What challenges face fintech?
dubai — Cyber-security and threats to the financial privacy of individuals and institutions are the key challenges posed by the fastemerging financial technology (fintech), according to experts at a seminar on the role of technology in banking and financial services.
Stressing the need to adapt modern technology across banking and financial operations, speakers at FinTech 2017 said strengthening security and privacy of transactions needed greater focus.
Speakers at the event, hosted by the Emirates Institute for Banking and Financial Studies (EIBFS), agreed that far from being restricted to financial institutions, fintech can serve as a common ground to bring together businesses in the financial and non-financial sectors to collaborate on providing more options and better services to the end-user. FinTech 2017 featured more than 25 industry specialists from prominent local and global academic and financial establishments including Citibank, Beehive, North Wales Business School and Khalifa University.
The one-day conference touched upon a variety of issues including the relationship between banks and fintech, the role of peer-topeer lending within the fintech sector, artificial intelligence, cybersecurity and blockchain.
“The fast-paced development of the financial and banking sector in the UAE that is also one of the most dynamic sectors in the region, requires innovative fintech applications,” said Jamal Al Jassmi, general manager of the EIBFS.
He said the early adoption of such cutting-edge technologies would allow institutions in the region to remain relevant and competitive and provide advanced financial services to organisations
Fintech-compliant entities will also be betterpositioned to strengthen their operational and governance frameworks Jamal Al Jassmi, GM of the Emirates Institute for Banking and Financial Studies
and individuals. “Fintech-compliant entities will also be betterpositioned to strengthen their operational and governance frameworks to guarantee their own security as well as the security of their customers.”
The digital economy that depends on fintech applications is the future economy, said Al Jassmi. “We must address emerging challenges due to this transformation, in order to put in place sound tools and methods that will enable us to achieve the highest level of technological advancements, even while limiting possible drawbacks.”
Participants exchanged insights into new fintech applications for the retail industry, regulatory challenges, data security, the impact of the high number of competing fintech providers, as well as the collaboration between banks and non-financial institution fintech app developers.
Dr Kelvin Leong and Anna Sung, professors at the North Wales Business School at Wrexham Glyndwr University in the UK, cited examples such as the French Web platform Finexkap that facilitates financing for SMEs, Starbucks Mobile Order & Pay app that allows customers on the go in the US to place orders and pay via their mobile phones, and the UK remittance app TransferWise.
Vivek Vaidyanathan, director of treasury and trade solutions at Citibank, highlighted the need for financial institutions to use fintech as an opportunity for expansion. He referenced the Kodak story as an example of a brand’s strategic failure due to missed opportunities rather than the negative impact of technological advancement. Had Kodak adjusted its focus and capitalised on the rise of digital photography instead of depending solely on its filmbased business model, it could have survived the shift, he said.
He warned that banks stand to repeat the same mistake if they do not take full advantage of the new wave of fintech. Pointing out the broad definition of fintech, he reasoned how and why banks can and should move swiftly.
Dr Ernesto Damiani, director of the Information Security Research Centre at Khalifa University in Abu Dhabi, highlighted the correlation between big data and fintech.
He noted that the increasing demand from banks and retailers for the prediction of certain incidences through close study of information patterns necessitated the integration of fintech into daily operations.Dr Damiani also examined the issue from the opposite perspective of the end users, who are calling for more filters in the type and amount of information shared about their behaviours.
— issacjohn@khaleejtimes.com