As new payment technologies continue to emerge and fraud tactics evolve, there is a growing recognition of the need for regulatory adjustments to effectively combat these challenges.

At this year’s Pay360 conference held at London’s ExCel – one of the largest payment events of the year in the UK – more than 5,000 payment and finance professionals from around the globe gathered to address balancing the drive of regulation and innovation.

Event organisers and key speakers stressed the necessity for continuous modernisation and regulation in payment systems to ensure their effectiveness, championing various approaches aimed at mitigating the rising prevalence of fraud within payments and bolstering the resilience of payment markets.

Tribh Grewal, head of altpay, fintech and commercial solutions at Discover® Global Network, hit Pay360’s main stage to take attendees on an exploration of Payment Services Directive 3 (PSD3), a proposed EU directive about payments, data and security, and how it could pave the way for a more efficient and inclusive financial system.

Following Grewal’s engaging keynote session, The Fintech Times had the pleasure of sitting down with the renowned payment expert to delve deeper into evolving regulatory trends and their impact on the payments industry.

Importance of adapting

He explained how with all the change and innovation in the industry, many regulations are no longer relevant.
“Many regulations haven’t kept up to pace with the technology and the new systems, use cases and new services that are emerging,” said Grewal. “With innovation, there’s a lot of modernisation, so it’s important to make sure that it’s within a robust regulatory environment.

Grewal highlights the broader goal of regulatory adaptation: not only to keep pace with technological advancements but also to uphold principles of inclusivity and security in financial services to increase consumer confidence.

“We need to make sure everybody has equal access to services, they are protected, and they feel comfortable using them.”

Using data to manage fraud detection

This need for regulatory adaptation extends to fraud prevention as well. Fraudsters typically have always been one step ahead of anything that the payment companies do. So how can payment companies use data to manage their fraud detection and prevention?

According to Grewal, it’s crucial for companies to instil proper data management and compliance with regulatory requirements to enhance fraud prevention measures.

“It’s all about data and sharing information. Many companies view data as proprietary, but regulations will require payment service providers to share data, whether at a macro or micro level, and this involves staying informed about emerging fraud trends and scams and educating users to manage them effectively.

“Then, it’s about how you cleanse that data, how you look at it and how you analyse it but the regulation will make sure that companies share their data and that it is utilised properly.”

Looking after customers

As payment companies navigate the complexities of data management for fraud prevention, their commitment to customer protection becomes increasingly vital. Ensuring data integrity and compliance not only strengthens fraud prevention measures but also fosters consumer trust and security.

In our conversation, Grewal touched on the importance for payment companies to ensure inclusivity, accessibility and security in their services. In particular, he highlighted the need for customers to feel confident that they are dealing with legitimate companies and that their transactions are secure.

“There’s a lot of work that companies can do in education in making things simpler and making them convenient as well as easy to use, while making sure that the consumers are protected and have that confidence,” he outlined.

Spotlight on Pay360

Grewal’s insights offer a broader perspective on industry dynamics. By comprehending regulatory changes, fraud prevention strategies and emerging innovations to guide decision-making and solution development, Discover® Global Network is able to show it is committed to navigating the dynamic payments landscape adeptly, he explained.

“We’ve been part of the Payments Association (previously the Emerging Payments Association or EPA), including Pay360, for several years. We’ve observed the conference’s growth over time and know it’s about visibility, engaging with current and potential partners and clients, and collaborating with key industry players.”

“Our focus was to meet with existing partners and organisations for potential collaboration. But personally, it’s been enlightening to engage with experts discussing regulatory challenges, fraud prevention strategies, and emerging innovations in the industry.

“Understanding these dynamics helps us tailor our solutions effectively.”

Watch The Fintech Times chat to Tribh Grewal at Discover® Global Network

ComplyAdvantage, the financial crime intelligence firm, has officially acquired Golden, a San Francisco-based firm automating the construction of one of the world’s largest knowledge graphs, which shows interconnected data points and their relationships to analyse complex information.

ComplyAdvantage uses AI and machine learning to parse through a continuously updated database of entities to give clients the most accurate 360-degree view of financial crime risk. As clients respond to alerts, a feedback loop continuously enriches the insights ComplyAdvantage provides.

Golden’s data extraction and disambiguation using sophisticated natural language processing will bring additional disparate data sources into ComplyAdvantage’s data ingestion layer to provide clients with even more comprehensive, real-time financial crime risk insights.

As part of the acquisition, Andreessen Horowitz (a16z), a venture capital firm in Silicon Valley, joins a group of technology investors, including Goldman Sachs, Index Ventures, as well as Balderton Capital.

Vatsa Narasimha, CEO of ComplyAdvantage, said: “Delivering AI-enriched financial crime insights to our customers through a best-in-class user experience built on the most interconnected data has been our north star at ComplyAdvantage since day one. The acquisition of Golden is a critical milestone on that journey. We are excited to welcome their talented team to the ComplyAdvantage family, alongside a16z, who bring powerful expertise as we embark on the next phase of our growth journey.”

Financial institutions and other regulated entities are required by law to ensure the people and organisations they choose to do business with are legitimate and that the transactions they facilitate are legal.

ComplyAdvantage continues growth

Jude Gomila, founder and CEO of Golden, is set to join ComplyAdvantage as a board observer and special advisor.

Gomila said: “I have known Charlie Delingpole, the founder of ComplyAdvantage, since 2005, and I am thrilled to bring together our capabilities. By combining our experienced team of AI and large language model (LLM) specialists with ComplyAdvantage’s industry-leading data science team, we are creating a global team of data experts. Together, I’m confident we will transform financial crime risk management for businesses worldwide.”

This announcement comes on the back of continued momentum for ComplyAdvantage as the scale-up continues its impressive growth, significantly expanding its client roster since the last fundraising round led by Goldman Sachs.

The acquisition also strengthens ComplyAdvantage’s foothold in North America, with Golden bringing an extensive base of US customers.

The Fintech Times recently attended Token2049, the premier crypto event held annually in Dubai and Singapore where founders and executives of leading Web3 companies and projects meet, network and share their views on the industry. 

There were several opportunities for us to catch up with industry leaders throughout the event, to understand the overlap between the traditional financial services sector and this fast-expanding world of crypto.

Let’s first take a look at the technology and terminology surrounding this industry to understand where we are and where we are going.

Technology

The decentralised network connected through a network of computers or nodes underlies blockchain technology, synonymous with cryptocurrencies. Blockchain protocols are the guidelines or rulebooks that determine how a blockchain works.

The term Web3 was coined in 2014 by Ethereum co-founder Gavin Wood, and the idea gained interest in 2021 from cryptocurrency enthusiasts, large technology companies, and venture capital firms. 

The key to Web3 development focuses on providing a user-friendly interface and experience for decentralised applications. It’s common for end-users to interact with Web3 applications instead of the blockchain directly.

Azeem Khan, COO and co-founder of Morph, a blockchain company, explained: “I can’t wait for blockchains to be abstracted away to the point that no one knows they’re using a blockchain; in the future, it would just be understood that if you say I’m building a financial tool you would build on blockchain. 

“I find it pretty insane that people try to compete on which database the information is stored on. It’s like a Web2 company saying, ‘Well, I use MySQL rather than Microsoft SQL, and that’s our competitive advantage’.”

Why is there so much hype about Web3? 

Well, web browsers are now able to use a programming language called WebAssembly, which is a type of code, it is a low-level assembly-like language that runs with near-native performance and provides languages such as C/C++, C# and Rust with a compilation target so that they can run on the web, this allows the web browser to access lower-level functions like a traditional operating system, facilitating greater integration and more complex applications running natively in the browsers.

A prediction from Kadan Stadelmann, CTO of composable blockchain platform Komodo Platform, is that it is going to enable the web browser to be the future operating system, taking over from the likes of Windows, Apple and Linux.

At its core, Web3 employs blockchains, cryptocurrencies, and NFTs to return ownership to users. Web1 was read-only, Web2 is read-write, and Web3 will be read-write-own. 

These native and powerful browser applications are numerous and well-suited to financial use cases. When we specifically examine cryptocurrencies, we observe a distinct use case in emerging and developed countries. In emerging markets, people use cryptocurrencies to preserve value, while in developed markets, they perceive them as an investment asset.

Revenue vs innovation

Crypto impacts people’s lives in developing countries where traditional payment infrastructure is lacking, while in developed countries, it may not be as relevant due to existing payment infrastructure. 

Cecilia Hsueh, CEO and co-founder of Morph, on the differences between emerging and developed countries, said: “Given my experience, people in emerging countries care about revenue generation. Can this application help me to get money or make profit? Then they are happy to use it. But in developed countries, they care about innovation. They want to be the first to use the product. It’s a very different mindset.”

Pixels, a farming game on the Ronin blockchain, has recently become the first Web3 game, to surpass 100,000 daily active users (DAU). At the YGG Web3 Game Summit held last month in Manila, Philippines, Jeffrey ‘Jihoz’ Zirlin, co-founder of Sky Mavis, pointed out that Google Analytics data showed that over 82,000 visitors, representing over 25 per cent of all traffic to the Pixels website, came from the Philippines.

Constance W., Partner at venture firm Ryze Labs, says: “The people in the emerging market of the Philippines are using Pixels as a way to make money; it is not about buying Bitcoin, storing it, and riding the boom market. They are using the play-to-earn feature to make their primary income.” 

Risk

When looking at the developed market’s preference for investing, Anastasia Ulianova, co-founder and co-CEO of  A.R.I.A. (Algorithmic Ratings & Investment Analysis), a crypto rating agency, said: “When I asked people how they choose their crypto investments, there are three answers that I usually get: Oh, this one is safe. It’s like Bitcoin and has a high market cap, this one I heard about in the news. It’s booming, so I’m going to get in on it. Oh, this one my brother told me about. Over 90 per cent of people, I ask, follow this process; this is not investing, it’s gambling and it is high risk.”

Much of the talk around blockchain and cryptocurrency use in the financial world revolves around the concept of decentralised finance, or DeFi, as commonly referred to. However, the mass adoption of many of these DeFi applications is generally considered limited due to the perception of high risk and the lack of financial regulation.

Talking about risk, Nitin Agarwal, chief revenue officer at digital bank FV Bank, likened the current state of the industry to the unregulated era of media streaming services: “Everyone used to use BitTorrent to download movies, TV shows and songs, we never had our parents use it as the first thing they would get would be a virus because it was not structured, it was not regulated, it was high risk. When media distribution started with the likes of Netflix, Spotify and Amazon, people stopped using BitTorrent because the regulated versions were faster, better, trustworthy, and with no risk.”

When addressing the subject of risk, many naturally focus on the concept of regulation and consumer protection. Mainstream adoption unanimously identified this as the key challenge facing the industry.

What’s next?

My main takeaway from the Token2049 conference at the iconic Madinat Jumeirah in Dubai was that regulation is imminent and welcomed by all the individuals I spoke to during the event. They view this as the next catalyst for bridging the gap between the traditional banking services sector and the new world of Web3-powered financial services.

Christian Borel, head of MENA at Swiss crypto bank AMINA Bank, commented:, “I think right now, if we compare crypto to the internet era, we are at the 56k modem, so we didn’t even reach ISDN yet. We are only scratching the surface of the potential of the blockchain. And I’m certain that in the near future – I don’t know, maybe 2049 – that AI and blockchain technologies will have taken over certain parts of the banking world.”

Institutional investors are entering the industry, driving regulation at speed. How quickly can authorities implement these new regulations, and will they impact the sovereignty of this emerging industry? Will it become the very thing that they are trying to overcome?

Converge Africa 2024, taking place from 22 to 24 April, builds upon the foundation laid by ECOM Africa, and explores the diverse digital commerce sector.

Taking place in Cape Town, South Africa, Converge Africa has broadened its scope to encompass a diverse array of digital commercial brands, including banking, fintech, insurance and businesses utilising digital services to serve their customers.

Organised by Vuka Group and Kinetic, the event also serves as a catalyst for pioneering innovative solutions and shaping the future of commerce in Africa with conference tracks, expert insights and industry-leading innovations.

On the agenda

Attendees will explore key areas shaping the future of business in the digital landscape, including:

• Online retail and e-commerce: Unveiling the latest trends, strategies and technologies shaping the future of digital commerce, with a focus on enhancing customer experiences, optimising platforms for increased conversions, and leveraging emerging technologies such as AI, AR/VR, and voice commerce.
• Cybersecurity in digital commerce: Addressing critical cybersecurity issues, understanding the latest threats, risk mitigation strategies, and best practices to safeguard businesses and customers in an interconnected world.
• Digital marketing: Uncovering the latest trends and strategies to create impactful campaigns, reach target audiences, and drive customer engagement and loyalty through data-driven marketing, automation, and AI-powered solutions.
• Customer-centric strategies: Putting the customer at the centre of digital commerce strategies, focusing on delivering exceptional experiences that drive satisfaction, loyalty, and advocacy through intuitive online experiences, omnichannel engagement, and superior customer support.

Attendees can expect to meet and hear from more than 100 expert speakers across a three-day event and five conference tracks, more than 50 exhibitors and more than 20 workshops focused on accelerating digital commerce across Africa.

The event will also welcome leaders from companies across African digital commerce ecosystem, including Massmart, Takealot, The Foschini Group, Google and Absa.

“Converge Africa, where visionaries, entrepreneurs, and thought leaders converge to explore how digital commerce is transforming the landscape of the continent,” said Terry Southam, group director: retail at Vuka Group. “Join the conversation and discover how you can harness the power of digital commerce to drive sustainability and entrepreneurship in Africa.”

Download the agenda as well as learn more about the different tracks, workshops, sponsors, speakers and exhibitors.

Digitalisation is reshaping the landscape of commerce for both consumer and business payments and prompting an increased focused on innovation, security and finance. At the forefront of this dialogue are virtual card numbers (VCNs), a digital- only form of payment that are gaining prominence for their ability to offer enhanced security, real-time transaction capabilities, precise data quality and simplified reconciliation.  

To gain deeper insights into the evolution of commercial payments in 2024, including the pivotal role of VCNs, we chatted with Marcos Gelfi, head of global commercial products and cardholder services at Discover® Global Network and a payments veteran, with more than 27 years of experience in the industry.

Here he shares his five insights so far for 2024.

1. VCNs are set to become more widespread

Virtual card numbers have been on the commercial payment landscape for the past seven to nine years, steadily gaining momentum. In 2024, we anticipate a significant surge in their adoption across various payment sectors within commercial payments.

This includes Travel, B2B and Small Medium Enterprise (SME). What was once considered a niche solution is now set to become mainstream for businesses globally.

This growth is propelled by VCNs’ versatility, offering secure and efficient payment alternatives for an array of use cases.

Corporations, whether big or small, need to handle payments, be it for travel-related expenses or B2B transactions, even mundane office supplies. Traditionally, physical cards were used and distributed to employees.  Then, card-on-file for online transactions surged in popularity. This convenience, especially in the travel space, enabled transactions for remote activities, such as purchasing airline tickets and hotel reservations.  Companies embraced card on file due to visibility to expenses and opportunities to negotiate with preferred suppliers while employees cheered for centralised expenses reducing the burden of producing expense reports.

Companies often use a travel account for booking business travel. And while the travel account offers a single channel to manage bookings, supporting travel policy, visibility into spend with suppliers, and simplification for the employee in expense report management, the central account can become challenging to reconcile transactions accurately. Corporations must match the incurred expenses against a single account. VCNs solve this problem by providing a tokenised number per transaction, ensuring 100 per cent reconciliation, policy management with enabled spend controls, and robust fraud prevention.

In essence, VCNs, when partnered with a legacy payment solution like a travel account or a purchasing card, layer additional security, data quality, and control assisting to check all the boxes to support streamlined and simplified payments for corporations.

2. There will be more diverse use cases for VCNs

Although it took some time for adoption to accelerate, digitalisation, especially in a post-Covid world, is driving increased demand for VCNs across various industries.

While VCNs have been historically used to support business travel, they are fast becoming a capability that can be used in alternative scenarios, including procurement payments, recurring expenses and utility bills.  As more corporations are managing hybrid offices and employees, and oversite to those expenses become even more critical, VCNs offer an effective means to manage their finances, ensuring policy compliance and controlling budgets.

The beauty of VCNs lies in their ability to provide transaction data that can be leveraged for data analytics, helping businesses make informed decisions and negotiate better deals with suppliers.

3. VCNs are transitioning to real-time data integration

Over time, we’ve witnessed a significant shift in data handling for businesses. Previously, data was processed in batches, often after the fact, which lacked the urgency needed in today’s fast-paced landscape. However, the paradigm is changing. Real-time data is becoming the norm, offering corporations the ability to access, customise, and analyse the information instantly.

This shift enables corporations to make more informed decisions, strike better deals, and effectively manage their expenses. You can expect to see the integration of real-time data analytics becoming increasingly prevalent in payment solutions, enhancing user experiences and decision-making processes.

4. Security and user experience remain top priorities for businesses

As we move forward, security and user experience will continue to be paramount in the payments industry. For businesses to remain competitive, they must have the confidence that their payment solutions are PCI compliant;  prioritisation of data security is non-negotiable.

At Discover Global Network, we place substantial emphasis on investing in security measures to protect payment information. Additionally, as many large corporations tackle antiquated, complex payment platforms, simplicity and user friendliness will remain top priorities as we evolve our products. We aim to make digital payment solutions as accessible and secure as possible, ensuring a seamless transition for all users.

5. Expect to see increased educational efforts around VCN from industry experts

In recent research conducted by DGN, we learned that 27 per cent of large corporations and 12 per cent of small medium enterprises are currently using VCNs to manage their business expense.  VCNs are forecasted to more than double in usage by 2026.

While VCNs have been gradually gaining traction, we foresee a significant acceleration in their adoption, not only for business travel and procurement, but also managing expenses of remote hybrid employees in the coming years. Our industry is becoming increasingly aware of the advantages offered by VCNs, such as enhanced security, improved data quality, and better financial control.

To facilitate this adoption, educational initiatives will play a pivotal role. That’s why, at Discover Global Network, we’re spending time to educate the industry and supporting our partners to upgrade to a better use case and a more secure solution that ultimately will drive additional volume. This, in turn, will be much better for the users from a security and budget control perspective.

The payments landscape is undergoing a profound transformation as consumer preferences continue to evolve, with digital payments rising in prominence as the preferred method for conducting financial transactions. However, as the digital payments ecosystem expands, ensuring the security of customer payment information remains a paramount concern.

Addressing fraud and enhancing security measures has become increasingly vital with tokenisation emerging as a crucial tool for safeguarding digital payments, whether they occur in physical retail stores at the point of sale or take place virtually.

To gain valuable insights into these trends and challenges, The Fintech Times turned to Valeri Vanourek, vice president of digital payments at Discover® Global Network, a seasoned professional with more than 17 years of experience in the industry.

Her journey began on the issuing side, primarily focusing on the Discover Card issuer team, before a transition to the network division, where she has played a role in managing various digital products, such as overseeing tokenisation efforts and the development of the tokenisation platform at Discover® Global Network. Vanourek also collaborates closely with major digital wallet providers, including Apple Pay, Samsung Pay and Google Pay.

Valeri, please share your perspectives on the latest trends and innovations in the payments industry

Digital e-commerce volumes continue to grow, alongside the shift to mobile and digital wallets. Network tokens and stored payment token usage are also on the rise. As a result, our focus remains on combating fraud and enhancing security.  In 2024, there are three significant factors we will be concentrating on:

1. On top of mind for us, is always ‘how to protect the payments and customer data at the same time’. This is closely tied to merchant concerns about friction in the checkout process. Thus, it’s vital to strike a balance between providing an excellent customer experience and ensuring confidence in transaction authentication and decisioning. Merchants must ensure that the checkout process is quick, efficient, and secure, benefiting all parties involved.
2. Regulations, particularly those related to tokenisation, data localisation, strong customer authentication, and the EU, continue to be areas of our focus.
3. Last, but not least, is a focus on compliance and risk management. Perhaps these are the least sexy or captivating topics, when you’re working in payments, but it is of such critical importance. For instance, Payment Card Industry (PCI) 4.0, which provides guidelines for securing systems involved in processing, storing, and transmitting credit card data, is significantly impacting many within the industry and the broader ecosystem. We are committed to improving payment security and implementing internal controls, policies, and processes to ensure the security and encryption of transaction data, whether it involves wallet transactions or sharing transaction data to combat fraud. This commitment extends beyond our cardholders to benefit everyone in the payments ecosystem. We are equally dedicated to compliance and risk management this year.

How do you balance being more innovative, while keeping security and fraud at the foremost?

We have the fundamentals of transaction processing in place, which is essential for us to maintain, of course. However, this foundation allows us to partner with others or concentrate on a multi-cryptogram strategy, multifactor authentication, and improving transaction security. I often liken fraudsters to a game of Whack a Mole. The moment you address one issue, another pops up, and then another, and it’s a continuous challenge. But having these fundamental foundations in place makes it easier for us to shift our focus and adapt to new methods or methodologies as needed.

How has tokenisation influenced security concerns?

Network tokenisation has had a dual impact. Firstly, it has enhanced security by introducing an alternative payment credential, reducing the exposure of a customer’s payment information across the ecosystem, and adding an extra layer of security based on the cryptogram linked to the transaction. Secondly, it offers significant benefits to card members. For instance, in the event of a card being lost or stolen, the payment experience for recurring bills or digital wallets remains uninterrupted. The associated account number is automatically updated, reducing friction and improving overall security. I view it as a win-win-win situation for merchants, cardholders, the network, and the issuer.

How do you keep on top of emerging trends like Internet of Things (IoT) and connected payments through various channels?

It’s not always straightforward, and it requires ongoing attention. However, as I mentioned earlier, we have a solid foundation in place, which will always serve as the basis for supporting emerging trends. Whether it’s the way we provision a network stored payment token or the fraud checks we conduct, our objective is to ensure that customers consistently enjoy a seamless transaction experience. We continue to invest in our tokenisation platform and authentication capabilities, as these form the fundamental layer that enables the adoption of emerging payment methods. You mentioned IoT and connected cars as examples, and indeed, more innovations will continue to emerge. One advantage we have is our strong focus on partnerships. By collaborating with various stakeholders, we gain insights into the evolving payment ecosystem and can closely monitor these trends as they mature and evolve. So, while staying informed is essential in the payments industry, our commitment to partnerships proves to be especially beneficial in this regard.

How important is collaboration within the industry?

Collaboration is absolutely essential, as the saying goes, ‘it takes a village’. In my evolving role, I’ve come to understand that I never work alone. This holds true for my product owners and engineers as well; we function as a cohesive unit. Whether we’re focusing on internal business partnerships or external collaborations, our approach remains consistent when it comes to combating fraud.

Some of the companies we partner with have a strong focus on innovation, which greatly facilitates shared learning and the creation of collaborative opportunities. Through the exchange of data and insights, we can identify instances of fraud earlier and respond to them with greater speed and effectiveness. Furthermore, this collaborative effort helps us uncover new threats and vulnerabilities.

Sharing data between merchants and issuers in real-time is also of paramount importance. This enables more informed decision-making, resulting in reduced false declines, higher approval rates, and increased confidence among issuers in the identity of all customers.

The critical significance of data protection controls, policies, and procedures cannot be overstated. We are unwavering in our commitment to maintaining the security and privacy of data. Whether it’s safeguarding against PCI DSS compliance requirements, managing risks associated with various types of data, or implementing industry-standard encryption during data processing, storage, and transportation, we approach data sharing with the utmost seriousness. I recognise that this commitment is shared by many others within the ecosystem as well.

What else do you expect to see in 2024?

We expect to see a continued surge in partnership-driven innovations within the payment industry. At Discover Global Network, we love working with our partners, as new and cutting-edge solutions are being developed and brought to market, capitalising and leveraging the power of day one. It remains to be seen what we will see coming as we move through the year, but we’re excited to be there with our partners.

Take for example, the launch of Amazon One and the ability able to wave your palm and make a contactless payment; it’s so innovative and such an easy way to pay, and our teams were so proud to participate in that and it really drives satisfaction and fulfilment.

Looking ahead, we expect significant advancements in payment decisioning. For instance, Discover Enhanced Decisioning, our free fraud management solution, enables merchants to share enhanced  customer and transaction data, real-time with issuers, via ISO or API . This feature empowers issuers to make more informed decisions when approving or declining transactions, resulting in a reduction of false declines and an increase in authorisation rates.

By enabling data and increased collaboration among merchants and issuers, we aim to improve authorisation decision quality and lower fraud. With lower false positives and improved approval rates, we believe no issuer or merchant would want to miss out on these benefits.

 

Investopia 2024 kicked off with an impressive array of discussions at the esteemed St. Regis Sadiyaat in Abu Dhabi, featuring 11 panel sessions showcasing insights from 37 experts across various sectors of the new economy.

Diverse perspectives were shared on investment opportunities spanning technology, circular economy, creative economy, hospitality, sports, and aviation. Notable attendees included investors, economists, government officials, policy-makers, and entrepreneurs hailing from different corners of the globe.

One of the focal points of the morning discussions centred on macroeconomics in a post-COVID-19 world. The panel delved into the trajectory of the global economy post-pandemic, the significance of COP28 in addressing climate change, the implications of the US Presidential election outcome, and the resilience of the global economy amidst geopolitical upheavals.

Titled “New Economic Frontiers Unveiled: Navigating the Unknown,” the panel explored the driving forces behind emerging sectors of the economy, market dynamics, and the collaborative role of governments and the private sector in fostering economic growth.

Esteemed participants such as Dr. Mahmoud Mohieldin, Executive Director of the International Monetary Fund; Dr. François Bourguignon, Honorary President of the Paris School of Economics; Dr. Nathan Sheets, Chief Economist at Citi; and John Defterios, Professor of Business Administration at NYU Abu Dhabi, contributed valuable insights.

Dr. Mohieldin stressed the importance of addressing the needs of low and middle-income countries amidst shifting global economic trends, citing Africa’s transition from a low-income region to a middle-income one. Highlighting the challenges faced by middle-income countries and the imperative of investment in human capital, education, and infrastructure, he underscored the urgency of tackling debt and development issues on a global scale.

Dr. Bourguignon emphasised the pressing need for swift action towards achieving carbon neutrality to mitigate future consequences of climate change. He advocated for a paradigm shift in global manufacturing and production frameworks.

In contrast, Dr. Sheets expressed optimism about the resilience of the global economy, attributing it to advancements in technology that have enabled solutions to various contemporary challenges.

Discussing the UAE’s economic landscape, Dr. Bourguignon lauded the country’s flexibility and resilience in navigating economic challenges.

Another compelling panel featured government officials including Ryad Mezzour, Minister of Industry and Trade of the Kingdom of Morocco; Jose-Maria Figueres, Former President of Costa Rica; and Valentino Valentini, Deputy Minister for Enterprises and Made in Italy. The panel deliberated on navigating the evolving global economic landscape, technological advancements, renewable energy, and challenges to globalization.

Additionally, Khaldoon Al Mubarak, Managing Director and CEO of Mubadala Investment Company, presented an insightful review of new investment sectors, highlighting the importance of innovative investment strategies in response to recent global economic shifts.

Renowned British actor, musician, and director, Idris Elba, shed light on untapped investment opportunities within the creative economy during a panel titled “Investing in the Creative Economy.”

The event also hosted a thought-provoking roundtable titled “Family Offices: Catalysing ESG and Shaping the Future” in collaboration with Standard Chartered Bank and the UAE-UK Business Council, underscoring sustainability as a pivotal pillar in the new economy agenda.

Retail payments are undergoing a rapid transformation. From the widespread adoption of mobile wallets to the emergence of cryptocurrencies, alongside innovations like merchant-initiated payments and buy now pay later options, the entire landscape of consumer experiences and business operations is being reshaped.

It’s an exciting evolution that’s changing the way we interact with money and commerce.

PXP Financial, a payments provider in the retail, hospitality, entertainment, travel and gaming sectors, processes more than €22.7billion annually through a unified gateway.

In this week’s Spotlight, we speak to Chris Gilderson, head of retail and hospitality at PXP Financial, about the dynamic space of retail payments and the disruptive technologies shaping its future.

Tell us about yourself and PXP Financial

I have been at PXP Financial for more than 25 years and joined straight out of college. Specialising in customer services, operations and onboarding, I have held various roles over the years including head of customer services. As head of hospitality and retail, I lead a close-knit and commercially focused team which supports some of those sectors’ most recognisable brand names.

PXP Financial specialises in delivering end-to-end payment service to clients and partners from wide variety of industries. We provide a single unified payments platform which allows our customers to accept payments online, on mobile and at the point of sale.

The company’s journey began back in the 1980s, and today we have over 200 employees from 25 nationalities working across five offices around the world.

What are the most influential trends shaping the space of retail payments today?

Without a doubt, the adoption of contactless payments stands out as the most defining trend in retail payments today. Even versus just 12 to 18 months ago, adoption has significantly increased.

Adoption in Europe is skyrocketing, for example, in Austria, our statistics show that 96 per cent of last year’s in-store transactions were contactless. The US is lagging behind Europe, but gathering pace. In early 2023, the percentage of contactless transactions in the US was still in the low 30s, however that increased to around 45 per cent by the end of the year. The US has a reputation as a slow adopter of payments innovations, so it will be interesting to see where contactless stands by the end of 2024.

We’ve also seen a phenomenal increase in the variety of devices people can use to make contactless payments. Wearables have entered the mainstream, from jewellery and watches to keyrings and clothing. These offer security thanks to biometric authentication, and also convenience, making payments on the go easier than ever before. This has appeal for a lot of people, for example, commuters who want to pay without any hassle and continue with their journey as swiftly as possible.

How are retailers responding to evolving consumer payment preferences, particularly in-store?

Significant changes are coming, particularly to point of sale technology. We will see retailers testing a number of initiatives and concepts in the coming months and years, and though the changes won’t come overnight, in-store experiences are set to be transformed by payments innovations.

Rather than opening stores with multiple fixed points of sale, we will see retailers increasingly turn to mobile payment apps with connected smart devices. These offer a variety of functionalities from assisted selling, to inventory, to click and collect.

This kind of payments strategy has a range of benefits. Staff have increased mobility and are able to assist customers and make sales seamlessly throughout the store, reducing wait times and enhancing customer service. Retailers also stand to benefit from enhanced data analytics, operational efficiency, and greater agility and adaptability, to name just a few of the perks.

Can you tell us a bit more about your retail customers and how their needs are evolving?

While every company requires a tailored approach, there are definitely some common themes across the board. There is mounting pressure on retailers to be able to swiftly adapt their trading models to support diverse paths to purchase and various channel combinations.

It’s a highly competitive business environment, driven by a combination of factors including advances in technology. Retailers need to stay ahead of changes in consumer behaviour at a time when consumers are more empowered than ever, navigate the rise of e-commerce while optimising their physical stores, and they need the ability to harness data for decision-making.

PXP Financial responds to this need for agility by providing modular and configurable systems, so our retail customers can scale or launch at speed, as well as turn on additional sales channels post-launch. This flexibility and customisability is vital in the fast-changing retail industry.

Seamless Asia, one of Asia’s flagship fintech events, took place at the Suntec Singapore this week, serving as a pivotal platform for charting the future trajectory of payments, banking, and e-commerce in the region.

With more than 2,900 attendees comprising payments, banking, and e-commerce innovators from across Asia and beyond, the event buzzed with insights, trends, and predictions shaping the financial industry.

Boasting over 70 insightful sessions spread across five stages, Seamless Asia provided a comprehensive forum for attendees to delve into the latest developments and strategies driving the evolution of the sector.

Amid the bustling atmosphere of Seamless Asia, we had the opportunity to chat to Andreas Rudorfer, regional director of APAC for transaction data management company Intix, to gain valuable insights into the region’s financial intricacies and his experience at the event.

Can you provide an overview of the current transaction data management landscape in the region and how it has evolved over the past few years?

Transaction data, particularly in the context of cross-border payments, has grown increasingly vital as transactions move towards near-real-time processing, with the goal of achieving real-time transactions. This shift necessitates a deeper understanding of transaction data than is commonly recognised.

Modern transaction data management solutions, such as Intix, specialise in monitoring the seamless flow of transactions, identifying any potential disruptions, whether technical issues or approval delays. Our objective is to provide comprehensive visibility for every transaction entering or leaving the bank, thereby enhancing customer service. This is crucial in an era where the expectation for immediate, delay-free payments is becoming the norm.

What are the primary transaction data management challenges that financial institutions in APAC are currently facing?

Discussing cross-border transactions reveals unique challenges, especially in a globalised context. I think it’s fair to say that Asia is currently at the forefront of innovations in payment systems. The region has distinguished itself through the establishment of bilateral payment rails, allowing for real-time payments between certain countries, such as Singapore and Malaysia, directly from mobile phones.

This level of interconnectivity is more advanced than what is observed in other regions, including Europe, which tends to lag in this aspect. Furthermore, Asia is proactive in implementing the necessary legal frameworks to support these advancements. Unlike the EU, which benefits from uniform regulations and a shared legal framework for its member states, Asia presents a tapestry of diversity with no overarching structures.

Given the diverse regulatory environment across APAC, how does Intix ensure compliance with local transaction data management and privacy laws?

When payment rails are established, they involve corresponding banks, and transactions are increasingly expected to flow in real-time. There is a significant collaborative effort among countries to set up these rails. Intix addresses a critical aspect of banking operations that extends beyond the external environment to the internal workings of a bank, which often involve multiple systems and silos. This complexity can lead to payment failures within the bank itself, which can end up being costly.

Intix aims to complement these external efforts by focusing on the banks’ internal challenges. Many banks operate on outdated infrastructure, which necessitates modernisation to identify and mitigate risks effectively. Intix provides the tools to detect transactions that may become stuck, enabling banks to address these issues promptly before they impact the customer.

Are there any other challenges that financial institutions in the region are facing?

Broadly speaking, banks are at a critical juncture where modernisation is not just beneficial but necessary. Upgrading their processes to align with current standards enables them to handle transactions more effectively. This transition has a profound effect on their infrastructure, presenting an ideal opportunity for us to provide support. In the realm of transactions, our role is to monitor the integration of new systems, ensuring that everything operates as intended.

Our involvement is crucial in maintaining the internal flow of transactions, akin to the external payment rails. However, our focus is primarily on the internal mechanisms of the bank, ensuring smooth operations within. The advent of new regulations poses a significant challenge to this smoothness, as they can disrupt established processes. By staying engaged and proactive, we aim to mitigate these disruptions, facilitating a seamless transaction environment that adapts to regulatory changes without compromising efficiency or customer service.

How significant are industry events like Seamless Asia for companies like Intix operating in the APAC region?

Events like Seamless Asia really highlight the enthusiasm and sense of community across the APAC financial sector. We share this enthusiasm and want to play our part in helping to advance the region’s banking sector, supporting it in adapting to the latest technologies. This week’s participation offers us the opportunity to do this, while staying abreast of other trends that are affecting this part of the world.