Financial companies have to be seen as innovators, Mastercard experts say
Research showed that global fintech investment in 2019 stood at $35.4 billion
Financial institutions need to be able to keep up with the rapid pace of change that is happening across the industry today, and be seen as innovators, experts from Mastercard said at an event on Wednesday.
Rohit Gupta, head of Regional Products, Managed Services, Mastercard, spoke about Industry 4.0 and how it is a technical revolution that will blur the lines between the physical, digital, and biological spheres.
“Digital transformation is a maze,” he said. “In this maze, it takes a lot of time for anyone to understand what is the right solution for you. We do this by looking at signals that we are getting globally regarding digital innovation, and putting them in our pipeline. We convert these signals into opportunities and de-risk the introduction of new products and services.”
He added that there are several key trends that the company is focusing on. The first one revolves around digital payments and using them to create a seamless experience and the best value for consumers. Another revolves around mobile payments to get a better feel of what the consumers are looking for. The last one revolves around the use of Artificial Intelligence.
He explained that Mastercard has grown and evolved beyond payments to become a fintech enabler. “Our capability has evolved to cover end-to-end innovation for our customers, and we have multiple offerings that help fintech companies to grow and develop their products in the market. We have a fantastic offering called ‘Labs as a Service, where we work with different partners to look at idea generation and disruptive thinking and how it leads to products development, which is followed by in-market testing and platforms.”
Shyam Mohan, VP of Fintech & Enablers, Mastercard, also highlighted how Mastercard has reinvented itself as a payment technology provider and is investing in new capabilities. “As the evolution of the industry has been quite rapid, we have been able to keep pace with that and deploy new solutions. The pace of evolution is only increasing and we have to look at how we can play a role in supporting the ecosystem.”
“We know that we can’t remain internally focused and have to be seen as innovators,” he added. “There is a lot of action around what startups, especially in the fintech space, are creating and we want to be close to it.”
He explained how Mastercard has an umbrella programme called Mastercard Accelerate, which is designed to make it easier for fintechs to work with Mastercard through all stages of growth and transformation – market entry, expansion, product development, diversification and innovation. Accelerate includes a range of programs that companies can choose from based on their needs.
As new technologies and regulations bring new opportunities and challenges to the financial services industry, nearly two-thirds of established companies are leveraging fintech capabilities for growth, according to a 2019 survey from Harvard Business Review Analytic Services. That number is expected to increase by 20 per cent over the next three years.
Mohan also revealed that the value of the global fintech market will rise from $127 billion in 2018 to $310 billion in 2022. Global fintech investment in 2019 stood at $35.4 billion. He added that the Covid-19 pandemic has resulted in in a greater demand for contactless solutions. Towards this end, the payments technology company partnered with various players and launched several low-cost innovations that allow merchants to start accepting digital payments without incurring additional or high infrastructural costs.
One of these was a partnership with Signzy, a RegTech startup based in India, that will allow Mastercard to enable Signzy’s video-based KYC (Know Your Customer) solution for its banking customers. With this partnership, Mastercard customers will benefit from a completely paperless, remote and secure onboarding solution for end-users. Backed by Artificial Intelligence and Machine Learning technologies, Signzy’s Video KYC solution features security protocols to prevent unauthorized system intrusion or attempted fraud. Further, the solution offers industry-leading scalability to deal with high volumes of video KYC transactions.
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