The Trifecta Effect — Fostering Consequential Conversations at the Intersection of Policy, Technology, and Finance

By Pat Patel, Executive Director of Elevandi

Today’s fragmented regulatory landscape inadequately serves the ambitious innovators aiming to revolutionise the finance and technology sectors. Although discussions about regulating Big Tech have been ongoing for years, little has been done to counterbalance the sector’s growing influence or to bolster emerging players that are striving to improve these industries.

To drive the global fintech industry in the Web3 era, there is a pressing need to foster more timely and synergistic dialogue between policymakers, technologists, and financial service experts — three industry stakeholders that have historically operated in siloes. For instance, in Southeast Asia, less than half of industry leaders believe regulators will support upcoming innovations, underscoring the need for rapid action.

The challenge lies in knowing where to start. Fortunately, platforms like the Singapore FinTech Festival (SFF) have provided fertile ground for these essential conversations. This year, SFF will focus on four themes that will define the fintech landscape.

Rearchitecting the monetary system

To instigate a fundamental transformation, we must begin by addressing basic access, one of fintech’s primary objectives. With 1.4 billion people still unbanked globally, there is a growing recognition that alternative solutions are necessary for  financial inclusion, prompting the need to collectively  re-architect our traditional financial ecosystem.

Emerging technologies like blockchain have paved the way for novel asset classes, such as tokenised deposits and stablecoins, bypassing long-standing systemic inefficiencies to effect a paradigm shift for the concept of money and the way we make value transfers globally. Today, around 130 countries, representing 98% of global GDP, are exploring Central Bank Digital Currencies (CBDCs). The increase is staggering when compared to just 35 countries who were pioneering CBDC pilots and projects in 2020 — a solid indication, if any, of the transformative potential that new innovations can bring to the banking and finance sector.

However, the effectiveness of these initiatives remain contingent  on the availability of robust digital public goods infrastructure, which is often only achievable through consistent public-private collaboration. Singapore has led in this arena by example, having implemented strategic national projects by way of its Smart Nation movement. This includes foundational upgrades to its national e-payments and identity systems, as well as convenient digital touchpoints for citizens to directly engage with businesses and government bodies.

The rest of the world is all but standing still, with several other countries pioneering first-in-market initiatives. For instance,  Abu Dhabi’s Global Markets Courts, known for being among the most technologically advanced legal systems in the world, have fully embraced blockchain technology. This has allowed litigants, lawyers, and judges to access and manage court cases in a way that is far more efficient and transparent than ever before. In a similar vein, the Georgian government has been at the forefront of blockchain development, investing significant resources into a digital land registry that aims to simplify the process of buying, selling, and transferring property.

However, despite these notable advancements, the deployment of nascent technologies is not without its challenges. Technical complications and ethical considerations have given rise to varying levels of acceptance across different countries, which could potentially inhibit the extent of the  global fintech revolution. In Georgia, for example, it was discovered that data on titles and transactions were still susceptible to manipulation before being secured on the blockchain. This has raised important questions about the efficacy of such initiatives and highlighted the need for ongoing cross-sectoral dialogues that  ensure new initiatives are designed to support the remodelling of our traditional financial ecosystem, instead of causing hindrances.

Preparing for future risks

As we navigate this evolving terrain, there is no question about the array of challenges that lie ahead, ranging from cybersecurity threats to climate change. The borderless nature of these risks means that they cannot be contained within a single jurisdiction and are likely to create ripple effects of a global scale. This has necessitated the development of technological solutions that can help to mitigate these threats.

On the cybersecurity front, AI and quantum computing are playing an increasingly important role. A 2023 report by IBM found that the use of extensive automation, supplemented by mechanisms like post-quantum encryption, has saved organisations nearly US$1.8 million in data breach costs.

In the realm of climate change, organisations now also have a plethora of tools at their disposal that can be used to analyse diverse climate data sources. This, in turn, enables them to make informed decisions about future investments and business transition priorities. The urgency of addressing climate risks has also been underscored by the recent Global Stocktake report, which has sounded the alarm for our world as we breach the 2100 warming thresholds set by the Paris Agreement.

As we grapple with new technology in a landscape of urgent, evolving threats, it comes as no surprise that regulation has to play catch-up. This is why the development of effective regulatory frameworks, supported by global governance frameworks and public-private partnerships, is crucial. Organisations such as the Cyber Threat Alliance and the Global Resilience Partnership have been instrumental in facilitating multi-stakeholder dialogues that are focused on optimising the development of technology for the greater good — but there is still a way to go before regulation can truly insulate the industry from potential harms.

Building a talent pipeline and the future of work and entrepreneurship

Before we look too far into the future, we must also understand the significance of a singular global event that we have just emerged from of late — the COVID-19 pandemic. These changes have had a profound impact on the future of work and entrepreneurship within the fintech industry.

One of the most notable impacts has been on funding, with venture capital investments and other funding sources plummeting by 17% in the first half of 2023 compared to the second half of 2022. This downturn has been driven primarily by heightened risk aversion and prevailing macroeconomic challenges. However, the numbers do not necessarily reflect the global appetite for innovation. The fintech industry has demonstrated remarkable resilience, continuing to innovate and develop despite decreased financial backing.

Creating an environment in which fintech can thrive requires a multi-faceted approach. This includes making advancements to the start-up and entrepreneurship ecosystem, as well as creating more employment opportunities for those who are technically-skilled but socio-economically disadvantaged.

A critical element in this equation is fostering diversity and ensuring gender equality. The fintech industry has long struggled with a gender disparity problem, with women making up less than 30% of the workforce, and holding just 17% of senior roles. This is a problem that must be addressed, and there are already strategic initiatives in place that aim to do just that. For example, DBS Bank has implemented a comprehensive upskilling and reskilling program, while Siemens has partnered with United Nations Women to provide additional tools and knowledge in areas such as data science and ethics.

Another innovative solution to the workforce challenge comes from India, home to Karya, a nonprofit organisation that sells datasets to companies at market rates and uses the majority of its profits to support its workforce. This model, which is unique in the fintech industry, is a shining example of the boundless possibilities for the transformation of work.

AI for good. AI for good?

Finally, we come to Artificial Intelligence (AI), the force that is steering fintech’s growth in a direction it has never been before. Since its emergence in the 1950s, the AI industry has experienced several cycles of boom and bust. But the current cycle is exceptional and one to watch. Driven by a potent combination of high investments toward the technology’s development, a willingness from both industries and governments to experiment with it, and the development of complementary technologies that will augment its functionality, the age of AI is arguably the dawn of a new fintech era.

At the start of this year, ChatGPT, a generative AI application, reached 100 million monthly active users within just two months of its launch, making it the fastest-growing consumer application in history. Meanwhile, McKinsey has predicted that generative AI has the potential to increase the impact of other AI technologies by up to 40%, which would add between US$2.6 trillion to US$4.4 trillion to the global economy annually.

However, tremendous potential often comes with risks, too, and this is evident in overall caution around the development and deployment of AI. As industry and political leaders increasingly position the technology as a critical tool  in the  global technological arms race, there is a pressing need to shift our mindset. The race to AI supremacy must not overshadow the imperative to use technology responsibly. Unchecked, AI could perpetuate bias, violate privacy, and destabilise security systems. But with a concerted effort to cultivate ethical AI practices through transparency, robust data governance, and widespread AI literacy, we can welcome a new fintech era that is not only more competitive and innovative, but also wholly committed to the greater good.

Toward the future: a call to collaboration

Looking ahead, it is clear that the challenges and opportunities we face in fintech are numerous, and that tackling them will require collaboration on an unprecedented scale. Upcoming events such as the Singapore FinTech Festival (SFF)  provide an important platform for consequential, cross-industry dialogues that explore the new technological opportunities from diverse perspectives.

For the fintech industry to reach its full potential, it must be willing to embrace change, foster innovation and develop new ways of thinking. This is not an endeavour that can be undertaken by any single player, but rather one that requires the collective effort of government, business, regulatory bodies, and individuals. It is only through collaboration that we can hope to build a fintech ecosystem that is not only resilient but is also capable of delivering sustainable and inclusive growth for all.

Shopping Cart

Media Kit

    Data Protection

    Personal Data (“Data”) submitted for Media Kit (“Media Kit”), and/or collected in the form of first name, last name, email address and other contact details may be used for the purposes of inviting you to future events and for reaching out to you with content which may be of interest to you. For these purposes, The Digital Banker will share the Data with our associate companies (including event and content sponsors) to promote their products and services. You will also be automatically subscribed as a user on www.thedigitalbanker.com. If you would like to opt-out, email us at [email protected].

    By clicking Submit, you acknowledge that you consent/ have sufficient informed consent to the collection, use and disclosure of Data as set out above.

    The Digital Banker Summit

    Moving on from FTX: is 2023 the year of CBDCs?

    Indonesia, Jakarta

    Thailand, Bangkok

    Philippines, Manila

    Contact Us

      Data Protection

      The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

      Request Nomination Pack

        Data Protection

        The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

        Registration Form

          Data Protection

          The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

          Registration Form

            Data Protection

            The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

            Registration Form

              Data Protection

              The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

              Registration Form

                Data Protection

                The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

                Registration Form

                  Data Protection

                  The information you provide will be held on our database and may be used to keep you informed of our and our associate companies’ products and for selected third party mailings. Please tick the box if you would prefer not to be contacted for these purposes:

                  The world’s preeminent Private Banks and Wealth Managers are demonstrating a committed drive in innovation, advisory, new products and services to meet the sophisticated needs of their clients.

                  COVID-19
                  Amid economic activity revival on the back of the Covid-19 vaccine program, organisations moving from business continuity plans to stable working environments, together with the slightest improvement in unemployment numbers, forced the world to adjust to new realities. Coming to terms with the “new normal”, global investors are now on the look-out for attractive and stable investment opportunities.

                  Needs of Private Wealth customers and families worldwide have drastically changed due to the pandemic and banks have had to accelerate efforts to deploy a multi-channel service strategy and safeguard clients’ businesses and wealth against negative impacts of economic uncertainly.

                  The Global Private Banking Innovation Awards will recognise the world’s best private banks, wealth managers and asset managers that are championing innovation across advisory, service, products, customer experience and more.

                  Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. 

                  Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum.

                  Request Nomination Pack

                  Error: Contact form not found.