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Introduction
The annual Money2020 conference in Amsterdam brought together fintech executives from around the world to discuss the latest trends and developments in the industry. With the current slump in technology valuations and softer consumer spending, the focus of the conference remained on enterprise sales rather than consumer-oriented services. However, one area that generated significant excitement among attendees was generative artificial intelligence (AI). In this article, we will explore the hot trends in fintech, including the dominance of business-facing companies, the rise of generative AI, and the cooling interest in cryptocurrencies.
Business-Facing Companies Taking Center Stage
At Money2020, it was evident that business-facing or business-to-business (B2B) companies were dominating the show floor. Companies like Airwallex, Payoneer, and ClearBank were prominently featured, while consumer apps like Revolut, Starling, and N26 were noticeably absent. This shift towards B2B services can be attributed to the challenges fintechs face in making consumer offerings economically viable. Additionally, the cost of attending conferences like Money2020 necessitates a focus on selling to other attendees to justify the investment. Embedded finance, which involves integrating third-party financial services into other businesses’ platforms, is a key area of growth for B2B fintechs.
Richard Davies, CEO of Allica Bank, explained, “B2B is definitely in good shape — both SME and enterprise SaaS [software-as-a-service] — providing you can demonstrate your products and services, have proven customer demand, and good unit economics. Embedded finance certainly is part of this and has a long way to run as it is in its infancy in most cases.”
Generative AI: A Game-Changer for Fintech
One of the most hyped areas at Money2020 was artificial intelligence, specifically generative AI. Attendees were captivated by ChatGPT, a popular generative AI software from OpenAI that produces human-like responses to user queries. Fintech and banking leaders were keen to explore the potential of AI in their industry. For example, Cleo, a fintech start-up, showcased how they use generative AI to enhance customer communications by incorporating memes into the chat function and allowing their chatbot to provide personalized financial advice.
Teo Blidarus, CEO and co-founder of FintechOS, highlighted the impact of generative AI on fintech enablement infrastructure, stating, “AI, and particularly generative AI, it’s a big enabler for fintech enablement infrastructure… It allows you to spend your time on more productive stuff — creative stuff, rather than integration work.”
The ability of generative AI to streamline processes and improve efficiency is particularly valuable for fintech companies looking to do more with less. Automation and reducing manual processes, especially in areas like onboarding and underwriting, are key priorities for fintechs aiming to optimize efficiency and manage risk effectively.
Shifting Focus From Crypto
In contrast to previous years, the interest in cryptocurrencies at Money2020 was notably low. The regulatory crackdown on crypto exchanges and the volatility of the crypto market have made fintech companies cautious about launching products tailored to cryptocurrencies. Many fintech executives expressed a lack of demand from their customers for crypto-related services and emphasized the importance of compliance and regulation.
Jack Zhang, CEO of Airwallex, stated, “It’s very important for us to maintain the high standard of compliance and regulation… Dealing with crypto, especially with global banks, is a real challenge right now.” Prajit Nanu, CEO of Nium, echoed this sentiment, noting that interest in their cryptocurrency support service has fallen off as banks have become skeptical about crypto in the current environment.
Conclusion
The Money2020 conference in Amsterdam shed light on the latest trends in the fintech industry. Business-facing companies took center stage, with a focus on B2B services and embedded finance. Generative AI emerged as a game-changer, enabling fintech companies to streamline processes and improve efficiency. However, the interest in cryptocurrencies waned due to regulatory concerns and market volatility. As the fintech landscape continues to evolve, it is clear that adaptability and a focus on customer demand and compliance will be crucial for success in the industry.
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