Name: Tech trends in financial services: What’s on the industry’s radar?
Uploaded: 2023-06-27T12:58:57.504Z
Duration: 407.64
Description: Paddy Ramanathan, MD of iValley and Host of the FINTECHTALK™ Show, joins us to talk about the fintech landscape and the technologies that financial institutions are experimenting with. Stay up to date with the community on https://finovate.com/ Find out more about FinovateSpring on http://www.finovatespring.com/

FSPR.INT.019.mp4

Paddy Ramanathan.vtt

English

{{00:00:02}}
Paddy Ramanathan: My
name's Paddy Ramanathan.

{{00:00:06}}
Thanks for having me here.

{{00:00:08}}
I am founder and co managing director
at iValley Innovation Center and

{{00:00:13}}
host of a podcast FinTech Talk.

{{00:00:16}}
iValley does corporate focus,
FinTech venture studio.

{{00:00:21}}
We build big, things in FinTech.

{{00:00:31}}
Oh, it's a good question.

{{00:00:33}}
Like to take a historical perspective,
so if you could go back, even back to

{{00:00:37}}
the eighties, what was the main thing
for financial services or what would

{{00:00:41}}
be a competitive differentiator was
having a very good distribution network.

{{00:00:45}}
At that time more branches and, segment
specific offering products that would

{{00:00:50}}
fit the needs of their customers.

{{00:00:53}}
Obviously we had a little
bit of the digital revolution

{{00:00:56}}
last co couple of decades.

{{00:00:59}}
A lot of digital transformation FinTech.

{{00:01:01}}
Played a big role in it helping
making banks rise up to the occasion.

{{00:01:07}}
What we're seeing now, and what I'm
excited most about is it's the same first

{{00:01:12}}
principles, is that distribution and
segment specific plus digital is what's

{{00:01:19}}
differentiating the differentiation.

{{00:01:22}}
And what I mean by that is things
like embedded finance which, is

{{00:01:26}}
basically expanding the distribution
of financial services to different

{{00:01:30}}
verticals and segment specific.

{{00:01:33}}
So you have all these generic
challenger banks, but now you

{{00:01:36}}
have segment specific challenger
banks, like for teens for disabled

{{00:01:40}}
populations, from minority populations.

{{00:01:43}}
They, are resonating much well, With
the population that they're targeting.

{{00:01:51}}
So in essence, embedded finance, very
excited about segment specific offerings.

{{00:01:55}}
Very excited about,

{{00:02:08}}
That's a good question.

{{00:02:09}}
Generative AI is, if I could start
with that has taken a lot of oxygen,

{{00:02:14}}
especially in the funding environment.

{{00:02:17}}
With, all that's going on with ChatGPT
and GPT four I think still early stages,

{{00:02:24}}
but how we see it at iValley is that
it's, a disruptive potential and in,

{{00:02:31}}
the sense that generative AI or general,
what's happening in AI it's transforming

{{00:02:38}}
kind of knowledge and how we learn.

{{00:02:41}}
And that in turn will transform
knowledge work and knowledge workers.

{{00:02:45}}
So we'll see what I like to call the
AI ization or like the Uberization

{{00:02:50}}
AI ization where you have these
new businesses come in, which will

{{00:02:55}}
fundamentally disintermediate or create
a lot of capacity, AI based capacity

{{00:03:00}}
of what knowledge workers could do.

{{00:03:02}}
You're already seeing some of that
in say IT work or development work.

{{00:03:07}}
Design work and consulting work.

{{00:03:09}}
One of the big fours announced
that they're setting aside some

{{00:03:12}}
money to figure out how an AI
could do what their consultants do.

{{00:03:17}}
So that will trickle into
the financial services.

{{00:03:21}}
I think what, to your question,
what the appetite is that.

{{00:03:26}}
The banks are interested.

{{00:03:27}}
They're exploring, they're
experimenting how this would change.

{{00:03:30}}
They have some kind of smaller
use cases around summarization,

{{00:03:34}}
around the virtual assistance.

{{00:03:37}}
Morgan Stanley, I think, worked
with Open ai, do something like

{{00:03:39}}
that to help their wealth managers.

{{00:03:42}}
Bloomberg's working with open AI
again to do Bloomberg, G P T kind of.

{{00:03:48}}
Intermingling their data set with
kind of the large language model.

{{00:03:51}}
So there are all these bigger
projects happening, some

{{00:03:54}}
experimentations happening.

{{00:03:56}}
I think it's early stages
but we'll see more of it.

{{00:04:01}}
The other things you mentioned, metaverse,
I think it was big last year and the

{{00:04:05}}
year before, seeing a little bit of
slow down, but I think it has its own

{{00:04:10}}
potential perhaps in the gaming and all.

{{00:04:12}}
And in thereby with payments
and other things could impact.

{{00:04:17}}
So there's some appetite to it, maybe
not as much as was a couple of years ago.

{{00:04:29}}
Yeah.

{{00:04:30}}
I have to see how to be politically
correct, but in, I, I think if you

{{00:04:35}}
step back, there's obviously the
regulatory regime is not looking

{{00:04:40}}
positively towards decentralized finance.

{{00:04:45}}
And, what fundamentally it is you have
centralized finance or central bank

{{00:04:51}}
function and the commercial bank that
we've grown up with for the last however

{{00:04:56}}
many decades defi and blockchain based.

{{00:05:00}}
Fundamentally a challenge to
that more than anything else.

{{00:05:05}}
So obviously that's, a
big impedance, right?

{{00:05:08}}
People are not ready for that, for
business reasons, for political reasons,

{{00:05:12}}
for risk reasons and other things.

{{00:05:14}}
And that's, I think, what we're
seeing play out with a lot of

{{00:05:17}}
regulatory enforcements around it.

{{00:05:19}}
I think technology is powerful,
but we have to figure out, re

{{00:05:23}}
reconcile what's the role of, kind of
non-central bank entities and things.

{{00:05:30}}
But I'm very bullish about some
companies like figure is one company

{{00:05:36}}
that I've invested in that's done
really well in the defi space.

{{00:05:40}}
I think it has more potential,
but things need to sort out.

{{00:05:43}}
At the policy level.

{{00:05:53}}
I think the current times high interest
environment things are slowing down.

{{00:05:55}}
Public markets pressure, venture
capital towards fintech's low.

{{00:05:59}}
So more than what they're building.

{{00:06:02}}
I think focusing on cash
flow profitability is key.

{{00:06:06}}
Acquiring customers is key.

{{00:06:08}}
So that's what kind of I look at and
people are adjusting to that new reality.

{{00:06:14}}
I think AI and how generative AI
in other parts of AI will build new

{{00:06:20}}
solutions around kind of financing
with the SVB fallout, right?

{{00:06:26}}
So venture debt, for example, was
a big thing as we used to do, and

{{00:06:31}}
that's almost nonexistent now.

{{00:06:33}}
So having fintechs and AI kind of address
that vacuum our, new solutions I think

{{00:06:40}}
will come up in the FinTech world.

Paddy Ramanathan: My
name's Paddy Ramanathan.

I am founder and co managing director
at iValley Innovation Center and

iValley does corporate focus,
FinTech venture studio.

Like to take a historical perspective,
so if you could go back, even back to

the eighties, what was the main thing
for financial services or what would

be a competitive differentiator was
having a very good distribution network.

At that time more branches and, segment
specific offering products that would

Obviously we had a little
bit of the digital revolution

Played a big role in it helping
making banks rise up to the occasion.

What we're seeing now, and what I'm
excited most about is it's the same first

principles, is that distribution and
segment specific plus digital is what's

And what I mean by that is things
like embedded finance which, is

basically expanding the distribution
of financial services to different

So you have all these generic
challenger banks, but now you

have segment specific challenger
banks, like for teens for disabled

They, are resonating much well, With
the population that they're targeting.

So in essence, embedded finance, very
excited about segment specific offerings.

Generative AI is, if I could start
with that has taken a lot of oxygen,

With, all that's going on with ChatGPT
and GPT four I think still early stages,

but how we see it at iValley is that
it's, a disruptive potential and in,

the sense that generative AI or general,
what's happening in AI it's transforming

And that in turn will transform
knowledge work and knowledge workers.

So we'll see what I like to call the
AI ization or like the Uberization

AI ization where you have these
new businesses come in, which will

fundamentally disintermediate or create
a lot of capacity, AI based capacity

You're already seeing some of that
in say IT work or development work.

One of the big fours announced
that they're setting aside some

money to figure out how an AI
could do what their consultants do.

So that will trickle into
the financial services.

I think what, to your question,
what the appetite is that.

They're exploring, they're
experimenting how this would change.

They have some kind of smaller
use cases around summarization,

Morgan Stanley, I think, worked
with Open ai, do something like

Bloomberg's working with open AI
again to do Bloomberg, G P T kind of.

Intermingling their data set with
kind of the large language model.

So there are all these bigger
projects happening, some

I think it's early stages
but we'll see more of it.

The other things you mentioned, metaverse,
I think it was big last year and the

year before, seeing a little bit of
slow down, but I think it has its own

And in thereby with payments
and other things could impact.

So there's some appetite to it, maybe
not as much as was a couple of years ago.

I have to see how to be politically
correct, but in, I, I think if you

step back, there's obviously the
regulatory regime is not looking

positively towards decentralized finance.

And, what fundamentally it is you have
centralized finance or central bank

function and the commercial bank that
we've grown up with for the last however

Fundamentally a challenge to
that more than anything else.

So obviously that's, a
big impedance, right?

People are not ready for that, for
business reasons, for political reasons,

And that's, I think, what we're
seeing play out with a lot of

I think technology is powerful,
but we have to figure out, re

reconcile what's the role of, kind of
non-central bank entities and things.

But I'm very bullish about some
companies like figure is one company

that I've invested in that's done
really well in the defi space.

I think it has more potential,
but things need to sort out.

I think the current times high interest
environment things are slowing down.

Public markets pressure, venture
capital towards fintech's low.

I think focusing on cash
flow profitability is key.

So that's what kind of I look at and
people are adjusting to that new reality.

I think AI and how generative AI
in other parts of AI will build new

solutions around kind of financing
with the SVB fallout, right?

So venture debt, for example, was
a big thing as we used to do, and

So having fintechs and AI kind of address
that vacuum our, new solutions I think

FinovateSpring

Trend

Paddy Ramanathan, MD of iValley and Host of the FINTECHTALK™ Show, joins us to talk about the fintech landscape and the technologies that financial institutions are experimenting with. 

Stay up to date with the community on https://finovate.com/ 

Find out more about FinovateSpring on http://www.finovatespring.com/ 