While the US lags in addressing the gender pay gap and sexual harassment policies, Taiwan, India, and South Korea lead with higher rates of transparency and policy disclosure, reveals data provider Equileap.

Its 2024 Gender Equality Report & Ranking evaluates 1,494 publicly listed companies in 24 emerging markets covering various aspects of gender equality, including parental leave, gender balance, anti-sexual harassment policies, women’s representation in leadership roles, and gender pay gap disclosures.

It reveals that companies in Taiwan, India, and South Korea surpass their US and UK counterparts in gender pay transparency and combating sexual harassment.

In particular, the US falls short in disclosing gender pay information, with only 13 per cent of companies doing so, while India boasts a 100 per cent publication rate. Similarly, 69 per cent of US companies publish anti-sexual harassment policies, trailing behind India (100 per cent), Taiwan (96 per cent), and South Korea (87 per cent).

Despite these disparities, the report also highlights positive aspects, such as Taiwan’s gender balance in the workforce, matching levels seen in the US and the UK. However, challenges persist, with South Korea exhibiting the lowest representation of women on executive teams among emerging markets.

Inaugural report

Diana van Maasdijk, CEO at Equileap, says its inaugural report on gender equality in emerging markets confirms an “ongoing commitment to delivering essential social data to institutional investors”.

“Our findings illuminate an important global market, teeming with financial opportunities and innovation, where companies are demonstrating efforts to advance gender equality. We recognise significant strides with 38 per cent of companies disclosing their gender pay gap, surpassing the 33 per cent rate in developed markets, and with 54 per cent of companies taking a public stand against sexual harassment in the workplace.

“However, the stark reality remains: only 0.9 per cent of these companies have closed their gender pay gap, and gender balance remains low at leadership and workforce levels. Yet, now that the data is available, investors can play a crucial role in promoting gender equality in these vibrant markets. This not only aligns with our dedication to social responsibility but also solidifies our belief in the undeniable link between diversity, equity, and sustainable economic prosperity.”

Equileap has launched its inaugural Gender Equality Report & Ranking for emerging markets, alongside the launch of the Solactive Equileap Emerging Markets Gender Equality Index. Setting a new benchmark for inclusive investing, this index represents a significant milestone in Equileap’s mission to foster gender equality globally, while investors can “align their portfolios with their values, while driving positive social change”.

This April, The Fintech Times is focusing on all things embedded finance, the integration of financial services into non-financial products and services. As the space rapidly develops, we look to highlight the latest developments, initiatives and challenges embedded finance has to offer and overcome across the globe. 

Having established what regulatory challenges banks and fintechs should be aware of when leveraging banking-as-a-service (BaaS), and how the technology is advancing financial inclusion across the globe, we now turn our attention to emerging trends and if they are region-dependent.

A focus on regulations or financial inclusion

Richard Kalas, client solutions director for retail banking, GFT, the digital transformation pioneer, notes the various different ways that embedded finance is impacting the financial sector.

“BaaS is experiencing a significant, and quite exciting, expansion of its ecosystem, with more banks, fintech startups and technology companies entering the market as service providers or consumers. This trend fosters greater collaboration and innovation.

“The ecosystem’s expansion is paving the way for groundbreaking products and solutions that have the potential to revolutionise the financial services sector, empowering consumers and businesses alike with seamless, tailored experiences.

“It is also great to see a surge in innovation, which can be witnessed by the number of neobanks entering the market and disrupting the financial services sector by challenging the status quo of traditional banking models. Neobanks are known for their strong focus on improving the overall customer experience. By leveraging BaaS solutions, neobanks gain the ability to offer cutting-edge and user-friendly financial services tailored to meet the evolving needs of their client base.

“The modularity, interoperability and seamless integration of BaaS have also proven to be powerful drivers of innovation in sectors beyond banking. For example, the retail and e-commerce sectors are taking advantage of BaaS by embedding financial products directly onto their platforms, making payments more accessible and efficient as well as enhancing the overall customer experience of shopping online.”

Emerging markets vs developed ones

Kalas concluded: “Whilst these trends are evident on a global scale, their implementation and impact may vary across different regions. For example, in mature markets like North America and Europe, there is a strong emphasis on regulatory compliance and data privacy, driving innovation in secure and compliant BaaS solutions. In contrast, in emerging markets in Asia and Africa, there is a greater focus on financial inclusion and leveraging mobile technology to reach unbanked populations.”

Regulation and socio-economic landscapes shape trends

Regulatory frameworks are shaping the emergence of embedded finance across the world explains Maz Karimian, head of strategy at ustwo, the digital products and services provider.

“The landscape of Banking-as-a-Service (BaaS) is undergoing significant transformation, driven by a blend of regulatory initiatives, technological advancements, and evolving consumer expectations.

“The advent of open banking, particularly in Europe with the implementation of the Payment Services Directive 2 (PSD2), has sparked a wave of innovation. By compelling banks to share customer data with third-party providers upon customer consent, it has democratised banking data, thus empowering fintechs like Revolut and Tink to craft more personalised financial offerings.

“Simultaneously, embedded finance is redefining financial adoption and engagement models in regions like Southeast Asia, with trusted homegrown companies like Grab, the Uber of Southeast Asia, incorporating financial services into their otherwise unrelated offerings through a mobile-first strategy that aims to circumvent Asia’s fragmented banking sector.

“In the US, the environment for embedded finance is starkly different. Faced with the sophistication and strength of the financial services industry; tech giants like Apple have taken a more partnerships-led approach to offering embedded services like Apple Pay and the Apple Card.

“Such initiatives have won market share on the basis of simplified, seamless user experiences. This tendency to prioritise convenience raises fascinating questions regarding the potential benefits and pitfalls of on-demand, AI-powered financial services.

“The bottom line is that BaaS innovation differs widely across regions, and trends in the space, more so than in other ‘blank-as-a-service’ domains, are shaped by specific regulatory frameworks, technological landscapes, and socio-cultural contexts.”

Emergence of lending-as-a-service

As more non-banking players look to enter the financial space, BaaS is becoming increasingly helpful. According to Aman Behzad, managing partner, Royal Park Partners, the fintech focused financial advisors, lending-as-a-service is once trend being seen across the globe.

“We will see BaaS break new ground over the next two years. Macroeconomic conditions are driving the need for client monetisation, presenting more opportunities to extend the reach of BaaS. Lending, for instance, has become increasingly appealing to various non-bank players seeking higher interest yields and new revenue streams, driving the growing of new lending-as-a-service (LaaS) solutions.

“The applications of BaaS will continue to grow, and it’s exciting to see it transcend the boundaries of finance. In an era where customer-centricity is paramount, businesses across all sectors will be looking to BaaS to give them a competitive edge.

“Sectors as far reaching as healthcare and travel are tapping into the potential of BaaS to generate ancillary revenue streams, and augment customer retention. In the travel sector, for instance, one growing use-case is the integration of banking functionalities into airline loyalty programmes. Passengers can now earn, manage and redeem rewards seamlessly, benefitting from a more enhanced and integrated experience.”

Partnerships can help modernise infrastructure

Consumers want easily accessible solutions. Karthik Sethuraman, chief delivery and risk officer at audax, a corporate venture backed by Standard Chartered Bank, notes that one way firms can ensure they meet this need is through partnerships.

“Consumers want to be able to make a series of transactions with one app – from booking transport, paying for groceries, getting a micro-loan, and purchasing travel insurance. We help to empower banks and financial institutions to accelerate their digital transformation to meet those needs.

“Southeast Asia’s population is increasingly digitally-native, which has seeded the growth of BaaS by increasing the demand for digital financial services and accelerating the adoption of innovative banking solutions. The digital natives are accustomed to digital interactions and prefer seamless, convenient, and personalised digital financial experiences that can be accessed via mobile or online banking services.

“More partnerships between BaaS providers and fintechs create more comprehensive offerings both for banks, FIs and end-users. An example is the audax partnership with Thought Machine, where audax’s scalable digital banking technology platform is integrated with Thought Machine’s configurable core banking technology, enabling institutions to swiftly modernise infrastructure and develop fully customisable financial products for end customers.”

Ensuring consumers are protected

Daniel Grunstein, CEO and co-founder at Crowded Banking, the digital banking platform notes that consumers can find themselves open to fraud if BaaS providers don’t play their roles properly.

He explains how they can: “BaaS providers have gotten a bad rap recently – with all of the reports of fraud and failed ventures. I want to draw attention to the companies in the BaaS industry that are thriving, as a founder in this space myself.

“Embedded finance platforms for established clients are being unfairly grouped with the neobanks that acquire customers through B2C ads or other unreliable methods that leave them vulnerable to fraud.

“There are embedded finance platforms that are growing, irregardless of the fraud and compliance complications that other neobanks are facing. Crowded, having tripled its customer base last year, works with nonprofit organisations that have been around for longer than most banks – fraternities, universities, Girl Scouts, etc. Fraud around KYC/KYB is harder to pull off with established clientele, as the BaaS provider can easily weed out fraud accounts by checking with the national office of these multi-chapter organisations.

“When providing BaaS to an established organisation, rather than to individuals, more accountability and checkpoints prevent some of the vulnerabilities to fraud. Also, unlike most fintechs, where compliance is a burden, Crowded has monetised it, allowing their non-profit clients to maintain their tax-exempt status, and turned it into a revenue driver and competitive advantage.”

Who can move money

Different regions have different rules on who can move money highlights Donald Chapman, head of North America at Pollinate, the digital tool provider.

“BaaS enables non-banks to provide financial services, so tech firms that can innovate to find ways to profitably serve underbanked people or businesses. They can now deliver financial services where banks previously weren’t able or willing.

“These companies are not banks so they need to work very closely with their bank compliance teams to ensure they adhere to all pertinent rules and regulations.

“BaaS definitely varies by region. For example Europe almost encourages the dissemination of banking capabilities, such as PSD and PSD2 allowing non-banks to move money whereas in the US it is more strictly a bank situation.

“There are e-money licenses in Europe and money services business (MSB) licenses in the US, but in the US a company needs to go state by state to properly conduct business nationally which is a regulatory nightmare yet to be solved.

“Banking is a staid and highly traditional industry, so as the capabilities open up to tech firms that innovate, we will see more sectors, more adoption, and more opportunities… as well as more missteps.”

Payments are arguably the face of fintech. When you think about financial technology, it is easy to think about solutions which are making payments faster, easier and more accessible.

Paytech development has skyrocketed across the globe, with one of the main payment methods adopted being digital wallets. To understand how different geographies have used digital wallets, we reached out to the industry.

Old news for developed countries

Aaron Rafferty, CEO, StandardDAO, the decentralised treasury, notes that developed countries have had the technology for a while, whereas in emerging markets, they are revolutionising payments.

Digital wallets are a revolution, but not for most in developed countries. In fact, those living in the United States and similar have had digital wallets for many years now with most stores having NFC readers and phones having functions like Apple Pay and Google Pay since 2014.

“From the streets of Lagos to Mumbai’s slums, crypto-powered apps on cheap smartphones are bringing many of the world’s poor onto global financial systems for the first time. Informal economies are stepping into the open, enabling people to save, invest and do business like never before without access to providers like JP Morgan or HSBC.”

Manual card number entry is a preferred payment method in the US

While digital wallets may not be anything new in developed markets, Matt Miller, vice president of product, Paze, the digital bank wallet, notes how they are not the most popular payment choice available to users.

“Digital wallets have tried to provide consumers the convenience and security during e-commerce transactions – with some success. Despite all the entrants in the space, the e-commerce checkout experience is still rife with friction and none of the existing wallet solutions have solved the problem for consumers en masse.

“While digital wallets have made some strides in addressing these issues, a surprising 71 per cent of US consumers still resort to manual card number entry at guest checkout when shopping online. This reliance on manual input not only introduces the potential for errors but also results in abandoned shopping carts and lost sales, all of which drives the need for a smoother and better-engineered checkout process.

“Research also indicates that consumers prefer and trust bank-provided wallets over existing checkout options like a smartphone manufacturer, tech company, retailer or telecom provider.”

Developed markets have less incentive to adopt digital wallets

Robin Yan, co-founder and CEO, FANA, the philanthropic community for mobile native users, explains how emerging payment methods can struggle for adoption in developed markets due to users being stuck in their old ways of paying.

“Digital wallet adoption is more rapid in developing regions across Asia and Africa compared to mature markets, largely due to three key factors.

“First, the existing banking infrastructure in these regions is often poor and outdated. Second, there’s a high risk of fraud in cash transactions. Third, digital wallets in these areas are typically integrated with widely used consumer products. For instance, in China, WeChat Pay and Alipay evolved from messaging and e-commerce platforms, respectively, and now have over a billion users each. Similarly, in Southeast Asia, GrabPay and GoPay originated from ride-sharing apps and have become widely used.

“In contrast, ‘Western’ financial markets are more developed, reducing the incentive to adopt new payment methods. Digital wallets in these markets will need to be built off of high-utility consumer applications, like last-mile logistics or e-commerce (e.g. ShopPay).”

Sharp adoption has died down

Also analysing the impact digital wallets have had in emerging markets, Paul Staples, group head of embedded banking, ClearBank, the banking API provider, said: “Initially, advanced transportation systems in major cities such as London, Singapore and Sydney, saw a rapid adoption of digital wallets and the precursor of pre-paid cards.

“This momentum has slowed, however, in favour of the debit and credit card. The US has seen a lower level of adoption at all age groups relative to other peer countries, but this is no surprise for a country wedded to the cheque.

“Globally, we need to think of digital wallets not simply as front ends on a mobile phone but more as a lubricant for better financial outcomes. Sectors with complex financial processing will begin to operate digital wallets more frequently, but these may well be more internally focused use cases than those that result in an end customer.”

Digital wallets are a lifeline in Asia and LatAm

In emerging economies, one of the biggest issues faced is access to finance. Many fintech have found success in these regions due to democratising finance. Kurt Wuckert Jr., chief Bitcoin historian, CoinGeek, the blockchain and crypto news site, explains how digital wallets have played a role in enabling this.

“Amid a global cost-of-living crisis, digital wallets have emerged as a beacon of hope for financial agility. As traditional banking feels shaky and employment is still confusingly low, people worldwide are pivoting to the swift, cost-effective haven of digital assets.

“Particularly in regions hit hardest by economic turmoil, like parts of Latin America and Southeast Asia, digital wallets are not just a convenience—they’re a lifeline for locals engaging in commerce and migrant workers sending money across borders. Blockchain assets, bypass hefty transaction fees and speed up settlement, a crucial advantage when every cent counts.

“But it’s not just about saving money; it’s about accessibility. Digital wallets democratise various financial services, empowering unbanked or underbanked populations with tools once reserved for the financially privileged. We’re seeing a surge in adoption in these areas, where digital wallets become crucial savings and spending tools. Hopefully, we don’t see another cascade of confiscations and bankruptcies or ‘rug pulls’ as we saw with various DeFi apps or Celsius, BlockFi and other gray market, pseudo-banks.”

Payments are arguably the face of fintech. When you think about financial technology, it is easy to think about solutions which are making payments faster, easier and more accessible.

Having already explored the biggest upcoming trends in the world of paytech, it is clear that progress in payments becomes drastically different depending on which region of the world you look at. To find out how payment trends differ across the world, we reached out to industry experts and asked them how these trends differ in emerging markets, compared to the most established ones.

Differing financial landscapes 

For Jeremy Baber, CEO of Lanistar, the payment card provider, emerging markets are less reliant on traditional banking, creating more opportunity for fintech growth in those regions: “When it comes to established versus emerging markets, there remains a distinct gap between the two in terms of financial landscapes.

“Established markets are dominated by traditional banking meaning the opportunities for newer fintechs to deliver significant change are much more restricted. There simply isn’t as much room to upset traditional players and carve a path. But for emerging markets, new technology and an appetite for embracing change has provided an advantage for not just fintech growth, but also for those governments and markets.

“Currently, emerging markets find themselves at a sweet spot, where their dominant population demographic of under 30 favours online transactions. This has allowed the growth of methods that support such payments, stimulating economic growth through providing standardised practices in an otherwise neglected market.

“Brazil, for example, has been the site of the development and roll-out of bank transfer methods such as PIX and QR-code-driven payments. This has been seen as a game-changer, especially in comparison to more established markets which are years behind. Without emerging markets wholeheartedly embracing cryptocurrency technology and development, many fintechs would not be seeing a significant lead against traditional competitors and even a lead in their future financial service development.”

Varying banking usage

James Simcox, chief product officer at Equals Money, a money movement solution provider, explains how varying amounts of different populations with bank accounts change the payments landscape in each region: “In established markets, a substantial portion of the population already have bank accounts.

“This means there’s often a greater understanding of banking and well-established payment systems, creating an easier and faster route for innovation. Trust in banks is generally established, which means they can focus on maintaining infrastructure and engaging stakeholders.

“In emerging markets, the challenge is educating merchants and addressing infrastructure gaps. For example, in Mexico, despite having instant payments, there’s still low banking usage. Kenya, however, skipped traditional banking and moved straight to mobile payments.

“Unlike in established markets, the absence of existing systems and infrastructure allows the chance to start from scratch with payment technology.”

Financial infrastructure impacting trends

Gabriel Le Roux, CEO and co-founder of Primer, the unified infrastructure for global payments and commerce, discusses how differing levels of financial infrastructure are the main cause of differing trends between emerging and established markets: “While digital commerce is becoming more common in both emerging and established markets, there is a clear difference between the two.

“Established markets have a much more advanced financial infrastructure, including online banking services. Typically, consumers in these markets prefer electronic payments over cash due to better convenience and security.

“Yet, the idea of a cashless society in emerging markets is extremely unlikely. Although innovation in mobile payments has grown over the last decade, emerging markets often face infrastructure challenges, including limited access to banking services and inadequate point-of-sale systems.

“In both markets, however, there is a growing shift towards ‘nationalised payments’ due to concerns about national payment sovereignty and rising international fees. Several countries, such as the United Kingdom or Brazil with its Pix payment network have already taken steps to launch or suggest their own domestic card schemes. It’s likely that we will see more countries try to establish their own card network, reducing dependency on the likes of Visa and Mastercard.”

Banking penetration and smartphone adoption

Amal Ahmed, director of financial services and EMEA marketing at Signifyd, the e-commerce fraud protection platform, said: “While cash and mobile money continue to dominate the landscape in emerging e-commerce markets, fueled by lower banking penetration and higher smartphone adoption, established markets see credit and debit cards taking centre stage.

“Contactless payments and digital wallets are rapidly gaining ground, pushing cash aside, and as this becomes the norm globally, emerging markets present unique challenges and opportunities.

“Local payment methods like M-Pesa in Kenya or AliPay in China are crucial for success, and mobile-first optimisation is essential. Limited access to traditional banking necessitates creative solutions like micro-loans. Conversely, rising internet and smartphone use, alongside government initiatives and fintech innovation, are accelerating the digitisation of payments in these regions.

“Despite these differences, a trend towards convergence is undeniable. Mobile wallets, digital currencies, and buy now, pay later options are finding favour in both established and emerging markets.

“Ultimately, security and user experience remain paramount across the board, but navigating local regulations, data privacy laws, and cultural preferences is equally crucial for tailoring a winning payment strategy in any market. Building trust and ensuring secure digital transactions will be key for unlocking the full potential of e-commerce in emerging markets.”

Are payments in emerging markets overtaking the Western world?

Craig Ramsay, managing director and business development head at payments solution provider Episode Six, also comments: “Emerging markets are in the process of moving from cash directly to faster digital payment methods, like QR codes and wallets.

“In these markets, cheaper transaction fees hold great appeal – the use of UPI in India, PIX in Brazil and Dimo in Mexico are all instances of digital-first propositions that offer seamless and secure payments to the unbanked and underserved.

“Governments in emerging markets are focused on payment solutions that are affordable, safe, and accessible to everyone. That means creating instant payment solutions that don’t require sensitive financial information. They’ve been a rousing success and propelled the adoption of digital payments in these countries.

“Overall, there’s a huge institutional investment in real-time payments within emerging markets, the Middle East is already the fastest-growing market globally. They’re speeding past card payments, a step that we relied on for so long in the Western world.”

The payments experience

Arnaud Crouzet, VP of Fime Consulting, the advisory service provider, discusses how the issue of financial inclusion changes based on the market: “For merchants, the payment experience has become business critical, and vital to their relationships with customers. They need frictionless payments integrated into the customer buying journey.

“However, this expected buyer journey can vary significantly between emerging and established markets. As a result, domestic schemes are uniquely positioned to offer the bespoke payment framework required while bringing enhanced payment sovereignty to a nation. By providing localised support, domestic schemes are best positioned to meet the specific needs of the nations they serve.

“In emerging markets, the challenges of financial inclusion are far more prevalent than in established markets. In regions where smartphone penetration is far lower or a significant percentage of the population is unbanked, merchants need a way by which to offer enhanced yet still affordable payment experiences. This is essential to avoid excluding the unbanked or those without a compatible smartphone. New schemes such as that of Bangladesh Bank helping create an accessible, secure economic platform that meets the needs of the emerging market.”

Marca Wosoba, GM of global reach and head of payments at the Royal Bank of Scotland, also explains how emerging markets actually have an upper hand: “Emerging markets outpace their developed counterparts when it comes to the growth of real-time or instant payments.

“This is because emerging markets are less constrained and more willing to embrace new technologies and systems, making them a hotbed for innovation. Some of the most exciting innovations are happening in Africa with the mass adoption of digital payments, such as with M-Pesa in East Africa.”

The global consumer class will expand by 109 million people in 2024. That’s according to “Beyond Borders 2024,” a report by Ebanx, the Brazil-based payments provider, addressing the digital economy in emerging markets.

The report highlights how digitization is transforming key industries and fostering economic growth, resulting in a more equitable landscape between emerging markets and developed economies.

Per the report, in 2024 India will contribute 34 million (31%) of the new consumers globally, surpassing the combined numbers from Europe, the Americas, and Africa, owing to the rise of ecommerce.

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For international corporations, rising markets present a significant avenue for digital growth. The data shows that while ecommerce is experiencing a 13% annual growth rate in developed nations (Europe and the U.S.), it’s advancing at 20% in rising markets (Southeast Asia, Africa, Latin America).

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A substantial portion of ecommerce in rising economies, particularly Latin America, is driven by international purchases. The data shows that cross-border transactions also play a significant role in the economies of Mexico, Chile, and South Africa.

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Moreover, according to the forecasts, by 2027 rising markets will account for roughly 40% of global B2B digital payments.

Artificial intelligence (AI) has emerged as a new fraud challenge finds ComplyAdvantage,  the AI-driven fraud and AML risk detection firm, as it launches ‘The State of Financial Crime 2024’ report.

“Today, AI is being utilised by both criminals – who are using it as new ways to defraud customers – and institutions, who are using it to stay ahead of fraudsters and defend their customers,” said Vatsa Narasimha, CEO of ComplyAdvantage.

“We know from our work with financial institutions around the world that AI-based technologies can significantly enhance the fight against financial crime. We see a tremendous opportunity for banks to show consumers how these new technologies and processes like explainable AI are being used to safeguard their finances.”

AI: Fighting the emerging threat

• Two-thirds (66 per cent) of financial industry respondents think the use of AI by fraudsters and other criminals poses a growing cybersecurity threat. Risks include deepfakes, sophisticated cyber hacks, and the use of generative AI to create malware.
• Banks and other financial institutions are increasing their defences against these threats, with 86 per cent of respondents saying their company is investing in new technologies.
• However, only 53 per cent of financial industry respondents said they prioritise explaining their use of AI to their customers.

“Whether they use AI to identify fraud patterns, analyse networks, or streamline processes, banks can take the lead on what we believe will be a key trend in 2024: explainability. Namely, the ability of financial institutions to demonstrate to their customers how and why AI models have taken decisions that affect them,” continued Narasimha.

“If compliance leaders are concerned about how customers will receive this information, our survey suggests they should be optimistic. 65 per cent of consumers told us they are open to banks sharing their transactional details with other banks if it helps identify fraud patterns. Clearly, consumers recognise that addressing our financial crime challenges requires new and more innovative approaches.

“We would expect this percentage to increase further once the benefits of AI for improving financial crime detection are more widely know.”

Ongoing problem of payment fraud with millennials hardest hit

One example of growing criminal sophistication highlighted in the survey is payment fraud. With digital payments continuing to experience double-digit growth year on year, criminals are using new technologies to commit fraud on a mass scale.

• Sixty per cent of industry executives surveyed say that payment fraud has remained at the same high levels over the last 12 months, with eight per cent reporting an increase.
• Nine out of 10 consumers surveyed (89 per cent) expressed anxiety about being a possible victim of fraud.
• One in four consumers (23 per cent) report being the victim of fraud in the last three years, with millennials (age 27-42) the hardest hit at 31 per cent.

When asked what kinds of fraud they were the victims of, the most common responses were:

• Credit card fraud (59 per cent)
• Identity theft and phishing (21 per cent)
• Employment scams (12 per cent)
• Investment fraud (10 per cent)

“Millennials have embraced digital payments and mobile banking, which dominate how we access banking services today. The scale of fraud amongst this generation demonstrates how quickly criminals exploit technology and changes in consumer behaviour,” said Narasimha.

“Every compliance executive we surveyed said that they are either currently participating in an authorised push payment (APP) program or will in the near future. With APP fraud continuing to rise, we expect this to become a big priority for regulators and financial institutions in 2024.”

One in five consumers admit to ‘friendly fraud’

At least one in five of the consumers surveyed admitted to at least one behaviour that is described as ‘friendly fraud‘. Indicators of this include:

• Disputing a payment after receiving an inadequate response from a merchant (21 per cent).
• Disputing a payment that they later realized was legitimate (12 per cent).
• Claiming a debit or credit card refund despite not returning the item (nine per cent).

“The surprisingly high level of ‘friendly fraud’ uncovered in our survey shows just how widespread and complex fighting fraud can be when consumers can – even inadvertently – commit behaviour that may raise a red flag with their bank,” said Iain Armstrong, regulatory affairs practice lead for ComplyAdvantage.

The Madeira archipelago in Portugal is witnessing the birth of a startup hub focused on emerging technologies, such as blockchain and artificial intelligence. Rogerio Gouveia, finance secretary of Madeira’s regional government, says the technology sector represents approximately 30% of the island’s businesses – a considerable increase for a traditionally tourism-driven economy.

The local tech community is behind the Madeira Blockchain Conference, a two-day event to promote startup networking and discussions about how blockchain can be used to solve real-world problems.

Cointelegraph attended the event held at the Cultural and Research Center of Funchal (CCIF) for the second consecutive year. The conference’s key takeaways are outlined next.

Traditional gaming studios are quietly embracing blockchain, steering clear of buzzwords

Gaming companies exploring blockchain technology are facing backlash from players and developers, prompting some studios to steer clear of Web3-related buzzwords. 

Redcatpig, a traditional game studio, encountered hurdles in adopting blockchain features on its games. CEO Marco Bettencourt highlighted the difficulty in getting the startup team to explore the potential advantages of integrating blockchain into game development.

Although the studio has been working on the technology, it has avoided buzzwords. “We all know there is new technology. We all know about NFTs and proprietary technology. And you won’t sell games using the buzzwords. […] Players don’t need to know that it is Web3 or blockchain. The only thing they need to know is that if they buy a skin, they own it, and they can sell it tomorrow if they want,” Bettencourt said.

In 2024, the company will launch its first blockchain-based game, offering nonfungible token (NFT) skins and drones, which can be traded and purchased in-game with fiat or cryptocurrency.

Is your startup raising funds? Not all money is the same

During the event, Subvisual’s head of ventures and strategy, Alexandre Mendes, provided key insights for Web3 startups raising capital. According to him, startups looking for funds must bear in mind that “not all money is the same.”

Startups need a clear strategy of what types of investors they are seeking and how they will participate in governance. “So lockup or not lockup, vesting, carry, these are very strategic and demanding topics that we need to be more mindful of,” said Mendes.

Mendes also explored the “infinite dilemma” of launching a token and building a product at the same time. In his opinion, not every project needs a token. “We don’t always need a token. […] the amount of startups that launched a token successfully and then failed to ship the product is quite significant.”

Many founders often don’t know who they’re building for, Mendes said, adding that some projects are more a technology demonstration than a product. “This brings us to what we are trying to build here, is it a technology demonstration, or are we really trying to build a company?”

Madeira bets on startups to strengthen its economy

Madeira is embracing new technologies by offering key incentives for startups. One of the perks for tech companies is its free trade zone, which offers companies tax benefits, including one of the lowest corporate tax rates in the European Union and a capital gains tax exemption.

“For companies aiming to establish a presence in the region, the foremost tax incentive is found in the Madeira free zone or the International Business Center. This area offers a preferential tax regime, capping the corporate tax rate at a competitive maximum of 5%,” Gouveia told Cointelegraph, emphasizing that the region isn’t an offshore haven, but instead operates under a set of regulations and guidelines to spur Madeira’s economic growth.

Madeira is developing a payment network aimed at connecting local merchants and easing currency exchange for tourists. This network, currently in the feasibility study phase, is expected to run on blockchain technology, allowing tourists to load funds onto a single debit card for use across the archipelago. The same card system is also planned to optimize government operations, including the distribution of public benefits like scholarships to residents.

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