Martin stiller (Senior Research Analyst)

I recently attended The Finovate Europe 2019 trade show, held in London, it provided a stage for 64 international fintech companies to showcase their new products, tools, and ideas in a seven-minute live demo to the 1,000+ attendees, with the aim of attracting bank customers and investors. In this blog, I have examined fintech trends and highlighted some IDC Financial Insights profiles some of the rising stars and emerging technologies.



Pitching Innovative New Fintech Tools at Finovate Europe 2019, Source: Finovate, 2019

London Will Remain a Key Global Fintech Hub, Forward-Looking Regulators and Sandboxes Can Help

The summit started with a bold statement by David Birch, Global Ambassador at Consult Hyperion: “London is and will remain the world’s premier hub for financial-oriented technology start-ups.” He believes that there is no other hub in the world that concentrates capital, skills, and technology, while providing such a forward-looking regulatory environment.

Anna Wallace from the UK Financial Conduct Authority (FCA) outlined how the FCA can support emerging technologies, such as blockchain, to comply with any relevant regulations via sandboxes where new tools and models can be tested in a safe environment. Wallace invited businesses to enter the Global Financial Innovation Network (GFIN). This global innovation sandbox is built for businesses seeking authorization to test their products in a controlled environment and contains regulators from 29 jurisdictions. We believe that systematic approaches toward financial regulation in the UK and the EU will set a global trend in banking regulation that can help to increase the transparency, flexibility, and accessibility of financial services.

We Have Been Doing Banking Wrong for the Past 500 Years — Nothing Drives Profitability Like Great Customer Experience

It is important to understand that financial services, especially on the retail side, are being commoditized. Banks need to find a way to continually serve customers, but only in situations where they are really needed or when they can add value. It will be difficult to achieve without building business platforms that allow banks to capture micro-moments of intent, helping them to serve customers with exceptional precision.

ING’s Benoît Legrand, Chief Innovation Officer, highlighted the changing role of today’s banks. He said that banks have put too much attention on solving their own problems over the past centuries and not enough on customer needs. Commoditization of financial services has brought transparency and accessibility. Its pushed banks to rethink their business models and to invest into new tools that allow them to provide personalized services at scale. ING’s Legrand used the example of Netflix and Spotify.

Netflix saved $1 billion a year via personalization by overcoming a problem they identified of customers getting bored and canceling their subscription. Spotify increased their customers’ listening time by 25% thanks to personalized playlists and discovery tools.

Partnering in Ecosystems and Platforms Helps to Expand Portfolios and Drive Down Costs

There was a lot of buzz around customer experience at the trade show, but there was also a realization that many of today’s business-to-consumer providers of tools for financial advice, budgeting help, multi-banking, and others may not be able to charge much for such personal finance management offerings in the future.

Many banks are beginning to offer these services to their customers free of charge, often in cooperation with a fintech, as a way of retaining customers. Those with the best customer experience and most enriched data will be the ones to retain existing business and win new customers.

It Is Easier to Offer Technology Solutions to Banks Than to Build a Scaled-Up Rival Offering

This year at Finovate Europe we only saw 6 out of 64 fintechs providing direct services to consumers. Based on interviews with many of the participants, this is the most popular path for a fintech start-up, barring the “true believers” that are still betting on banks being too slow to enact digital transformation. This confirms that initial hype about fintech start-up firms displacing banks has evaporated, as they now realize it takes scale, and an ability to overcome regulatory and other barriers to entry, to replace a traditional bank.

The challenger banks, such as Atom, Monzo, Fidor, and N26, have taken time to gain a foothold, although they can continue to make inroads by collecting fintechs in a collaborative ecosystem. Collaboration rather than competition is often the name of the game these days. After all, it is easier to offer technology solutions to banks than to build a scaled-up rival offering.

Open Banking Drives Fintech in 2019

A majority of fintech participants viewed AI and open banking APIs as major innovation enablers. On display were engines for accelerating digital on-boarding; automated credit-scoring tools; and other advanced data analytics tools. A lot of attention was given to conversational interfaces like chatbots and digital voice assistants.

Voice is turning into a major digital interface for communication between consumers, e-commerce providers, and financial services providers. For instance, Amazon’s Alexa can already help end users to shop outside of its core portal and process a payment via their voice.

IDC predicts that, by 2020, 90% of European financial institutions will be capable of processing transactions initiated by third-party voice assistants. (IDC #EMEA44682319) This creates an opportunity for “bigtech” vendors like Amazon, Google, Apple to become a key banking touchpoint and an entry point to the open ecosystem.

Selected Fintech Vendors of Interest at Finovate Europe 2019

Based on the seven-minute live demos at Finovate Europe 2019 and individual interviews, IDC Financial Insights has selected start-ups that we believe create unique business value for banks and consumers and are worth tracking.

Shifting Core Banking to the Cloud

Five Degrees is an award-winning fintech founded in 2010. It offers FIs a modular digital core banking platform deployed in the cloud or so-called “bank as a service.” Five Degrees has developed an open banking marketplace of third-party products, which connects banks and fintechs in a service-orientated ecosystem. This allows banks to bring the latest innovations to their customers more quickly and easily simply by “plugging them in.”

IDC Opinion

Five Degrees sets an example of how to provide platform-based core banking, and how to create value from business partnerships and ecosystems. For major specialized vendors, such as Temenos, Finastra, and FIS, cloud is slowly becoming the preferred model for deploying banking solutions.

According to IDC’s 2018 CloudView survey, European banks are still concerned about security and regulations, however regulators in the region have tried to address these concerns by publishing guidelines on how to meet the regulatory requirements about outsourcing via the cloud. For banks that have already adopted cloud, it often helps to maintain high security standards while enabling easier access to fintech-inspired innovation.

IDC predicts that, by 2024, 50% of European banks will have moved at least 20% of critical business functionality to as-a-service cloud platforms. (IDC #EMEA44682319)



Marketplace of Third-Party Products That Connect Banks and Fintechs in a Service-Orientated Ecosystem. Source:

A Mobile Keypad Service That Enables Frictionless Access to a Banking Service

PayKey has developed a keyboard plug-in for mobile banking applications that brings the banking experience to social media users or those performing any other activity on their mobile smartphone keypad. The pad is fully integrated with mobile banking applications and offers the option to execute, from the smartphone keypad, the most frequent banking commands such as checking account statements and making payments.

PayKey is already partnering with large retail banks and card schemes such as HSBC in the UK, Standard Chartered in South Korea, ING in Poland, and MasterCard.

IDC Opinion

PayKey has brought a unique technology that allow banks to retain interactions with their customers. It has the potential to become a platform to connect retailers, transport companies, and other industries and — based on tracking customers’ activity — address immediate needs like travel insurance, phone credit top-up, peer-to-peer money transfers, and others.



PayKey Keyboard Integrated with Bank Mobile App, Source: PayKey

Turning Data into a Better Banking Experience and Improving Digital Sales

W.UP is a fintech start-up founded in 2014 that provides a platform for real-time marketing campaigns. Its platform creates behavioral customer profiles based on data analytics from the user, banks, and third-party data from social networks, customer locations, demographics, and so on.

The platform understands what a client’s job is, their family relations, means of transportation, eating or sports habits, and many other behaviors. Based on real-time customer insights, it sends a notification with targeted offers and suggestions. For instance, if you travel to Austria for a ski trip, the platform already knows if you forgot to purchase travel insurance.

IDC Opinion

Batch campaigns and customer segmentation are dated sales tools — context is needed in today’s world. Banks should be investing in such tools to help anticipate customer needs and capture micro-moments of intent with exceptional precision. W.UP provides a powerful platform; however, the precision of the insights will play the key role in whether the notifications make the customer feel angry or appreciated.

If not well targeted and timed, such notifications risk being perceived as spam.



W.UP Platform in Action, Source: W.UP

Game-Based Learning for Clients and Employees

LaunchFire is a leader in game-based employee and customer engagement for FIs. It showcased its award-winning Lemonade SaaS platform that helps employees or customers at FIs to cope with change associated with the adoption of a new technology.

The tool guides users through any newly implemented software and rewards them based on completing different tasks, takes them through role-play scenarios, or simulates new features of a bank product. This can help on-boarding, internal digital transformation training, promotion of new tools to clients, and so forth.

IDC Opinion

For banks undergoing digital transformation, the key challenge is not the adoption of the latest technologies but rather changing the culture and leadership. LaunchFire has perfectly addressed how to support clients and employees throughout digital transformation journey and can help internal and external users learn how to use new features and to adapt to the new way of working, as well as recommend relevant new digital products.



LaunchFire Game-Based Learning  Source:, @Launchfire

FIs Can Build Loyalty Programs Based on Shopping Habits

Dateio is providing card-link marketing in the Central and Eastern Europe (CEE) region. At this year’s Finovate show in London, it presented a loyalty feature for bank customers offering discounts via mobile banking applications that rely on consumers’ location and shopping behavior.

Dateio has built relationships with major retailers in the CEE region and offers streamlined processing of loyalty rewards. It now wants to add banks and other payment services providers to its community.

IDC Opinion

Consumer wallets today are packed with multiple loyalty cards from cafés, book stores, petrol stations, and other retailers. Dateio’s solution gives banks an opportunity to interconnect loyalty programs and build relationships with wider retailing ecosystems. It increases efficiency when processing rewards, allows for the personalization of loyalty offers, and brings other opportunities for data monetization.



Dateio at Finovate Europe 2019 Source:, @MartinStiller

Personalized Video for Banks’ Customers

BlueRush is a Canadian fintech that offers an interactive personalized video platform for financial services. Its IndiVideo is a scalable platform built to provide data-driven video content that personalizes experiences and delivers control over what is sent and to whom. It helps banks to improve marketing efficiency and sales performance and to generate greater customer satisfaction.

IDC Opinion

The video format has surpassed all other major marketing formats, especially among the young, and consumers often choose it when seeking advice or help online. For banks, this is a good opportunity to increase customer proximity and proactively send personalized video offers based on individual behavioral patterns.

Financial advice like loan consolidation could be individually explained at scale while maintaining a human touch. For new customers, personalized video is a good format to ease the on-boarding process for complex products like a mortgage. It can work equally well as an educational or promotional tool in the corporate bank when adding new trade finance, corporate treasury or other clients.



BlueRush Financial Advice by Video, Source:

IDC Financial Insights team is continually writing about these emerging technologies and fintech trends. Get in touch with us at for more information on this topic.