Say goodbye to the old way of doing finance. Banking-as-a-Service (BaaS) is changing how businesses launch financial products. No more years of development and eye-watering costs, BaaS lets you do it in weeks, at a fraction of the price. And when you combine it with low-code platforms, the barriers to entry almost disappear. Want to know how? Let’s get into it.

Breaking Down Barriers

For far too long, finance was an exclusive club. If a business wanted to offer banking services, it needed a licence, millions in capital, and the patience to navigate endless regulatory hurdles. That’s no longer the case. BaaS is opening up financial infrastructure, allowing businesses, big and small, to offer financial services without becoming a bank themselves.

A decade ago, setting up a traditional bank was a colossal endeavour, often costing tens of millions and taking years to get off the ground. Today, thanks to BaaS and low-code platforms, businesses can launch digital banking services much faster and cheaper. While exact figures vary, it’s now possible to establish a digital banking service in a matter of months with a significantly lower investment. This shift has opened the doors for more players to enter the financial market without the substantial time and financial commitments previously required. Innovation isn’t just for those with deep pockets anymore.

Leaving the Tech to the Experts

Today, businesses don’t need to reinvent the wheel to offer top-notch financial services to their customers. By teaming up with fintech partners, they can seamlessly embed financial products into their platforms, enhancing user experiences without the hassle of building everything from scratch. 

And with low-code solutions, an SME or a scale-up company with zero fintech experience can launch a digital wallet or payment solution in record time. A few clicks, some customisation, and you’re done. For businesses with limited resources, low-code removes the technical bottleneck, allowing them to focus on growth instead of getting lost in complex software development.

Learning from the Risks

Of course, it’s not all plain sailing. The fintech world has seen its fair share of high-profile failures, from platform crashes to full-blown collapses. When businesses rely too heavily on a single provider, they can find themselves in serious trouble if that provider runs into issues. Just ask anyone who depended on Wirecard.

So, what’s the lesson? Diversification. Businesses should work with multiple providers to build resilience. If one fails, the others can step in, ensuring services continue without disruption. Adding redundancy to your BaaS strategy isn’t just a safety net, it’s a necessity.

Making Finance Invisible—and Better

Embedded finance is changing the way people interact with money, and most of the time, we don’t even realise it. Think about booking a holiday and having travel insurance seamlessly added at checkout. Or making a purchase online and being instantly offered flexible payment options tailored to your spending habits.

BaaS enables businesses to weave financial services right into their platforms, making everything smooth and engaging for users. And with low-code tools, these integrations are quicker and more affordable than ever. It’s not just about adding on financial features, it’s about making them work seamlessly for your customers. Ultimately, identifying your customer’s pain points better dictates which features and processes best serve your business.

Scaling Without the Pain

Growth is great until it becomes a logistical nightmare. More customers, more transactions, more compliance, it doesn’t take long before scaling becomes overwhelming. Traditionally, businesses needed huge investments and a team of specialists to manage this kind of expansion.

BaaS removes a lot of that complexity. These platforms handle the heavy lifting, making adding new features like lending or insurance easy without needing to rebuild from scratch. Whether you’re expanding into new markets or introducing new financial products, BaaS makes it possible without breaking the bank.

Innovation Wins in the End

The future of finance isn’t just digital, it’s agile, adaptable, and accessible to all. BaaS and low-code solutions are leading the charge, giving businesses the flexibility to innovate without getting bogged down by outdated systems.

Thankfully, we can say goodbye to the days of bloated budgets and slow-moving legacy banks, today, creativity and speed matter more than size. 

Businesses that embrace this shift will thrive, while those that hesitate risk being left behind. So, low-code? No worries. BaaS is here to stay, and it’s the answer every business has been waiting for.

Q: Martin, what are “digital customers” to you, and how are they changing the way businesses deliver customer experiences?

A: Digital customers, often known as machine customers, are Internet of Things (IoT) devices. These devices act on behalf of consumers to provide key insights without the need for human intervention. We estimate that by 2030, over 40 billion connected IoT products will have the potential to behave as digital customers, from smart fridges and medical devices to cars and smart meters. 

These devices are not only end-users but also intermediaries for human customers, requiring organisations to rethink how they deliver seamless service. 

Integrating IoT-driven solutions into Customer Experience (CX) isn’t a foreign concept. People already act on machine insights, such as scheduling a car service based on a vehicle alert. In CX, the same principle applies: millions of smart meters, appliances, movement sensors and other IoT devices act as enablers for contactless resolution and proactive service delivery. By adding a predictive element to all this data to address issues before they become customer pain points, businesses and other organisations can significantly enhance satisfaction and loyalty.

Q: Can you explain how IoT facilitates the shift to “contactless resolution”?

A: Proactive customer service is quickly becoming a priority for many organisations. According to Forrester, 71% of customers say they want proactive engagement from the businesses that serve them, and 72% report high satisfaction levels when they receive it.  

The Holy Grail of CX has long been to sort out customer issues within a single interaction, called ‘first contact resolution’. However, with the continued growth of connected devices, it is possible to go one step further. When service issues occur, for instance, proactively reaching out to customers can pre-empt the surge in contacts traditionally associated with such situations. We can get ahead of the curve, and help contact centres seamlessly anticipate spikes in demand.

Building on this approach, Agentic AI, a type of AI that can make autonomous decisions and take actions based on multiple sources of data and knowledge, is helping to boost organisations’ ability to integrate and act on data across diverse sources. Known as omni-data, this process will require a considerable amount of processing power, however Agentic AI will execute its tasks super-efficiently with minimal need for human oversight. 

Q: How significant is the growth of IoT in shaping the future of CX, and which industries are leading the change?

A: Each new IoT device represents a potential “digital customer”. For organisations, this means customer interactions are no longer limited to just a few billion potential human touchpoints. Instead, companies must cater to a much larger network of machine-driven interactions. This shift requires rethinking traditional service models, investing in intelligent automation and artificial intelligence (AI), and building ecosystems that support machine-to-machine (M2M) communications.

Utilities, manufacturing, healthcare and motor industries are at the forefront of IoT-enabled customer interactions. For example, IoT technology allows healthcare providers to improve access to care through various ‘virtual’ experiences, including ‘hospital at home’ virtual wards which allow discharged patients to be monitored at home using internet-enabled medical IoT devices. Patient data is shared with teams of clinicians, dedicated to tracking the progress of virtual patients and supporting them accordingly.

The automotive sector is also a trailblazer, with connected cars alerting manufacturers about maintenance needs or even autonomously scheduling service appointments. Soon these vehicles, and the service hubs who coordinate them, will be automatically scanning potential suppliers of any parts they need and negotiating the best deals. These industries are showcasing the immense potential of IoT to revolutionise CX and redefine the concept of customer service.

For the public sector, local governments have begun transitioning to become “centralised command hubs” to help monitor high-spend areas such as social care, waste management, and highway maintenance while working with increasingly stringent budgets. IoT devices allow them to monitor all aspects of their centralised data and then act on the information in real time. 

Q: What’s the long-term impact of IoT on customer relationships?

A: IoT is fundamentally reshaping customer relationships by shifting the focus from reactive problem-solving to proactive value delivery. Businesses that integrate IoT into their CX strategies can anticipate and address customer needs before they become pain points, creating a frictionless experience.

The long-term transformational potential of IoT lies in its ability to humanise technology, making interactions and transactions effortless for both human and digital customers. Organisations that embrace this shift and invest in connected ecosystems will drive customer loyalty and create new types of partnerships built on trust, transparency and proactive support.

IoT devices in the CX industry are nothing new, and businesses in some sectors have been using IoT-powered insights to improve their customer service for several years now. The next step is for other industries to replicate and build on their success in novel applications, utilising IoT and Agentic AI together to deliver contactless resolution and improve customer experiences as well as workforce productivity. 

Contact centres will be transformed into dynamic data hubs that allow organisations to act on incoming information and deliver personalised, proactive communications. Organisations will interact with and manage their digital customers in a vastly different way from traditional human customers. Still, the core aim remains the same – to make interactions at once personalised, straightforward and impactful. 

In today’s fast-evolving economic landscape, financial services organisations are feeling the pressure to innovate. Businesses face global inflation, rising living costs, and heightened consumer expectations. In this environment, the demand for seamless, personalised, and cost-effective experiences has never been greater. Customers now expect real-time solutions, meaningful engagement, and greater value at no added cost. For financial institutions, the message is clear: evolve or risk falling behind.

To meet these demands, leading financial companies are embracing AI-driven solutions, automation, and process orchestration. Together, these technologies are transforming customer experience (CX) strategies. In a competitive market, investing in intelligent automation (IA) is essential for financial services firms aiming to stay relevant.

A 2024 Forrester Consulting Total Economic Impact™ (TEI) study, commissioned by SS&C Blue Prism, underscores this imperative by revealing a 5.4% CAGR in incremental profit over three years for companies adopting automation solutions. This is a significant shift from the 2017 study. Then, 92% of the value of automation was realised through cost savings. Now, 73% of the value is captured as incremental profit. It’s a clear indication that intelligent automation (IA) is more than just a cost-saver. Rather, it’s a growth driver in an increasingly competitive landscape.

Meeting evolving customer needs

Consumers today navigate digital and physical interactions with ease, expecting real-time access to information, customised solutions, and streamlined experiences. Whether they’re using mobile apps, intelligent chatbots, or visiting branches, customers expect consistent, personalised service—especially amid economic uncertainty.

Younger generations, influenced by the high-tech, digital-first experiences provided by FinTech companies like Amazon and Instacart, are raising the bar for digital interactions. These platforms exemplify this shift with rapid refunds and seamless automated processes. These CX standards have proven to be challenging for traditional financial institutions to replicate.

Financial institutions must adapt to this paradigm. Traditional competitors aren’t the ones setting expectations any more. Instead, it’s tech-forward firms that prioritise customer convenience. Institutions slow to meet these standards are seeing customers gravitate toward the most efficient players which can offer competitive rates due to operational efficiencies. This trend illustrates a broader market dynamic: consumers increasingly favour providers who prioritise efficiency and experience, even when those services come at a higher cost.

Automation with a human touch

Generative AI, machine learning, and advanced analytics are essential tools for enhancing customer experiences—not only by improving efficiency but by adding a personal touch. With self-service AI solutions offering instant responses, financial organisations can reduce human intervention for routine tasks, allowing advisors to focus on complex or sensitive interactions. This enhances customer satisfaction by delivering speed and accuracy without sacrificing empathy.

However, to stay competitive, organisations must balance automation’s efficiency with a human touch, especially in high-stakes decisions. And with 33% of firms using automation reporting faster service, and 36% noting a reduction in errors and complaints, it is clear that IA can maintain both precision and customer rapport.

Finance leaders must take decisive action to harness these capabilities. Integrating IA thoughtfully can elevate customer experience to a competitive advantage, helping institutions thrive in a landscape where both efficiency and empathy are paramount.

Strategic automation for enhanced experiences

Automation has swiftly become a strategic imperative for financial services, delivering operational efficiencies and enriching customer experiences. In fact, 61% agree the approach to automation adoption is strategic and business-oriented. Technologies like robotic process automation (RPA), AI, and intelligent document processing (IDP) are revolutionising operations, allowing firms to cut costs while improving service quality.

By merging automation with AI, companies can streamline workflows, reduce manual tasks, and provide faster, more consistent services. RPA automates routine data entry, freeing employees to focus on high-value activities, while AI delivers real-time insights that enhance customer interactions.

A case in point is ABANCA, which achieved a 60% faster response time for customer inquiries by deploying SS&C Blue Prism’s IA and generative AI tools. Over the duration of the program, digital workers completed 150,000 workdays, improving both customer and employee experiences. Insurance company SILAC, achieved a 75% improvement in claim processing speed by integrating automation. Intelligent automation enables financial institutions to scale operations while upholding the exceptional service customers expect.

Investing in AI-powered automation positions organisations to adapt swiftly to market changes and evolving customer demands. As the desire for personalised, immediate services grows, automation empowers companies to meet these expectations efficiently and remain competitive.

The time to invest in AI is now

The financial services sector is undergoing a significant transformation fueled by evolving customer needs and rapid technological advancements. Initially, FinTech companies gained market share by offering digital-first, customer-centric solutions; now, large banks are reclaiming ground by acquiring these firms and integrating their innovations. To navigate this shift, financial organisations must embrace AI and IA tools, which are proving essential to future-proofing the customer experience.

Those who invest in IA today will be better positioned to meet the demands of tomorrow’s customers, offering seamless, personalised, and empathetic experiences that drive loyalty and growth. Organisations delaying AI adoption risk being outpaced in customer satisfaction and operational efficiency.

The ones who understand and embrace these technologies are the ones shaping the future of customer experience in financial services. Organisations that lead the way in adopting AI-driven solutions will not only meet evolving customer expectations but also stand out in a crowded marketplace.

Now is the time for financial services organisations to act. By harnessing AI and automation, companies can build stronger customer relationships, enhance operational efficiency, and secure a competitive edge in an increasingly complex market. Investing in AI isn’t just about improving customer experiences; it’s about future-proofing your business and ensuring lasting success.

The Digital Operational Resilience Act (DORA) is not just a regulatory framework. It is a critical step toward ensuring that financial institutions can withstand and recover from digital disruptions. This is particularly important as these disruptions become increasingly common in today’s marketplace. For financial services, DORA presents both challenges and opportunities to enhance organisations’ durability while adhering to the evolving regulatory landscape. 

Operational resilience is becoming increasingly important in financial services. It’s not just about avoiding penalties, however. Operational resilience is about strengthening the entire system. By doing so, financial service organisations become better equipped to manage digital risk. Managing digital risk effectively also means being able to deliver continuous services, and maintain trust in an increasingly complex environment.  

Why DORA Matters 

DORA is a regulation introduced by the European Union designed to strengthen the operational resilience of the financial services sector. While the act took effect in 2023, it became fully enforceable in January 2025. It aims to enhance the Information and Communication Technology (ICT) security of financial entities and ensure they can effectively manage operational risks arising from digital disruptions. These disruptions can be caused by cyberattacks, system failures, or other technological failures. DORA sets out clear requirements for financial institutions to improve their governance, risk management, and cybersecurity practices. Not only that, but is also assesses institutions’ ability to manage and recover from disturbances. 

These regulations offer financial services firms an opportunity to proactively address risks and build more resilient operational frameworks that can withstand the challenges of an increasingly digital world. This will enhance the sector’s ability to deliver services securely, even in the face of adversity. 

The Key Components 

Governance and Risk Management 

DORA requires organisations to establish strong governance frameworks and comprehensive risk management strategies for managing ICT. This includes integrating digital operational resilience across all levels of the organisation. Dooing so ensures effective risk identification, assessment, and mitigation while maintaining transparency and continuous testing. 

Incident Reporting and Crisis Management 

The regulation mandates timely reporting of significant ICT-related incidents. Financial institutions must implement systems to monitor, detect, analyse and report incidents. Doing so ensures that both internal and external stakeholders are promptly informed. This ensures that regulators are notified within the required timelines and that transparency is maintained. 

Third-Party Risk Management 

DORA highlights the need for robust due diligence and ongoing management of third-party vendors, ensuring they meet the same high standards as financial institutions. It also underscores the importance of information sharing between financial entities and regulators to collectively enhance resistance against ICT-related threats. 

ICT Security and Data Protection 

Adopting robust ICT security frameworks and data protection measures to safeguard systems and sensitive data from a range of cybersecurity threats and operational disruptions. It requires taking a proactive approaches to cybersecurity to ensure the protection of both institutional and customer data. 

Testing and Reporting Requirements 

DORA requires organisations to regularly test their systems for resilience against potential interference. Institutions must conduct scenario-based testing and vulnerability assessments, reporting the results to regulators to demonstrate that they are managing risks effectively and maintaining business continuity. 

How to Implement DORA 

For financial institutions, implementing DORA will require significant changes across organisations. Here are the key actions that companies must take to ensure compliance: 

• Enhance governance frameworks: To comply with DORA, financial service organisations should establish clear governance structures for managing digital risks, ensuring that roles and responsibilities are defined at all organisational levels. Senior leadership must take an active role in overseeing the implementation of resilience measures. 
• Conduct comprehensive risk assessments: Financial institutions must perform regular risk assessments to identify vulnerabilities in both internal systems and third-party services. These assessments should be updated regularly to reflect the evolving threat landscape and inform risk mitigation strategies. 
• Develop incident reporting protocols: Institutions must create and formalise incident reporting protocols. This involves setting up processes for timely reporting of ICT disturbance, developing crisis management plans, and training incident management teams to ensure a coordinated response to mitigate impacts on operations. 
• Strengthen cybersecurity and data protection: To meet DORA’s cybersecurity requirements, financial organisations need to invest in advanced security technologies, conduct regular security audits, and implement data protection measures that ensure sensitive data remains secure during operational disruptions. 
• Implement regular testing and simulations: Regular resilience testing, including vulnerability assessments and scenario-based simulations, is essential. Institutions must run these tests periodically, address identified weaknesses and report the outcomes to regulators to demonstrate ongoing compliance with DORA’s requirements. 

What DORA Means for the Financial Services Sector 

DORA represents both a challenge and a significant opportunity for the financial services sector. The regulation provides a clear framework for enhancing operational adaptability, which will ultimately strengthen the stability of the financial system. While the cost of compliance and investment in technology and processes may be considerable, the benefits are far-reaching. 

Financial institutions that embrace DORA will be better prepared to handle disruptions, safeguard customer data, and maintain business continuity during times of crisis. By embedding resilience into their operations, financial services firms can build greater trust with customers, regulators, and investors. 

DORA also presents an opportunity for organisations to streamline their risk management processes, compliance and technology innovation, strengthen their cybersecurity frameworks, and improve overall operational efficiency.  

These regulations are critical in shaping the future of digital risk management in the financial services sector. As we continue to evolve in a digital-first world, DORA presents a unique opportunity. DORA is a chance to build stronger, more resilient organisations that are better equipped to face the future. 

The business world is changing. If you are paying attention, you will notice one of the most exciting transformations happening right now is embedded finance. We hear a lot about APIs (Application Programming Interfaces) and how they power our digital lives. However, what’s really grabbing attention is the rise of the API economy. Specifically, people are excited about how embedded finance is reshaping how businesses interact with their customers.

So, what’s all the fuss about, and why should you care? Let’s dive in.

What is Embedded Finance Anyway?

At its core, embedded finance means integrating financial services into non-financial platforms. It allows companies to offer banking-like services—think payments, lending, and insurance—directly within their apps or websites, without needing to be a bank themselves.

It’s like how Uber lets you pay for your ride without ever leaving the app. Uber isn’t a bank, but through embedded finance, it can offer seamless payment options, providing an effortless user experience. The user doesn’t need to think about the financial side of things; it just happens in the background. And that’s the magic of embedded finance—it’s smooth, simple, and frictionless.

APIs: The Backbone of Seamless Integration

APIs (Application Programming Interfaces) are the unsung heroes enabling the smooth interaction between different software systems. They allow platforms to communicate and share data effortlessly, acting as bridges between various services. For instance, when companies like Airbnb incorporate payment processing, they rely on APIs to connect with third-party providers like Stripe or PayPal. Without these connections, seamless financial interactions would not be impossible.

In the past, businesses that wanted to offer financial services had to build out much of the infrastructure themselves. However, with the rise of the API economy, this complexity has been drastically reduced. Companies can now integrate ready-made financial services quickly and focus on their core offerings. 

However, while APIs handle much of the heavy lifting, they aren’t the whole solution. They still need to be connected to the devices or systems using them. This involves stitching them together through a middle layer that coordinates the various API functions, along with coding a front-end interface that users interact with.

In essence, APIs provide the building blocks, but there’s still a need for a tailored architecture to ensure everything operates smoothly— from the back-end infrastructure to the user-friendly front end. This layered approach ensures businesses can offer a seamless experience without getting bogged down by technical complexities.

Why the API Economy is Booming

The API economy is booming because it allows businesses to be more agile, innovative, and customer-centric. APIs give companies the flexibility to offer services they wouldn’t have been able to in the past. A clothing retailer can offer point-of-sale (POS) financing without becoming a bank, or a fitness app can offer health insurance with the click of a button.

Think about Klarna, a company that’s become a household name by offering “buy now, pay later” services. Klarna partners with thousands of retailers, allowing them to provide flexible payment options directly within their checkout process. The retailer doesn’t have to worry about the complexities of lending—it’s all handled by Klarna’s embedded finance platform through APIs. 

This creates a win-win situation: customers get more flexible payment options, and retailers can drive conversions without any of the financial headaches.

How Embedded Finance is Connecting Customers to the World

Embedded finance is all about breaking down barriers between industries and creating better, more holistic experiences for customers. And it’s not just about payments—it extends to lending, insurance, and even investments.

Take Revolut, the digital bank that started as a foreign exchange app but now offers everything from insurance to cryptocurrency trading. By using APIs to embed these financial services into their platform, Revolut has transformed into an all-in-one financial hub. Customers don’t need to visit different apps or websites for banking, insurance, or investments—they can do it all within Revolut.

The world of e-commerce has certainly embraced the world of embedded finance, Shopify, the e-commerce platform, has built it directly into its ecosystem. Through its Shopify Capital programme, the company offers its merchants quick access to business loans. This seamless integration is made possible by APIs, allowing Shopify to assess a merchant’s financial data and offer lending without the need for the merchant to seek out external financing. It’s fast, convenient, and keeps businesses within the Shopify ecosystem, further strengthening customer loyalty.

A New Level of Personalisation

This is more than just making payments easier—it’s about giving customers a more personalised, seamless experience. By tapping into financial data, businesses can offer products and services that really hit the mark for each individual.

Take travel apps like Skyscanner, for example. They’ve made things super convenient by embedding travel insurance right into the booking process, so, when you’re booking a flight, you can easily add travel insurance without even leaving the app. It’s all about creating a one-stop shop that gives you exactly what you need, right when you need it.

The Future 

The API economy, particularly in the realm of embedded finance, is just getting started. Over the next few years, we can expect to see more industries leveraging this technology to enhance their offerings and create richer customer experiences. Everything from health tech to real estate is ripe for disruption.

Businesses that adopt embedded finance solutions early will have a competitive edge. They’ll be able to offer seamless, integrated experiences that meet the modern consumer’s demand for convenience and personalisation.

However, it’s not just about jumping on the bandwagon. Companies need to be strategic about how they implement embedded finance. It’s not a one-size-fits-all solution, and it’s crucial to understand how these services align with your business goals and customer needs.

The rise of the API economy and embedded finance is opening up new doors for businesses and customers alike. By embedding financial services into non-financial platforms, companies are not only streamlining operations but also creating more value for their customers.

Embedded finance is already making waves across industries, from retail to tech, and the businesses that are brave enough to embrace it are positioning themselves at the cutting edge of this transformation. For customers, it’s opening the door to a world that’s more connected, convenient, and tailored to their needs. It’s not about whether embedded finance will change the way we do business—it’s about how quickly it’s happening, and which companies are ready to step up and lead the charge. 

So, whether you’re running an e-commerce business, developing a tech platform, or simply thinking about how to better serve your customers, it’s time to consider how embedded finance can connect your customers to the world in ways you never thought possible. 

The future is embedded, and it’s here.

The deadline for compliance with the EU’s Digital Operational Resilience Act (DORA) comes into effect on January 17th. 

With — according to research from Orange Cyberdefense — 43% of the UK financial services industry set to miss the deadline, the act could significantly disrupt commerce between the UK and the EU. Organisations found to be in breach of DORA could face serious financial fines of up to 1% of worldwide daily turnover for as long as six months. In addition to potential fines levied against the financial services sector, DORA’s new regulatory requirements pose challenges for procurement teams operating across the channel, as well as IT teams governing the movement of data. 

Financial services and digital infrastructure

The digital infrastructure sector underpins multiple sectors, including cloud computing and financial services, about to be affected by DORA. 

All of these sectors will experience profound changes as a result of DORA coming into effect.  “Critical digital infrastructure providers, like Equinix, may become directly regulated for the first time and will play a critical role in supporting its financial services clients in adhering to stringent requirements,” observes Adrian Mountstephens, Strategic Business Development for Banking at data centre giant Equinix. All financial service companies in the EU, he adds, will need to update their contracts with their supply chain to remain compliant.  

Mountstephens also notes that, along with other legislation focused on digital security, like NIS2 (EU-wide legislation on cybersecurity) and the European Cybersecurity Act, DORA will result in organisations adopting enhanced security measures. “Third-party risk management will intensify, with increased supply chain oversight and emphasis on companies having certifications. We aim to keep our customers future-ready by providing financial institutions with solutions that address their digital transformation challenges while ensuring compliance with evolving regulations,” he says. “As one of the most comprehensive cybersecurity regulations the financial industry has seen, the new policies aim to ensure infrastructure is in place to prevent, respond to, and minimise disruptions, specifically as financial institutions are increasingly dependent on technology and face growing risks of cyber attacks.”

DORA and the cloud 

Dmitry Panenkov, CEO of cloud management platform emma, also notes that “One of the main challenges with the upcoming DORA regulation is ensuring visibility and control across cloud environments, as introducing hybrid or multi-cloud setups to strengthen resilience, often comes with a lack of the integration needed for comprehensive risk management and compliance oversight.”   

Ensuring that businesses have a “dedicated and mature” Digital Resilience Framework will also reportedly be critical, and Panenkov stresses that organisations must be prepared to conduct required annual evaluations and tests. However, even as DORA comes into effect, “many are still building the capabilities and processes needed to meet these obligations.” 

If organisations can’t take steps like enhancing their real-time risk mitigation strategies and ensuring that data security processes up to a suitable standard to withstand operational and regulatory scrutiny, they could find themselves in noncompliance. 

“Organisations must recognise that DORA is as much an organisational challenge as a technical one,” he says. “It demands collaboration between compliance, IT and cloud teams to embed resilience planning into operations. The most successful organisations will not only align with DORA but also use it as an opportunity to strengthen their overall operational resilience.” 

Purchasing and DORA 

Arnaud Malardé, Smart Procurement Expert at Ivalua agrees with regard to DORA being an operational issue. “Until now, many procurement teams might have mistakenly viewed compliance with the regulation as solely an IT responsibility – but this Friday will act as a serious wake up call for many organisations,” he says. “The fact is that procurement plays a crucial role in managing the third-party risks at the heart of digital operational resilience. Without robust supplier oversight, organisations risk non-compliance that can result in crippling fines, legal liabilities, and exclusion from markets they rely on.”

However, he adds that many procurement teams are still reliant on outdated processes, fragmented data, and manual contract review that is both prone to human error and provides limited visibility into supplier performance and compliance. These legacy holdovers only increase the chances of being found in violation of the new regulations and forced to accept significant penalties. 

To “play catch-up” and meet these challenges, Malardé argues that organisations need to digitalise their procurement processes — and fast. “For example, cloud-based Source-to-Pay platforms create a centralised repository for contracts, DORA-specific reporting, and supplier data, allowing for real-time risk monitoring and automated compliance tracking,” he says. “By embedding resilience into procurement strategies, businesses will not only meet DORA’s demands, but also strengthen supply chains, mitigate cyber risks, and unlock long-term competitive advantages.”

In today’s fast-paced digital landscape, customer trust and engagement are critical to the success of fintech and insurtech businesses. 

Consumers have become more discerning. They expect top-tier products, yes. But they also demand personalised, transparent, secure, consistent, and high-quality communication. The ability to communicate effectively has become a key differentiator for businesses aiming to build long-term customer relationships. 

The importance of communication in fintech and insurtech

Effective communication is no longer a ‘nice-to-have’ but a necessity across industries. Customers expect companies to communicate with them in ways that feel personal and relevant, particularly when it comes to sensitive topics like financial services or insurance policies. 

The Connected Consumer report by Esendex surveyed 1,000 consumers across the UK and Ireland. It revealed that, while many are willing to trust communications from businesses, the trust is conditional. It requires consistent effort to maintain.

According to the report, over half of respondents trust messages like renewal reminders and tailored offers from financial and insurance companies. However, a striking 80% said they would stop using a business altogether if they were dissatisfied with the quality of communication. 

This number jumps to 85% among younger, more digitally engaged consumers aged 18 to 44, emphasising the critical importance of getting communication right.

Leaders must understand that communication goes beyond delivering information – it’s a strategic tool for engaging customers. In a world where consumers are bombarded with messaging, the quality, timing, and relevance of communication significantly affects brand perception. 

How leaders can improve their communication strategy

Today, there is an increased expectation of personalised communication. A remarkable 90% of respondents said that personalisation encourages them to take action at least some of the time, with 30% reporting they do so all or most of the time. This shows that tailored messages—whether about policy renewals, financial advice, or special offers—resonate more deeply with customers and can drive meaningful engagement. However, fintech and insurtech companies must be cautious about how they handle personal data. 

Consumers are generally more willing to share details to receive personalised offers. However, in turn, they expect their data to be handled responsibly and securely. Leaders must be transparent about how customer information is used and stored, ensuring that ethical data practices are in place to protect privacy and build confidence.

Fintech and insurtech businesses are able to enhance communication through mobile channels, and with consumers increasingly reliant on mobile devices, it is important for businesses to meet customers where they are. 

Mobile communications, whether via SMS, app notifications, or mobile-friendly emails, should be concise, timely, and easy to engage with. Esendex’s research reveals that many customers value receiving mobile communications, which can be a powerful tool when leveraged correctly.

Yet, despite the benefits, the risks of getting it wrong are high. As the research highlights, the majority of consumers are quick to leave a company if communication falters, particularly in younger age groups. Poorly timed, irrelevant, or unclear messages can not only cause frustration, but can lead to customers losing trust and moving elsewhere.

Fintech and insurtech leaders must focus on delivering clear, well-timed messages that add value to the customer experience, rather than cluttering inboxes with irrelevant information.

Building trust and loyalty through thoughtful communication

At a time when competition in fintech and insurtech is fierce, businesses must look to communication as a strategic advantage. 

To stay ahead, fintech and insurtech leaders need to prioritise the quality of their communications. This means more than just sending out messages. It involves understanding customer needs, personalising interactions, and handling data responsibly. Mobile channels are particularly important as they become a primary touchpoint for many consumers, and businesses must ensure that these interactions are seamless and valuable.

In the end, communication is not just about providing information; it’s about building relationships. Trust, once earned, can translate into long-term loyalty, but it requires effort, consistency, and a commitment to understanding and meeting customer expectations. 

By investing in thoughtful communication strategies, fintech and insurtech businesses can enhance their customer relationships and strengthen their position in a competitive market.

AI adoption by banks and financial institutions isn’t a simple story. As a major, recent U.S. Treasury Department report pointed out, “Financial institutions have used AI systems in connection with their operations, and specifically to support their cybersecurity and anti-fraud operations, for years.” But those traditional forms of AI and existing risk management frameworks, the report also notes, may not be adequate to face emerging threats born of generative AI. What’s new is the massive amount of convincing synthetic content generative AI can create — automatically constructing fraudulent identities, behavior patterns, whole banking histories, and cyberattack schemes. 

Fraudsters are going on the offensive with Generative AI, while defensive algorithms race to keep up with the new, supercharged forms of attack. 

A 2024 survey of banking professionals revealed a knowledge gap that doesn’t help matters: Only 23% reported that they definitely knew the difference between traditional AI and generative AI. And while a large bank like Goldman Sachs has over 1,000 developers using generative AI to help write code and summarise documents, those are different functions than directly combating fraud — and smaller banks don’t have that horsepower for any function. What’s more, MiTek’s latest research disturbingly found that a full third of surveyed risk professionals estimate that up to 30% of financial transactions may be fraudulent, that 42% of banks identified onboarding new customers as a process particularly susceptible to fraud, and that “nearly 1 in 5 banks struggle to verify customer identities effectively throughout the customer journey.”

Fraud on the rise in three key areas: mobile payments, account takeover, and cyberattacks

As generative AI becomes more sophisticated, the tools used by fraudsters are becoming more complex and targeting many aspects of financial services. The sector is especially likely to see AI-enabled increases in mobile payments and transfer fraud, account takeover fraud, and cyberattacks resulting in financial crime. 

Mobile payments and transfer fraud

Mobile banking rates have increased, and so has fraud perpetrated from mobile devices, rising from 47% in 2022 to 61% in 2023. Consumer Reports, evaluating the mobile banking apps of five of America’s largest banks as well as five newer digital banks, found that the apps are not offering adequate fraud prevention measures based on four criteria, including real-time monitoring, fraud notifications, scam education on their website, and fraud education for the app generally. Earlier this year, the Federal Trade Commission reported that payment fraud losses in 2023 increased 14% year-over-year and amounted to over $10 billion, with bank transfers or payments being the top method of loss.

AI-powered systems offer hope, specifically in detecting mobile payments and transfer fraud in progress. AI algorithms can analyse vast amounts of transactional data to detect patterns indicative of fraudulent activity within banking and mobile payment platforms. For instance, AI can identify unusual spending patterns, geographic anomalies, or suspicious login attempts in real time. Banks are already using AI-powered inspection, image analysis, and intelligent, configurable fraud decision engines to combat check fraud. This type of fraud is often executed on mobile devices and projected to reach a stunning $24 billion globally this year. By continuously learning from historical data and adapting to new fraud trends, AI-powered systems leveraging pattern recognition and predictive machine learning can identify and flag potentially fraudulent transactions before they are completed.

Account takeover

As generative AI can accurately reproduce a person’s voice, writing style, and image in photos and even video, fraudsters are stealing identities and fabricating new ones to engage in account takeover (ATO), fake account creation, and fraudulent account logins. TransUnion recently found that “nearly one in seven newly created digital accounts are suspected to be fraudulent.” Financial institutions can use AI algorithms to fight back by analysing user behavior and transaction patterns — including deviations from normal login times, locations, device types, and transaction amounts. These allow them to identify anomalies that may indicate an account takeover attempt. By monitoring user activities in real time, AI systems can detect suspicious behavior and trigger authentication challenges or account lockdowns to prevent unauthorised access. But the growth of this kind of attack requires equally aggressive growth in real-time detection and mitigation AI implementations.

Cyberattacks

AI-enabled cyberattacks that result in financial crime are on the rise, too. For example, generative AI chatbots and other tools are helping hackers perpetuate social engineering designed to infiltrate accounts and trick employees of financial institutions. The U.S. Treasury Department has urged banks that are moving too slowly to take action to address these cyber threats. AI-powered systems and algorithms can analyse network traffic, scrutinise email communications to identify phishing attempts, detect malware signatures and patterns indicative of ransomware activity or BEC scams, and predict potential vulnerabilities in financial systems based on historical data.

Collaboration is key to fighting fraud in the AI era

Typical applications of AI in financial fraud have been atomic in nature, but a shift is underway, where AI-driven fraud collusion networks are emerging to ramp up massive attack campaigns. We’ll need even more sophisticated AI algorithms collaborating to identify large-scale fraud schemes across multiple financial institutions. Now and in the future, banks must collaborate on many levels in order to keep pace, or outpace, criminals. 

Cross-enterprise collaboration among AI model and technology teams, legal and compliance teams, and others will lead to shared advantage towards fraud prevention. However, the sharing of fraud information among financial firms is currently limited. While it doesn’t yet exist, a clearinghouse has been proposed that would allow the rapid sharing of fraud data and that can support financial institutions of all sizes. Smaller institutions have remained at a disadvantage and more negatively impacted by the absence of fraud-related data sharing because they often do not have the broad set of client relationships and the wider base of historical fraudulent activity data that can be used to develop and train AI models. Fraudsters know this and know that smaller institutions are more vulnerable.

Working through AI adoption challenges 

As banks work to speed up their AI collaboration and adoption efforts to combat fraud — and find ways to take full advantage of generative AI to complement other kinds of predictive AI and machine learning — they face three major kinds of challenges, shared by enterprises in other industries: reliability, domain context, and business integration. We know that, as fast as development is happening, large language models (LLMs) are not yet fully “enterprise-ready.”

Successful implementation of generative AI solutions requires reliability, predictability, and explainability of output. That means hallucinations and bias are simply not acceptable in production environments. Banks must be able to offer evidence of an action or decision to auditors and to maintain a good reputation with customers. AI models also must account for organisational context, consuming vast data that helps them “understand” an organisation’s internal processes, unique history and particularities. Banks must also integrate models into business workflows in order to tie them to real value creation.

Five AI strategies banks should adopt to counter fraud

Banks can and should take action by adopting specific strategies to prevent and mitigate fraud. First, they can use predictive modeling and anomaly detection to identify potential anomalies in customer transactions by analysing their transaction history, location data, spending habits, and other data. Any deviations from the norm may be flagged for additional scrutiny. For example, sudden large purchases and transactions from unusual locations or at odd hours may indicate a problem. Analysis of bank statements can help predict future spending patterns based on past behavior.

Biometric authentication is another strategy banks should integrate into their processes. Financial institutions can use biometrics like fingerprints, facial and voice recognition, and behavioral parameters powered by AI to significantly reduce the risk of unauthorised access, thereby reducing fraud. 

AI can also improve document analysis. An AI-driven system can improve the accuracy of analysing customer documents used for identification, which helps detect forgeries.

Banks should leverage AI for automated threat response as well. By automating tasks with AI like blocking suspicious transactions, contacting customers for verification, and notifying law enforcement in case of suspected fraud, banks can sharply speed up response times and enable loss reduction.

Finally, banks should use AI for data integration and enrichment. By integrating data from various sources, including internal databases, social media, and public records, banks can quickly build a comprehensive view of a customer’s identity and minimise fraud risk.

Final thoughts

Consumers look to banks to be stalwarts of protection and stability in rapidly changing times. Economic and social systems depend on it. Getting in front of fraud in the AI era is a complex endeavor for banks, but an imperative.

It’s only through smart and collaborative AI adoption that they can face the threats AI-powered fraud poses, protect consumers and improve their experience, and remain competitive for the long term.

The fintech space is continually evolving, driven by advancements that prioritise customer-centric solutions. One of the key differentiators for fintech companies in this competitive market is their ability to offer highly personalised and tailored experiences to consumers. PLIM Finance, a fintech company focusing on the medical aesthetics sector, stands out in this regard. It does so with its innovative marketplace that allows for the creation of customised consumer experiences. By offering a marketplace that enables customised searches for health and wellness services, PLIM is redefining how to deliver financial services in a more personal, efficient, and effective manner.

Health and wellness marketing 

PLIM is revolutionising how consumers interact with health and wellness services through its marketplace platform. The company aims to empower individuals by providing them with a seamless, user-friendly interface. Using this interface, they can find and book services tailored to their specific needs. The marketplace connects consumers with a variety of health and wellness services offered by PLIM’s partner brands. These include treatments and clinics that can be searched based on location and specific requirements.

Unlike traditional models that often rely on generic recommendations, PLIM has built its marketplace to offer a more personalised approach. The platform allows users to find exactly what they need with ease. By focusing on customisation, PLIM enhances the user experience. Greater levels of customisation make it easier for consumers to access the services they are looking for.

At the heart of PLIM’s marketplace is its powerful search engine. This tool is designed to simplify the process of finding health and wellness services. The search engine allows users to perform highly specific searches based on three main criteria. These are: location, type of treatment, and specific clinics. This targeted search capability ensures that users can quickly and easily find the services that are most relevant to their needs.

1. Location-Based Search

Users can search for treatments and clinics based on their geographic location. This feature is particularly useful for consumers who are looking for services close to home or work. By entering their location, users can receive a list of available treatments and clinics in their vicinity. This makes it easy to find convenient options.

2. Treatment-Specific Search

PLIM’s search engine also allows users to search for specific types of treatments. Whether a user is looking for a wellness program, a specific procedure, or an aesthetic treatment, the search engine can filter results to show only those services that match the user’s criteria. This capability ensures that users are not overwhelmed with irrelevant options and can focus on finding the exact treatment they need.

3. Clinic-Specific Search

In addition to searching by location and treatment type, users can search for specific clinics that offer the services they are interested in. This feature is valuable for users who may have a preferred provider or who are looking for clinics with certain credentials or specialties. By allowing users to search for specific clinics, PLIM’s marketplace ensures that users have control over their healthcare choices.

PLIM has designed its marketplace to offer a highly customised consumer experience. It achieves this level of customisation through a user-centric design that prioritises simplicity and ease of use. The search engine’s intuitive interface allows users to quickly input their search criteria and receive relevant results, making the process of finding and booking services straightforward and hassle-free.

Inside PLIM’s retail media walled garden 

PLIM’s marketplace also offers a compelling opportunity for partners to expand their reach and attract more clients by creating a detailed, customisable profile. By signing up, partners can showcase their treatment menu, upload images, and integrate their social media channels, all for free, providing potential clients with a comprehensive view of their services. This feature-rich platform acts as a powerful marketing tool, enhancing visibility and making it easier for clients to find and book their services. The only cost to partners is a small commission fee of 5-15%, depending on the size of the eventual transaction, making it a cost-effective solution to grow their business without upfront investment.

By focusing on user needs and preferences, PLIM’s marketplace enhances the overall customer experience for both partners and consumers. Users can find exactly what they are looking for without having to sift through irrelevant options, and partners can create a platform to market their brand to a new audience they may not have had access to previously. This streamlined approach not only saves time but also increases user satisfaction by providing a personalised service that meets individual needs.

Fintech companies like PLIM are at the forefront of making services simple to use and tailored to individual needs. By integrating a powerful search engine into its marketplace, PLIM is able to offer a level of service that is both highly efficient and deeply personalised. This is a significant improvement over traditional service models, which often lack the ability to provide personalised recommendations at scale.

Trust and data 

Trust is a fundamental component of any service, especially in both the medical aesthetics and finance industry. PLIM recognises the importance of building trust with its users by providing a transparent and user-controlled experience. Users have clear visibility into how the search engine works and how they can find the services they need. This transparency helps to build confidence in the platform and ensures that users feel in control of their choices.

Additionally, PLIM’s marketplace provides detailed information about each service and clinic, including reviews, credentials, and pricing. This information empowers users to make informed decisions, further building trust and confidence in the services offered.

PLIM’s marketplace is an excellent example of how fintech can create customised consumer experiences. By utilising a sophisticated search engine and a user-friendly marketplace model, PLIM provides a user-friendly platform that not only enhances the accessibility and relevance of the services offered but also sets a new standard for personalised service delivery in the fintech industry.

As the demand for personalised and accessible services continues to grow, fintech companies that prioritise user-centric solutions, like PLIM, will be well-positioned to lead the market. By focusing on customisation, transparency, and user control, PLIM is redefining how consumers interact with financial services, offering a glimpse into the future of personalised service delivery.

In the pursuit of beauty and aesthetic enhancements, financial control plays a pivotal role in making informed decisions, aligned with personal goals. 

Meet Nada and PLIM 

I am Nada Aliredha, pioneering entrepreneur, fintech expert and international businesswoman, continuing to make my mark with the launch of my latest venture: PLIM, a FinTech platform offering offers a “Buy Now, Pay Later” credit service and online marketplace designed specifically for the medical aesthetics industry. With over 663+ clinics on boarded across the UK, PLIM have prioritised the financial needs of both the clinics and their patients whilst providing successful payment solutions within this industry.

As a global businesswoman and now CEO, I have a strong passion for helping female business owners flourish. I honed my experience in a variety of fields and contributed my expertise to several professional boards. I am a member of Irthi Crafts Council, Nama Woman & Advancement Establishment, Sharjah Business Women Council and also proudly worked as a part of the UN Women Alumni Association, to advance female empowerment and promote women’s rights and gender equality.

The gender gap in UK FinTech 

In the realm of UK tech, women have long been overlooked and underrepresented, facing significant barriers in accessing opportunities within a male-dominated industry. While progress has been made, there’s still a challenging journey ahead. The presence of leading women reminds us of outdated perceptions and paving the way for a more inclusive future. 

Witnessing women thrive in tech, despite the odds stacked against them, is not only refreshing but also inspiring and motivating. However, despite shifting attitudes towards gender diversity in the tech industry, a critical issue persists: investors. Securing funding as a woman in tech remains a formidable challenge. 

Unfortunately, investors often succumb to stereotyping. This makes it harder for women-led tech start-ups to gain traction. As a result, less than 1% of all UK venture funding is awarded to all-female teams. Unfortunately, this is a challenge I’ve personally encountered. I was told I will never be able to raise funds without a male partner. Funding is obviously crucial when it comes to building your reputation in the business world. As such, I had to adapt to change and work with the prejudices in the industry to achieve my goal. The lack of belief from those able to give me the funding meant that I was forced to partner up to prove my own abilities. 

The emergence of Femtech

While strides have been made, achieving complete gender equality in tech remains an uphill battle. 

Increasing the representation of women in leadership positions, such as Chief Technology Officers, could have a transformative impact on both the industry and gender equality. Implementing quotas for female developers within tech teams and ensuring female perspectives are incorporated into tech products are both steps in the right direction. 

The emergence of Femtech is setting the stage for meaningful change.

To encourage more women to pursue careers in tech, we must start at the grassroots level: schooling. Women are often discouraged from entering the tech field due to limited role models and stereotypes. We must dismantle these stereotypes and promote female role models within the industry. In doing so, we can inspire the next generation of women in tech. 

Additionally, providing incentives such as job security and tailored packages for women in tech can further bolster their participation. 

I’ve worked with female CEOs who struggle to balance home and work. This is not because they are incapable, but because they lack the support. The ones that succeed (and are happy) are the ones that don’t apologise for being imbalanced, and who ask for help. 

A better, attainable future

Achieving gender equality in tech is a collective responsibility, and with continued improvements and changes, it’s an attainable goal.

It’s essential to recognise the gender gap that exists within the FinTech sector. Women, both as consumers and professionals in the fintech sector, find themselves underrepresented and underserved. 

PLIM is bridging this gap, within organisational and industry levels. My team at PLIM is diverse, with 60% of my team being women in senior positions. As we progress to a business world with a growing female population, resilience, and determination to prove attitudes wrong should motivate you to achieve the goals you set out for yourself and your business.

The financial services industry is highly technology-driven and organisations around the world are scrambling to take advantage of developments in Artificial Intelligence (AI) to enhance the customer journey. By harnessing AI, firms gain the ability to provide personalised services that ensure each customer’s journey is uniquely tailored to their individual preferences. 

We live in a consumer-centric world, which means most innovations are led by the customer’s demands, and that is apparent across many different sectors. The shift towards a more personalised journey not only enhances stakeholders’ trust in organisations in the financial services space, but it also positions companies that are doing this well at the forefront of innovation in an extremely competitive and fast-moving sector. 

For banks, there are three key business areas in which AI technology is being particularly explored, utilised and integrated to take advantage of the efficiencies it can bring. Customer operations are the first, especially Know Your Customer (KYC) and Customer Due Diligence (CDD) processes. Marketing and sales departments use AI to drive customer engagement through hyper-personalised, data-driven campaigns that adapt in real-time based on customer interactions. Moreover, AI can analyse customer sentiment through natural language processing (NLP) of customer feedback, social media, and service interactions. This allows financial institutions to identify at-risk customers and implement targeted retention strategies. Meanwhile, software engineers are using AI to speed up and streamline the construction and integration of complex IT frameworks and tools, increasing the perceived business value.

How will AI support this transition?

AI has opened the door to a wealth of customer data that helps financial institutions shape the journey. The analytical capabilities are dramatically enhanced, which allows assessment of much greater volumes of data on customer behaviour trends, such as financial history, spending patterns, and real-time transactions. For example, if a customer is approaching retirement age, their banking app might proactively offer retirement planning services. Similarly, AI can identify customers at risk of financial distress and provide them with personalised financial management advice, thereby preventing potential issues before they arise.

Most banks we work with use simple forms of AI, such as chatbots, and approximately 70 per cent use an advanced form of AI. This number skyrockets in the fintech market, with these organisations using AI wherever possible as they operate in a less regulated environment. However, they will be subject to compliance with the EU AI Act moving forward. Some financial institutions invest in more elaborate AI assistants tailored to specific corporate knowledge and documents including policies, offerings and terms and conditions. Tapping into the benefits of automated machine learning means organisations can continuously improve their responses to customer enquiries and tailor interactions for an immediate, more convenient service. 

When it comes to compliance and protecting customers from fraud, AI can enhance KYC processes by providing advanced identity authentication and anomaly detection, ensuring robust compliance and heightened security. AI and ML technologies can help detect fraud patterns or suspicious activities in risk profiles, automatically flagging high-risk profiles for enhanced due diligence and pre-emptive measures. 

What is the advice for financial services firms?

When it comes to building AI functions, the safest route is to prioritise consistency. Many firms are creating the same architecture in an agile environment across multiple departments to ensure security and data governance are at the core of all applications. 

Regarding data, banks need to develop sustainable data engineering capabilities. Also, there needs to be a key focus on compliance and governance to ensure no privacy concerns. For example, banks are exploring the use of AI within facial recognition systems specifically to enhance security measures and improve customer authentication processes. To make facial recognition AI successful, there needs to be a comprehensive audit trail of all facial recognition attempts, including timestamps, user identifiers, and the outcome of each authentication attempt. Logging this information ensures transparency, accountability, and compliance with data protection regulations.

In addition, as financial institutions increasingly rely on AI, it is crucial to address ethical considerations such as algorithmic bias and transparency. Implementing fairness and accountability measures in AI systems helps maintain customer trust and regulatory compliance.

Businesses in the financial services space have the opportunity to gain a competitive edge through AI and the opportunities are boundless. Still, they must also remain aware and in control of the potential risks of leveraging much greater volumes of personal data and increased data sharing. 

The Italian Trade Agency (ITA) is leading a delegation of institutional partners and business leaders from Italy’s financial technology community to Money 20/20 Europe. This premier FinTech event will take place in Amsterdam from June 4 to June 6, 2024. This year’s edition is expected to be a record-breaker, attracting over 8,500 attendees from more than 100 countries, serving as a key networking hub for those looking to stay at the forefront of FinTech innovation.

The FinTech industry is one of the fastest-growing sectors in Italy and a significant area for investment. Money 20/20 Europe presents a valuable opportunity for the Italian ecosystem to gain exposure and showcase its leadership in Europe to global businesses and foreign investors. According to a survey by the Bank of Italy, financial technology investments have surged over the past year, with total investment projects projected to reach €1.88 billion by 2025. These investments are primarily focused on deposits, lending, and payments, where the integration of new technology is driving efficiency and service improvements.

To maximize this opportunity, the Italian Trade Agency has partnered with other key institutions and players in the FinTech world. The Bank of Italy will have a dedicated space at the exhibition area, highlighting its commitment to promoting innovation in payments and finance. Additionally, Cassa Depositi e Prestiti (CDP) and other national partners in the FinTech ecosystem, including Fintech District, YesMilano, ItaliaFintech, and AssoFintech (in collaboration with SDA Bocconi), will be present.

Joining them will be a delegation of innovative Italian startups, providing them with the chance to form new connections with international stakeholders and expand the potential for innovation in Italy. The Italian Pavilion will also feature investment specialists from the Italian Trade Agency’s offices around Europe, who will offer first-hand knowledge about establishing a presence in Italy.

The Italian Pavilion will officially open on June 4 at 11:00 AM at Stand 8A110, marking the start of three days filled with networking sessions and interactive discussions. ITA – Italian Trade Agency continues to champion Made in Italy excellence, supporting national FinTech companies in their internationalization efforts and increasing their visibility in global markets.

Join the Italian delegation on June 4-6 at Money 20/20 Europe – RAI Amsterdam, Stands 8A110 and 8A120, and witness the future of financial technology.

Some of the most innovative, fast-moving ideas and companies have found their feet (and funding) on the show floor. From J.P. Morgan, Stripe, and Airwallex to HSBC, Deutsche Bank, and Checkout.com, Money20/20 is the place where money does business.

The Place Where Money Does Business

Money20/20 Europe is home to the industry’s boldest and brightest new voices – where the money ecosystem comes together to shape what’s next for the industry. Every year, Money20/20 provides connections, tools, knowledge and access to the innovations of the future. Check out the show highlights from last June in Amsterdam.

Ready for Money20/20 Europe 2024?

Dive into the fintech evolution at Money20/20 Europe! Uncover insights, cultivate connections, and fuel innovation in three unmissable days.

Grab your pass now using code INF200 on the link below and embrace the future of finance all while saving €200!

The insurance industry’s traditionally conservative rate of progress has recently given way to a new, much more accelerated pace. The sector is digitalising rapidly, with an uptick in customised services. Personalised experiences, mobile platforms, and data-driven analytics have become integral parts of the insurer’s relationship to their customers. 

Now, generative artificial intelligence (AI) is emerging as the next pivotal driver of innovation for insurance. The technology promises to create new efficiencies, increase resilience, and help insurers better manage risk. 

Generative AI applications for insurance 

Generative AI has the potential to greatly enhance the delivery of personalised recommendations. Correctly applied, it can also contribute to the creation of new products customised to the individual. More traditional AI has already seen success as a way to deliver personalised services. Experts in a recent report by LeewayHertz, however, believe that traditional AI “may be limited in creating highly individualised content.” 

Generative AI, however, is capable of handling greater levels of complexity, and could therefore be capable of offering “truly personalised insurance policies, customising coverage, pricing, and terms based on individual customer profiles and preferences.” 

The technology can also enhance the virtual risk management process thanks to its ability to generate synthetic datasets used for threat assessment training. Generative AI models can generate high quality synthetic training data. This data can help train security teams, augment limited datasets, and enhance the performance of AI models. 

Lastly, generative AI is already playing a growing role in the automation of customer service and organisational tasks. Sebastjan Plavec, Chief Marketing Officer at Adacta, noted in a recent blog that “AI-powered Chatbots built on LLMs have proven highly effective in customer service.” The quality of conversation that LLMs like ChatGPT can achieve is “way above” what is achievable with traditional chatbots. 

On an organisational front, Plavec believes that Generative AI could have a key role to play in automating elements of the underwriting process, as well as document organisation and due diligence. “ChatGPT and similar models can be used for analysing large volumes of unstructured data to identify patterns and empower more accurate underwriting decisions,” he writes. 

Through the application of generative AI to the insurance sector, insurers have the potential to realise significant operational efficiency gains at speed.

Time and again, the fintech industry has defined itself in comparison to traditional banking. It’s part of the branding: famously conservative, slow-moving financial institutions versus agile tech powerhouses unencumbered by centuries of tradition and risk-averse thinking. 

This seeming philosophical opposition between banks and fintechs is, some claim, a very good reason for them to collaborate. Analysts working for Bain and Company argue that partnering with fintechs could help banks move faster on digital product design, time to market, and security. 

“Fintechs provided the technology, banks the funding and customers, with each augmenting the potential of the other,” note the analysts. However, they also note a successful partnership between a bank and a fintech is “not easy to source, implement, and manage.” 

One of the reasons this is the case could be the fundamental differences in how each type of organisation approaches risk.

Banks are “responsible” for fintech partner risk management 

Michael Hsu, the acting Comptroller of the Currency for the US government, has reservations about fintechs’ presence within the traditional banking ecosystem. As reported by Reuters, Hsu’s belief is that “Banks that work with financial technology companies to offer banking services should be actively managing risks associated with those relationships.”

A further report by the US Treasury department highlights the issue that “the presence of non-bank firms outside the bank regulatory perimeter—while offering a similar set of products and services that pose similar prudential risks as banks, such as deposit-taking and making loans and extensions of credit—poses a risk.” 

Increasingly, the US banking sector appears to be embracing fintechs. For example, 39% of US banks have already partnered with a fintech to support payment facilitation and money movement. For context, the same percentage are planning to partner in the future. Also, 34% have already partnered with a fintech on a mobile wallet, with 21% more planning to do so in the future. The benefits fintech can provide to traditional banks are clear. More importantly, the banks themselves recognise the benefits.

However, the regulatory hurdles which many fintechs have managed to avoid so far will not be waived when it comes to their participation in traditional banking.

As Hsu insists, “We will not… lower our standards, create a special regime, or take an overly expansive view of banking to entice new entrants or in the hope of bringing a particular activity into the bank regulatory perimeter.” It appears that banks may be forced to shoulder increased regulatory risk when partnering with famously risk-tolerant fintechs. If that happens, it may erode a good deal of the appeal that created these partnerships in the first place.

The insurtech industry—and fintech, more broadly speaking—is going through a time of transition. Venture capital funding has continued to diminish after the 2021 high point. This year, the industry will likely do some soul searching, although new technologies and macroeconomic pressures could make it hard to find the necessary breathing room for reflection and change.

Here are our 3 trends we see driving a year of self-analysis and change in the insurtech sector. 

1. Thinning of the startup herd 

A lot of Insurtech startups will go bankrupt this year. Less venture capital overall will make investors more skittish when it comes to investing for the first time. Likewise, existing investors will also be more likely to pull the plug on a struggling investment than they were a few years ago. 

Several insurtech startups have already folded quietly, but the trend stands to become a lot more noticeable in the months ahead. Quentin Colmant, CEO and co-founder of Qover, believes this will also spur the transition of the industry from being VC funded to supported by more strategic investors. “Insurance is a very slow business and a complex one. Yet it is also robust and resilient,” he writes. “That’s why I predict that in the coming years, strategic investors who are more patient and have a better understanding of the insurtech world will invest more and more.” 

2. ESG expectations are rising 

The devastating effects of the climate crisis aren’t going anywhere. At the end of one year defined by record temperatures and extreme, damaging meteorological events, we find ourselves at the start of another experiencing the hottest February ever. The crisis urgently requires action to protect global ecosystems and communities.

For insurers worldwide, these developments are driving both ESG policy revisions and investment into technology. Using machine learning and AI, insurtech will likely prioritise improvements in risk modelling to address uncertainties related to climate. Furthermore, insurers must focus on enhancing transparency and building trust in their communication with customers. 

3. Times are tough, y’all 

The insurance industry, notably in the US non-life market, is facing the least forgiving market conditions in a generation. Insurers are facing the formidable task of swiftly increasing prices to offset the substantial rise in expenses, a challenge that is projected to become even more demanding as the industry adapts to these harsh market realities. 

Moreover, reinsurance rates are expected to stay elevated, adding further complexity to the landscape for insurers. In this challenging market environment characterised by rising prices, insurers must carefully navigate between maintaining profitability and ensuring affordability for consumers. The heightened reinsurance rates may prompt carriers to reevaluate their approaches to risk-sharing.

Over the last decade, it often felt as though fintech startups had a licence to print money. 

In 2010, worldwide investment into fintech was $9 billion. Over the next decade, that figure skyrocketed, reaching $216.8 billion in 2019. Funding took a precipitous dip in 2020 thanks to the pandemic. The next year, however, funding bounced back with a vengeance, and fintech spending rose to an all-time high of $225 billion in 2021.

That year, startups like Klarna and C6 Bank raised $1.6 billion and $2 billion, respectively, in funding. It was a clear message. Fintech’s decade of growth was on track to be followed by another, possibly even more frantic one. But then, the story changed. 

The great fintech growth slump

The cocktail of technological progress and market-readiness that drove fintech’s decade of hypergrowth soured in 2022. According to analysts at McKinsey, “a market correction triggered a slowdown in this explosive growth momentum. The impact continues to be felt today.” 

Funding and dealmaking activity have decreased dramatically across the fintech sector in the last two years. US fintech funding dropped by 36% to $18.2 Billion in 2023, while the UK saw a 63% decrease to $4.2 Billion. A new report published by Tracxn notes that “with inflation, increased interest rates, geopolitical issues, and other macroeconomic conditions, activity across industries has been slow, making it challenging for the investment market.”

Unicorns are still emerging, with four new companies hitting a billion dollar valuation in the US last year. The change of pace is, however, can’t be denied. 

A new model for sustainable growth in fintech

Some analysts aren’t worrying about the slowdown, however. At McKinsey, authors of their report, Fintechs: A new paradigm of growth, believe that slowing growth isn’t the crisis some have painted it as. Even though the 2021 “funding surge proved to be a one-off event” and a return to “business-as-usual conditions” caused “fintech evaluations to plummet,” they insist that there are still opportunities to be unlocked in the future. 

Combined with generational leaps in data analytics and artificial intelligence (AI), “these trends are also coinciding with—and in many ways catalysing—the maturation of the fintech industry,” write the report’s authors. “The days of growth at any cost are behind the industry, for now at least. In a liquidity-constrained environment, fintechs and their investors are emphasising profitability, not just growth in customer adoption numbers or total revenues. 

One Africa-based growth equity investor told McKinsey: “In the past, the reward went to fintechs that showed growth at all costs, which led to healthy valuations. Now it is about the sustainability of the business, the addressable market, and profitability.”