Weekly Analysis And Opinion Highlights – 4 December 2023

And we’re kicking off the week with new analysis and opinions on fintech with updates on the future of banking, generative AI, ransomware threats, and more. Dive into the latest fintech insights and have a great start to the week!

Relationship-based services as a customer attraction and retention tool
(Fintech Nexus)

Banks leverage relationship-based services to attract and retain customers during periods of higher interest rates, offering bundled products and services based on customer activity. SunTec Business Solutions President, Amit Dua, emphasizes the importance of technology to track and enhance customer relationships, ensuring transparency and personalized offerings. Read more

Embedded lending can solve BNPL’s in-store checkout problem (Fintech Nexus)

Embedded lending emerges as a solution to the challenges faced by Buy Now Pay Later (BNPL) products during in-store integration. Yaacov Martin, CEO of Jifiti, explains how embedded lending technology seamlessly integrates with existing systems, providing flexibility across various customer channels and offering a superior financing experience for both individuals and businesses. Read more

How Europe’s PSPs are bracing for SEPA instant payments (Fintech Futures)

Despite slow adoption, the European Commission proposes legislative changes mandating instant payment capabilities for Payment Service Providers (PSPs) across Europe. The mandate aims to improve efficiency in cross-border payments, enhance cost efficiency for merchants, and address fraud risks. The timeline for implementation includes requirements for eurozone PSPs by May 2024 and a phased approach leading to full implementation by October 2026. The article emphasizes the need for unification and global interoperability in Europe’s pursuit of faster payments. Read more

Why AI won’t solve legacy problems (Fintech Futures)

A recent article by Fintech Futures critiques the efficacy of AI solutions, particularly IBM’s WatsonX Code Assistant, in addressing legacy issues in banking systems. While AI aims to modernize core banking, the author argues that rewriting code in new languages misses the point. The piece emphasizes the need for a fundamental reimagining of core banking solutions, considering factors like real-time operations, scalability, flexibility, and composability. It suggests that technologies beyond AI, such as blockchain and smart contracts, may offer greater adaptability for future-proofing banking systems. The author urges a shift from the “faster horses” approach, advocating for innovative thinking and modern technology in transforming the banking industry. Read more

Why the pursuit of profits shouldn’t detract fintech from its original purpose (Altfi)

A recent piece by Altfi underscores the evolving focus of the fintech sector, originally driven by a mission to enhance financial access and support social advancement. It highlights how, amid the pursuit of growth and profitability, core principles of inclusivity and transparency have occasionally been sidelined. The author emphasizes the need for fintech to realign with its original purpose, especially during the current economic downturn, and discusses the significance of Environmental, Social, and Governance (ESG) strategies. Read more

From regulation to reality: Understanding Consumer Duty’s impact (Altfi)

The Consumer Duty regulation, in effect since July 1, 2023, represents a shift in the UK’s retail lending market. With an ‘outcomes-based’ focus, it aims to enhance the customer experience and has evolved from past financial scandals. The change signifies a move from a checkbox approach to one emphasizing “evidential standards.” Key aspects include responsive customer service, transparent communication, and regular reviews to prevent harm to vulnerable customers. The regulation is anticipated to bring substantial transformations to the lending sector, challenging existing business models and promoting long-term behavioral change. Read more

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