Will collaboration fuel growth in 2024?
Nobody knows for sure what macroeconomics and geopolitics will bring in 2024, however it’s clear that fintech innovation will undoubtedly continue to thrive. Why? Because of the continued collaboration that drives growth in our industry.
The potential is vast in terms of innovation clusters: financial wellbeing, green finance, open finance, payments, fraud prevention, evolution of Artificial Intelligence (AI) and the future of work. All aim to enhance and enrich customer experiences or drive efficiencies.
This year, we need to embrace the spirit of exploration, move faster, mitigate risks and be bold. Yes, Generative AI (GenAI) has been a lightning strike moment of innovation and 2024 will invariably be the year to truly leverage its potential. Managing the unique set of ethical and responsible AI considerations will also be key. This is not a unique challenge (although amped up with GenAI) but has always been a primary consideration in our adoption of any services – that is, not to jeopardise trust.
As technology has caught up with the promise, the ease of exploring and realising opportunities is only growing. Open finance and more specifically open data will pick up steam, delivering the next wave of financial services innovation.
We continue to be dedicated to delivering the benefits of Open Banking with our team in place for over three years now to progress our market readiness. Integral to this is support for a Consumer Data Right regime and leveraging existing industry-led work to ensure legislation addresses consumer needs, mitigates risks, and can be implemented efficiently.
Navigating uncertainty ahead
As well as regulation, market outcomes are materially shaped by geopolitical and economic conditions and disruptions. Uncertainty only reinforces the need to leverage our collective expertise to navigate opportunities. There is no doubt mitigating risks, driving efficiency, and bringing richer customer propositions to market will remain a significant focus.
It is hard not to focus on the very real potential of the AI inflection point. In as much as GenAI in banking represents a paradigm shift in how financial institutions will operate and interact with their customers, it is one of many important innovation clusters.
However, how we reimagine experiences, will only be as good as the accessibility and flow of data. This will invariably lead to another wave of data enablement capability, and we are already seeing a significant lift in emerging capabilities. As a result, this can only benefit a more extensive open finance ecosystem.
Harnessing the potential of green finance
Imagine the potential for green finance to truly support the transition of industry to a lower carbon emission state. In green market leading economies, for example Denmark, the extent of green finance ecosystems is driving real industry change, significant growth in green tech (including Vestas’ wind turbines everywhere) and linking benefits to customers in the form of solar discounts, Electric Vehicle (EV) incentives and access to green investments.
Here in Aotearoa New Zealand we have the appetite and most of the individual mechanisms but have yet to piece it together effectively. One thing is certain, we won’t be going it alone. It may be stating the obvious, but it is through the broader collaboration of banks with fintech, tTech, and adjacent partners that we will see the revolution of how financial services are delivered and managed.
By Richard Copus, Technology Innovation Lead, ANZ NZ
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