The three core omnichannel strategies; Wall Street Is Anti-ChatGPT; The Fintech Formula: A data-driven blueprint for creating enduring value;

Sam Boboev
15 min readMar 1, 2023

In this edition:

1️⃣ India and Singapore link UPI and PayNow in cross-border payments push

2️⃣ The adoption of digital identity could present a drastic change in the way customers interact with online services

3️⃣ The Fintech Formula: A Data-Driven Blueprint for Creating Enduring Value

4️⃣ The three core omnichannel strategies

5️⃣ Current State of Customer Engagement in Banking

6️⃣ Wall Street Is Anti-ChatGPT

7️⃣ Building an open payments ecosystem

And many more….


India and Singapore link UPI and PayNow in cross-border payments push

India and Singapore have linked their digital payments systems, UPI and PayNow, to enable instant and low-cost fund transfers in a major push to disrupt the cross-border flow of money between the two nations that amounts to more than $1 billion each year.

The linkage between the two systems went live Tuesday, the two nations’ central banks said at a press conference. Eight banks, including DBS, Liquid Group, Axis Bank and State Bank of India from Singapore and India are currently participating in the collaboration, they said. Citizens in each nation can use their local payments systems to send money to those in the foreign land in “real-time.”

For now, an Indian user can remit up to 1,000 Singapore dollars a day, the Reserve Bank of India said.

The two nations announced their plan to link their payments systems in 2021 and had originally set a deadline of July 2022 to go live with the collaboration. “The PayNow-UPI linkage is India’s first cross-border, real-time system linkage and Singapore’s second. It’s also the world’s first such linkage feature cloud-based infrastructure and participation by non-bank financial institutions,” said Singapore Prime Minister Lee Hsien Loong at the conference.

“As we progressively add more users and use cases, the PayNow and UPI linkage will grow in utility and contribute more to facilitating our trade and our people to people links,” he added.

UPI, a seven-year-old payments infrastructure developed by a coalition of retail banks, has become the most popular way Indians transact online.

The system, adopted by scores of local and global firms, including Walmart, Google and Facebook, processes over 8 billion transactions a month. Like UPI, Singapore’s PayNow also offers interoperability between banks and payments apps in the nation, allowing users from one payment app to make transactions to those on other apps.

Nearly 250 million people across the world send over $500 billion in cross-border remittances annually, according to Citi. But the space is ripe for disruption. “The fees are extremely high. It is embarrassing that we have not solved this issue so far,” Citi analysts wrote. Global average cost for sending money is around 6.5%.

Tuesday’s announcement is the latest in an ongoing effort from New Delhi to launch and expand its tech infrastructure such as UPI and DigiLocker to other nations. India plans to use its ongoing presidency of the G20 forum to make presentations to other nations about its digital infrastructure.

Source Techcrunch


The adoption of digital identity could present a drastic change in the way customers interact with online services

Banks and FI’s can be a driving force for this change.

Digital identity is the anchor across a customer’s journey. If the financial system is considered a mirror of the real economy, identity mirrors the unique individuals who interact with the financial system. Digital identity represents humans at the center of modern financial services.

Providing seamless access, supporting hyper-personalization, enabling risk and fraud management, all while reducing friction, are expectations that cannot be met with a simple “personal profile.” And there’s more to the challenge. An increasingly shrewd customer population expects security, values privacy, and demands control over their identity.

The modern digital identity augments personal attributes with other pieces of information that represent the unique individual at every touch point. Device types, locations, and customer and corporate behaviours are connected to profile the individual as well as how they interact. As a financial institution, think beyond access management: with digital identity, you can reimagine your customer-corporate relationships and build trust. This trust will be the new anchor to tether customers to your business. Failure to build this new tether would most likely result in your customers gravitating towards other providers.

Rush to decentralized?

Not so fast. Centralized and federated identity models have been around for many years. Most of our public and private sector business constructs have been built around these models. We have established frameworks and processes to manage objectives like know your customer (KYC) and anti-money laundering (AML); our legal, regulatory and compliance frameworks need adjustments to accommodate the flexibility offered by decentralized identity.

It’s quite clear that we’re moving towards a self-sovereign identity model (SSI) underpinned by decentralized networks. However, in the interim we are likely to adopt a national federated identity model in Canada. This transition will be gradual and through adoption of priority use cases. For example, business owners can share identity attributes with other business partners securely via single application for cross-jurisdictional domains and secure identity proofing (e.g., AML/KYC check references, passwordless login using digital wallets).

Source EYCanada


The Fintech Formula: A Data-Driven Blueprint for Creating Enduring Value

Very interesting analyses by Sarah Hinkfuss and Tina Dimitrova

While the story of public market fintech over the last three years has been perplexing, a retrospective analysis reveals a few simple lessons.

Roaring back from the fears of economic collapse at the beginning of COVID, digital distribution and servicing became a must-have for financial services disruptors and incumbents alike. Consumers, awash with cash, opened more accounts, explored new ways of investing, saving, and spending money, and trusted the digital provision of financial services more than ever before. Businesses invested for growth at unprecedented levels, creating a frenzied labor market, a record pace of new product development and a high mark in company burn.

Enticed by the increased demand, the opportunity to sell into some of the largest markets in the world, and the vision of strong founders, VC funding reached record levels: according to Pitchbook, in 2021, venture investments in fintech reached $121.6b, a 153% YoY increase in global VC deal value that was more than the total value invested in 2019 and 2020 combined. Fintech was the darling of VC, accounting for $1 for every $5 of venture funding.

The last 12 months have been more sobering — some have described 2022 as the morning after the party. Russia’s invasion of Ukraine sent shockwaves throughout the global economy, including financial services, and heightened our sense of insecurity. With inflation surging, the Fed began increasing interest rates in March, changing the fundamental economics under many companies, especially fintech companies whose performance is more directly tied to the cost of capital.3 Resulting both from (1) the high pace of capital deployment into fintech in 2021, which meant many companies were well-capitalized heading into 2022, and (2) the crash in public market valuations that challenged sky-high private market growth valuations, venture investing in fintech companies came down considerably. As of Q3 2022, according to CB Insights, global fintech funding fell 38% vs 2021 to hit $12.9B in Q3 2022 — matching Q4’20’s level.

Looking at the market deceleration over the past 15 months, it is widely understood at this point to those who follow the markets that publicly-traded fintech companies fared worse than their non-fintech counterparts. We can see this below: a market cap-weighted index of 121 selected publicly-traded fintech companies (we’ll call it “BCVF”) rose by more than the S&P 500 and about the same as the NASDAQ, peaked earlier, but then dropped by more from its peak than both other indices, and ultimately ended up lower than the S&P 500 and the NASDAQ relative to Jan 1, 2020. But, why?

Read the full article in the comments

Source Bain Capital Ventures


Blue-chip firms spent big on companies promising new ways to make payments or manage money

Now they understand they overpaid.

Over the past few years, venture capitalists and Wall Street giants paid eye-popping prices for companies that promised new ways to bank, borrow or buy insurance. In 2021, global spending on these so-called fintechs reached a fever pitch at $139.8 billion, almost triple the previous year’s level, according to researcher CB Insights.

But in 2022 that money dried up as a broader bear market took hold. And with fintech valuations falling precipitously, some big players are admitting they paid too much.

Take Prudential Financial’s foray into “insuretech.” In 2019 it paid $2.35 billion for Assurance IQ, a digital newcomer that was less than five years old. Assurance offered Prudential an online platform to sell life, health, Medicare and auto coverage. But the unit failed to turn a profit until the most recent quarter, and Prudential has written off almost $2 billion of its investment as a loss.

Some ideas may not have been as innovative as they first appeared. JPMorgan Chase’s purchase of college financial-planning website Frank for $175 million in 2021 turned out to be worse than just a disappointing acquisition — the bank alleges it was a victim of fraud. The site has been shut down and the bank is suing Frank’s founder, Charlie Javice, saying the startup purported to have more than 4 million customers when it actually had fewer than 300,000.

In an ultralow-interest-rate environment, venture capital poured into fintech and raised the price of deals. Not long before Prudential bought Assurance, SoftBank led a $300 million funding round for the online insurance company Lemonade, valuing it at about $2 billion. Lemonade later went public and now has a market value of $1.15 billion.

The ballooning valuations were also seen in deals between more established businesses. FIS a US-based provider of behind-the-scenes financial technology to banks and businesses, in 2019 paid more than $41 billion for Worldpay, a global payment processing company. The deal was viewed as a way to combine strengths at a time when competition was heating up. But nearly four years later, the companies are splitting up, and FIS recently posted a $17.6 billion writedown on the acquisition.

Stripe, whose software allows merchants to take payments online and in person, saw payments volume growth drop from 60% in 2021 to 25% in 2022. Swedish “buy now, pay later” lender Klarna last summer saw its valuation in fundraising slashed by 85% from a year earlier. Dave, a mobile banking service that went public via a special purpose acquisition company, has seen its stock plummet more than 94% in the past year.

That doesn’t mean fintech’s over for acquirers still willing to bite, perhaps the prices will at least be easier to stomach.

Source Bloomberg Business


Current State of Customer Engagement in Banking

Most financial institutions are playing a game of catch up, trying to meet current and future customer needs using yesterday’s technology. As customers have changed their expectation of service and engagement, banks and credit unions must find ways to deliver unique, personalized, and contextual journeys.

This requires a shift from a traditional product-centric approach to a customer-centric approach that focuses on intelligent customer engagement. Done well, the result will be the ability to capture new growth opportunities by delivering greater value for customers now and in the future.

It is not surprising that previous research by the Digital Banking Report found that increasing customer satisfaction and improving efficiency were the top two customer-oriented objectives of financial institutions globally. It was also not surprising that cross-selling was a major objective. The good news is that there has been an increase in emphasis in providing proactive advice and increasing engagement opportunities as shown below.

Despite good intentions, however, most financial institutions fall short of engagement success beyond the basic customer service interaction level. Key areas of concern include easy account opening and onboarding, the offering of financial wellness tools, proactively providing advice and offers, and the empowerment of employees with analytics to help customers.

These challenges are reflected in the self-reported ratings financial institutions provided relative to their customer engagement maturity. Except for offering some level of personal financial management (PFM) tools, and account aggregation capabilities, the engagement maturity level of financial institutions across all asset sizes and regions is extraordinarily low.

In fact, less than 10% of all organizations can provide personalized financial recommendations, automated actions based on transactions, or lifestyle-related offerings using open API technology.

Source The Financial Brand


Wall Street Is Anti-ChatGPT

JPMorgan’s slogan is “Do The Right Thing,” which could conceivably be why CEO Jamie Dimon decided to ban his employees from using ChatGPT in the workplace. Bank of America, Goldman Sachs, CitiGroup and others have followed suit, arguing that large language models are no friend of big banks, Paul J. Davies writes.

Now, you might be envisioning lazy bankers using AI to complete basic tasks like writing emails and drafting proposals:

But that’s not exactly what these banks are worried about. Any other guesses? I’ll give you a few moments ….. Okay, here’s the answer, courtesy of Paul: It comes down to that fearsome R-word, regulation.

Compliance departments have dealt with enough lately. The WhatsApp nightmare will haunt them for years to come, and AI-powered technology like ChatGPT is a loose cannon, to say the least. It makes mistakes. It might be biased. It lacks transparency. It wants to be alive. It can channel evil-villain vibes with surprising ease.

For a bank like Goldman Sachs, whose website says “our people are our greatest asset — we say it often and with good reason,” the reputational risks alone make the use of artificial intelligence a nonstarter. On top of that, Paul says the technology would completely undermine a bank’s business proposition, which is to provide traders with highly sought-after intellectual capital — something that ChatGPT, a robot baby-birding you regurgitated internet speak, has no concept of. “Companies pay them big bucks to advise on takeovers or raise capital because they know things about rival firms and appetites for risk in markets…Would you want to pay so much if you thought a web-crawling robot was writing the pitch for your business?” he asks. The answer is no, and you don’t need ChatGPT to tell you. Read the whole thing.

Source Bloomberg Opinion


Building an open payments ecosystem

Open banking has created a new bank payments method and a framework for payments innovation. While it generally does not provide a new set of payments rails, open banking creates a new mechanism for payments initiation, in effect, open payments. APIs can be used to easily trigger single payments but also give greater flexibility, such as creating a mandate or business rules for variable recurring payments transactions. The APIs that exist alongside open banking have unshackled the potential of A2A payments by removing the barriers created by fragmented payments rails, forming an effective “pay by bank” option.

This makes it easier to access payments clearing systems and embed an A2A payments at the point of purchase. As a result, customers and merchants face much greater choice. A2A payments offer the potential of unrivalled reach by covering anyone with a bank account, and strong conversion rates thanks to zero data entry and a smooth user journey. Moreover, it offers the potential to provide superb bankgrade security with regulatory checks seamlessly baked in and, crucially, a very low-cost option with fewer or no intermediaries.

Open payments and “pay by bank” will blossom in markets that are able to create an effective open payments ecosystem, which includes robust standards, strong operational performance, great customer experiences and strong adoption. As these components start to come into place, markets will see a tipping point for “pay by bank” across certain segments where it achieves initial product market fit. Payments providers need to invest ahead of open payments developments to be well-placed to take advantage of these market shifts.

The UK’s open banking experience

In 2018, the second payments services directive (PSD2) was implemented in Europe. The UK adopted a unique approach to driving open banking, built on key principles from PSD2, such as mandating and standardizing APIs across the nine largest banks. Over time, the UK approach was refined to include improved customer experience and a focus on operational performance of APIs. This laid the foundation for FinTech and PayTech firms to develop solutions using this capability, fostering competition and accelerating innovation.

In 2021, more than 26 million successful payments were made,2 with an estimated total value of more than £10 bn.3 There are now more than six million users4 and, at the current growth rate, almost two-thirds of adults will be using open banking by the end of 2023.

Source EY


What can we expect from Fintech in the UK this 2023?

The United Kingdom is the leading country when it comes to fintech. Most of the fintechs and neobanks have some presence in the UK which again maintains its position as a leading country in these sectors.

We can already see that 2023 started tough with decreased customer spending, high inflation, layoffs and significantly lower VC dollars for all sectors including fintech.

Despite all these negative factors UK fintech sector still looks healthy. We didn’t hear significant layoffs or lowered valuations among fintechs in the UK.

In 2023 we should expect some consolidation in the fintech market which means the company either get acquired, merge or finally turn into a profit if you are following the news then you must know the process has already started.

On the other hand, this is a good moment for traditional financial institutions and banks to grab some of those fintechs and add them to their portfolio or enhance their tech innovation.

No matter what will be the case innovation in fintech will not stop in 2023.

One of the hottest trends is AI in finance and we should expect more companies to create products in this direction.

Open banking and progress towards open finance is another trend we should keep our focus on. These two technology implemented correctly could be game changers in finance.

Of course, not everything is very well in the crypto industry with more regulation coming further down this year.

What are some of the things you are expecting in the UK fintech market in 2023?


The three core omnichannel strategies

These three strategies are part of a continuum, with omnichannel ecosystems being the most advanced. Retailers can stick with one strategy, go deep, and then excel as a commerce or personalization leader, or, with the right fundamentals in place, they can move along the continuum into an ecosystem and expand into other business models over time. More importantly, each strategy has proven to be viable in creating long-term value, if executed well.


Retailers that take this approach — both physical-first and digital-first brands — often prioritize one channel and invest in targeted cross-channel connections to support the buying experience, such as the ability to order online and return in store. At the most basic level, this model allows retailers to meet the minimum threshold for omnichannel performance. But retailers with more advanced capabilities can take it to a very different level. Best Buy, for instance, has burnished the in-store experience with curated offerings that allow customers to explore smart-home technology solutions, which they pair with free in-home advisory services. The retailer’s mobile app allows customers to “scan to shop” from catalogs and curbside, and offers the ability to buy online for pickup in-store, making it easier for consumers to move through the journey end to end, supported by 24/7 tech support from the company’s Geek Squad.


While most retailers personalize engagement and outreach to some degree, those that pursue omnichannel personalization go far beyond rudimentary retargeting and lookalike segmentation. They shape consistently tailored interactions across channels, and they do so continuously and at scale. Sephora, for example, provides consumers with rich in-app messaging, personalized push notifications, and the ability to book in-person beauty consultations from their phones. In-store technology allows “cast members” to access a customer’s favorite items and suggest new products that align with the customer’s profile. Customers can also use scanners to match products to their specific hair color and skin type.


This model extends the brand experience, providing consumers with an ever-growing platform of content, offers, and community-based interactions. Instead of turning to a retailer for occasional interactions, consumers make omnichannel ecosystems part of their lifestyle. It’s an always-on relationship that can pay ample dividends. Nike, for example, uses its SNKRS and Run Club apps to foster in-person meet-ups, running groups, and events. Its Training Club app delivers individual workouts and multiweek fitness programs. These investments allow Nike to create experiences that go far beyond their shoe and apparel lines and fold the brand into an individual’s day-to day-routines. Omni ecosystems like these also help retailers expand into adjacent business models.

Source McKinsey & Co



Sam Boboev

I am a fintech enthusiast and product leader passionate about crafting simple solutions for complex problems. Subscribe