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3. Regulators finally make the pivot to supporting the FinTech ecosystemBitX, a bitcoin startup in Singapore, was looking to enter the UK and European markets. Instead of having an arduous journey gaining the required licenses and approvals as it would have expected in the past, BitX was accepted into the regulatory sandbox of the UK’s Financial Conduct Authority. This enabled it to test its services and build its product with the backing of the regulator. This kind of thinking reflects how in the past few years we have seen regulators move from hindering innovation and new services, to proactively supporting and strengthening the FinTech ecosystem.It is a challenging line to take, particularly in the

world of finance – to help create the framework and environment for innovation, while also protecting consumers and businesses. However, increasingly we see regulators getting this blend right.For example, the European Union’s Directive on Payment Services (PSD2) will create an EU-wide single market for payments. This will drive new opportunities and innovation in the payment sector, because it will force financial institutions to provide secure access for a third-party service provider to a customer’s online account. Meanwhile, we have seen regulatory sandboxes emerge not just in the UK, but in locations from Singapore to Australia. The US Treasury meanwhile recently announced it will start issuing special purpose national bank charters to FinTech companies.In the future, expect to see the emergence of “RegTech”. This will enable real-time interaction and analysis between regulators and financial institutions. Indeed, thi

ch as in New York, London or Singapore. So, although the UK dominates the world of fintech (generating an estimated £6.6billion in FinTech related revenue), leading organizations are looking for inspiration among the innovative services, products and ideas being created from Guadalajara, to Laos, to Kenya.In many cases we can see that the unique financial environment of these locations is resulting in novel ideas. For example, Guadalajara based start-up Kueski uses a person’s digital footprint to assess their credit worthiness – a particular challenge in Mexico where credit is not available to large swathes of the population. In Latin America Tigo Cash is a mobile financial service which already handles more cash than many financial institutions in the region. We will see markets and services emerging which are currently not on anyone’s map, and become some of the most important financial organizations in the world.

software platform between itself and the banks, so it can view and analyze information in real-time.4. Look beyond the hubs to find innovative ideasAcross Kenya, mobile money has become ubiquitous – being used by at least one person in 96% of Kenyan households. But what is the real impact of mobile money in such countries? One study estimated that M-PESA, the Kenyan mobile money system which enables money to be stored on a phone and be sent via text, has helped lift 2% of Kenyan households out of poverty.What this example demonstrates is that the impact of FinTech innovation is often created and experienced outside of the usual hubs of finance su

In the past few years we have seen the rapid evolution of FinTech from generating novel ideas which solve customer problems, to offering core financial services. We have seen the shift from digital startups, characterized by a lack of financial wherewithal and which operated on the edge of tightly regulated markets, to the emergence of mature financial digital organizations at the heart of the traditional financial world.We can describe the development and maturing of FinTech in 3 main waves:The early emergence of digital startups helping consumers. Originally FinTech solutions were the preserve of B2C markets which solved specific customer problems such as offering home loans faster and easier. They used new technologies such as mobile and cloud computing, and were characterized by a laser focus on the customer with all the hall-marks of a digital Silicon-Valley style start-up.Transition to B2B markets. Today FinTech plays a role at the core of B2B innovation in financial markets, and industry observers widely expect B2B FinTech revenues to dwarf those in consumer markets within the next couple of years. Organizations such as Currency Cloud (cross border B2B payments), Payoneer Escrow (escrow services), and Hummingbill (B2B invoice platform) all reflect a maturing industry.The creation of an ecosystem between FinTech and traditional players. FinTech organizations are realizing that the required go-to-market investment, economies of scale, and regulatory needs, means it makes sense to partner with traditional financial institutions. On the other side, established players recognize the value, innovation and potential of FinTech in a world which is increasingly mobile-first. These financial institutions are also adopting many of the methods that FinTechs use so successfully, from a focus on the customer, to using Agile software development, to holding hackathons, and forming accelerators and innovation programs.

ch as in New York, London or Singapore. So, although the UK dominates the world of fintech (generating an estimated £6.6billion in FinTech related revenue), leading organizations are looking for inspiration among the innovative services, products and ideas being created from Guadalajara, to Laos, to Kenya.In many cases we can see that the unique financial environment of these locations is resulting in novel ideas. For example, Guadalajara based start-up Kueski uses a person’s digital footprint to assess their credit worthiness – a particular challenge in Mexico where credit is not available to large swathes of the population. In Latin America Tigo Cash is a mobile financial service which already handles more cash than many financial institutions in the region. We will see markets and services emerging which are currently not on anyone’s map, and become some of the most important financial organizations in the world.

It’s 2020 and to apply for a loan, instead of going to your local bank branch, you quickly ask Facebook for approval. This is far from fanciful thinking. Even as of today, PayPal is arguably one of the largest retail banks — it has more money in deposits than all but the largest 20 US banks, and offers services from payments, to loans and credit cards (albeit currently via partners). But we believe that one of the major tech companies, whether that is Facebook, Amazon, Google, or Ant Financial (the financial arm of Alibaba) will not only transform retail banking, but rapidly become the largest retail bank in the world.

Despite this certificate being awarded in 2012 and being stated as being in the LITERARY category, Ouko insists he is the original M-PESA innovator and further elaborates by saying that he has been “trying to Patent a Money Transfer system way back in 2003”. Even though he says that he believes many more Kenyans contributed to the innovation and development of M-PESA without recognition or reward, he writes, “Even though I currently believe I am the one, I start this with an open mind. If another person or firm comes forward with compelling proof I am ready to step aside and support that person.”

By any stretch of the currently available facts, the service that accounts for more than 60 percent of Kenya’s GDP in transactions was conceived by British professionals. The company commissioned with developing the idea, Sagentia, into a workable technology was British. Additionally, the company that owns the intellectual property rights to the idea, Vodafone, is British and, lastly, it was funded in its initial stages by the British Government.

What is very promising is that the success of Fawry inspired a lot of other players to create fintech companies and contributed to the transformation of Egyptian financial services, which will bring higher value to Egyptian customers.

Mobile operators MTN, AirtelTigo and Vodafone currently lead the industry.

A few years ago, Adovor says, he would have had to endure the traffic driving across Accra to pay cash. “Mobile money is facilitating business and that will increase as more and more people use digital platforms,” he says. Backed by a supportive regulatory environment, mobile money has become the preferred payment method for Ghana’s small businesses.