After months of solely digital events, Fintech Week London marks the change and the start to the return of normality, as the first in-person fintech event in London is held since the pandemic began. This week-long event will have senior decision-makers representing the most innovative companies in financial services gathering in the UK capital to discuss the position of London as a Fintech hub post-Brexit.
Over the course of five days in a hybrid format, holding both in-person and virtual panels and discussions, Fintech Week London will welcome executives from high-street banks, digital challengers, technology giants, and new disruptors, who will come together to shine a light on ground-breaking developments in Financial Technology.
Having shifted to another location, Fintech Week London continued its hybrid event on Thursday the 15th, with an introduction from Fintech Week London’s CEO, Raf De Kimpe, who explained the themes of the day were raising capital, cybersecurity, payments, cryptocurrency and more.
This session revolved around payments, financial crime, and risk detection. The moderator was Robert Courtneidge, Independent Industry Advisor and EPA Board Advisor at Emerging Payments Association (EPA). The panellists included John Sam-Kubam, Head of Financial Crime at Crown Agents Bank and Crown Agents Investment Management, Andrew Churchill, Security Consultant and Standards Director and Lead Author at the British Standard, and Sarah Francis, Payments Advisor and Senior Consultant at Polymath Consulting.
Francis kicked off the discussion when asked to give an overview on where and why there were failings when dealing with financial crime. “People tend to lose sight of what the base concept of a regulation is. The base concept is to protect business, protect customers and protect the financial system from abuse.” She stressed how fintechs have opened the doors to financial inclusion, but as a result of this and the enlarged numbers it brought with it, many have had their accounts closed.
“We have to get back to basics.” Francis continued, “This isn’t just about compliance and AML and KYC. Let’s start with understanding our own products and services, and understand what customers are going to be motivated by and how that makes them behave.”
The topic of conversation moved on to AI and why fintech startups can think about using AI with their first 10,000 customers, as it is more complicated when compared to a Barclays that has 100 million customers. Francis argued that fintechs should be using this before their first 25 customers, let alone thousands of customers. It is of utmost importance to know your customer and what their intentions are, what their living style is like in order to tailor the app to them. She went on to describe how risk judgement was also needed when dealing with even the fewest customers: “People aren’t fraudsters or criminals until they’ve gone through a court of law… People get away with anything they can, because they can.
“There must be an understanding and installation of what risk-based judgement is. There is a balancing act of what is good, what is bad, starting out very early and understanding the financial benefits they’re missing out on by not getting that,” Francis said. She explained how it can be used to target new customers.
“People have got to stop saying we’ve got machine learning and artificial intelligence and leaving it there. Its that point of having the educated risk-based judgement to look at what they’re seeing and feed that back in to cut back on the alerts, and refine the alerts: make them more practical and more workable.” – Sarah Francis.
Adding on to this train of thought, a conversation took place discussing what business should be done with who. said, there’s an idea that “we can’t do business because there are bad guys everywhere so the safest thing to do is to stop doing business, but actually, that’s not the safest thing to do. I think the safest thing to do is to understand your risk and manage your risk,” allowing you to understand the good and bad players.
The afternoon panel sessions kicked off with discussions on cryptocurrency and decentralised finance. The panel was moderated by Lawrence Wintermeyer, Executive Co-Chair at Global Digital Finance. He made the intentions of the discussion clear before the panel were introduced, “Whether you’re new to DeFi or a seasoned pro, don’t worry, this session promises to move your knowledge along.”
The panel consisted of Bette Chen, Co-Founder at Acala & Karara, Anish Mohammad, Co-Founder at Panther Protocol, and JD Gagnon, CEO of BENQI Finance.
Wintermeyer started by asking the panel what DeFi was. Chen was the first to reply, explaining that in order to understand DeFi, one had to understand its properties and values. She said, “For the first time, as humans, we actually own something through cryptocurrency. Pre Bitcoin, we didn’t own anything. If we go to a bank we have money on our cards, but they’re pretty much an I-owe-you. the banks owe us a certain amount that is stored in their database, but we don’t actually own anything.
“We have a mechanism which is powered by blockchain that allows us to have real ownership.” Chen continued in regards to the adoption of crypto. As the event carried on Chen said, “Decentralised finance has disrupted the finance industry like the internet did to media.”
Talking about the response to crypto in the mainstream, with some believing it will completely take over, Gagnon said, “An idea of a world where DeFi exists and the government has no say and regulators have no say or oversight i think is somewhat misplaced.”
As the topic of conversation was moved towards regulation and advice, Gagnon did not approve of social media’s impact on the average Joe’s decision making when it came to crypto. “Spend time researching the things we’re talking about… you don’t have to follow what people say on TikTok or Twitter which is what many people are motivated or influenced by.”
Wintermeyer, spoke about how DeFi’s partnerships were developing, and how regulators were responding. “We’ve seen that regulators are generally open to working with the DeFi community. You know, so that we better understand how it works, and hopefully, how to get meaningful compliance work, the right size or right side of regulation in place, rather than the application of a top-down set of rules that may have worked in the analogue era but just don’t quite hit the mark anymore.”
The NFT Boom: Hype or here to stay?
The Fintech Times own Editor in Chief, Gina Clarke sat down with Eelco Dettingmeijer, Nuvei’s SVP for Sales and Partnerships in EMEA, to discuss all things NFT, posing the question: Hype or here to stay?
The session kicked off by talking about the current trends in digital payments and NFTs, with Gina asking Eelco what his take was on the boom in popularity that has been seen this year.
He said: “One of the main drivers I can see is the global pandemic. Having digital assets and digital identity in gaming, such as skins, has really brought this to the surface and allowed this to take off.
“Because we’ve spent so much more time online and so little time in the public space, being able to spend your money on digital assets and your digital identity has really accelerated the growth.”
When it comes to new businesses emerging in the space, he said “There’s a large ecosystem of everything that has to deal with the creation of NFTs, and also the trading itself in marketplaces. It spreads across a wide variety, like art and architecture, to simple stuff like a certain logo and a certain skin.”
For Eelco, one of the most interesting use cases is NFTs in fashion, which he believes will see massive growth.
“I do feel that from talking to a lot of fashion brands there’s a lot of investment going into this,” he said. “And it kind of makes sense as a lot of things around this like cryptocurrency and tokens got a bad rep in terms of sustainability, and this can really turn that around. If you imagine that NFTs and fashion got a lot more sustainable, you’re basically cutting out that entire ecosystem of environmental unfriendly things by going to something that is purely digital, and it also really helps in terms of exclusivity. More and more people are wanting a unique and exclusive way of dressing themselves and with NFTs it’s always unique and always exclusive to you.”
In terms of the future, the conversation moved to the generational divide. Eelco said: “The generation that has been brought up with having a unique digital identity online and spending money on that is much more the target audience on this than my generation,” with Gina adding how we’re likely to see a chasm of generational differences as the sector moves forward. “They are going to spend their money differently to how we are doing today,” he concluded.
The last panel covering the crypto and blockchain breakout was on Bitcoin. Moderated by Itai Elizur, Partner and COO, MarketAcross; Nimrod Lehavi, CEO, Simplex; Anna Stone, Head of Strategy, GoodDollar.org; and Eric Anziani, COO, Crypto.com.
Starting with what the panellists thought of Bitcoin, Stone said: “Bitcoin has done a wonderful job proving digital money is real, that it’s happening, it’s being adopted by institutions and real people want to hold it as well.
“I think what is yet to be proven in terms of winning is what actual use case bitcoin plays in our world of money.”
“We’re on the right track,” added Anziani, “But winning would be having 7 billion users globally, so we still have some ways to go to bring crypto and bitcoin in every wallet.”
Lehavi followed on from this, saying he hates to be the “party pooper”, but he thinks that nothing has changed in the last 10 years. “A decade ago I said that Bitcoin is going to be mainstream. And i was so wrong, it’s going to take another decade at least.”
The panel moved to discuss CBDCs, and were virtually in agreement that “CBDCs are the gateway drug to learning about digital currency.”
Anziani said: “CBDC’s are definitely not crypto, but its digital currency and I think people need to get more used to using digital currencies. Two months ago we did a survey with The Economist Intelligence Unit, and one of the drivers of digital currency adoption was actually CBDCs. People talk about it and see it in the media, and then look into what a digital currency is and discover Bitcoin and other cryptos.
“I think there is a value to it as it gets people to use digital currency, so overall it’s positive.”
Finally, speaking to the recent announcement that Bitcoin is being made legal currency in El Salvador, and what the panellists thought of it.
Stone said: “I would never want to go grocery shopping with my bitcoin, or any of my currencies that react so volatility. I think it’s going to result in a lot of unforeseen economic benefits, and unfortunately, the people that will suffer are those who are at the lowest end of the wealth spectrum. I think we’ll learn a lot, it will be an experiment the rest of the world will learn from.”