Adapt – A FinTech Perspective

“The ability to pivot and adapt is key and this not just confined to the new finance start-ups”

As we have all seen, heard, and experienced – FinTech has had meteoric growth over the past ten years. This shows no sign of slowing because as traditional barriers to entry have lowered, consumer behaviour shifts, access to financing improves, and advancements in technology drive through an ever-increasing demand to access and manage our money online.

Consequently, company valuations increase, which further attracts investors and new start-ups, and then the cycle repeats.

Will it end? Yes… but only for those companies that do not adapt fast enough.

“No company is too big to adapt, the word itself is relative and not an outcome – the key is to start and relentlessly improve”

The ability to pivot and adapt is key and this not just confined to the new finance start-ups. Almost all of these new companies rely on large financial services providers and institutions, and more traditional ‘western’ economies have been slower to react. This is good news for many Asian economies, such as China and India, where the potential to dominate innovation in this sector is very real. For example, in China mobile payments already outnumber cash payments. Dominated by a duopoly of AliPay and Wechat Pay, they account for almost 95% of all mobile payments. It is not surprising, therefore, that Alibaba maintains its spot as the largest ever IPO with a whopping $21.8 bn. The next two? Both Chinese and both banks.

However, with this rise comes increasing regulatory pressure. The importance of adapting to new regulations couldn’t be more critical as more and more individuals (and countries!) seek to exploit weaknesses for personal gain. Financial regulators have responded accordingly, with three of the five largest-ever fines being imposed on financial institutions, predominately for failing to adequately manage their risk and regulatory exposure. With over $350 bn fines issued since 2009, is it no surprise that a rapidly expanding new sector of ‘RegTech’ has emerged, fuelled by the complexity, cost of compliance and rapidly altering regulatory change, as more and more companies look to outsource this minefield.

“Product development, whilst is typically dominated by ‘agile iterative delivery’ to get features to our customers quicker, is still plagued by cultural hurdles that impede its effectiveness”

Company culture must also adapt to the new challenges they face. Product development, whilst is typically dominated by ‘agile iterative delivery’ to get features to our customers quicker, is still plagued by cultural hurdles that impede its effectiveness. New ideas and ‘experiments’ are expected to succeed, and when they don’t – it is seen as a failure rather than a learning. This negativity creates a fear response in the employee that further impedes innovation and new ideas. No company is too big to adapt, the word itself is relative and not an outcome – the key is to start and relentlessly improve.

Adaption is in our DNA; yet it is often stifled, as uncertainty can be daunting in a culture where it is not celebrated. Covid-19 has caused many of us to change the way we interact, in just one year the global video conferencing market doubled to $7.9 bn in 2020 from $3.9 bn in 2019. Just as we adapt, so does Covid-19 as new, and often more severe variants of the virus circulate.

Want a career in FinTech? The good news is that being one of the fastest growing sectors, there are plenty of jobs around – but as the typical wage is high, so is demand – especially in IT. Coding skills are still a core requirement, but companies increasingly value employees who can contribute to design, so an understanding of the business domain and user journeys is also a must. These ‘Analyst Developers’ are in high demand. Do not spread yourself too thin, specialize on a specific narrow field – this could be (but not exclusively!) API Engineering, Risk Management, RPA/Automation, Data Science or Blockchain. If you partner this with a spirit of innovation and openness, doors will open and your career will thrive.

“Want a career in FinTech? The good news is that being one of the fastest growing sectors, there are plenty of jobs around – but as the typical wage is high, so is demand – especially in IT”

I am fortunate. I work for a payments company that values and encourages change, recognizing this is its greatest asset. We are not perfect, but realizing that gives us our greatest strength – the need to adapt.

• The article was originally published in Career Ahead July 2021 issue.