Moneycorp: 2023 payment industry predictions (part 1)
January 4, 2023
Today we will take a look at yet another prediction for this coming year in the payment industry which, along with fintechs, experienced “unparalleled” heights of innovation last year. The latter part of the year showed resilience and “rapport” despite the economic turmoils and shifts, and it is many experts’ hopes that this will carry on to this year.
This post by The Fintech Times in collaboration with Koen Vanpraet, EMEA CEO of payments fintech Moneycorp, discusses the predictions for the evolution of the payments industry in 2023.
As EMEA CEO, Vanpraet is responsible for driving the respective UK and European business including the rollout of existing and new Moneycorp products and services, and growing Moneycorp into providing peripheral services in the payments and banking space
What’s coming next in the payment industry?
Fintechs experienced a series of unprecedented changes due to the pandemic and how customer demands needed to be met, such an example is the rise of the blockchain technology trend; the way the industry grabbed it and used it to decentralize financial services and applied it to cross-border payments.
It is predicted that even though the crypto economy saw a loss of nearly $2 trillion and is set to face regulations, this technology will continue its growth as the industry further develops it and uses it even beyond the fintech space.
Another key topic in 2022 was embedded finance, which gained popularity because of its characteristic ability to change swiftly, so much so, that the changes we’ve seen would have otherwise taken years to implement. However, this poses a risk as it makes it difficult to keep up with account security.
This rapid rise in digital payments and online banking however had caused a critical security challenge to emerge – the confirmation of identities and ability to combat money laundering.
This challenge led to the development of know-your-consumer (KYC) solutions, which allows to remove many “layers of complexity” by merging billions of data points to “give way for stricter and more secure compliance processes”.
A revolution is in the air
These advances have led to growth and the possibility of partnerships between fintechs and traditional financial institutions, which will lead to a better, more flexible end-user experience. The number of emergencies movements and trends in the payments industry are sure to change the game forever. in the words of Vanpraet, “it would not be a stretch to say that we are witnessing nothing short of a payments revolution.”
2022 was the beginning, but 2023 will bring the test that fintechs will have to face as most of the trends in the horizon will be inevitably a result from last year.
Surely in 2023 we will begin to see the changes and impact the recession will make within and without the industry, this not only refers to economic state end-users will have, but also the regulations that will be put in place.
(…) But if properly navigated and set up, the regulations combined with opportunities in B2B international payments and blockchain can allow fintechs to thrive.
Regulation
‘Growth’ and ‘innovation’ are the two most accurate words to describe the payments landscape in 2022, with innovation inevitably comes regulation; regulatory bodies will be looking at fintechs companies and payment providers, as well as no banks who offer financial services. This year, the key word might be ‘scrutiny’.
Moving into 2023, regulators will call for more oversight on nonbanks that offer financial services for consumers, ensuring their data is properly protected under compliance and consumer protection laws.
Regulation is not bad, however, regulators will need to work with these institutions in order to find and provide alternative solutions to underserved customers while maintaining a level of scrutiny and restrictions.
In the US, the Officer of the Comptroller of the Currency (OCC) has already started to do so, stating a dedication to work closely with fintechs to develop regulations, although the effectiveness of this has yet to be seen
Innovation leads to regulation leads to innovation. Next week we will talk about business-to-business (B2B) and the future of blockchain.
Want to learn more? Check out The Fintech Time’s full write-up here.
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