How will the financial services sector respond in 2021? (Episode 5)

Fintech

How will the financial services sector respond in 2021? (Episode 5)

By: Celine Sim

We decided to give our scoop of what experts in the field have to say and relate it back to Instamo as an organisation. This article forms episode 5 of the series.

In Episode 5, we had 3 speakers:

  • James P. Scriven, Chief Executive Officer, IDB Invest

  • Laura Borsato, Banco Regional Chief Executive Officer, Banco Regional

  • Miguel Cortes, Chief Executive Officer, GRUPO BOLIVAR 

to bring us on their key insights ahead for 2021.

What do you think are the most important challenges for the financial sector in 2021? 

James (IDB Invest) 

Currently, one key issue is that most people are not financially included - for instance, not having a bank account. Digital solutions will become the key to this challenge. We need to create an inclusive society where not only a small portion of the population are included in the financial sector but through digital inclusion, we can include the currently non-included populations. Moreover, the concept of sustainability would be key in 2021. For instance, there could be an increased transition from coal energy to sustainable energy options.

Miguel (GRUPO BOLÍVAR)

At BOLÍVAR, we are working on financial inclusion especially for the bottom pyramid. For instance, we launched a payment platform “Davivienda” which means to give. This platform is free of usage and Grupo actually pays on behalf of anyone that uses the platform. Moreover, at BOLÍVAR, we realised that those that are poor are not just poor in wealth but also in time - they do not have the time to go to places to pay. Thus, Davivienda helps them create a credit history and gives them time to do what they need to do. Davivienda actually expanded in the last 8 months from 6 millions clients to 11.2 million clients highlighting the sheer impact that an organisation can make collectively.

In the case of opportunities for 2021, we can see to combine virtual reality with a human touch. For instance, through banks, placed where children can come together and be children can be created to foster community inclusion.

What kind of innovation are you looking at? And what do you plan to implement?

Laura (Banco Regional)

We are working in 4 key areas:

Firstly, to redefine the customer experience. We need to cater to customers needs and tackle the tougher operational environment that we faced during the pandemic.

Secondly, there needs to be increased accessibility for all types of banking from all devices. For instance, mobile banking would need to be implemented across banking services.

Thirdly, a strategy for personalisation needs to be implemented. We need to know what data we have and how we can centralise these existing data sets. 

Lastly, with all these data sets from the many technological platforms, we need to create the middle world that interact with the technological world.

Ultimately, it is about building the data, strengthening customer needed solutions and strengthening our own cyber security tools.

What are your thoughts on Open banking since Mexico and Brazil have already issued some regulations around it? Should financial institutions embrace open banking before, during or after regulations? 

Laura (Banco Regional)

Open banking is a Premature trend and a driving force for innovation. We need to take on opportunities in open banking readily. For instance, existing processes and work flows need to be improved. Moreover, we need to consolidate accounts from multiple providers into a single interface and to streamline the long application process. At the end of the day, we would need to address all the pain points of our customer experience.

James (IDB Invest) 

In the case of IDB, we look at open banking as a lens of development. Currently, we are working with the govt of Chile to implement fintech laws on open data and open banking.

How do you see the coming of new companies or financial services providers?

Miguel (GRUPO BOLÍVAR)

From the way we look at it, anyone who does close banking would disappear in a couple of years. Thus the only way to really add value to our clients and to society is through joint ventures and open banking. We have to collaborate and combine each other’s capabilities to be better off. Eventually, we as a platform need to enable different desires to work. Thus, we see value in investing and partnering with others such as big techs and fintechs.

At Instamo, our partnerships with banks and fintechs allow us to streamline the entire customer process to achieve automated operational excellence whilst ensuring that our customers get utmost value.

How can we get better at financial inclusion? 

Laura (Banco Regional)

From the onset, we would need to understand that financial inclusion is very related to digital inclusion. Banks need to collaborate with fintechs that can help them bring better algorithms on the grey positions. Through this collaboration, fintech companies can combine this data with unconventional sources such as social media activity and online footprint. Thus, the challenge of the bank is simply too big to withstand on it's own. They would need the collaboration of all to create an ecosystem in order to get better at financial inclusion.

#instamo #fintech #globalpaymentsolutions #openbanking #ecommercepayment #merchantpayments #remittance #b2bpayment #internationalpayment

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