The Paysafe team is just back from this year’s Money20/20 Europe show in Copenhagen – billed as the continent’s largest fintech event, and certainly the most interesting trade event of the year so far from our perspective. As trade shows go, this one was more than just the usual collection of vendor booths; a great turnout from every corner of the industry, combined with a broad and deep selection of general and breakout talk sessions, ensured that there was something to keep everyone engaged throughout.
“Overall, we saw a massive improvement from last year’s show,” says Danny Chazonoff, Chief Operating Officer. “It was more widely attended, with great keynote speakers; a perfect place for us to show that we continue to be a group at the forefront of payments innovation for merchants and consumers”.
That sentiment, and the sense that this was more than just another networking opportunity, was echoed by the whole Paysafe senior management team. “This was a great opportunity to reinforce our credibility in the fintech and payments worlds,” according to Joel Leonoff, Chief Executive Officer. “It’s a great assembly of the whole industry, with all kinds of opportunities. We had a lot of interesting conversations with some very significant organisations that I think will result in more business for us collectively”.
“The opportunity to meet with people at very senior levels is quite unique,” says Daniel Kornitzer, Chief Product Officer. “You can walk away from meetings with something really actionable, the beginnings of a fruitful relationship”. Talk of such partnerships is not just about traditional industry clichés, according to BD Goel, Chief Innovation Officer. “In the last few years there has been a lot of chest-thumping from players claiming to have a full payments stack. Now everyone’s recognising that the world is just too complex to go it alone, and partnerships are genuinely becoming very important” – particularly when it comes to technology such as AI, he thinks, which is beyond the scope of the traditional payments sector.
Goel also noted that this year’s Money 20/20 Europe offered rare insight into the real activity beyond the fintech hype – a glimpse of what the industry is really doing, not just what it’s talking about. “We get to see what’s real and what isn’t. It’s not as chaotic as some of the biggest conferences – that lets you get a real perspective on where the industry's going”. That perspective revealed some very clear directions among the Money20/20 Europe crowd – some already well-known, and some with less well understood implications for the near future.
Perhaps the biggest trend this year is the shift towards a new understanding of the power of the consumer. “It’s clear that this is not just about traditional payments any more – it's about how people buy stuff and the best payment experiences,” says Goel. Regulation such as PSD2 is a big driving force for this, he thinks, but so too is an awakening of the industry to the idea that a more open approach will lead to better business for everyone. “We’re seeing that the whole notion of what services banks can and should provide is changing. Banking is becoming a collection of APIs that are creating “banking as a service” models which allow consumers to spend their money any way they want,” he says. Exactly what those models will look like in future remains to be seen – “anyone who thinks they have a crystal ball is smoking something,” he says – but he’s convinced that approaches like Paysafe’s own platform-as-a-service will turn out to be critical in building them.
One other notable direction is a strengthening of the relationship between the fintech community and traditional industry players. “At least some fintechs were taking a position of attack as far as the incumbent banks were concerned. Some of that is still true, especially around inefficiencies and pricing, but there’s a noticeable shift in that position this year” says Kornitzer. “Many of them now recognise that banks are great potential partners, not enemies”.
Unsurprisingly, hot topics such as fraud and risk were in widespread evidence at Money20/20 Europe. “Every third booth seems to be some sort of fraud fighting entity,” says Bernhard Linemayr, CEO for payolution. “On one hand, that’s very good – it means that we have lots of partners to choose from. But there’s also a lot of overlap between the vendors, especially around technology such as device fingerprinting, custom scoring models or AI."
The advent of AI, in particular, is adding new layers of innovation to fraud and risk management – hence the popularity of talk sessions on the subject at this year’s show. But Leonoff observes that not everyone is quite as determined to innovate as others, and that there’s still work to be done right across the financial services board. “All in all, it’s a great show. But there are still some dinosaurs around who are going to find it impossible to turn quickly on a dime. We're one of the companies doing something far more significant when it comes to moving money around the planet. Money20/20 has been a great opportunity for us to find the other companies who can help us do it”.
Ultimately, of course, the value of shows like Money20/20 Europe will become clear in the form of benefit for consumers and merchants. Kornitzer thinks that innovation is just one aspect of delivering real value to a customer base that remains underserved by the industry at large. “Many technological and regulatory factors impact innovation and disruption, but ultimately it comes down to finding customers who are not being well-served today. This show has reinforced our belief that there are still truly underserved groups out there who can be engines for real growth. We need to find more innovative business models for them, not just more products”.