Fasanara Fintech Weekly

Fintech in 2021, Upcoming Digital Transformation, Attacks on Finance, Post-Brexit Stuff & Other News



Happy Tuesday!



In this edition:


  • 2021 Digital Transformation: What Should We Expect?

  • Why Financial Organisations are a Prime Target for Cyber-Attacks

  • Comings and Goings: Fintech Industry Movements Post-Brexit

  • Embedded insurance: a $3tn market opportunity, that could also help close the protection gap

  • Looking for The Top Fintech Stocks to Watch Right Now?

  • The State of Fintech in 2021




2021 Digital Transformation: What Should We Expect?



As 2021 begins, three fintech-focussed companies from across the globe are asked what this year will hold in terms of payments, lending, and digital transformation as a whole.

“Next year we should expect continued growth all around as consumer behaviours keep demanding better and more innovative products. The general acceleration towards online (which was particularly accelerated by the 2020 pandemic) will continue, and fintech will be a natural beneficiary of that trend”.

Going forward, digital lenders will forge deeper partnerships with big tech companies and banks by co-developing products or literally combining through M&A deals as we have already seen this past year such as the Lending Club acquisition of Radius Bank or Metro Bank acquisition of RateSetter. The number of digital lender, big tech, bank partnerships is rapidly increasing because the relationships are mutually beneficial, with partnership returns resulting in significant profitability growth. Therefore, as digital lending becomes more mainstream, incumbent banks and big tech companies will want to find ways to leverage digital lenders’ proven worth and technology.”

“Pre-pandemic, organisations were unprepared for the scale of disruption that Covid-19 would bring to their operations: technology became the hero in a world where ‘normal’ no longer existed and provided a sharp wakeup call for organisations. It’s why digital transformation became the year’s most important buzzword and a priority for businesses. It fired acquisition of fintech companies worldwide and will continue to do so into the foreseeable future”.


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Why Financial Organisations Are a Prime Target for Cyber-Attacks



The financial services industry deals with highly sensitive information, including monetary transactions, personal information, and financial data, all of which are the Holy Grail for cybercriminals. The consequences of this information falling into the wrong hands could mean the loss of significant sums of money, including financial penalties, costs for audits to understand why the incident happened and what additional protocols need to be implemented going forward.


Humans are only ever a click away from sending an email with the wrong attachment, or to the wrong contact. But this can be more than just an embarrassing mistake – the ramifications could, in fact, be catastrophic.


Cyber-attacks, especially against banks and those working in finance, have increased dramatically since the start of the coronavirus pandemic, with a 238% surge in financially-motivated attacks, according to the third edition of VMware’s Modern Bank Heists report. Many of these attacks are COVID-related in nature, linking to accessing loans to help businesses or fake government emails as highlighted by UK Finance. In turn, 96% of UK executives said they will shift their cybersecurity strategy due to COVID-19, according to a recent study by PwC.


2020 may have been the catalyst for businesses to improve their understanding of cyber threats and the vulnerabilities they exploit as they plan for the new normal, but how can they do this successfully?

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Comings and Goings: Fintech Industry Movements Post-Brexit



With the UK having now officially left the European Union, many are still wondering what the long-term effects of the move will be, particularly for businesses. One major concern that seems to regularly occur is the movement of companies out of the UK in fears that Brexit will make things more difficult for businesses.


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Embedded insurance: a $3tn market opportunity, that could also help close the protection gap



Insurance is something that nobody wants but everyone needs.

Insurance is needed more than ever today as the “protection gap” – the gap between the amount of insurance that is economically and socially beneficial for individuals, households and firms and the amount of coverage actually bought – is getting wider and wider.

From 2000 to 2020 the protection gap doubled, according to the Swiss Re Institute, driven by global trends in digitisation, urbanisation, climate change and a lack of effective innovation.

In private pensions alone the Geneva Association, an international think tank, estimates that the gap is over $20 trillion worldwide today, i.e., most people cannot afford to live comfortably into old age. And if the main family breadwinner dies today the majority of humanity is not able to maintain its living standards and repay debts. The COVID crisis has exposed and exacerbated this situation.


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Looking for The Top Fintech Stocks To Watch Right Now?



Fintech stocks have had a stellar 2020. Rightfully so, as countless people have come to rely on digital payment solutions throughout their daily lives. Whether it is the average consumer or businesses of varying sizes, fintech offers vital services in these times. On one hand, this is due to the coronavirus pandemic making social distancing a new norm for all consumers. On the other hand, the push for digital acceleration has also seen many business owners flocking to fintech companies to bolster their payment infrastructures. Therefore, investors have been looking for top fintech stocks to buy right now.

With cashless payments being the safest means of buying just about anything now, fintech companies have been seeing huge gains. We only need to look at the likes of Square (SQ Stock Report) and StoneCo (STNE Stock Report). The two have seen gains of over 100% in their stock price over the past year


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The State of Fintech in 2021



As we mark the start of a new working year it seems an appropriate juncture to take a look at the state of play in the world of fintech, the trends that were prevalent in 2020 and which could continue to shape the industry in 2021.


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Thank you for the time!