Fintech revolution – re-shaping the global financial system
Business Review attended a series of events organized by La villa numeris, a French digital think tank, in the framework of French Season in Romania, designed to foster cooperation between Romanian and French companies in leading the digital industries of both countries.
The fintech conference that took place at Impact Hub Bucharest under the name “A new financial era for a new and positive economic governance?” started with a keynote speech on fintech trends by Joelle Durieux, managing director at Finance Innovation, the French competitiveness pole.
“Finance Innovation brings together corporates, start-ups and academics in order to foster collaborative, innovative R&D projects, in France and at an international level. Finance Innovation is at the heart of the finance ecosystem. Our cluster aims to gather all the financial industry players in order to accelerate innovation and research inside the financial ecosystem. Our priorities are banking, insurance, asset management, real estate, social & the solidarity economy: we deal with the financial sector to a very large extent,” said Durieux.
The company aims to identify, select and certify the most promising fintechs in order to help them scale-up and make business partnerships with large financial corporations, to promote innovative financial tools for SMEs and to act as a think tank.
“Fintech is really a great revolution, worldwide, that will change the shape of the global financial system,” said Duriex.
Between 2016 and 2018, fintech companies significantly matured, with key segments being payment, lending, neo-banks, and insurance. Asia and North Africa are the dominant regions, but Europe is catching up. According to Finance Innovation data, French fintech companies have attracted many investors with a total EUR 370 million raised in 2018 through 74 operations, which put France fourth in Europe.
“We will have a redefinition of jobs in the finance industry, and the technical skills will be complemented by emotional skills such as empathy, leadership, and creativity, because they are much more difficult to automate,” said Durieux. “Our main purpose by being present at this event in Romania is to co-create projects at a European level. We must bring together our strengths to face challenges coming from giant countries such as the USA, China, and India, as well as the GAFAs (Google, Amazon, Facebook, Apple). Europe is really key.”
MARKETPLACE AS A FINANCING POINT
Maillon.io had started as a consumer credit marketplace available for points of sale financing. “We democratize access to credit solutions for small and specialty retailers via an app connected to banks, neobanks and other potential lenders which is able via solutions such as Docusign and KYC solutions to gather data and information on the physical buyer and send information on credit needs and credit history, and then allow the final client to sign the lending contract electronically on the spot, and leave with the product they want to buy,” said Andrei Benghea Malaies, cofounder of maillon.io.
The company is digitalizing the whole credit process and offering options to smaller retailers to help them grow and become more competitive, thereby improving their survival chances and enabling them to sell better quality products. “If progress is motivated either by fear or greed, banks and large companies are slowly getting there, but the speed in more mature countries is significantly different than in Eastern Europe. From a regulatory perspective, Romania is a bit slow and this is not always in the interest of the consumer. So, we hope we will convince everyone to invest in this ecosystem, because at the end it will benefit consumers and the European Union economy as a whole and will address the competitiveness issue with other big markets on the planet,” said Malaies.
He also commented that there are start-ups in the Romanian market that are trying to get partnerships with big corporates from the beginning. And for the fintech business there has been progress, one example being the BCR accelerator, currently leading to products and POCs. He considers it important to partner with banks and understand the entire ecosystem. “Romania is a big enough market to start, you validate your product but also get some revenue from it. And there’s openness to trying new things. We are courageous enough, so overall the start-up ecosystem in Romania is receiving a great boost, and the fintechs can benefit from this entrepreneurial culture,” said Malaies.
“Fintechs, for sure, won’t be able to replace banks, mainly because people want to have a bank they can talk to, and fintechs are instead made to address specific segments,” concluded Malaies.