In the past year real-time payments progressed toward widespread availability, mergers and acquisition activity brought new, key players to the fintech arena and partnerships brought to light the strength found when banks and fintechs collaborate. When I look at the runway 2019 paved for the fintech industry, three predictions rise to the top for what’s to come in 2020.
The Future of Work conversation will change. The narrative to-date has focused on how technologies like AI and robotic process automation (RPA) are replacing humans in jobs. But, according to a report from the
The tone will shift from negative to positive as businesses realize that technology is allowing humans to do jobs that are more strategic, thoughtful and value-add rather than manual and task driven, ultimately creating more value for the organization. As we talk about the who, what and where of work in 2020, the conversation will become about how we help our people – our workforce – make this transition to continue feeling like valued contributors, providing the tools and resources they need to thrive in the “cognitive revolution” where their jobs become more focused on intangibles like problem solving and managing relationships. Aligning leadership around new models and keeping employees engaged through this transition will be critical as we redefine what it means to “work” in today’s market.
If you think about it in terms of solely speed, B2B real-time payments (RTP) already exist in the form of virtual cards – a buyer executes a payment and it almost instantly clears to the supplier. However, suppliers are reluctant to leverage virtual cards for large ticket transactions.
The Clearing House and the Federal Reserve have already made headway with RTP rails that can clear large transactions at the fraction of the cost of other e-payment methods, but not all companies and banks have adopted the networks. Will one payment network become the sole network? Are the two payments systems compatible to settle payments? These are great questions, and we’ll begin to see answers resolved in 2020.
What I challenge when it comes to RTP is that the focus should be about more than just the pace. Buyers and suppliers already have established relationships, so it’s more about the cost, payment reliability and data that accompanies a payment, rather than it being instantaneous. The real value in the possibility of RTPs, particularly in the B2B space, is around the ease in which data can flow in and out of accounting systems, which could help businesses be more efficient, improve visibility and mitigate potential risks.
Recent research released by
Like the innovation we’ve seen when banks and fintechs collaborate, the same mindset can apply here. For example,
A theme that transpired in 2019 and carries into 2020 is opportunity. In what’s been named the “fourth Industrial Revolution,” the opportunity for fintech to continue to disrupt the payments landscape and deliver solutions that move money quickly and securely will only continue to grow. With the foundation 2019 has built, I eagerly welcome 2020 and the opportunities for innovation it holds.
