Technology

The quantum leaps made in payment technology over the past 10 years have transformed every part of the merchant acquiring landscape. Rampant M&A activity, the accelerating shift to ecommerce, and the influx of non-bank fintech players have up-ended tried and trusted business models.

Africa lagged behind the developed world in inclusive finance, but that is rapidly changing as tech hubs spring up across the continent, providing incentives to enterprising start-ups and investors and jobs to talented young workers. The gains are spilling into the wider economy, with tech ecosystems propelling progress and development.

Anyone who owns an old car understands the frustrations of upgrading it to modern standards. The same is true of incumbent banks faced with the requirement to compete with challengers in the digital world while encumbered by legacy infrastructure built for another time. The best tactic is to start fresh with a managed services approach.

Banks have always represented lucrative targets for cybercriminals – after all, as famed pre cyber era bank robber Willie Sutton said, “that’s where the money is.”   A 2019 report from the Federal Reserve Bank of New York found that financial firms experience as many as 300 times more cyber-attacks than other companies, and the threat has only grown over the years.

As the sophistication of artificial intelligence and intelligent algorithm technologies has increased, they now have the potential to revolutionize traditional banking models and deliver a shift to digital banking which is faster, more agile, and more customer centric. AI has the potential to transform all aspects of banking – from the way we save to the way we invest and spend – making possible a model of banking that is smarter, faster and more customer friendly. 

Fintech has transformed banking as we once knew it, and now fintech-as-a-service (FaaS) is providing financial technology as a service through integrated API-based solutions to a wide market. From processing payments to meeting compliance requirements, FaaS is set to drive coordinated financial innovation further, with no end in sight.

The internet has become an indispensable element in our lives and has also crowned a few behemoths, which control not only a huge chunk of the Web but plenty of user data. As we move into Web 3.0, we can expect to see a more decentralized DLT-based system that gives back to users sovereignty over what is rightfully theirs: their data.

The dust has had time to settle on the much-awaited publication of the Kalifa Report on the  fintech industry. The report, by Ron Kalifa, was conducted on behalf of The City of London Corporation, at the behest of Her Majesty’s Treasury, and could not have come at a more opportune time.

Financial services will always be a target for hackers seeking to gain their hands on lucrative assets. But as the sector continues to digitise, organisations risk increasing the number of entry points for increasingly sophisticated cyber criminals to take advantage.A growing cause for concern is the rise in ‘Shadow IT’, as the adoption of cloud-based services increases.

India, second only to China in population, is home to one of the world’s most active tech sectors, with innovative firms popping up all over the vast nation, attracting significant interest from foreign investors. Time will tell if these enthusiastic start-ups live up to their expectations and reward their investors with soaring profits.