity out there”. Three of the key growth areas of FinTech explored in the contest were blockchain and distributed ledger technologies, global financial inclusion and cyber security.
The pace of technological change and customer demand for convenience makes tackling cyber-security issues is essential for financial services firms. James Varga of The ID Co said that the key to successful cyber-security is to combine security and convenience to create an incredible customer experience. Heidi Rakels of GuardSquare summed up on of the key challenges that financial services firms face neatly, stating that additional security can often make mobile apps slower and more difficult to use.
In introducing the blockchain FinTech participants, Edie Lush of Hub Culture estimated that the global blockchain market would reach $20 million by 2021. She said distributed ledger technologies would be used by 15 per cent of large banks by the end of the year and could allow banks to save up to 30 per cent on infrastructure costs.
Adi Ben-Ari, showcasing the start-up Applied Blockchain, described blockchain as providing a tamper-proof ledger that can be trusted by a number of parties. He believes that this is more secure than trusting a central solution. He also explained how the uses of distributed ledger technologies are expanding beyond simple transfers of value, giving the example of smart contracts which allow the design of complex transactions between multiple parties.
Another use case of blockchain was detailed by Dimitri Verhelst of Juru, in what he termed “Identity as a Service”. He explored how the current fragmentation of an individual’s identity information could be centralised in a secure platform under the control of the individual. As he put it, “your identity is quickly becoming your most valuable asset”.
A number of start-ups showcased how the innovations they are bringing to market are helping to bring financial inclusion to the 2 billion adults globally that are currently unbanked or underbanked. While the majority of these people are in the developing world, Edie Lush told the audience that there are still 1.5 million adults in the UK without a bank account.
Ian Dillon of Now Money said that there are 26 million low-income migrant workers in the Gulf, the vast majority of which do not have access to a bank account; however, 98 per cent of these do have access to a smartphone. His firm’s idea is to provide mobile remittance services for these workers to send money to their families back home in a more convenient and cost-effective manner.
Tomo Nakamura of Doreming discussed how global financial inclusion is not only good for society but also a great opportunity for businesses, especially within FinTech. As he put it, “by using FinTech, new markets and new business opportunities can be created, especially within developing markets”.
One thing that all of the FinTechs agreed on was that innovation comes from firstly identifying, and then solving, real customer problems. As Justin Short of Nous Global Markets put it when showcasing the trading app TIQL, “we solved a problem for our users. There was no way for them to do this before”.