This years’ Finovate Europe took place in Berlin. A three-day extravaganza that I attended at the Intercontinental Hotel - featuring the latest and greatest from the European FinTech scene. Despite Storm Chiara (or Storm Sabine dependent on where you are in the world) I made it to the conference in time, taking the ICE sprinter from Frankfurt to Berlin.

So I am delighted to share the key trends and take-aways from this year’s Finovate Europe conference. 

Among the take-outs sessions focused on how convenience is becoming the new loyalty; the emergence of new digital currencies; how banks can stay competitive in the age of the challenger; the impact of 5G on mobile banking, artificial intelligence and its influence on business strategy and profitability; and how banks will begin to turn compliance into a competitive advantage. 

Convenience is the new loyalty

A key trend that the conference highlighted was how banks can provide a better customer service. In today’s day and age the most valuable commodity is time. Customers don’t want to waste time sifting through advice and product offerings– especially ones that aren’t tailored to them. 

Steven Van Belleghem, Author of ‘Customers The Day After Tomorrow,’ made an entertaining and enlightening keynote speech on ‘New technologies that will be truly transformative in a new digital world’, highlighting that convenience is the new loyalty. With the sharing of personal data, financial institutions can personalise their offerings, digital support, and advice for each customer, making their time to market as speedy as possible. As we enter a new digital age we will see customers putting convenience at the forefront of their decision making. Steven in particular pointed out that exceeding in only one single customer expectation will not be sufficient anymore to be successful. It has to be across the whole universe, covering price, product range, location, after sales and store experience. 

The emergence of digital currency

During the conference, David Birch – Director of Innovation and Global Ambassador at Consult Hyperion - provided an entertaining outlook on the future of digital currencies. Mr Birch discussed how many analysts point to market trends tying everything to the US dollar, and how this might be changed with the potential emergence of a peer-to-peer, offline-usable digital currency. While the US are still using traditional methods of finance such, naming paper cheques in particular (and with a smile), other nations are working on digital currencies citing China as perhaps the most progressive one. With the mobile phone acting as a receiver, a card and terminal for payments, he opened up some very interesting use case scenarios in the third world, with digital currency  to become a game changer in the way money is used.  

Staying competitive in the age of the challengers

In order for traditional banks to stay competitive in a world of Monzo and Revolut, tech stacks must be updated and modernised. Old legacy systems are being left behind and single end-to-end platforms are increasingly becoming crucial to keeping up with ever changing regulation. For banks, the tech skills gap will only get bigger as they continue to attempt to leverage the data in their old legacy systems. Banks will increasingly need to partner with FinTech players to help them become fighting fit for the future. 

The impact of 5G on mobile banking

FinTech analyst Daniel Latimore – Senior Vice President of Celent’s Banking Group - captivated the Finovate audience with an overview of how 5G will reshape the world of banking. Mr Latimore commented on how 5G will transform latency – providing an analogy of turning the hot water on in a shower and being able to turn it to hot or cold with ease to get the right temperature. 

With 5G, banking apps will become merely a pointer to a powerful back-end server. Centralised updates will mean that everyone has the latest version, and banks will be able to offer better contextual advice to give extra value to their customers. Essentially, a future mobile device will be distinguished by its radio, camera and other hardware features; not its processing power. 

AI and its influence on business strategy, profitability and corporate governance

Artificial intelligence has a profound impact on business, especially within the financial services industry. Clara Durodié, CEO, Cognitive Finance Group discussed how ‘data is the oxygen for AI’, and with good data management and data governance AI can support businesses and help them thrive. 

However, the use of AI is often met with challenges, mainly focused around the lack of backing from the board of directors within banks interested in harnessing emerging technologies. Findings have highlighted that 94% of banking leaders have never had any professional experience relating to technology. It’s therefore no surprise that with this lack of experience, many are reluctant to provision for digital projects – with Ms Durodie citing that 75% of digital projects go to waste. The use of technology must be treated by businesses as a game changer to help drive efficiencies and profitability, rather than a toy that is trialled. Indeed, the keynote referenced that a business with at least one tech-savvy director on the board would deliver a 30% yearly return on its assets. 

RegTech Roadmap to turn compliance into competitive advantage 

A panel discussion on “How Financial Institutions can create a RegTech Roadmap to turn compliance into a competitive advantage” yielded insights around the future of regulation. The panel, chaired by Dara Chevlin Tarkowski, Chief Innovation Strategist, Quointec LLC, and featuring Randeep Buttar, Head of Transformation and Innovation (Risk Data), HSBC; Ghela Boskovich, Head of Europe, Financial Data and Technology Associates, and Markus Cevela, Head of Group Data and Reporting Governance, Erste Group Bank AG; spoke about how it will no longer be enough for banks to ensure compliance alone as a checklist. 

If banks and financial institutions of the future are to retain customers, they will need to ensure they deliver compliance while at the same time provide a high level of customer experience and engagement. As part of this transformation, banks will begin to look at compliance in a new way: as an additional profit stream, rather than a cost to the business. From a vendor perspective, this translates to me into the following: RegTech is becoming a commodity.