Disruption in financial services continues to make headlines. This has not stopped industry experts from believing that fintech will be a vital part of a healthy financial future. Representatives from the entire fintech ecosystem attended the Fintech Nexus USA 2023 conference earlier this week. The Javits Center buzzed with lessons on how fintech will help companies weather the storms of change successfully.
Some of the hot topics at the conference, previously LendIt Fintech, included the future of embedded finance, payment innovations (buy now pay later [BNPL] and frictionless, fast options) and of course, the role of generative artificial intelligence (AI), such as ChatGPT. As digital transformation continues in the finance industry, more companies are considering new standards for data and will be watching the use of generative AI platforms from Google, OpenAI and IBM that are jockeying for a piece of the financial pie. From enhancing identification verification to helping create opportunities for the underbanked, AI can help propel the industry into a positive future of growth.
Another topic that was hot: fraud. From how to detect it early to reconciling funds to customers, financial-related companies are curious on how to most effectively address the age-old problem.
“Identity theft is the natural progression as more companies expand their digital offerings,” said Wayne Brown, managing partner in The Walker Group and host of monthly virtual lunches for fintechs. Brown, who advises companies in banking, financial services and fintech, has attended this conference since 2016. “That is why more companies are looking to identify and mitigate fraud early.”
In addition to the uptick in identity fraud and digital fraud, there has been a resurgence in old fashioned check fraud. Banks reported nearly 250,000 cases of check fraud nationwide in 2021, according to the Financial Crimes Enforcement Network, a division of the U.S. Treasury Department. In 2022, that number nearly doubled to 460,000 check fraud cases reported. “If consumers have a preference for using checks, fraud in this area will remain an issue,” Brown added. While criminals rely on platforms such as Telegram to recruit people in committing check fraud, financial institutions are using fintech to return stolen funds in a timely manner.
Several other fintech trends got airtime during the Fintech Nexus conference, including blockchain, data security and inclusive and responsible lending. It was clear during the conference that companies should have two attributes to survive in any economic climate: the need to be agile and open to the possibilities created by fintech.
– Charlyne H. McWilliams, SVP