IFGS 2024: Day One Roundup

Innovate Finance Global Summit returned to the heart of London, at the historic Guildhall venue, to celebrate its 10th anniversary and bring financial experts and innovators together to drive progress forward in the space. 

Kicking proceedings off on day one of the conference, Madush Gupta, policy lead for innovation and technology at the City of London Corporation, discussed the evolution of fintech in recent years: “At its core, fintech is about connection and about people – and that is why it is thriving. Few countries can stake a claim to as many fintech successes as the United Kingdom. Over the past six years, 30 per cent of VC investment went into fintech. That is over $40billion. The UK remains the largest fintech market in Europe. Fintech can drive financial inclusion, support businesses and grow our economy.”

Following on, Janine Hirt, CEO of Innovate Finance, took centre stage and continued to reflect on the growth of fintech in the UK throughout the last decade to celebrate the tenth year of IFGS: “Eight out of 10 adults in the UK are using at least one fintech tool on a regular basis. Nearly 60 per cent of all equity lending across the entirety of the UK is being done by fintechs – by challenger banks and alternative lenders. The UK also boasts 10 per cent of global fintech market share.”

IFGS also boasted a welcome from Prime Minister Rishi Sunak, who sent a video message addressing attendees at the conference. Sunak said: “I’m unashamedly optimistic about the power of technology to make life better for everyone.

“Last year, UK fintech received more investment than the rest of Europe combined and now Innovate Finance is building on that by launching the first unicorn council for the sector – and that’s the ambition we need. So my message today is this: keep leading, keep innovating and we will back you all the way.”

Unveiling a new CFIT-led open finance taskforce

Concluding a strong welcome to the conference, Bim Afolami MP, Economic Secretary to the Treasury, announced the official formation of a new open finance taskforce. He explained: “The taskforce will craft a clear set of recommendations, pinpointing the datasets of commercial incentives necessary to drive forward CFIT’s SME lending use case for open finance.”

The taskforce will mandate identifying and prioritising more use cases for open finance, determining data sets to unlock, as well as creating APIs to facilitate better SME finance availability.

It will also identify commercially viable approaches to incentivise businesses to securely share their financial data, before considering appropriate next steps towards implementing any agreed recommendations.

Introducing Project Nemo

The announcements continued later in the day, as Joanne Dewar, founder, NED and advisor sat down with Chris Skinner, author and commentator, to discuss how Project Nemo, which launched on the day, plans to promote accessible, inclusive and equitable workplaces for everyone.

Joanne Dewer said: “This project has the potential to be a blueprint as to how disability and inclusion can be accelerated at industry level across many other industries… There’s so many different types of people that we need to create full inclusion in our organisations to make the best decisions, best teams and best companies.”

“Fintech has always been really good at creating specific solutions to address specific pockets of exclusion – for example creating banking wallets for those without credit histories.

“But actually, all of our products and services should be accessible, and I feel without the inclusion on the inside we have missed a trick when thinking about the accessibility of the products and services and the outside.

“So Project Nemo is born of the idea that actually we need to address both of these things. Rather than just being a pledge or putting something on the to do list, this is a short sharp intervention, a course correction that makes inclusion better for everyone.”

Generation unicorn

Following some great summaries of the evolution of fintech over the last 10 years, the first panel of the day, ‘Generation Unicorn: CEO Perspectives On the Next Decade of Growth‘, aimed to identify how the fintech industry could advance in the next 10 years.

Francesca Carlesi, UK CEO of Revolut, explained how the UK finds itself in a strong position to build on across the next decade: “If you reflect back on the successes of the UK ecosystem so far, it’s about attracting investment, attracting, retaining and growing talent, and having a strong track record. In the UK, we have the ability to attract investment and talent because the UK is the financial Europe, especially in Europe but also globally. We also have a strong track record: companies that have grown up in the UK to become global leaders.”

Iana Dimitrova, CEO at OpenPayd, added: “In the last couple of years, we have seen an awful lot of focus on consumer protection, consumer duty and APP fraud. This is all positive – but what is the impact on innovation? What is the impact on the instant transfer of payments, and how can we actually offset this. So we need a level of predictability and more constructive engagement.”

Charles McManus, CEO at ClearBank, explained the work needed to be done to ensure the UK remains the best location for fintechs: “If we want London to be the premier financial centre in the world, rather than New York or elsewhere, then we need government, policy, fintech and every other stakeholder working together to actually get companies to grow into global leaders and stay put in the UK.”

In conversation with Monzo

Following a quick lunch break, Janine Hirt sat down with TS Anil, CEO of Monzo, the UK’s largest digital bank, to discuss the opportunities in the fintech industry. Anil explained: “Geographically, I do think that in the UK, we’re just scratching the surface of the opportunity.

“There is so much runway for us to continue to grow in the UK, by serving tens of millions of more customers, hundreds of thousands of small businesses with more of their money needs being met in a responsible way.”

Anil also offered his take on the future of finance and fintech in the UK: “If I look at the existing model in the industry, I think this is a race over the next 10 years between two categories of players: the incumbents, and whether they will get and embrace and deliver on the promise of technology, or challengers like us, and whether we can get banking at scale.

“This race between the two categories of players has a prize at the end of it: to transform customer’s relationship with money. In 10 years time, I would love to see that the industry has changed; that we put customers in control of their money by giving them the tools to make sense of their money, make good choices, and remove the barriers to financial progress.”

There’s no going back with AI

The topic of AI and its impact on digital transformation was discussed by Georgina Bulkeley, director of financial services solutions EMEA at Google Cloud, Google.

Bulkeley explained the challenges and opportunities firms may face in implementing the technology. Siloed data and workflow, tech data and legacy IT, retaining talent and security and regulatory requirements are all challenges firms face.

“In order to really benefit from new AI technologies, it’s important we work with partners who really understand its potential. Firms need to have the right conditions to test and learn how to use these technologies in the right way. This takes time, investment and care.”

One less thing to check when leaving the house

Digital wallets have taken the world by storm. The need to tap your pockets for phone, wallet and keys has been reduced down to just phone and keys (for now).

Understanding how top innovators are capitalising on the potential of digital wallets, Katie Prescott, technology business editor at The Times moderated a panel between Oliver Scott, head of Samsung Wallet at Samsung, and Shachar Bialick, founder and CEO at Curve.

Scott began: “Digital wallets are not new. But they’ve evolved to bring in a whole new ecosystem of use cases. Payments remain the biggest part of the digital wallet for sure but now, the opportunities to manage your life through your mobile phone have greatly increased: from accessing your home to car keys and more.”

The conversation moved towards consumer concerns – especially surrounding security and data. Commenting on this Bialick said: “Data is a currency that customers are willing to give away for value. The best examples are Facebook, Instagram and TikTok. Customers continually engage with them because they get value. So long as you meet that trade-off, of valued customer against the data, it can help with costs.”

A token for your thoughts

Programmable digital currency financial markets are on the cusp of a revolution according to a panel consisting off VictoriaThompson, the founder and CEO of Orora, GilbertVerdian, CEO of Quant and Matt Ong, founder and CEO at Ctrl Alt.

Speaking about the benefits of tokenisation, Verdian said: “As we’re making our assets and instruments digital, we’re getting the benefits of DLT. This includes custody, security and accessibility to all the keys you manage. It also provides programmability, which means you’re able to code logic into the asset itself for the first time. In turn, this means you can code workflows into money and in doing so, you can automate a whole bunch of complex processes that took many years and resources to do previously.”

Ong added: “The problem statement that we addressed with tokenization is giving more people access to these investments whether that’s on the institutional scale, or on the retail scale. When it comes to digital currencies, you know, we definitely see tokenisation as a phased process. And in order to get to that kind of golden ground that people talk about with full benefits of tokenisation you do need a digital currency to go alongside for tokenising real world assets.”

Addressing consumer desires, Thompson said: “Consumers dont care about tokens. They care about money. They care about being able to access products and services and go on with their lives. What we’re talking about with tokens is data: data moving around within a ledger.”

Bringing up some barriers to adoption, Thompson noted the big three are “knowledge, people, and capital deployment. Currently, we’re still in the education phase where people need to learn and understand tokenisation so they visualise how to scale an enterprise.”