This month at The Fintech Times our focus switches to reflection as we look back at developments over the last 12 months. 2022 has certainly been a challenging year for everyone with global economic activity experiencing a severe slowdown, with inflation higher than seen in several decades.
What lessons have you learned from 2022? That’s the question we posed to The Fintech Times community and what a great response. Today we feature the thoughts of leaders at Fime, METACO, Savana, Happy Mango and TransferMate.
Seamus Donoghue, METACO
As the chief growth officer at METACO, a provider of security-critical software and infrastructure to the digital asset ecosystem, Seamus Donoghue says 2022 brought less learning and more a reminder that change is the only constant.
“It can happen suddenly and accelerate rapidly, but perhaps the real learning is just how quickly the past cycles have repeated in crypto. We have experienced centralised failures that are reminiscent of Enron, Madoff, Lehman and MF Global in just the last few months.
“Many of the high-flying crypto companies that achieved eye-watering valuations from fundraising throughout 2021 have now either rapidly collapsed into bankruptcy or seen a depletion in their addressable market and growth rate.
“So the takeaway is the pace of change remains exponential and therefore we should expect an equally speedy recovery from bearish cycles. The technology is not going away and while the tide is out and market frothiness is settling, it is time to build for the next wave of adoption.”
Emily Steele, Savana
For Emily Steele, president and chief operating officer at financial software firm Savana, her takeaways from 2022 is that digital banking (historically defined by the front-end digital consumer app) is now considered table stakes for a financial institution.
She adds: “However, as banks eagerly rolled-out new consumer digital apps over the last several years – new silos were formed in the process and the unification of systems between banker-assisted and consumer self-service channels was effectively eliminated.
“Banks now face the challenge of removing these silos on the back-end and front-end to boost operations and ensure channel consistency.”
Lionel Grosclaude, Fime
Lionel Grosclaude, CEO of Fime – the biometric card personalisation validation company – has more than 20 years’ experience in the banking, telecom and IT sectors across Europe and the US. He believes that one lesson that we have learnt from 2022 is that fraud now exists as a full industry in its own right.
“An entire sophisticated ecosystem exists for buying, selling and exploiting sensitive data,” he says. “This growth in fraud is primarily being seen on e-commerce sites, due to issues surrounding user authentication. Therefore, retailers and their payment service providers must be able to balance security requirements with providing a good user experience.
“If the security provisions in place are too obstructive, this can lead to cart abandonments and lost sales. Conversely, if they are not rigorous enough, merchants may suffer financial losses and reputational damage.
“A combination of active and passive authentication frameworks can ensure that the payments flow is secure while limiting the impact on the customer experience. Additionally, innovations such as payment tokenisation, biometrics and integrated data management allow these authentication procedures to be further enhanced to protect retailers and their customers alike.”
Sinead Fitzmaurice, TransferMate
CEO of B2B payment technology firm TransferMate, Sinead Fitzmaurice, says 2022 has been an unprecedented year of market turbulence.
“While I’d rather not refer to it as ‘lessons learnt’, I think unpredictable market turbulence can serve as a positive reminder to businesses to always seek cost-effective, transparent solutions when conducting their activities.
“Especially when it comes to money movement, to ensure their working capital cycles are at all times powering their businesses at maximum efficiencies.”
Kate Hao, Happy Mango
The key lesson learned for the fintech industry is to ‘get back to basics’, says Kate Hao.
Hao is the founder and CEO of Happy Mango, which a mission is to bring greater transparency to credit reporting.
“The collapse of FTX, the impact of which is still unfolding, exposed the shocking lack of basic risk management inside one of the most hyped and highest valued fintech ventures.
In addition, fintech investors are now demanding returns in the basic form of profitability instead of ‘growth at any cost, as even the deep-pocketed Goldman Sachs has decided to scale back its consumer finance ambitions after Marcus’ unimpressive financial results.”