FTT Embedded Finance


Embedded finance and the wild west of crypto – FTT Bookmark Issue 14

Your weekly resource for noteworthy news, fascinating features, and fintech titbits that caught our eye. Whether you live by your Twitter lists, save your Google Alerts or simply scroll through LinkedIn for insights and commentary – there is a wealth of content that weaves a global story around fintech.

Our job at Fintech Talents is to work within that global story – finding the news items, conventional wisdoms and hard data that aids us in bringing the industry the best content, community and experiences in the business. This week’s FTT Bookmark of timely resources and real time conversations that are shaping fintech is brought to you by VC Innovations Director of Strategy, Lisa Moyle.

The Embedded Finance Opportunity is Big but Is It Win, Win, Win Big

A recent report by Solaris Bank and the Handelsblatt Research Institute pointed to the enormous potential of embedded finance in Europe. Looking at Germany, the study notes that 61% of Germans would consider using a financial service provided by one of the leading e-commerce providers listed.

The report also observes that ‘Compared to Europe, where embedded finance is still in its early stages, China and the U.S. are already ahead, with large technology companies having embedded financial services into their ecosystems.

This presents opportunities (and challenges) for banks and fintech providers alike. Paul Compton, Global Head of Banking and Co-President of Barclays said in a recent edition of Rise Fintech Insights that ‘Embedded finance can enable a ‘win-win-win’ for incumbents, startups and consumers.’

At Fintech Talents we thrive on exploring new pathways in the provision of financial services and will be digging deep into what it all means in the coming weeks and months.

Gen Z ride into “Wild West” of cryptocurrency amid recession

The pandemic has been hard on young people. It’s closed many of their typical routes to making some money, whether they are in university or figuring out their next steps, as the retail and services sectors have been mostly closed for the past year. They have been shut off from socializing and doing all the things that most love to do at this age. On top of all of that, the jobs market is looking less than favourable for the upcoming crop of graduates and school leavers.

It was interesting to see that as the going got tough this year, many young people have turned to crypto trading. There are some interesting stats about ‘who’ is trading in the linked article including an FCA report that notes that new crypto traders “tend to skew more towards being female, under 40 and from a BAME background.”

Gen Z – now the largest generation in the world – is keen on crypto and stories of university students making big sums of money trading crypto currencies are growing. It will be interesting to how the demographics play out. Anecdotally, I have one of those in my family and given that he ignores my advice to be cautious, I’ve suggested a course focussing on the fundamentals of trading.

Whole Foods in the Palm of Your Hand

Amazon One, which allows you to link a payment card to your palm print, is being rolled out to Whole Foods stores in Seattle. Amazon plans on selling the technology to other retailers and other sectors, we can expect to see this being rolled out elsewhere. No doubt the drive for contactless methods of payments during the pandemic will accelerate the uptake of new payment options.

There are the ongoing concerns about customers sharing their biometric information with private companies. Despite assurances of high levels of security, if malicious actors get access to your biometric date, it isn’t as simple as cancelling a card. Amazon chose to use palm because it was felt to be more private and less laden with controversy than facial recognition given the many cases of racial bias.

Speaking of that embedded racial bias, I recently watched Coded Bias on Netflix and highly recommend it for a very revealing examination of how technology can be created and used in ways that lead to unfair outcomes for some communities. It starts with a look at the research done by Joy Buolamwini at the MIT Media Lab that uncovered the gender and racial bias that had essentially been baked into facial recognition software that is increasingly being used all over the world. We owe a massive debt of gratitude to the many inspirational women featured in the film and their work in setting up the fabulously named Algorithmic Justice League.

That is the round up of my fintech news for the week. Look out for the views of my colleague Laura Camplisson in next week’s FTT Bookmark.