Retail Banking

Daily Review: Will 2018 Be the Year of the Bank of Amazon?

MEDICIGlobal Head of Content

As technology companies are gradually invading the financial world, the circle tightens up around the most expected step – fully-fledged banking services from the likes of Amazon. The year 2018 will reveal startups to be a healthy push to innovation adoption rather than any substantial competition, while Telcos, WhatsApps, Amazons of the world increase the pressure in already actively transforming financial services industry.

Pick #1. Will 2018 Be the Year of the Bank of Amazon? Experts Weigh In

Retailers like Wal-Mart Stores Inc. have long wanted in on banking, and regulators might finally be on their side. That could open the door to a Bank of Amazon or a Facebook Financial. If these technology giants did decide to move into finance, they would have a few major advantages over the banks: better data, a superior user experience, and immense customer loyalty.

“The tech behemoths have been slow-ish but that’s changing quickly driven largely by Chinese chat/payments envy. Facebook, Apple and others will double down on trying to replicate this in the US.” – Jeremy Philips, Spark Capital

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Pick #2. 2018: Another Growth Year for Blockchain

On payments

As we saw payments do in 2017, I expect we will see trade finance begin to go live on blockchain in 2018. In payments, momentum will pick up and volumes will increase as larger banks, including correspondent banks, get into the act. These players will be tempted by the advantages blockchain brings in terms of real-time processing, lower risk profiles, lower costs, and transparency.

On the fund industry

One space I think we should keep a particular eye on in 2018 is the fund industry, where firms like Melonport are using blockchain to rethink asset management. I think we will see more of this, and that the fund industry will start to be significantly disrupted next year.

This will start with the management of crypto-assets, but over time, we will see traditional assets increasingly being tokenized, migrated onto blockchains and managed on-chain.

On ICOs

Over the next 12-18 months, I expect people with experience and expertise in the IPO world will embrace tokenization as a technical platform, and the whole business will be professionalized, with book building, pricing, startup evaluation and so on happening more along traditional lines.

As we’ve already begun to see, it will be harder to get funding simply on the back of a white paper. Investors will demand sound business plans and high levels of transparency, with all that entails.

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Pick #3. The Internet of Things: Past, present, and future

IoT adoption of is driving the growth of sensor technology. The rise of big data and the pressures around proficiencies and productivity has led more businesses to explore the concept of sensor-enabled machinery. Referred to as “indispensable and integral in digital ecosystems,” using smart sensors in a factory setting means that problems, or predicted problems, can be proactively identified and dealt with automatically – even down to component level – minimizing downtime and boosting productivity.

Smart buildings are becoming one of the most recognizable applications of IoT. Sensors can be used to turn off lights when the last person leaves at night, and turn them back on when the first person arrives the next morning. They can control heating, ventilation, air-conditioning, and analyze the data they collect to determine the most efficient means of lighting or heating a space.

We’re also seeing more integration of sensors into everyday objects, such as electricity meters, waste bins, traffic lights and street lights, which is steering society towards a smarter way of living. There’s more talk of the likes of driverless cars, a key takeaway from the recent UK Budget announcement, which is set to transform how we live everyday life and take us one step further into a society revolved around the latest technologies.

“A big part of the Internet of Things isn’t so much about smart devices, but about sensors. These tiny innovations can be attached to everything from yogurt cups to the cement in bridges and then record and send data back into the cloud. This will allow businesses to collect more and more specific feedback on how products or equipment are used, when they break, and even what users might want in the future.” – Bernard Marr, Forbes

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Pick #4. Indiegogo Goes Where Few Companies Dare: Into Initial Coin Offerings

Indiegogo helped take crowdfunding mainstream. Now the company is hoping it can do the same for initial coin offerings, the popular but unregulated practice of selling custom virtual currencies to raise money for software projects.

Indiegogo started a new service on Tuesday to vet coin offerings, and then help sell them to small and large investors.

The first project to use the service – a startup known as the Fan-Controlled Football League will begin raising $5 million on Indiegogo this week. The startup aims to use the money to create a league of football teams that will be guided by people who buy the league’s coins (a crazy-sounding idea that has already been tested).

“We want to bring a brand of trust to the entire industry, which we think will bring ICOs to the mainstream,” said Slava Rubin, one of the founders of Indiegogo.

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Pick #5. Kicking off Stripe’s private beta in India

“Today, we’re starting an invite-only beta for Stripe in India with a small group of companies. These businesses will help us test our platform in the Indian market and provide feedback on features that we’ll need to build to support all Indian businesses looking to accept online payments and run their companies on Stripe.

Supporting Indian entrepreneurs is critical to our mission of expanding the GDP of the internet. Now more than ever, India is uniquely positioned to move more commerce online: In just the past two years, the percentage of India’s population connected to the internet has more than doubled to 500 million users. And in 2016, India saw more than twice the number of new businesses start as the United States.

With Stripe Atlas, we’ve already been able to help some Indian entrepreneurs build and scale global companies. However, we believe that by operating locally in India – with the ability for Indian companies to connect their local bank accounts to Stripe and get paid out in rupees – we can help support even more businesses and more types of business models (such as local marketplaces) in the years to come.” – Anand Balaji, India Lead, Stripe

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Elena Mesropyan

MEDICIGlobal Head of Content

Global Head of Content, MEDICI

Elena is a research professional with a background in social sciences and extensive experience in consumer behavior studies and marketing analytics. She is passionate about technologies enabling financial inclusion for underprivileged and vulnerable groups of the population around the world.