Fintech Innovation has always been a hot topic. With the increase of new disruptive technology, the finance industry will evolve and flourish in the years to come. Take for instance, the development of the current 5G technology will evolve mobile payment to become safer and more convenient. Fintech innovation would promote the progress of the financial industry and trigger a chain reaction that will affect all aspects in our life. On 13th June, XNode held a special conference on Fintech Innovation Leading to Cross-Industry Changes at CES Asia 2019 (Asia Consumer Electronics Exhibition). Six distinguished guest speakers were invited to share their experiences and views on Fintech innovations through their keynote speeches and panel discussion to the crowd of audience.
In 2016, the Japanese government put forward the concept of "Society 5.0" - "Super Smart Society". Society 5.0 emphasizes on the balance between economic advancement with the resolution of social problems and a human-centered society to realize a high-quality life full of comfort and vitality society. During this conference, Mr Toshiya Cho, Senior Evangelist / Managing Director (Financial Information Systems Sales Management Division) from Hitachi Limited introduced that FinTech is the one of the key drivers to achieve Society 5.0. As the key technology for social innovation, Fintech can promote industrial interconnection and overcome the obstacles of industrial cooperation. One of the use cases he pointed out was about business matching. Banks can use artificial intelligence tools to analyze the transaction history between enterprises and extract common factors so as to identify potential business partnerships that can help enterprises expand their business. However, Mr Cho also pointed out that in the application of FinTech to solve practical issues, there could still be some problems that the development of technology might not be mature enough. For example, in the case of insufficient data, over-fitting will lead to prediction errors; the model generated by artificial intelligence calculation could be too complex for analysts to interpret. Hitachi's Digital Solutions aims to provide services with higher added values in a timely manner using various data and technologies through co-creation with clients.
The Common Trend of FinTech Innovation in Both East and West
Mr Jon Tzen Ng, Chief Strategy & Innovative Officer from Ping An Technology sees that FinTech innovation has shown a tremendous role in changing traditional business models in both local and abroad. FinTech innovation has shown a strong transformation ability to optimize business processes, speed up information transmission and enhance user experience. Challenger banks are typical cases in the world. They are very concerned about the needs of customers and adapt to their behavior in the new era: anytime, anywhere, on demand. In this way, products and services developed from the user's perspective are more attractive than traditional banking institutions which are not flexible. For example, according to the different choices of users, it provides a variety of interest rate models, which are flexible and concise. Another example is China's leading mobile payment, which provides services to customers in scenarios that traditional banking institutions could not touch in the past. Interestingly, in response to Challenger Bank, many giants are willing to open up cooperative relationships and share markets to provide a wider range of products and services. Jon also emphasized that the use of FinTech to transform the financial industry in any country or region would make the economic environment of the country or region better, and correspondingly, other related industries could develop rapidly because of the favorable economic environment.
More Possibilities Can Be Brought by FinTech Innovation
FinTech innovation will be able to bring more possibilities and opportunities for enterprises and consumers. Mr Yang Sun, Director of Fintech Business Unit of Suning Financial Services, delivered a speech on "O2O Fintech as a Media: Convergence of Scenario Finance and Industrial Internet", which showed how Suning Group integrates FinTech with other technologies: Big Data, Blockchain, Artificial Intelligence, Internet of Things etc into the various products and services of Suning Retail Industry. A wealth of financial product matrixes has been established between both buyers and sellers, and sellers and suppliers, to promote the growth of transactions on the platform.
During the roundtable discussion, Ms Meng Li, Chief Operating Office of Jane7 shared that Chinese users especially the younger generation have now more opportunities and ways to learn the right financial knowledge and use these financial products to improve their quality of life. Most of their users on Jane7 are young people who are usually more acceptive and open towards new ideas and technology.
However, in Europe, the pace of FinTech innovation is slightly slower. Mr Andras Berczeli, CEO of Sprintform, said this was due to the diversity of European culture and policies. Although more companies realized that FinTech innovation would bring them more opportunities for development, it would still take some time before they would reach the pace of innovation that is similar to China.
In discussing about hot issue on open innovation in the development of FinTech Innovation raised by Mr Wei Zhou, founder and CEO of XNode, the speakers agreed the it is not the sole role of large enterprises that is contributing to the development of FinTech Innovation. Open innovation can effectively link the innovative ability of challengers and the rich resources of corporates. This can help to create products that are more in line with the needs of the market and users. However, there could still be obstacles in the collaboration between corporates and start-ups such as different languages and cultures that might magnify in the more conservative financial field. Open innovation would require time to show its effectiveness.
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