We spoke with fintech expert Anna Maj to discuss the future of payments and how to bridge the entire finance value chain.
To say that Anna Maj is a busy woman is a massive understatement. As the Fintech Leader at PwC, she is responsible for driving the fintech agenda. Her work ranges from providing fintech support to standard financial services projects to overseeing the fintech leg of the Startup Collider, the firm’s international accelerator program – a scaleup hub which focuses on boosting startups around Europe and creating collaboration models between established players and startups in the sector. As an expert jury member on the European Innovation Council’s EICAccelerator, Maj and her peers gather several times a year in Brussels to evaluate and provide funding for rising innovative SMEs across the EU.
On top of this, Maj is also developing an online course on Opening Banking at London’s Centre for Finance, Technology and Entrepreneurship; giving fintech lectures at both Warsaw University of Technology and Warsaw University; the co-author of the PAYTECH book and the AI Book, both published this year; a Goodwill Ambassador for the European Women Payments Network; and an advisor to a social entrepreneurship network called Ashoka. This overwhelming list of projects and responsibilities makes one thing clear: Anna Maj is an expert in her field.
Maj has dedicated her career to developing the payments industry to operate as seamlessly as possible. She asserts that the biggest challenges within our current payments system are threefold: 1) frequent hiccups within the payment process, 2) basic service offerings which cannot accommodate specific needs, and 3) cross-border payments. Maj believes that technological innovation holds the key to creating an increasingly seamless payment experience. Newer players can better position themselves to meet more specific, niche customer needs, for example in the commercial payments domain. However, bigger players are also interested in addressing the financial needs of SMEs or business entities in a more efficient and innovative way.
Maj likes to conceptualise the payments sector as an ecosystem, wherein players have different roles in creating value. In this way, she sees collaboration between new fintech companies and traditional financial institutions as a natural part of modernising the payments industry:
There are, increasingly, various collaboration models between incumbent banks and newcomers. I think this is the prevailing situation, that fintechs and new tech companies are trying to cooperate with banks.
New banks such as Starling, Monzo and Aion offer alternatives to the traditional banking model. Although Maj acknowledges that some tech startups just want to challenge traditional banks, many more want to add value alongside the traditional players. Indeed, she believes more purely-oppositional tech startups were prominent just five years ago, and that those more collaborative models have been better able to flourish.
Not only is collaboration between new fintechs and traditional players central to propelling the payments industry forward, but partnerships between them are also important. Maj believes that fintech-fintech partnerships can bridge the entire value chain, enabling a seamless and tailored end-to-end digital journey for customers. Says Maj:
This is no one man (one company) show, this is a team play. Addressing only certain customer needs is a very limited approach, so you have to build alliances or partnerships. For that you need more players to cooperate; I don’t mean just direct collaboration, but also operating and co-existing in the same area. I’m not talking about this horizontally but vertically, closing the entire value chain.
Maj believes that the most important hurdle for new fintechs is to quickly scale enough to survive beyond the initial trials:
What I really see is there are some companies, startups and new players doing lots of testing, POCs, and there is really not much beyond that. You can innovate, develop, and enhance your solutions, but you need to scale to bring commercial value to your company and shareholders, you need to nail the commercial implementation as soon as possible and you need to monetise.
Maj also highlighted the importance of building a good reputation and trust with the customer base.
When asked how payments will look in five years, Maj argued that it is hard to predict how such a rapidly changing industry will be in just two years. This is especially true right now, when the global coronavirus epidemic is interrupting and impacting global markets. Pandemics notwithstanding, however, Maj believes the biggest changes will be in how payments are executed. She believes that payment interfaces will become more invisible to the consumer as the industry becomes more seamless and hassle free:
Definitely the main changes will be in the way we are executing payment; the question is how. If I just talk about payment interfaces, it’s about the tech structure underlying it, the entire industry is working towards becoming more invisible, hassle free and seamless. We will see payments that are as integrated into our lives as our daily activities.
Maj argues that the changes will lie not just in how payments are made, but in who is offering payment services. In the coming years, she foresees that it will be tech companies and other ‘non-banks’ taking over from the traditional banks and other licensed providers. Their offerings may soon be so seamlessly integrated into our daily interactions, they will all but disappear from our awareness.