Here is Finance Monthly’s list of the hottest FinTech startups which are expected to continue attracting new customers in 2020. Some of them are well-known companies which will remain at the forefront of the sector and some are new startups which have the potential to disrupt FinTech in the new decade.

2019 has been a remarkable year for Revolut in terms of growth. Founded by Nikolay Storonsky, the digital finance platform which offers banking, currency exchange, cryptocurrency and stockbroking services, currently has around  6 million customers (up from 1.5 million a year ago) and is welcoming around 16,000 new users every day. It also currently has around 1,200 employees – the bank has recruited around 800 new team members in the space of a year. Despite the fact that Revolut reported a pre-tax loss of £33 million in 2018, compared with £15 million the previous year, exciting things such as a potential $1.5 billion funding round, as well as reports that Japanese investment giant SoftBank might invest in the challenger, are happening.

Founded in 2012 in San Francisco, Coinbase is a digital currency exchange which provides you with a platform where you can buy, sell, and manage your cryptocurrency portfolio. To wrap up an exciting year, Coinbase recently announced that it’s added five new cryptocurrencies to its offering (BAT, REP, XLM, XRP and ZRX), which brings the amount of the cryptocoins it supports to nine (with the original four being BTC, ETH, BCH and LTC). It’s also launched in 10 fresh international locations - Bulgaria, Croatia, Denmark, Hungary, Iceland, Liechtenstein, Norway, Poland, Romania, and Sweden. With its secure storage and insurance policy which covers all cryptocurrency stored on Coinbase’ servers, the FinTech is one of the most trusted cryptocurrency platforms in the world.

Regarded as one of the most popular neobanks out there, Monzo is currently used by 3,437,886 people and counting – according to its website, 40,000 people open a Monzo bank account every week. With its new features such as the ‘get paid a day early’ and the ‘salary sorter’ which separates your money between savings, bills and spending so you can't overspend, the FinTech’s super user-friendly app is continuously disrupting online banking.

Despite its unicorn valuation though, UK-based Monzo operates under the “disrupt-now-and-make-money-later” approach – it reported losses of £47.2 million in the fiscal year ending February 2019, which are expected to rise further this year due to a £20 million marketing drive. However, with its rapidly growing number of users and staff (1,351 people at present), Monzo will definitely continue to drive innovation and be a trusted partner to tens of thousands of people in 2020 and beyond.

Founded by internet entrepreneurs Jeremy Allaire and Sean Neville in 2013, Boston-based Circle is a platform which helps you use, trade, invest and raise capital with open crypto technologies. With offices in Boston, New York, San Francisco, Dublin, London and Hong Kong, the company has caught the attention of Jim Breyer (Facebook), Goldman Sachs, IDG Capital (Baidu, Tencent), General Catalyst (AirBnB, Snapchat) and Accel Partners who have supported the company with $250 million.

Starling Bank is another online-only challenger bank which is disrupting traditional banking through innovation and technology. Launched in 2017 by Anne Boden in the UK, it recently hit 1 million users and is growing at a similar pace to Monzo. Over the past couple of years, Starling Bank has won a number of awards such as Best British Bank and Best Current Account 2019 and is also reportedly on-track to reach profitability by the end of 2020 - a rarity among the challenger banks.

Founded by Bulgarian entrepreneur Vladimir Tenev and American entrepreneur Baiju Bhatt, Robnhood is a commission-free investing platform. The company is currently valued at $7.6 billion after closing its most recent, late-stage funding round in July 2019 when Robinhood raised $323 million. With its over 6 million customers in the US and a planned expansion into the UK in early 2020, the company and its billionaire co-founders won’t be stopping anytime soon.

London-based Greensill specialises in supply chain finance, where businesses raise funding backed by supplier payments, with serious establishment backing. Founded in 2011 by Lex Greensill who used to be a Director at Morgan Stanley and Citibank, the company raised a round of $800 million in May 2019 from SoftBank’s Vision Fund which valued the company at $3.5 billion. Five months later, in October, it raised another $655 million in new funding from the same fund, bringing its total capital raised to $1.7 billion.

Headquartered in Berlin, N26 is one of Europe’s most prominent digital banks which target millennials. Labelling itself as ‘not your grandad’s bank’, the challenger is investing a lot in marketing campaigns and does not see profitability as a “core metric”. Earlier this year, the bank raised a further $170 million from existing investors at a valuation of $3.5 billion (increasing its market worth by $800 million from the last raise). With its 3.5 million customers in Europe, the neobank has big plans for 2020 and plans to expand into the US market in the near future.

2019 has been a good year for Berlin-based FinTech Raisin – it raised €25 million from Goldman Sachs in August on top of a €100 million Series D round three months before. It now has 84 partner banks from 24 countries and eight platforms which cover all of Europe. Founded in 2012 by Dr Tamaz Georgadze (CEO), Dr Frank Freund (CFO) and Michael Stephan (COO), the company offers an open banking platform for online savings and investments for customers across Europe, claiming that it has delivered more than €115 million in interest to its 200,000 savers across Europe.

With its US platform launching in 2020 and plans to buy potential businesses in the retirement market, it looks like Raisin is set for another exciting year.

With its offices in Stockholm, London, New York and Berlin, Klarna is on its way to become one of the world’s top FinTech companies. In 2019, the startup that makes shopping easier launched a new $460 million fundraising round, which resulted in a post-money valuation of $5.5 billion and made it the highest-valued private FinTech company in Europe.

The company has recently faced some criticism because the ‘pay later with Klarna’ button is used too much by young people who then end up in debt, so there are definitely some things that the Swedish FinTech needs to work on in the future when it comes to its image. However, with its more than a million transactions a day between 170,000 merchants in 17 core markets, Klarna is definitely one to watch!

Set up in 2011 by Estonian friends Taavet Hinrikus and Kristo Kaarmann in London, TransferWise has revolutionised the way we transfer money overseas. With its wise model of not moving money across borders, which would incur fees, the startup maintains separate pots for each currency, which it then disburses funds from. Backed by investors such as Richard Branson and Silicon Valley VC firm Andreessen Horowitz and collaborating with FinTech rivals such as Monzo and N26 which have integrated TransferWise’s software into their platforms, TransferWise is one of the FinTechs that are actually profitable – it reported an annual post-tax net profit of £10.3 million for the fiscal year ending March 2019, which was 66% more from the previous year.

Founded in 2018, Bita is a FinTech company that offers infrastructure and software for the development, backtesting, calculation and administration of indexes and systematic investment strategies. By using BITA's open infrastructure, asset managers, banks and institutional investors can run any type of systematic strategy or index in house, retaining their IP and avoiding costly data and index licensing costs. Bita is one of Frankfurt’s fastest-growing FinTech companies and this year, it secured  €1.25 million from a group of local and international investors.

Cleo is a London-based artificial intelligence startup that offers an assistant to help users with managing their finances. Through connecting to your bank accounts and credit cards, the app provides you with insights into your spending and can answer all of your questions. Founded in 2016, Cleo has so far raised $13.3 million and is set to become everyone’s virtual financial assistant.

With over 600,000 users, Curve provides a smart platform for all of your cards which replaces your wallet. Launched in 2018 and based in London, the startup recently raised €49 million and offers its customers to become part of the ownership structure of the company through launching a Crowdcube campaign in September this year.

Founded in 2017, Goin is an award-winning app which helps people save and invest money automatically. You don’t need any previous investment experience – all you need is the Goin app. Based on a simple system which understands the user’s profile and habits through questions and answers, it offers automatic ways and methods to save money. Once you’ve saved enough money, Goin provides its users with options for investments – including through crypto. The startup has raised €2.2 million in the past 2 years.

Lunar Way is a Danish digital banking app which operates in Denmark, Sweden and Norway. Founded in 2015, the startup received its banking licence this year and has offices in Aarhus, Copenhagen, Oslo and Stockholm, having raised $53 million so far. Lunar Way provides its users with a basic account, money transfers, bill payment, and budgeting tools. You can also create personalised goals, save money and choose credit lines depending on your needs.

German FinTech Penta offers SMEs and startups a digital financial services platform which saves them time and money. Hoping to disrupt business banking in Europe and worldwide, the company connects a number of services and provides a platform for all of its users’ financial needs. Earlier this year, Penta was acquired by finleap and in August 2019, it raised €8 million in an investment round led by HV Holtzbrinck Ventures.

London-based startup Trussle is your free online mortgage broker, helping you wherever you are on the ladder. All you need to do is create a Trussle profile which indicates your unique needs and Trussle will go through 12,000 deals to find the right one for you. Set up in 2016, the company is the first online mortgage broker and has raised £19.3 million in the past three years.

Since its inception in 2016, TrueLayer has been building universal APIs that allow companies to securely and efficiently access their customers’ bank accounts to share financial data, make payments and validate their identity. London-based and available in the UK, the company will be expanding into the EU soon, aiming to become the leading provider of APIs that will power a new era of financial innovation. In June this year, the startup raised $35 million in funding in a round led by Chinese financial giant Tencent and Singaporean sovereign wealth fund Temasek, which will fuel its expansion into Asia.

Wagestream is an app which gives your employees the power to stream their earned wages into their accounts whenever they need it. The company has an expanding list of partners – all of which are seeing up to a 40% increase in staff retention, 10% increase in employee productivity and a huge competitive recruitment advantage - as much as a 10x increase in job applicants by offering flexible daily pay to employees. Backed by Jeff Bezos and Mark Zuckerberg, the London-based FinTech was founded in 2018 and has so far raised an impressive £44.5 million.

In October, Orange Bank launched the financing of mobile devices and other purchases in Orange stores. Orange Bank has also just signed a partnership with the real estate services platform Nexity, to propose a home loans offer. Lastly, Google Pay will soon be available for customers with Android phones.

Over 20,000 new customers per month

With over 500,000 customers coming from Orange stores, Groupama branches and digital channels, Orange Bank is acquiring new customers at a respectable rate of over 20,000 per month. Apart from the volumes, the success is down to added value: ¼ of customers are acquired through loans, a major difference with other online banks, and ¾ through bank accounts which enjoy a high level of activity as 54% of these customers carry out an average of more than one transaction per week. An average of 10% of accounts are now being opened with the Visa Premium card.

A major advantage for Orange Bank is  the link with the Orange and Groupama store and branch networks which is proving very effective. The Orange stores now propose over the counter loans representing nearly 5,000 sales since its launch, and the holders of a Visa Premium card benefit from a 5% discount on their purchases in Orange stores. At Groupama, car insurance is also available with a car loan for customers who wish to benefit from it.

Partnership with Nexity

The development of the bank's distribution network has been enriched by a partnership with Nexity, the real estate services platform, intended to finance real estate projects. Through this partnership, seen as being of strategic importance, Nexity intends to become a source of new business for Orange Bank, with a shared vision: to be a player in the digital transformation of lifestyles. The first applications are expected to be processed by the end of 2019.

In response to the growth of its customer base and the diversification of its range of offers, Orange Bank is investing in resources; unlike many online banks, its 878 employees are based in France, Montreuil and Amiens, and benefit from an average per capita training budget that is 40% higher than other French banks. This justifies the attractiveness of Orange Bank which receives 20,000 job applications per year. This investment in human resources, as well as the gradual digitisation of the bank, has helped to increase the productivity of the customer relations centres and back offices by 30% to 40% depending on the activities.

Using Single Sign On (SSO) technology, Xero users will have direct access to NatWest’s Rapid Cash service, which provides businesses with a flexible line of credit to cover unpaid invoices for up to £500,000, offering greater flexibility and a fast solution to temporary cash flow difficulties. Rapid Cash will be the first working capital product to have this level of integration with Xero in the UK.

The move is part of the bank’s intention to introduce broader connectivity between its suite of digital banking services, and other major providers in the business banking sector.

New Zealand based tech company Xero provide cloud-based accountancy software targeted at small and medium sized businesses. Born-in-the-cloud, Xero is an easy-to-use platform for small businesses and their advisors around the world. In the UK, Xero provides 536,000 businesses with connections to a thriving ecosystem of 800+ third-party apps and 200+ connections to banks and financial service providers.

NatWest launches the new feature today having also introduced a similar level of functionality with its accountancy software business FreeAgent several months ago, which over 100,000 UK sole trader and small SME customers now use. The bank acquired the Edinburgh based fintech in 2018, which continues to operate as an operationally independent entity.

Andy Ellis, Head of NatWest Ventures, said: “We’re pleased to be able to begin offering our innovative new services, such as Rapid Cash, to users of Xero from today. Businesses increasingly tell us that they want simple, easy access to our products and services. By offering our solutions directly through the platforms that customers use to manage their business day to day, we’re making it easier for them to get the support they need - whether that’s funding, products or our expert advice.’

Edward Berks, Director of Platform Business, UK & EMEA, Xero, said: "Small businesses have historically fallen behind larger firms in accessing the best financial services. This means they often struggle to access capital which can threaten their very existence. So it's great to see the playing field level out through innovations such as NatWest Rapid Cash."

NatWest is a sponsor at this year’s Xerocon event, taking place at the London ExCel between 12-14 November, where the bank will be exhibiting its key digital ventures with attendees.

Luckily, thinkmoney have uncovered the unspoken benefits for businesses if Britain were to ditch cash.

In addition, their research has also revealed which UK regions are the most prepared for the ‘death of cash’.

1. The Average Business Would See a £23,145 Boost

Research has revealed that businesses lose out on £23,145 when they only accept cash transactions.

2. Lower Risk of Illness Due to ‘Dirty Cash’

In its 113-month lifespan, the average £20 note is exchanged 2,238 times.

A single average banknote carries up to 3,000 different types of bacteria – some of which are known to spread skin infections, food poisoning and stomach ulcers.

3. Safer Workplaces for Staff in Retail and Hospitality

Since 2012, crime within the food/ retail businesses has fallen by 9% - which could be attributed to fewer establishments handling cash.

4. Your Money is Safer With Banks

In the past year, UK banks have successfully prevented £1.66 billion in fraud.

5. A Potential £80m Increase In Charity Donations

A lack of Brits carrying cash has led to UK charities losing a staggering £80 million every year.

However, another organisation that relies heavily on donations, the church, has seen a 97% increase in donations since accepting contactless payments.

6. The Government Could Save £35 billion – Which Could be Invested in Businesses

Every year, the HMRC loses a staggering £35 billion to tax avoidance.

If Britain were to go cashless, this saving could be invested in businesses.

As there’s been a notable drop in the number of people using cash machines, thinkmoney have also uncovered which regions have seen the biggest decline over the past year. The results suggest which regions are the most prepared for a cashless society.

From this research, it is clear that Northern Ireland is the least prepared for a cashless society. It’s also worth noting that last year, N.I. was the only region that saw an increase in the number of bank branch openings. Every other region saw a clear decline.

Ebury provides corporate banking services to small businesses that trade worldwide. Operating in 119 countries, in 140 different currencies, it has processed over £16.7 billion in payments since its inception and helped over 43,000 clients trade internationally.

News has broken that Santander is buying its 50.1% stake in the fintech for £350 million, of which £70 million will help Ebury merge into new markets in Latina America and Asia.

This is a bold but expected move form Santander, as it manages accounts for more than four million SME customers around the globe, 200,000 of which operate on an international scale. The partnership between Santander and Ebury will also allow the fintech to make the most of the bank’s relationships, assets and brand to build new banking partnerships.

Ana Botín, group executive chairman of Banco Santander, said: “Small and medium-sized businesses are a major engine of growth around the world, creating new jobs and contributing up to 60% of total employment and up to 40% of national GDP in emerging economies. By partnering with Ebury, Santander will deliver faster and more efficient products and services for SMEs, previously only accessible to larger corporates.” 

Partnerships are critical for incumbent banks and financial services companies to stay ahead in a crowded market. Collaboration allows them to upgrade their technological capabilities and their digital customer experience faster - and at a lower cost – so they don’t lose out to new players in the market.

Viktoria Ruubel, Chief Product Officer at IPF Digital, looks at the ways that partnerships can be a win-win-win situation: for the bank, the FinTech and ultimately, the customer.

Building synergies around product, technology, or talent access

One way that banks and other financial institutions are collaborating is through licensing technology or software from other businesses in the form of a white-label. This provides financial organisations with immediate access to the latest, state-of-the-art technology stack, gives access to new products and speeds up time to market. Meanwhile the FinTech start-ups, that are often providers of the technology, get access to consistent revenues streams, and the software providers have the opportunity to invest in adding new capabilities to their portfolio of services. There are many examples of this type of partnership including Mambu and N2, Starling Bank and Raisin.

At a time where there is a battle for top talent across multiple industries, the financial services industry is not exempt from the challenge of finding talented engineers, scientists, and other skilled employees to design, build and serve new digital platforms, products and offerings. It is therefore not surprising that many companies partner with specialised service providers to tap into the world’s best expertise. A good example of this is the partnership between Discover Financial Services and Zest finance, which are leaders in artificial intelligence (AI) software for underwriting. They announced a partnership tasked with the creation of one of the largest AI-based credit scoring solutions in the financial services industry. Partnerships of this kind drive faster innovation and the adoption of new technologies like AI.

At a time where there is a battle for top talent across multiple industries, the financial services industry is not exempt from the challenge of finding talented engineers, scientists, and other skilled employees to design, build and serve new digital platforms, products and offerings.

Until a few years ago, no one would have anticipated the extent to which big industry players have invested in and become reliant on partnerships. These partnerships also present great opportunities for smaller companies looking to increase their market share.

Building seamless customer experience

Another common form of collaboration we have seen is banks choosing to set up partnerships with the aim of improving the ‘digital experience’ of their existing customers. Partnerships create a massive opportunity for businesses: enabling them to streamline internal processes, add technological capabilities, and most importantly, improve the end customer experience.

Customers are increasingly turning to digital channels to manage all aspects of their life, and financial services is just one industry being revolutionised by digital. With customer expectations for a seamless service ever-increasing, providing fast, convenient digital services has become critical for banks if they want to keep customers satisfied and sustain their competitive advantage.

Until a few years ago, no one would have anticipated the extent to which big industry players have invested in and become reliant on partnerships.

For established banks, partnering with a FinTech or Backend as a Service (BaaS) organisation offer an accelerated path to providing the best customer experience, which can be difficult to develop in-house due to legacy systems. At IPF Digital, we have partnered with several innovative players (e.g., Kontamatik, ElectronicID) to utilise their technology capabilities in ‘know your customer’ (KYC) and online verification, to provide a seamless digital onboarding experience for our customers.

Aiming for the win-win

For partnerships to be truly successful they must be equitable and aligned with both of the companies’ strategy and values, and they should benefit both partners in order to support the longevity of the collaboration.

One of the real challenges facing any high-growth oriented company, be it a young challenger bank or a mature FinTech aiming to speed up its growth, is finding and sustaining efficient customer acquisition channels. Partnering organisations with an existing, large customer base is appealing as it provides access to hundreds of thousands of customers that can benefit immediately from the attractive FinTech offering. Meanwhile the partner provides additional value to the consumer and adds the possibility of new monetisation opportunities. An excellent example of this is the collaboration between Affirm and Walmart announced in February this year.

By combining their resources and brand power with the innovative solutions created by FinTechs, banks will find they are able to serve new customer segments.

By combining their resources and brand power with the innovative solutions created by FinTechs, banks will find they are able to serve new customer segments. An example of this type of collaboration is the partnership launched between Kabbage and ING in 2017, which allowed ING to expand its small business lending into France and Italy.

Finally, partnerships can help businesses at both ends of the size spectrum to achieve efficiency, enable faster time to market, and ultimately speed up revenue generation. For established financial institutions, there are significant benefits: from fostering internal innovation to ensuring customer satisfaction and retention. The benefits for FinTech start-ups are also substantial, enabling the FinTech business to gain access to funding without giving away equity, and secure an alternative cashflow.

When you think about it, banking customers are leaving a trail of data when they conduct financial transactions – deposit activity, recurring payments, purchasing behaviours, borrowing activities and even when they just shop for financial services. All customer interactions – whether it is a point of sale, a tap on the screen, or a keystroke – generate insights on purchasing behaviour, clicks, searches, likes, posts and other valuable information.

Data usage has made an important difference in the changing landscape within financial services and the emergence of FinTech companies. Here in the UK, regulatory changes like PSD2 have created a new era of Open Banking where bank customer data will begin to flow amongst financial services providers. With this, the operating model for the traditional financial services companies is changing.

There are new entrant FinTech companies which have shown the ability to access and make sense of data in new and creative ways. Some of these start-ups are giving incumbents a run for their money not because they’re generating or accessing more data, but because they’re looking at it differently and using it in new ways. When FinTech companies get clarity about the use of data, make sense of it, organise and cleanse it, combine traditional and non-traditional sources, they can out-manoeuvre and out-innovate the incumbents.

There are three Vs which are fundamental to the management of data: volume, variety, and velocity.

There are three Vs which are fundamental to the management of data: volume, variety, and velocity. Given the increasingly competitive environment, evolving customer expectations, and regulatory constraints, financial services providers are seeking new ways to leverage data and technology to gain efficiency and a competitive advantage. The adoption of Big Data and new data management strategies is redefining the competitive landscape of financial services and companies that don’t have a strategy run the risk of losing market share.

To address this situation, financial services companies are investing in new and modern data management strategies that address both enterprise data and their Big Data assets. This new data environment must act at the speed of business, offering real-time insights that are created using massive volumes of data. New data-driven innovations include analytical tools such as machine learning and predictive analytics. These capabilities connect and leverage data across their entire enterprise and outside partners.

With all the changes taking place, there are many challenges and opportunities. Based on our experience working with many of the largest global financial services companies, we have observed a lot of focus and investment in these three following areas:

1. Creation of a Unified Financial Services Data Model.

This represents a standardised, multipurpose data model that creates a single, consistent view of the customer. This modern data environment is a business-driven data model that should serve all analytical requirements. It should also support all business domains such as marketing, risk management, product, customer experience, compliance, regulatory reporting, finance, and other functional areas.

It is critical that this environment is extensible and supports ongoing change. The activation of data that is stored must provide simple access for analytical applications as marketing, customer experience management, risk and other functions must respond in a real-time manner to create the desired customer experience or prevent fraud from occurring.

There are many other capabilities that can be delivered from this Unified Data environment. It is a foundational capability to address the rapid explosion of data, channels, devices, and applications.

2. While data collection is important, collecting more data is not always the answer. Ingesting the best sources and continuously testing them for accuracy and predictive capabilities is critical. New alternative sources of data are being created every day. While some of these sources can create some unique value, other sources may only add complexity to data management and cost without the desired return.

Deep mining of data can help predict needs and enable a much-improved customer experience. Improving the quality and accuracy of data that is collected, stored in the cloud, processed and analysed by artificial intelligence and deployed is important when creating new targeted offers and enhancing a customer experience.

Diligence in the areas of consumer privacy and security is and will continue to be paramount.

3. Diligence in the areas of consumer privacy and security is and will continue to be paramount. Consumer understanding of how their data is used often lags behind the pace of innovation, inspiring new demands from government agencies and consumer advocacy groups around the world. These factors compound the liability every financial services company faces when managing and activating consumer data.

Data security and privacy is an important issue and historically has been a strong point of differentiation for financial services companies, especially in light of the continued discussion around how Facebook and other social media companies manage data. There is and will always be an expectation that financial services companies remain a trusted guardian of data.

As financial services leaders realise that more trusted, connected and intelligent data contributes to their competitive position and survival, they now see data as an essential asset. This asset also requires investment to unlock value. Data should not be looked at as a driver of costs, but an important asset that will pay off handsomely for tomorrow’s financial services leaders.

About Scott Woepke

Scott Woepke is Head of Financial Services Strategy at global data, marketing and technology company Acxiom, where he leads a global team. He has over 30 years of hands-on experience in many facets of marketing, distribution, product, and technology strategy in the financial services and FinTech industries. His work includes working with many of the world’s largest financial services companies across retail/consumer banking, credit cards, investment services and payments.

 Website: https://www.acxiom.co.uk/

But according to James Butland, VP European Banking at international payments platform Airwallex, this is changing.

Innovative solutions and more customer centric business banking platforms are on the rise, and, as a result, SMEs are moving away from their current banks in their droves. This is highlighted by the UK’s Current Account Switch Service reporting that there were 17,687 business account switches using the service during Q2 of this year, compared to just 8,000 switches during the same period last year.

Clearly, SMEs are hungry for new services that help them to manage their money more effectively, and with Brexit and a fluctuating currency potentially causing issues, it couldn’t come sooner.

World changing SME banking 

The need for services that better meet the demands of businesses has seen payment fintechs such as Accelerate, Square and Monzo partner with the likes of Mastercard, eBay and Visa to provide more up to date technology in the B2B banking world. These innovations are aimed at speeding up payments and helping SMEs to compete in an increasingly globalised and competitive economy.

Innovation within international payments has also seen similar developments. This is largely due to the opaque nature of current FX practices. A new paper from the European Central Bank recently revealed that banks across Europe have overcharged SMEs for foreign exchange services, and have earned hundreds of millions of euros each year, at the expense of their small corporate customers. These SMEs have often been presented with misleading exchange rates and secret charges by banks, while unfairly being offered lower exchange rates compared to larger businesses at the same time.

This is a big issue. Particularly as 232,000 of UK SMEs exported to overseas markets last year, representing 10% of the country's small and medium-sized businesses. It’s why companies such as Airwallex, through our Global Accounts and FX capability, is helping SMEs to break through murky FX practices, and access exchange rates that have been typically only available to large corporates. Customers can be shown correct and clear rates and can act as a local in new markets. These new platforms, services, and in some cases new banking entities, are removing the complexities of exporting overseas and therefore allowing SMEs to focus more on growing their business.

Partnership benefits for SMEs

SMEs desperately need these developments because previous legacy payments and slow banking processes are not only significantly slowing down the speed at which they can operate at but are also ultimately limiting their growth. The transparency available now to help SMEs understand FX rates and expenses alongside more innovation within payments and banking solutions will prove vital for smaller businesses going forward. This will provide them with confidence over their margins and allow them to grow through enabling them to provide far swifter payments, both nationally and internationally.

A Global Guide to FinTech and Future Payment Trends

Peter Goldfinch

In his book, payments specialist Peter Goldfinch sheds light on highly topical themes such as the evolution of payment systems from paper instruments to computerisation, their role in enabling commerce to contribute to the development of emerging economies, cryptocurrencies and the slow decline of physical credit and debit cards due to the introduction of alternative forms of payment.

A Global Guide to FinTech and Future Payment Trends offers a comprehensive overview of the evolution of payments, looking at the ways they’ll develop in the future and encouraging readers to explore their own predictions. Published earlier this year, the book is an unmissable summer reading for technologists, marketers, executives and investors in the FinTech field, as well as academics teaching business and technology courses.

Inclusive FinTech: Blockchain, Cryptocurrency and ICO

David Lee Kuo Chuen & Linda Low

With the uninterrupted growth of the cryptocurrency market and the new class of FinTech companies born out of digital finance, this book illustrates how the underlying technology innovation may be applied to a wide range of industries and explores trends in FinTech, blockchain and token sales.

Inclusive FinTech: Blockchain, Cryptocurrency and ICO’s aim is to dispel the numerous misconceptions about cryptocurrencies and blockchain (especially bitcoin, Initial Crypto-Token Offering or ICO), as well as the idea that businesses can be sustainable without a social dimension going forward. It is a book for people who are interested in switching to a more meaningful and sustainable career or for those on the lookout for new business opportunities. The book’s primary hope is to change our mindset and show the potential that digital economy has.

Blockchain Regulatory Compliance Made Easy

Jargon-Free Insights and Tips for Blockchain Executives and Compliance Professionals

Simone Domenico Casadei Bernardi

Authored by a compliance adviser who works with a number of crypto-businesses and FinTech companies, Blockchain Regulatory Compliance Made Easy is the blockchain regulation compliance bible. Jargon-free and easy to assimilate, the book delves into the ins and outs of compliance and the ways you can benefit from it, discovers the strands of financial services regulation, the different sources of regulation and the regulatory models in the US and EU and explains how a number of directives and regulations might apply to your blockchain FinTech business. It also offers advice on what to do when things go wrong, discussing what the consequences of a breach are and what happens if the regulator starts an investigation.

This book is a vital read for compliance professionals operating in the blockchain FinTech sector, crypto business owners and senior managers, as well as journalists and bloggers who struggle to get their heads around compliance.

Blockchain Design Sprint

Moses Ma & Langdon Morris

The blockchain era is the next tsunami of digital change and it’s only getting started; expected to disrupt business models and inspire more change than ever before. Blockchain Design Sprint hopes to educate readers on the impact that blockchain will have on their businesses and help them develop a successful strategy for surviving and thriving in the blockchain era.

The workbook combines powerful techniques from Agile Innovation design sprints to increase creativity, as well as carefully designed exercises focused directly on building a blockchain business. Designed to prepare the reader for the remarkable future that the advent of decentralised financial services and the blockchain promise, this FinTech edition focusses on exercises and special content for the financial services blockchain developer.

FinTech: The Banks Strike Back

Yves Eonnet & Herve Manceron

Technology is changing the way the financial industry works as FinTech companies, BigTech firms, and the markets for third-party services continue to develop. Failing to keep up with the latest digital trends and hindered by cumbersome branch networks, traditional banks are fighting for their survival. FinTech: The Banks Strike Back is a book that examines not just the ways banks are responding to the FinTech thread, but also how they’re striking back through reinventing themselves.

Chatbots

In a matter of years, the use cases for chatbots have increased dramatically going from only being capable of completing very basic tasks, such as answering FAQs, to initiating actions on their own. Consequently, chatbot technology is likely to completely disrupt the way banks interact with their customers which will have a tremendous impact on the way banks operate. In fact, Juniper Research estimates that the operational cost savings from using chatbots in banking will reach $7.3 billion globally by 2023, up from an estimated $209 million in 2019. Additionally, it is expected that there will be a growth of nearly 3,150% in successful banking chatbot interactions between 2019 and 2023, while Gartner predicts that by 2020 consumers will manage 85% of their total business interactions with banks through FinTech chatbots. Thanks to advances in chatbot technology, banks will be able to streamline their operations, reduce service costs, improve their customers’ experience and be able to serve more people, more quickly.

Blockchain

In recent weeks, we have heard a great deal about Facebook’s new digital currency Libra with London FinTech Week making the case it is energising the blockchain and FinTech scene. This may well be the case as blockchain continues to gain momentum across banking and financial services sectors and looks set to be one of the most disruptive FinTech trends moving forward. This is echoed by the fact the financial services industry was found to be spending about $1.7 billion per year on blockchain last year, however, the International Data Corporation (IDC) predicts this figure will increase to $11.7 billion by 2022.

One in ten banks and other companies are now reporting blockchain budgets in excess of $10,000,000.

Further research from Greenwich Associates revealed that one in ten banks and other companies are now reporting blockchain budgets in excess of $10,000,000. Additionally, it found that the typical top-tier bank now has about 18 full-time employees working on the technology. These figures are substantial and are expected to rise as blockchain technology gains more traction. As its adoption increases, it is likely banks and financial services organisations will focus more on how they can use blockchain technology to reduce operational complexity, streamline efficiencies and find a competitive advantage.

 Advances in Mobile Banking

Increasingly, small businesses are demanding the same mobile interactions they get from their personal banks with research from Fraedom finding that 95% of commercial clients bank digitally in their personal lives. As a result, commercial banks are beginning to invest in key technology areas to make consumerisation possible. This is a trend that will grow as more commercial banks expand their digital offering to allow businesses access to a greater range of mobile banking capabilities.

Partnerships

According to London FinTech Week, the trend of financial institutions partnering with FinTechs will continue to develop, with Fraedom finding that more than 84% of commercial banks in the UK are considering new FinTech partnerships this year. There are a number of drivers for this, such as improving customer experience, speeding up digital transformation, better cash and card management and cost savings. Partnerships with FinTechs are not only enabling banks to implement the right technology, but they are also helping banks to better understand the consumerisation of business processes and technologies.

84% of commercial banks in the UK are considering new FinTech partnerships this year.

Regulatory changes

As the financial sector tries to get to grips with the new wave of regulations being introduced and the FATF prepares to roll out new rules to increase the compliance requirements on cryptocurrency exchanges, regulation was unsurprisingly a hot topic at London FinTech Week. However, where regulation may once have been seen as a barrier to the FinTech market, there is now more positivity associated with it in part due to PSD2 and the introduction of Open Banking showing regulations can actually be instigators of innovation. While we can’t say all regulation will have the same impact, it has certainly highlighted that the financial services sector must prepare for their introduction so as to be able to manage their influence.

As the financial services sector gets back to normality after London FinTech Week, it’s vital that they apply the learnings from the event and capitalise on these trends. With technology at the heart of many of these developments, partnering with FinTechs will be instrumental in helping banks to make the most of them, allowing them to improve their customer service, develop the more modern offering that society now expects and stay at the forefront of developments within the industry. 

We live in a digital world, and the financial industry is no exception. Eschewing traditional methods, finance has merged with technology to create a whole new sector, FinTech, that is changing the way we manage our money in a big way.

With banks and other established financial institutions cutting jobs in favour of automatic processes and AI, it's no surprise that many people in the industry are turning to FinTech for career opportunities instead. Plus, there's a lot of investments being made in FinTech start-ups and they have incredible potential for growth, so you could end up making more money if you find the right position.

So, whether you're looking to start somewhere fresh or are just after something more lucrative, here are the three things to consider when making the change from finance to FinTech.

Identify your transferrable skills

You don't necessarily need to be an expert in technology to find your place in FinTech. FinTech refers to the use of technology in any aspect of financial service, including markets, banking, payments, and insurance. There's such a broad area of focus that you'll likely find a company to suit your interests whatever they may be. And, whether you're technologically inclined or not, your experience in finance will be invaluable for identifying and assessing opportunities that technology specialists might overlook.

You know how the financial industry works and you have regulatory knowledge, which means you have valuable insight into the possibilities and limitations posed by standards, which will be useful when designing financial technology.

You know how the financial industry works and you have regulatory knowledge, which means you have valuable insight into the possibilities and limitations posed by standards, which will be useful when designing financial technology. Most importantly, though, FinTech companies are very data-driven, so you'll continue to be expected to use numbers and data to make business decisions.

It's also important to consider any other valuable professional skills that you've acquired in your previous roles, like communication and management. These are the kinds of qualities that will set you apart in any business, so it's just as necessary to draw attention to them as well as your financial background.

Aim for the right companies and roles

If you don't have a strong background in technology, don't worry. You could focus on looking for roles at FinTech companies in financial analysis, accounting, credit risk analysis, risk management, and compliance, as these are good roles for financial specialists to fill. The big question, though, is where to apply.

There's a lot of FinTech start-ups to choose from and not all of them will last, so working out which companies to approach can feel like a bit of a gamble.

Early-stage start-ups will probably ask you to take on a more dynamic role, which is certainly a chance to gain more responsibility, but it means you have to be much more invested in the company than you would normally be. Make sure you ask potential employers about their future goals before you accept these sorts of positions to determine whether they are in line with your own aspirations.

If you're looking for a position with more job security, remember that it's not only start-ups that are focussing on FinTech.

Additionally, start-ups have to be fluid but also capable enough to adapt to unexpected challenges and opportunities. Although there's a lot of money being pumped into FinTech start-ups, a lot of them will fail. So, if you have any concerns that their plans for the future won't provide you with the career you need, you'll be better off looking at one of the many other FinTech companies out there.

If you're looking for a position with more job security, remember that it's not only start-ups that are focussing on FinTech. Established financial institutions are also working out ways to combine finance and technology to keep up with industry trends, so don't rule out looking for major opportunities in places like HSBC and Citibank as well.

Continue to nail networking

Networking is always important if you want to keep abreast of news and job opportunities within your sector, but it is especially useful if you're thinking about changing from a career in finance to FinTech. It's a fast-moving sector, so by attending events such as new app launches you can get a better idea of the structure of the industry, the upcoming trends, and the sorts of positions available that might suit your experience. You may also begin to recognise some little-known companies and their representatives that you can add to your list of potential employers, as well as pick up some technological knowledge.

The buzz around FinTech means that you won't be the only person you know who's thinking about transitioning, so you don't need to be shy about building relationships with like-minded professionals. They might be able to share tips and recommend places to you if they find their way into FinTech, so make sure you keep in touch with fellow job-hunters you think have the potential to become valuable through social media.

Identify your transferrable skills, find the right company, and up your networking game. Focussing on these three areas can help you make a smooth transition from finance to FinTech and find the best opportunity for you.

Some 55% of respondents of the survey carried out by deVere Group affirmed that they ‘regularly use financial technology to access and manage their money.’

883 people from the UK, Europe, Asia, Africa, Latin America and Australasia took part in the poll.

Of the findings, Nigel Green, deVere Group founder and CEO notes: “Even two or three years ago, that figure would have been significantly lower. The fact that today 55% of people polled globally use fintech solutions on a regular basis highlights the staggering rate of the digitalisation of our everyday lives.

“And it is speeding up. From self-driving cars, genetic bio-editing to AI, new technologies are beginning to impact every part of our lives. Our financial lives are no exception. We’re in a new age.”

He continues: “Fintech firms are filling the void left between what traditional financial services companies are offering and what customers are now expecting, especially in terms of customer experience.

“In broad terms, this means immediate, on-the-go, 24/7 access to, use and management of their money. It means personalised, on-demand services. It means lower costs.

“Fintech is already a major disruptive presence in the financial services marketplace. This trend is only set to grow as ‘digital natives’ - the first generation that grew up with the internet and smart devices – become ever more dominant in the workforce and in social and political roles.”

According to the data collected by deVere, emerging markets in Asia, Latin America and Africa are becoming the biggest growth areas for participation.

“This could be due to fintech typically offering more inexpensive solutions compared to traditional financial services. Also because these areas are home to many of the world’s 1.7 billion unbanked or underbanked population – those who don’t have access to or have limited access to financial institutions – and fintech allows this issue to be overcome,” affirms Mr Green.

Other standout trends: Around two thirds (67%) of those polled used fintech apps to send remittances and money transfers. 46% use financial technology vehicles to track investments and/or accounts. 28% use them for storing and managing cryptocurrencies.

The deVere CEO goes on to add: “Fintech – a major part of the so-called 'fourth industrial revolution' – is a positive force for three key reasons.

“First, it is meeting clear and growing client demand for on-the-go services.

“Second, it is speeding up the advance of financial inclusion across the world. Helping individuals and companies successfully manage, save and invest their money will only result in a better society for us all.

“And third, it gives firms the opportunity to diversify, cut costs, meet regulatory requirements and improve the client experience, which will help build long-term relationships and trust.”

Mr Green concludes: “The poll underscores that fintech is the new normal.”