Money 20/20 Europe 2023 – highlights from one of the world’s biggest fintech events

• Event gathering major global players was held in Amsterdam on June 6-8.
• Artificial Intelligence and ChatGPT were the topics with the greatest repercussion.

The European edition of Money 20/20 was held on June 6-8 in Amsterdam, Netherlands.With nearly 8,000 participants from over 90 countries, the event featured consecrated exhibitors as well as many new brands in the segment to outline the latest trends in the global paymentsecosystem and fintechs.On the event’s various stages, the topics covered included: lessons and perspectives after five years of the emergence of Open Banking, Embedded Finance, Cross-border Payments, Sustainability and Artificial Intelligence (AI).

Unlike prior editions, cryptocurrencies and blockchain technology were no longer key topics in panel discussions.possibly due to the current scenario of a slowdown in business activity and the uncertainties in terms of regulatory framework.Many important players, including the venture capital segment, are reducing projects and investments in this sector while waiting greater clarification on regulations and the industry’s future for the creation of viable products.

AI, the trending topic of Money 20/20 Europe 2023

Definitely, the area that most drew the attention of participants at Money 20/20 was artificial intelligence, with fintechs and bank leaders seeking to take advantage of the technology’s potential while evaluating the risks of its adoption.The topic is still in its very early stage of development in the financialindustry, since, like everything involving payments and money, highly accurate technological tools are required, which is still being questioned in the AI environment and is a critical issue for the financial industry.

There were numerous discussions and presentations on the topic that highlight the transformational potential of tools involving customer experience, fraud prevention, risk management and other important aspects.One of the presentations with the highest engagement event was the Cleo application, which functionsas a chatbot or virtual assistant integrated into the user’s accounts and with access to their datathat uses machine learning and is able to offer ultra-customized service, control of spending, customized recommendations and more.And all this in an intuitive and relaxed chat environment that uses gifs and emojis, which promises to engage especially users from the Z generation.

One of the lecturers also showed how his company plans to incorporate ChatGPT into its call center to streamline calls between agents and customers.He commented that the process eliminated the need to take notes during calls as part of the initial tests, with the launch date expected soon.

Five years of Open Banking

After five years of the creation of Open Banking, various questions and promises about the directions taken by this system were discussed.Now, expanded to the term Open Finance, the main concept of this constantly evolving system deals with sharing data among different institutions to enable custom offeringsand other types of customizations that optimize the customer journey.The term is expected to change to “Open Data,” since this system would cover not just the financial sector, but be expanded to insurance, health, pension plans, taxes, etc.

Data components and AI are more connected than ever and have transformational effects on banking transactions, customer experience, risk management and strategic decision-making.Lecturers kept emphasizing how organizations should use these data to understand customer behavior, identify patterns, forecast market trends and customize services.However, many pointed out some challenges for Open Finance initiatives, such as access to data due to regulatory limitations and lack of customer trust to give consent to release their data.

The head of Open Banking and APIs at Accenture emphasized some points and actions required for the model’s sustainable growth, such as reforming the regulatory framework to stimulate this environment, which generally has been slow to advance worldwide.He said that the United Kingdom, Brazil and Australia have made more progress in Open Finance, and also mentioned that regulatory agencies around the world need to collaborate more with each other.Also needed are actions to raise awareness among and educate customers to give them more confidence and encourage the model’s adoption, as well as a more collaborative environment for fintechs with the support of various sectors in order to effectively develop the ecosystem.

Embedded Finance and Banking as a Service (BaaS)

Another topic widely discussed by panels was the growth of Embedded Finance, which are financial services offered by companies from different sectors, such as retailing, without neglecting the core business, but offering them as a complement.Through integration with a Banking as a Service (BaaS) provider, retailers can offer services that in the past were offered only by banks.Thismodel already has been adopted in Brazil with department store credit cards, but the concept is advancing worldwide and becoming more technological and frictionless through API integrations.Another advantage of this model in general is the democratization of access to financial services for consumers, becoming a competitor to traditional banks.

Discussions emphasized the importance of partnerships between traditional financial institutions and neobanks.Collaboration between the two entities can result in benefits for both, with traditional banks obtaining access to innovative technologies and neobanks being able to draw on existing customer bases and the regulatory knowledge of the traditional institutions.Retailers and technology companies tend to benefit from this complementary expertise.

Once again, the event raised new discussions and questions for the financial industry, which will be analyzed in the coming months and years.In fact, there are many challenges and changes, among which is AI, but in all cases, there is a huge need for collaboration among governments, regulatory agencies, banks and fintechs in order to build a sustainable and beneficial environment for customers and companies.

*Written by Carolina Rocha, Senior marketing consultant at Bexs, a company acquired by Ebury.The acquisition is subject to regulatory approval by the Central Bank of Brazil.

This article was published on the Brazilian portal Finsiders.