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What is this edition of Financial IT really all about?
In theory, it should be very easy to sum up the insights that are, collectively, delivered by our contributors and supporters in an Editors’ letter. Each edition nominally has a main topic – and the contributions are usually related quite closely to that topic.
In practice, though, the intersection of financial services with IT is a dynamic and complex place: this means that we typically (and gladly) receive contributions that deal with a totally different topic.
The result is that a certain amount of imagination is almost always needed to identify a conceptual thread which runs through the entire publication (or the vast majority of it).
However, this edition of Financial IT could be the exception which proves the rule. As it will be distributed at the Money 20/20 Europe conference in Amsterdam on 7-9 June 2022, all the contributions relate – as you would expect – in some way to payments.
The fact that the conference is built around five Show Themes is just one sign that the global payments industry is very large and complex.
To describe this edition of Financial IT as being about the latest developments in payments would, in a narrow sense, be correct. However, it would be inadequate.
This edition is really all about empowerment.
Empowerment takes many forms
Every one of the very diverse articles from our contributors talks about developments and solutions that bring benefits to several parties. The rise of Request to Pay (RtP or R2P) solutions, for instance, could bring annual benefits of upto GBP3 billion to the UK, as both payers and payees enjoy greater control and communication.
Meanwhile, Software as a Service (SaaS) offerings give traditional financial institutions the ability to make strategic moves at speed. To the extent that those moves involve the delivery of new or better products, the customers (be they existing or potential) should benefit too.
Embedded finance empowers small and medium-sized enterprises (SMEs) as well as payments services providers (PSPs) who are looking for an efficient way of extending credit to customers. Related to this are solutions that make it easier for recruitment agencies (or other employers) to handle payrolls when their employees are all working remotely – and often in other countries.
Meanwhile, other solutions enable operators of exchanges and other infrastructure in the crypto world to more easily comply with anti-money-laundering (AML) regulations. These solutions empower the operators and provide additional protection for the people who use the infrastructure.
In some parts of the world, banks are responding to the declining use in payments of physical cash by pooling their networks of ATMs. This reduces the costs to the banks that are involved and can provide benefits to customers.
One of our contributors explains how payment orchestration platforms (POPs) can empower merchants and acquirers who are involved with e-commerce. Another contributor discusses how the same is true in relation to in-person payments.
Not for the first time in Financial IT, this edition also touches on Robotic Process Automation, Artificial Intelligence (AI) and Machine Learning. When these are combined by an imaginative financial institution, there should be greater resilience for the bank and better customer experience. Once again, many parties are empowered.
The evolution of crypto – and the continuing rise of FinTech
A glance at the provisional schedule for the Money 20/20 Europe conference indicates that the crypto world continues to be seen as relevant and important by many people who are involved in payments.
In his letter for this edition of Financial IT, our Publisher Chris Principe discusses where crypto fits into the history of money. As he explains, the world has embarked on a monumental shift from crypto to central bank digital currencies (CBDCs).
As of the third week of May 2022, the mainstream and financial media continues to be dominated by bad news stories. Economies are experiencing stagnation or rampant inflation (or both). Stock markets and bond markets have been falling. The strength of the US dollar has highlighted the flow of capital away from other parts of the world. There have been problems in the crypto world. The conflict in Ukraine continues: elsewhere, geopolitical issues remain challenging.
However, the smart money that is in and around FinTech in general (including payments of course) remains optimistic. The people who matter can see the opportunities. Our Contributing Editor Katherine Emirosan describes the rise of crowdfunding. As another contributor notes, European tech start-ups raised EUR100 billion – the most ever for a single year – in 2021. Raisings by these companies in 1Q22 amounted to EUR27.5 billion, or 25% more than in the previous corresponding period.
The opportunities come from empowerment – a concept which also features prominently at Money 20/20 in Amsterdam.
We wish everyone a very successful conference.
Editor-in-Chief, Financial IT
Managing Editor, Financial IT
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