Fintech trends for 2021
2020 has certainly been a crazy year. Almost all economies and sectors were heavily impacted by the ‘new normal’, especially in the use of technology. Fintech companies in particular, powered by artificial intelligence, have moved up to new levels and adapted to this new way of living. Over recent years, the financial services industry has undergone significant changes, with technologies leading the way. Businesses across the fintech sector are continuously recognising the innovative and forward-thinking implementations of these technologies, constantly expanding its potential. Therefore, the industry is ever-changing. Things like online banking, digital wallets, contactless payment methods and many more, have allowed business as well as consumers a new and more advanced way of money management.
This year, fintech companies have spread into new areas, utilising AI to support companies handle challenges in business operations. In the new year, I anticipate that this will only continue to go even further. Professionals in finance industry need to consider developments in best practice solutions and the integration of new systems resulting in better serving customers.
Business consolidation to get SMEs back on their feet
In 2021 we will see a rise in levels of consolidation in the space, with small financial leaders being acquired by larger players. This will be partially evident in mature areas, such as lending, alongside emerging areas of the financial market like blockchain. For start-ups, consolidation can fuel and scale international growth and also help them to rebuild themselves, and their balance sheets, after a challenging year. Consolidation offers small businesses a golden ticket to every aspect of the financial services ecosystem.
Take CapitalBox’s recent acquisition of Spotcap Global, one of the most recognized online lenders in the Dutch market. This consolidation has allowed Spotcap Global to grow their business through the combination of expertise and technology, solidifying a strong market position and translating into better funding options for Dutch SMEs.
An increase in private equity and venture capital
Private equity and venture capital are perfectly placed to take advantage of an economic downturn. For investors skilled enough to act on the dry powder in the market, we expect a top buying opportunity for reasonably priced corporations in 2021 – especially as there is a considerable amount of institutional investor money sitting on the side-lines right now.
Fintech and eCommerce working together
With more payment options available, from mobile to pay-later, the eCommerce space has already got a taste of the profits of modern financial technology, and there is only more to come. In a world that is growing more digital by the minute due to social distancing, the COVID-19 driven surge in ecommerce is unlikely to fully subside even when rules are relaxed. The use of chatbots, biometrics and blockchain tech have revitalised the customer experience for good, therefore in 2021 fintech companies that facilitate, assist or fund ecommerce transitions will be thriving.
Using external eCommerce tools to be ready for 2021
Many small businesses have had to learn to digitize and sell online during this time in order to survive. A shows COVID-19 has massively enhanced the growth of e-commerce with a 77 per cent rise, an increase that would have otherwise taken four to six years. Therefore, we expect rapid growth in SME ecommerce tools as businesses prepare for the future. To be e-commerce 2021 ready, organisations must prioritise the use of external tools, like digital payment process systems and analytics tracking platforms, that can handle the dynamic environment caused by the coronavirus pandemic. Without these, small players run the risk of getting left behind as a result of a weak consumer experience.
Brexit set to add value for continental fintech players
The US has some really big fintech players and in the UK, there are a lot of businesses in the space albeit small to medium sized. The real opportunities in fintech however, come from targeting smaller countries rather than large markets.
With markets such as the US and UK, companies tend to trade internally as it is easier than getting to grips with multiple languages, currencies and regulations. The latter are difficult to deal with, but if your fintech business can navigate multiple regulatory ecosystems, then there are some serious opportunities to take, like having a bigger presence across the globe.
Brexit will be a benefit for continental fintech players next year, as it will add more regulatory hurdles for companies looking to enter the market. However, it will be even harder to establish as a fintech in the UK. To get past this, the UK Government needs to connect players in the UK to larger players in the environments it wants to expand to and find a way to work together.
With such optimism on the horizon for the fintech industry, it looks like 2021 will not disappoint. Armed with developments in AI, eCommerce tools and the prospect of acquisition for smaller players, SMEs are offered a lifeline by technology adoption. They can start to focus on rebuilding themselves, with the hope to eventually grow again.
Scott Donnelly is CEO at CapitalBox
Microsoft Power BI: Enabling data culture through innovation
Businesses using Microsoft’s cloud services may be familiar with Power BI – a business analytics service that aims to provide interactive visualizations and business intelligence capabilities with a simple experience helping end users create their own reports and dashboards. Power BI is part of the Power Platform which is a set of low-code tools consisting of business intelligence, app development, bot development and process automation applications. In a world where everything is constantly changing, the Power Platform enables subject matter experts to keep up with business needs.
Today, data comes not just from transactional systems of record, but from the real world – whether it is the devices people use, to everyday human interaction. Power BI’s mission is to make access to data paramount to every business operation through its solutions and empowers individuals, teams and organizations to drive a data culture. This sentiment is further established by Arun Ulagarathchagan, Corporate Vice President of the Power BI team, adding “Our vision here in the Power BI team is to help you drive a data culture where everyone can make every decision with data.” So what can organisations expect to see next in the pipeline? Microsoft is bringing performance management to Power BI for the first time. Organisations strive to achieve certain goals, and today, goals are largely data-driven. Power BI helps make those goals more accessible and personalized in existing workflows. This means that since many teams’ data, analytics and business logic is already reported in Power BI, they can now instantly connect it to their personal/department goals. It is also worth noting that Goals is natively integrated into the Microsoft Teams experience. The goals algorithm is also AI powered, so organisations can better understand how they’re doing and where are the opportunities for improvement. Finally, Microsoft is working towards integrating it with Power Automate, so organisations can define business processes that get automatically triggered as the goals change status. Goals will soon be available as a mobile experience too, so teams can stay up to date and take action in real-time. On that note, another major announcement from Microsoft features real-time analytics. Today, data is captured from everywhere and synthesizing it in real-time allows for maximum impact. Power BI has been a pioneer in real time analytics from the start with a simple vision – that the distinctions between batch, real time, and streaming data today will disappear over time. Power BI will launch Streaming Data Flows soon, allowing every business a simple low-code way to work with real-time data.
Amir Netz, CTO Power BI concludes “Our vision is to empower everyone in the world with data, and not just the people sitting in offices, but people who are working in the real world, people who are moving things, creating things, producing things with their hands. And for this, we have to think again about how we deliver data to help them make better decision