Finovate has traditionally been a strong indicator of the important trends in the financial services technology space, and the 2018 Europe edition has proven no different. While the format of the event has remained constant since it launched over a decade ago, there has been a noticeable shift in the tone coming from the stage in recent years, reflecting the growing maturity of the sector and the realization that the relationship between large financial institutions and smaller innovators needs to be based on being partners (or at least client–suppliers) rather than competitors.
As in previous years, there was a focus on digital banking and customer onboarding. The use of advanced data analytics and artificial intelligence to deliver a more active experience for the customer (as opposed to balance and transaction information being displayed) was once again an important topic, with greater personalization in the experience a further area of innovation. Equally interesting was the increased emphasis on digital identity verification solutions, which has grown noticeably in the past 12 months. In the short term, many banks need to improve here in order to deliver a truly digital product sale and customer onboarding process (making it a key investment area within digital banking). However, it is the longer-term opportunity for banks, in becoming the trusted identity providers for their customers, that is arguably even more compelling.
Open banking was – unsurprisingly – the most important underlying theme. In line with last year, many of the on-stage demonstrations involved elements that would take advantage of the ability to either aggregate a customer's entire financial position or enhance an adjacent service through the ability to access this data (such as debt recovery). With PSD2 now a reality, and many national regulators looking to promote similar initiatives outside of Europe, it is clear that open banking will be the single biggest driver of change, disruption, and innovation in the market for many years, creating opportunities for those institutions that embrace it, and risks for those that do not.
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