Paris Fintech Forum has definitely kicked the e-commerce trends discussion in 2020. It is always curious to look at the wider picture, profoundly discuss highlights, aspirations and challenges for the payments industry. Internalization and cross-border payments are increasing today and are very demanded by various companies and institutions. Thus, the legal pillar and infrastructure redesign are gaining serious attention from all the players on the field. Not to mention, merchants have to adjust to local customers’ preferences, which is a very picky conversation, especially when fueled by ecosystem formation trend.
I was gladly surprised that Russian e-commerce market is on par with European in terms of most products and sometimes is ahead of it in terms of customization of those products for B2B and B2C customers. For example, we have money transfers from different banks by phone number, B2B-payments are as simplified as B2C (and only two years ago it took about 3 days), multicurrency wallets, accounts and transfers are fully introduced, not to mention the opportunity to obtain a loan on-line or pay for everything from bills and groceries to cars fully online (Renault platform was the first such online sales company, while BMW and Tesla take deposits online for new cars with advance demand). Advocating for the Russian market progress might be hard at times, but let me outline a few concepts that are especially interesting from the savvy and advanced market perspective.
Digital financial commerce platforms doing good
Commerce platforms that provide neobanks with services for digital payments are booming and blooming. Platforms like Wirecard, Mambu, Marqeta, Treezor can customize enterprise solutions for digital banking in a matter of months, at the core lending the license and services to the new team. Interesting thing is that neobanks have a long way to go to meet the break-even point, while the aforementioned platforms are already making money.
It is vivid today that ecosystems will derive from value-added services and an attempt to fit all the customers’ needs (financial and lifestyle) into one app. Such a challenge consists of numerous tasks, each of them has to be tailored to the needs of the audience. Surely, each tech company is now competing for the user in order to create a paradigm where a customer would not hesitate which app to use in order to pay for any goods or services. Payments are expanding into the decision-making process by eliminating the need to browse various resources, comparing prices or finding the discounts. Yandex.Money has also followed that path, we transform our solution into handy lifestyle-service with tickets purchases, fines and tax payments, discounts and coupons for purchases, investment portfolio and gamification. Overall, in Russia we have at least 4 big companies who committed to creating an ecosystem, and one that promised to have an ecosystem of all ecosystems.
Another example of Russian e-commerce savviness would be solutions for marketplaces - check splits between different merchants operating at one marketplace are just around the corner. It means that the customer can conduct one payment at the marketplace, but the payment will be actually split between various merchants.
Next Big Thing
As fintech becomes more sophisticated, customized for specific needs and at the same time more globalized, it is obvious that the evolvement will come through collaboration and intersection with other tech segments - legaltech, healthtech, regtech, insurtech. That corresponds a lot with the aforementioned ecosystem trend - in order to provide all-in-one solutions companies have to be equally strong in various fields and that expertise has to be interconnected. Data connectivity was brought to the table numerous times - from antifraud to open banking, from marketing to M&A, from KYC to full PSD2 application.
The concerns about startups valuation were on the rise from the last year - Uber and Lyft IPO cases and WeWork pre IPO, along with many others all collectively cost investors a close to 100 billion USD in valuation money. However the robust money flow of investments is not expected to slow down, yet it will become more cautious. We may not see another big-buck acquisition like Plaid soon.
Heraclitus said that the only constant is the change. That is especially true to the fintech industry and Paris Fintech Forum gives a chance to review the current state and add to the transformation.