Reflections from Money 20/20
Money 20/20 was back in pre-pandemic force this week in Las Vegas, with thousands descending on the conference to hear from the biggest names in FinTech and explore new trends.
As always, there were exciting announcements, talks from the biggest names in the industry, and articles from around the country trying to predict the future.
I’m not going to rehash what you’ve already read, but I want to reflect on some observations that I’ve shared with my team as we head into the next year.
The Search for the Next Big Industry is On
It’s been a while since an entirely new industry exploded, but this year the FinTech community was ready to discuss the opportunities for growth in previously un-bankable verticals. Cannabis, Sports Betting, and Adult Content all made their mark in breakout tracks.
It’s no surprise that there’s money to be made, but it seems that digital maturity and new views on what’s palatable are providing a roadmap to mainstream adoption. As content moderation and responsibility grows, the ability to regulate and operate safely in these spaces appear to be lowering the perceived risk of involvement for some FinTechs.
What to watch: Mainstream consumer adoption could fuel these industries, which will demand new consumer experiences and simpler risk & fraud mitigation strategies. Keep an eye on how banks can make the industries more secure, and how they leverage existing technology to create new services. There will likely be a need for KYC & identity processes or new methods of checkout that align with the strategies of the marketplace.
Identity Management is Hitting a Saturation Point
This year, it was impossible to miss the myriad of solutions proving digital identity products for every point of the customer journey.
I’ve been closely watching trends that align to these solutions, including the shift consumers are making away from their physical wallets and the opportunities Web3.0 may provide to pass information cross-sites.
While many in the industry have been using facial recognition and AI to fight fraud for a few years, the strategies deployed have often been behind the scenes, hidden from the customer’s view. This year, more products are moving to the front-end, with promises of an easier and more secure experience. Dozens of companies planted a flag, stating that their AI was able to catch more fraud with fewer false hits.
What to watch: Consumers are more sensitive to privacy than ever before, and identity management could result in either a more secure experience or consumer aversion to sharing an increased amount of their biometric data. Sentiment will be key in winning this game. Also, keep an eye on companies claiming an advantage using unique AI to see if the‘re able to find unbiased success where others have fallen short.
“As-a-Service” Fits Nascent Needs
Short times to launch. Micro-brands. Niche client segments.
Banking-as-a-Service was hot on the show floor, with providers racing to hit the shortest time to launch new programs. Millennials and Gen Z are both showing affinity to micro-brands, an area that has traditionally seen economic challenges when it comes to loyalty and payment programs.
What to watch: Many of the Bank-as-a-Service companies have proven their technology, so I’d turn your attention to the new programs that launch and their ability to scale. If consumers’ affinity towards micro brands translates into top-of-wallet cards, there will be a greater need for plug-and-play program creation in the future.
Blockchain Hype is Normalizing
This one feels exciting for me. We’re beginning to exit the chaotic phase where everyone is clamoring for reasons to get into blockchain, and instead exploring solutions with much more meat on them.
The players throughout the conference had proven use cases and an ability to clearly articulate what should be built, and how. Moreover, there seemed to be a shift in understanding when blockchain is not the correct solution, which points to maturity for the industry.
Cash-to-crypto rewards, multi-currency wallets, and private blockchains with the ability to create unique networks were all on display.
What to watch: I think blockchain has survived the hype curve, and is making its way into the mainstream infrastructure ecosystem. The question remains how the business side of organizations handle decisions to become part of various consortiums, and what it will mean for industries that are still far behind on their foundational technologies. Look for announcements coming from strategy teams over the next year to see if this is moving into an area beyond the technology C-suite.
