The International SME Business Banking-Fintech Forum took place in London, October 2019. The event was organised by Lafferty Group and sponsored by ClearBank, concluded that the SME sector contributes more than 50 percent of GDP in many countries and is the biggest employer globally by a long stretch, and continues to be hugely underserved by banks.
Yet experienced bankers at the forum said that along with wealth management, SME banking is the most profitable sector for those who can offer high quality service. The development of the fintech sector in recent years in now offering useful bridges between underwriters and small businesses. The UK's progressive Open Banking scheme is also helping to revolutionise the delivery of credit and improving liquidity for small businesses. In particular, the automation of payments is freeing up time for small business owners to concentrate on the business itself.
The digitalisation of the financial process is coming full circle, with solutions presented ranging from decentralised digital identities to the digitalisation of receipts that eliminates the last piece of paper in the chain. In the UK, Open Banking is making possible speedy payments from account to account – and the card schemes are aware that this is an existential threat.
Many if not all small businesses are users of digital services such as Facebook to the extent that the vast FB, Whatsapp and Instagram network remains also an existential threat for banks. During the Forum, Mark Zuckerberg was once again before the US government, defending the launch of the Facebook-initiated Calibra concept, warning that if the US did not move to back Calibra, the Chinese digital renminbi would quickly launch and become a world standard. In a discussion in the Forum about Facebook, Calibra and Libra, a show of hands confirmed that that not one person in the forum did not use WhatsApp.
Among the other major talking points:
Within the overlooked SME sector is another sector even more overlooked: microbusinesses, sole traders and freelancers, who are accounting for an increasing amount of GDP growth as large business models are challenged and local, sustainable businesses become key in the fight against climate change. It is this vast sector that is likely to receive the bulk of government-initiated funds delivered through banks to microbusinesses with environmentally sustainable and profitable business models.
The speakers and panelists included;
The 2018 International Retail Banking Fintech Forum gathered executives from banks and leading fintechs to share their real-world experiences of bank-fintech partnerships and collaboration. Driven by a focus on case studies and practical examples, the conference presented opportunities to learn from business leaders who have been driving the digital transformation of retail banking.
The speakers and panelists included;
Using the theme of 'Striving for successful business models', this conference aimed to cut through the hype around digitalisation and new models, and looked to find out the difference between the ideas and the realities. The conference focused on those initiatives that are offering a genuine and realistic bottom-line contribution. Specifically, we looked in detail at the technologies, methods of collaboration and the cultural shifts needed to thrive in the new digital banking ecosystem – a result that led to us consider SME business banking as the apex of change during 2018 as new digital ecosystems and digital lenders upend traditional models.
With populism on the rise, Lafferty Group looked to see how the cards and payments business will negotiate the new world disorder. Digitalisation is playing a significant role in cards and payments; there's a sense that banks in particular have digitised, but not digitalised, and are yet to grasp the import of the new world.
Delegates heard from regulators, payments systems operators, fintech challengers, established banks, AI specialists, and big tech firms, and agreed that fintech is now being regarded with less alarm than a couple of years ago, as bank-fintech partnerships become commonplace. Instead it is 'Big Tech' that is the new challenge: from Google to Alibaba, the top ten big tech firms are investing vastly in AI, a game-changing technology in cards and payments. One speaker reminded the audience that Amazon, a giant in AI, lent $3 billion to merchants last year. AI, for instance, is already embedded in everyday programmes such as Outlook. As Nick Ogden explained, the ClearBank proposition would hardly be possible without Microsoft as a partner, due to the billions it invests in AI, anti-fraud measures, and the biometric security behind instant transfers.
Now, the big challenge is this: how much can the cards and payments industry learn from Big Tech without losing its DNA?
Our speakers and panelists included: