The Fintech Times - Money2020 USA 2023 Special Edition

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SPOTLIGHT ON

Combatting inflation using stablecoins in Brazil USA 22-25 OCTOBER 2023

Generative AI

How artificial intelligence is reshaping the global landscape

Driving gaming payments forward

Assessing the impact of the alternative payment service

Laust Bertelsen CEO of Banking Circle S.A. looks at the latest developments in the cross-border payment space as instant payments take a foothold

Eliminating the pain of cross-bord der payments

WELCOME We’re back in Las Vegas once again as the crème de la crème of fintech takes over the Venetian resort for the 2023 edition of Money20/20 USA.

Ever since 2011, Money20/20 has served up destination shows that act as a platform for the forward-thinking within the realms of payments, fintech and the broader financial services sector to come together and collaborate.

This year’s event promises four more action-packed days to delve into the future of finance with 300-plus industry-leading speakers

and companies from across the globe serving up an agenda packed with over 60 hours of engaging content.

This year's agenda unfolds through four chapters, each in alignment with the overarching theme of 'Now and Next' in the financial industry. They delve deep into crucial aspects, including the challenges of trust and regulatory clarity, the disruptive potential of AI and blockchain technologies, the shift towards sustainable business profitability, and the imperative of infrastructure development for the industry's evolution. You

VEGAS!

can learn more about these chapters on page 8.

Artificial intelligence also takes centre stage in this Money 20/20’s sessions, mirroring the heightened global interest in this field at present. With the number of consumer generative AI programs rapidly increasing, primarily led by OpenAI’s ‘ChatGPT’ and Google’s ‘Bard’, the growing impact the technology continues to have on everyday life is undeniable.

On page 4 and 5, we also take a deeper dive into the various use cases of AI to better understand

CHIEF EXECUTIVE OFFICER Jason Williams EDITOR-IN-CHIEF Claire Woffenden JOURNALISTS Francis Bignell ● Tom Bleach

the transformative impact of this technology on the financial sector.

Elsewhere in this Money20/20 USA special

by The Fintech Times, we hear from Xsolla on its mission to actively reshape the landscape of how gamers approach payments, while Banking Circle explores the latest developments in the cross-border payment space as instant payments take a foothold.

Enjoy the read and

Viva Las Vegas!

EDITORIAL DIRECTOR Mark Walker

ART DIRECTOR Chris Swales MARKETING Karen Phiri

FEATURES EDITOR Polly Jean Harrison

EDITORIAL ENQUIRIES editor@thefintechtimes.com

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M2020: ARTIFICIAL INTELLIGENCE

Generative AI: The tip of the iceberg Influencing industries far and wide, AI's expansive impact goes beyond everyday use, reshaping the global landscape With the number of consumer generative AI programs rapidly increasing, primarily led

by OpenAI’s ‘ChatGPT’ and Google’s ‘Bard’, the growing impact the technology continues to have on everyday life is undeniable.

Fintech firms and financial institutions (FIs) are also beginning to implement AI-driven systems and solutions

across all parts of their operations, both on the front and back end.

Explaining why AI has become so influential, Silvia Mensdorff-Pouilly, SVP and head of EMEA corporates and international banking at financial services technology provider FIS, said: “Although generative AI has been around for some time, recent technological advancements have made it incredibly easy to use, leading to wide-scale accessibility.

“The untapped value of generative AI is being explored across all industries

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Tom Bleach and Francis Bignell, journalists, The Fintech Times and, within fintech, has great potential to transform the sector, especially when coupled with other recent advancements, such as embedded finance and open banking.”

To better understand the transformative impact of this technology on the financial sector, we take a deeper dive into the various use cases of AI.

CREATING PERSONALISED SERVICES A McKinsey study has revealed that 52 per cent of B2B companies have increased their market share following the implementation of personalised services as a result of AI. Additionally, Twilio has found that 92 per cent of global businesses are using

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AI-driven personalisation with 81 per cent believing it has the potential to positively impact customer experiences.

Delving into the specifics of how the technology can achieve this, Matt Tippets, SVP of product at Drift, the conversational AI unicorn, said: “Personalisation isn’t just about serving up the right content.

It’s also about using the right channels to resonate with

across the globe, and financial firms carry more risk than in any other sector. Federal Trade Commission data shows that US consumers reported losing almost $8.8billion to fraud in 2022 alone, an increase of more than 30 per cent over the previous year.

To help fight back against fraudsters, many of whom are now employing AI themselves to help launch

clients, based on their preferences. Conversational AI allows financial service firms to increase interactions and learnings with customers, which ultimately leads to increasing personalisation.

“For example, if a customer searches for something on your website, the AI remembers that information and can bring it up in a later conversation, making the interaction relevant to their needs, instead of a general sales pitch.”

attacks on fintechs and FIs, organisations are now looking to level the playing field by investing in AI-driven fraud prevention solutions.

“When it comes to compliance, generative AI has the potential to radically improve fraud prevention by enhancing anti-money laundering and know your customer (KYC) processes and protocols,” explains Bernard Wright, CISO at paytech ClearBank.

According to a recent survey

by Brighterion, a Mastercard financial crime prevention company, in collaboration with

IMPROVING DATA SECURITY Fraud levels continue to rise

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Fintech Nexus, 93 per cent of FIs plan to invest in AI in the next two to five years.

The primary reason for this investment, cited by 63 per cent of respondents, is the need for ‘increased fraud detection’ underscoring how significant AI has already become in the fraud prevention space.

CUSTOMER ONBOARDING The digital transformation catalysed by the pandemic led to many organisations expanding their array of digital products and services. However, the process of customers signing up for new organisations has often proved challenging.

Deloitte’s research found that 38 per cent of customers abandon the onboarding process due to frustration caused by the volume of information required.

Not only could a poor customer onboarding experience impact the amount of revenue generated by a

company, but poor employee onboarding could be extremely costly when it comes to resource allocation. Using AI, companies can save between 25 and 40 per cent on process costs suggests Gallup, the analytics firm.

Conversational AI can also be used in this customer onboarding process. According to Drift’s Tippets: “This saves the sales reps time in doing the research and generating a response, while also giving them control to change it to match their own voice. This is not the future of fintech sales, but the present.”

THE PROBLEM SOLVER AND TIME SAVER: CHATBOTS Customer engagement is arguably the most

important aspect for a business to ensure consumer loyalty and trust. While this can come in the form of personalisation through calls, oftentimes, the wait time to speak to someone is not necessary if the customer has a simple question, requiring a short or simple answer. In cases like these, AI chatbots are particularly helpful for consumers.

Speaking on the impact AI and chatbots are having in Chile, Max Kreimerman, CEO and founder of Alloxentric, the communications platform based on AI, says: “Chileans have discovered how convenient it is to contact a company, answer recruiting questions or

solve an issue with a bot. After all, the bot can still transfer them to an agent if needed.”

Companies like Alloxentric are enabling businesses to improve their business and communications processes through the use of chatbots and voice bots. “Voice bots can target thousands of prospects in less than 60 minutes, allowing agents to focus on those interested in doing business,” explains Kreimerman.

ONLY THE TIP OF THE ICEBERG Of the FIs investing or planning to invest in AI, more than three quarters expect to see improved productivity (79 per cent); better client experiences (75 per cent); or enhanced customer insights (63 per cent) through the use of the technology, Lloyds Bank recently highlighted.

With expectations for AI to improve all aspects of FIs of all sizes, the technology looks set to change the face of finance at a significant pace.

The untapped value of generative AI is being explored across all industries and, within fintech, has great potential to transform the sector

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BANKING CIRCLE: GLOBAL COMMERCE

ELIMINATING THE PAIN OF CROSS-BORDER PAYMENTS TO UNDERPIN THE GLOBAL ECONOMY

Laust Bertelsen, CEO, Banking Circle S.A., looks at the latest developments in the cross-border payment space as instant payments take a foothold

The market for crossborder payments continues to grow rapidly, especially driven by the surge of international marketplace e-commerce models. A report released

by Juniper Research this year predicts that global spend on B2B cross-border payments could pass the $40trillion mark by the end of next year, increasing from $37trillion in 2022.

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Fuelled by technological innovation and regulatory change, the payments sector has been at the forefront of digitalisation and has taken a central role in improving the accessibility of e-commerce across the globe. However, there are still hurdles to overcome to make the payments process – particularly cross-border – smoother, faster, more cost-effective, and, therefore, inclusive for all.

The launch of FedNow, the USD instant payment platform launched by The Federal Reserve in July, is another major step in this direction. With FedNow having gone live, the three largest currencies (representing approximately 80 per cent of

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cross-border flow) now have full instant capabilities.

The advance of instant payments across the world has already re-shaped customer behaviour and expectations for local payments. For example, a BNY Mellon study recently found that 55 per cent of businesses in Asia have reported they have already moved or would change financial services providers to have access to real-time payments.

The same expectations are starting to filter through to cross-border payments.

Unfortunately, most instant payment schemes were built with a domestic focus, and elevating the instant experience to a cross-border level is not a

challenge easily solved. Limited interoperability between local schemes, a variety of local technology and regulatory requirements, and the additional layer of FX are just a handful of issues to overcome.

Unsurprisingly, Juniper Research estimates that only eight per cent of global cross-border transaction value will be instant in 2024.

Bridging the gaps for seamless cross-border payments At Banking Circle, we recognised these challenges and set out with a clear mission: to revolutionise cross-border payments and make

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international trade effortless for all businesses by reducing the barriers of time and cost. Our unique approach to achieving this is to connect the world's clearing systems on a single payments platform. This enables us to provide cross-border payments with the speed and cost of a local payment. And where we can connect to instant payment schemes, we can even offer a near-instant experience.

Our solution is delivering real value to the financial industry.

Banking Circle is already live on the UK Faster Payment Service and SEPA Instant, allowing our clients to receive and send funds in real time between the UK and SEPA-zone at minimal cost. And we are working hard to expand our instant capabilities further. For example, we aim to add other schemes like FedNow in the US1 and NPP in Australia in the future, ensuring that businesses can access instant cross-border payments on a global scale.

A winning partnership By seamlessly integrating our instant payment rails with our other comprehensive clearing capabilities and cutting-edge FX solutions, Banking Circle empowers financial institutions to break down age-old barriers.

Through a single, modern API, we provide access to a diverse suite of fast and cost-effective payment services, enabling our clients to enhance their own products and services, foster innovation, and thrive in the ever-evolving payment landscape.

For example, Banking Circle recently joined forces with the FIFA Clearing House (FCH) to process and streamline the payment of training rewards (solidarity mechanism and training compensation)

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corresponding to international player transfers.

Banking Circle delivers access to direct clearing with central banks and a solid worldwide banking network, supporting FCH with its ultimate objective of centralising and automating payments between clubs, while promoting financial transparency in the transfer system. The payment process is streamlined, while also reducing the costs and time incurred with each payment, with the football community being the main beneficiary.

Banking Circle stands as a testament to the power ofthe cloud Overcoming IT barriers through the cloud The transition to instant payments brings considerable challenges with the demands of 24/7 uptime and other connectivity requirements forcing many financial institutions to reassess their tech stack and back-office. This complexity amplifies when combining multiple schemes across different geographies.

Most traditional banks still operate on multi-layered legacy systems not designed to meet this challenge. Moreover, with the ongoing economic uncertainty, investment in new payments technology is constrained. The BNY Mellon study found that a staggering 90 per cent of financial institutions’ budget is spent on business-as-usual processes, leaving limited room for substantial investments in long-term transformation. These are just some of the reasons why many financial institutions already struggle to deliver on

the local instant payment promise, let alone doing so on a cross-border level.

We anticipate that the agility, efficiency, and scalability that cloud services provide will play a major role in resolving this issue and Banking Circle stands as a testament to the power of the cloud. Our fully cloud-based platform has empowered us to efficiently launch modern solutions and drastically increase performance in key workflows, all while rapidly scaling the business.

However, unfortunately, a McKinsey study conducted in 2022 found that only 13 per cent of financial institutions had half or more of their IT footprint in the cloud. While this number has undoubtedly increased, adoption is still in the early stages in the financial industry, it is clear there is still a long way to go for most players.

For those grappling with these technical challenges, or at the start of building a new business, a partnership with a cloud-enabled bank partner like Banking Circle can be a pragmatic and fast way to get access to advanced payment capabilities and get ahead of the curve.

Mitigating against the risk of financial crime Another important factor in removing barriers to real-time cross-border payments is financial crime. Instant payments have drastically increased requirements for speed on security checks, putting pressure on the processes and systems of financial systems. When moving to cross-border payments, the complexity increases even further with different local regulation, payment formats and data sources.

To combat this, Banking Circle is pioneering the use of AI in

AML, building on the traditional rules-based approach to identify more complex patterns of suspicious behaviour while increasing efficiency and effectiveness. This hybrid solution combines the best of AI and the traditional rules-based approach to all transactions Banking Circle handles on behalf of clients.

The payments future As e-commerce continues its globalisation journey and instant local payments are becoming market standard, the call for better and more accessible cross-border payments is growing ever louder. However, establishing instant cross-border payments on a global level still poses several challenges.

At Banking Circle, we aim to be at the forefront of solving this challenge and creating a world without borders for global e-commerce. By connecting to the world’s main clearing systems, Banking Circle helps payment companies of all sizes meet their customers’ demands for fast, accessible and affordable cross-border payments.

Any activity in the US will be undertaken by Banking Circle US, a sister affiliate of Banking Circle S.A

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About Banking Circle Banking Circle is a fully licenced next generation payments bank that is designed to meet the global banking and payments needs of payments businesses, marketplaces and banks. Headquartered in Luxembourg, Banking Circle S.A. has offices in London, Munich and Copenhagen. www.bankingcircle.com

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M20/20: SPOTLIGHT ON VEGAS

Las Vegas Money20/20 USA Shaping finance's 'Now and Next': navigating the winds of change in the financial industry With everyone who’s anyone in fintech descending en masse to the Vegas Strip, the 2023 edition of Money20/20 USA promises a jam packed four days to explore what’s next in the world of money.

Taking over the famous Venetian resort in Las Vegas, the US edition of the ‘where money does business’ event welcomes 300 industry leading speakers to join the fray with companies from all

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over the world to deliver an agenda of more than 60 hours of engaging content.

Aiming to cover the entire financial ecosystem, speakers come from all corners of the industry, including payment providers, VCs, lending and credit companies, startups, disruptors, and the largest banks and tech companies on the planet.

DISRUPTING THE INDUSTRY From insight to inspiration, the agenda is packed full of sessions that promise to leave attendees feeling super-charged and ready to level up their strategies, relationships and innovation.

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“We are excited to unveil an agenda that brings the entire ecosystem of money together, helping the industry build bridges from the challenges of right now to the opportunities of what is next,” said Zach Anderson Pettet, US content director at Money20/20.

“The agenda reflects the constantly changing industry where trust and uncertainty, creative disruption, the return to fundamentals, and the momentum of building utility are at the forefront. We can’t wait to open the doors to Money20/20 in Las Vegas.”

With sessions covering all the hot topics needed to shake up the money

ecosystem from banking to payments, crypto to startups, and so much more, there's something for everyone here, whether you’re a first timer or a fintech aficionado.

CHAPTER AND VERSE The agenda for 2023 focuses on stories told through four distinct chapters, following the year's overarching theme of 'Now and Next' in the industry. These chapters include 'Trust & Uncertainty', looking at the challenges of trust in finance and the need for regulatory clarity; 'Creative Destruction & A Technological Renaissance', considering AI and blockchain and their impact on the industry;

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'Age of Fundamentals', discussing the return to fundamentals emphasising business profitability over unchecked growth; and 'It’s Time to Build (Utility)', looking at infrastructure and the need to focus on building utility to reflect a new phase for the industry.

Regulation is a particular focus for the event, covering the topic from almost every angle in keynote speeches, interviews and panel discussions. Hester Peirce, commissioner of SEC (U.S Securities and Exchange Commission), will be interviewed on the topic of cryptocurrency regulation and market structure. Michael J.Hsu, Acting Comptroller of the Currency at OCC (The Office of the Comptroller of the Currency), will also discuss topics of banking, fintech, financial inclusion and new technologies.

INSTANT ACCESS Earned wage access will also be analysed in a panel

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with Marie-Elise Droga, head of fintech partnerships at Visa and Gil Akos, founder and CEO of payments platform Astra, along with Hali Mo, product manager of CT Cash & Flex at Cloudtrucks, a business management platform, and Alex Johnsson, founder of Fintech Takes, an online fintech publication.

The rapid developments in data and AI are bringing sweeping changes to the financial industry “I am truly looking forward to discussing the critical topic of ‘Time to Money: Instant Access to Earned Wages isn’t Optional'," said Droga. “By reducing barriers to workerinitiated payment solutions and enabling immediate wage accessibility, we can revolutionise the financial landscape and create a more financially inclusive future.

Sharing these insights during a distinguished forum like Money20/20 underscores the urgency and significance of the digital economy and this economic approach.”

THE IMPACT OF AI Artificial intelligence is a particular focus for this year's sessions, reflecting the increased buzz around the subject seen around the globe at the moment.

Ali Ghodsi, co-founder and CEO of Databricks, a provider of data, analytics and AI solutions is a keynote speaker at this year’s show, delivering a fireside talk on the transformative impact of generative AI and how it's reshaping the landscape of the financial services industry.

"The rapid developments in data and AI are bringing sweeping changes to the financial industry.

Conversations around governance, data sharing and generative AI are top of mind for every financial executive,” said Ghodsi.

“I am excited to speak at Money20/20 and look forward to forging new partnerships with industry leaders as the Databricks Lakehouse powers the financial services institutions of the future.”

Other keynote speakers also confirmed, include Ben Horowitz, co-founder and general partner of VC firm Andreessen Horowitz (a16z), renowned for his insights into the current tech renaissance, will share his expertise and vision.

Stephanie Ferris, CEO and president of financial tech company FIS will deliver a talk on leadership in the ever-evolving financial landscape, while Anand Selvaesari, chief operating officer of Citi, providers of banking services, and Zach Perret, CEO of open banking technology provider Plaid, will also team up to showcase the power of collaboration in driving growth and innovation within the digital finance industry.

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FEDNOW: PAYMENTS

Assessing the rise of FedNow From 57 early adopters to a growing ecosystem – insights from industry leaders In 19 July 2023, the Federal Reserve entered the payments landscape with the launch of its alternative instant payment service: FedNow. The service offers financial institutions an alternative to other instant payments services like The Clearing House’s Real-Time Payments Network (RTP) and the Automated Clearing House.

Two months after the FedNow launch, journalist and LatAm lead, Francis Bignell, reached out to industry experts to examine the early reception and potential impact of the new service.

Eyal Moldovan, co-founder and CEO of 40Seas, a cross-border digital financing solution provider “I guess you just need to look at the growing pool of participants to gauge the success of FedNow. When it launched in July, there were 57 early adopters, ranging from fintechs to large banks and institutions. At the time of

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writing, the number of participating players has risen to 72, along with an additional cohort of settlement agents, liquidity providers and certified service providers.

By enabling instant and secure money transfers between banks and individuals, FedNow aims to modernise and enable a more efficient US payment infrastructure.

“With surging levels of e-commerce and peer-to-peer payments, as well as growing adoption of mobile banking, financial institutions are recognising the pronounced need to meet evolving customer expectations and compete with fintech disruptors. Customers demand and expect a seamless banking experience, and real-time transfers are a core component of this.”

Doriel Abrahams, head of US Risk, Forter, the fraud prevention firm “FedNow has been a success in the sense that everyone is talking about it.

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Saying that, I have not seen it be broadly adopted just yet. However, any payment method, even one as groundbreaking as this one, needs time.

“As humans, we cling on to things we’re used to, and I don’t think the ordinary merchant or even buyer finds too many issues with debit/credit cards, or alternative payment methods like PayPal or Venmo.

“All of these are always mentioned in the same breath as FedNow as this is how it has been communicated to the US. It has been marketed as ‘like a Venmo’ for example, and when you hear this, you find yourself saying, ‘I use Venmo (again let's use Venmo in this case), why should I change?’

“There are various advantages to FedNow in terms of the efficiency and transfers in real-time, but I do think people are yet to realise these benefits. Because of this, if I’m an uninformed buyer and all my sites continue to offer payment options I’m used to, why would I go for something I’m not used to?

“At the end of the day, the Fed can’t relaunch the service, but it would have been great to see how it would have launched if it had been better communicated to the general public. We’re all in tech and we know about this stuff but enriching the knowledge of actual customers would have been very helpful.”

Eric Wheeler, director of product management at Syntellis, the performance management platform “There hasn’t been much adoption yet. There’s still a lot to do for customers to be fully aware of the benefits FedNow can bring. For the time being, I think we can only wait and see before really deciding if it has been a success. I will say, what we have seen and will continue

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to see in the near future is firms willing to participate in preparing the correct infrastructure.

“The idea of wait and see is further cemented by the fact so many organisations have this mentality. They want to see if technology really is as disruptive as it said to be before implementing it. Although they may not have implemented it yet, service providers are

probably on standby in case their clients decide that it is worth investing in.

“I think the big problem is customers won’t adopt a new payment solution until they are unhappy with the one they’re currently using. That is when FedNow will really take off.

“What is interesting is that FedNow’s adoption has not been like other payment methods’ adoption in the sense that both big and small financial institutions are acting as guinea pigs here. However, for something like FedNow to work, it needs a wide-scale ecosystem adoption.”

Customers won’t adopt a new payment solution until they are unhappy with the one they’re currently using. That is when FedNow will really take off www.thefintechtimes.com

Allison Barbosa, head of Americas, RTGS.global, the cross-border settlement provider “Following the launch, I think the biggest thing to note is adoption. And this is ultimately going to take time. It is interesting though, because many people are discussing how you can speed up the adoption process, and as a result, many are looking at countries like Brazil and Pix. Pix has an adoption rate of 85 per cent - a lot of the country is using it whereas in the US and the UK, it’s taking time to grow.

“Interestingly, with RTP you can send up to a million dollars whereas on FedNow you can only send $500,000. Regardless of adoption, it is good we now have another rail, even if the Fed is playing catch up. What would be great is if we saw payment rails like RTP and FedNow interlink, allowing

banks to use both to their advantage and offer customers one, joint system instead of two separate ones.

Aron Alexander, CEO and founder of Runa, the digital value infrastructure “There are promising signs early but the service remains largely untested due low adoption rates. The Fed making FedNow a relatively closed programme in the build-up to its launch makes it very different to European open banking. It is more conservative as third parties can’t immediately get access to data.

“In general though, all payment innovations take time to be adopted. Embedded finance solutions usually take up to 18 months, so these things take time - we will just have to wait and see.”

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XSOLLA: GAMING COMMERCE

XSOLLA'S PIONEERING ROLE IN SHAPING INDUSTRY-WIDE TRANSFORMATION

DRIVING GAMING PAYMENTS FORWARD Xsolla, the global video game commerce company, is actively reshaping the landscape of how gamers approach payments.

Through a dedication to innovation and global reach, the company is simplifying the gaming payment process for both players and developers.

The Fintech Times interviews Anton Zelenin, chief product officer at Xsolla, for insights into global compliance challenges and the future of digital wallets and super-apps in gaming.

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What role does Xsolla play in enabling alternative payment methods for the gaming community?

Alternative payments now make up 50 per cent of global video game sales, alongside traditional credit cards. We continuously research local markets and payment trends to integrate relevant payment methods for game developers, broadening our payment portfolio. Game developers can select the markets where they wish to monetise their games, aligning with their distinctive business needs and strategies. On our end, we are committed to ensuring

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comprehensive coverage for these selected regions.

Over the past year, we have successfully introduced alternative payment methods in various regions around the world, including Venmo and Klarna in the US, PicPay and MercadoPago in Latin America, and M-Pesa and Ozow in the MENA region, among others.

M-Pesa, launched in 2007, has become Kenya's leading mobile money application with a user base exceeding 17 million Kenyans. A key factor in M-Pesa's popularity is its ability to handle transactions as small as $0.01. This focus on micro-transactions has helped

local small businesses and played a role in lifting some people in the region out of poverty. M-Pesa is also compatible with most mobile phones and is a top alternative payment method for gamers.

We provide access to over 700 payment methods, support 130 currencies and operate in 200 geographies to help developers connect with customers worldwide. Our Pay Rank feature allows partners to customise payment methods based on individual customer purchasing habits. This feature ranks and highlights the most suitable payment options, offering a personalised experience for gamers.

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What challenges does Xsolla face when it comes to staying compliant with evolving global payment regulations?

Selling games globally involves complex compliance requirements. Misinterpretation of global and local laws can lead to legal issues and fines, hindering market expansion.

As a Merchant of Record, Xsolla offers comprehensive compliance services, including: ■ PCI DSS Compliance: Ensuring transactions align with PCI DSS standards ■ Data Privacy Compliance: Complying with GDPR and other data privacy regulations to protect user information ■ Tax Compliance: Calculating, collecting, filing, and paying sales tax, VAT, GST, and local taxes for smooth global sales operations As the gaming industry evolves, secure payment processes, especially for underage consumers, are in demand. Xsolla introduces the Parental Control Feature to address these challenges. This feature ensures a secure, compliant gaming experience for all ages, following COPPA and GDPR-K guidelines.

Minors access age-appropriate content, and guardians receive payment notifications, enabling them to approve or deny requests via their Guardian account for added security and control.

What do you see as the future trends and innovations in payment technology within the gaming sector?

In recent years, we've observed a surge in digital wallet adoption, with three out of

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five users now preferring them as their payment method. This extends beyond traditional options like PayPal to include local alternatives such as Alipay (China), PayTM (India), GoJek (Indonesia), and quick checkouts like Apple Pay and Google Pay. Digital wallets have evolved into comprehensive ecosystems, offering various services like social media, transportation, travel bookings, healthcare appointments, food delivery, wealth management, marketplaces, and gaming.

These multifunctional wallets are known as ‘super-apps’.

Super-apps also grant companies access to valuable user data collected within the ecosystem. This data allows for insights into consumer preferences, enabling targeted ads, personalised recommendations, discounts, loyalty rewards, and more.

Super-apps have seen significant success in SouthEast Asia and certain parts of West Asia. For instance, South Korean Kakao Talk has 87 per cent of the country's population as active users, and Grab, founded in Malaysia, dominates Singapore.

Indonesia boasts over 50 super-apps, each with unique promotions and loyalty programmes. We expect this trend to expand into Western markets in the coming years.

How does Xsolla adapt to industry changes?

We closely monitor the evolving payment landscape and integrate digital wallets based on partner requests.

Recently, we added over 20 wallets like Naver Pay, OVO, TrueMoney Wallet, Venmo, and PicPay to our portfolio,

resulting in significant sales increases, up to 13 times higher figures. New paying users also surged by up to 500 per cent, with an 18 per cent rise in acceptance rates.

Accelerated Checkouts like Apple Pay and Google Pay are favoured by gamers for their seamless one-tap purchasing.

We continually expand support for new markets and currencies with these wallets, enhancing integration. While no dedicated accelerated checkout solutions exist for games yet, the potential for future developments exists.

Digital wallets, especially super-apps, can serve as payment methods and game distribution channels. They offer alternative avenues for games, in-game items, and virtual currencies. By featuring games on these platforms, developers can tap into new revenue streams, boost visibility, engage customers, and build brand loyalty. Xsolla is committed to facilitating connections between our partners and digital wallets for alternative distribution opportunities.

Can you share any tips or success stories regarding how you achieved impressive results for your partners?

Optimising user experience, embracing global markets, and fostering effective communication can drive gaming business success.

Xsolla's partners doubled revenue by supporting local payment methods and transacting in local currencies like CNY and BRL, resulting in up to 30 per cent higher conversion rates. Adherence to integration guidelines boosted acceptance rates, from 10 per cent in South Korea to 40 per cent in Brazil with Boleto Flash.

Direct communication with players at checkout, tailored for demographics, payment methods, and markets, led to partners experiencing over 50 per cent revenue growth and a remarkable 240 per cent increase in unique paying users.

Our focus on optimising and customising the payment interface in the last year enhanced user satisfaction, engagement, and loyalty. The latest Xsolla Pay Station version, with extensive customisation capabilities, seamlessly blends with a game's brand style, even a simple theme adjustment through Xsolla Publisher Account yielding over five per cent conversion rate increase.

About Xsolla Xsolla is a global video game commerce company with a robust and powerful set of tools and services designed specifically for the video game industry. Since its founding in 2005, Xsolla has helped thousands of game developers and publishers of all sizes fund, market, launch and monetise their games globally and across multiple platforms. Headquartered and incorporated in Los Angeles, California, with offices in Berlin, Seoul, Beijing, Kuala Lumpur, and cities around the world, Xsolla supports major gaming titles like Valve, Twitch, Roblox, Ubisoft, Epic Games, Take-Two, KRAFTON, Nexters, NetEase, Playstudios, Playrix, miHoYo, and more.

Web: xsolla.com X: twitter.com/ Xsolla LinkedIn: www. linkedin.com /company/xsolla

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HOW TIKTOK AND FINTECHS ARE TRANSFORMING FINANCIAL EDUCATION TikTok, which in 2021 reached one billion active users and achieved over three billion downloads on both iOS and Android platforms, has embraced a new era of audience engagement that surpasses the platform’s initial reputation for lip-syncing and dance-based content.

People across the globe are engaging with the platform to learn more about their finances, with the hashtags #costofliving and #costoflivingcrisis amassing a collective 3.8 billion views.

UK finance expert Martin Lewis boasts over 700,000 followers on TikTok alone, by sharing regular videos focused on finance tips, explaining key developments in the financial world and hosting live Q&A sessions with his followers.

While Tej Lalvani, the British CEO known for being one of Dragons’ Den’s investors on the BBC, boasts over 68,000 followers thanks to his content explaining

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Tom Bleach, journalist, The Fintech Times financial terms, alongside videos about his time on the popular show.

Financial brands are presenting “complex financial products that need an element of humanisation,” explains Daniela Sale, head of finance in the UK for TikTok. “There has been a switch in the way people are consuming content on the platform – before it was very spontaneous – but now we are seeing a more intentional approach to the platform. So people come on the platform, to discover, to keep up to date with what’s going on, and also to find information that helps them make their own decisions.”

According to Sale, brands such as Monzo and Revolut are doing a “great job of building their own personality on the platform, as well as staying authentic and genuine to who they are and what their values are”.

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She continues: “They have these elements of not taking themselves too seriously and providing light entertainment.

They’re taking what we call a ‘Lo-Fi’ type of approach, so not too polished, as opposed to what you can see usually produced in studios.

Education around finances has always been quite difficult to get for everyone. I think TikTok is making this easy by offering free and easy access to personal financial education.”

There has been a switch in the way people are consuming content on the platform Unsurprisingly, given the platform’s vast number of users and high engagement levels, there has been a corresponding rise in the spread of misinformation and deceptive tactics aimed at achieving

personal gain by tricking users into certain investments.

In an effort to combat this, TikTok launched its #FactCheckYourFeed campaign, collaborating with creators and well-known public figures to keep users safe by encouraging them to think critically when using the platform. With this, it hopes users can identify misinformation and fake news more easily, to help fewer people fall victim to scams or share anything that isn’t true.

As people pay more attention to how they manage and look after their money – they have taken a far greater interest in getting information from the experts on a platform that makes information from their community easy to find.

Users have recognised that they shouldn’t trust everyone that makes content – therefore making challenger banks, traditional banks and recognisable financial experts the more popular sources.

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Keeping fintech talent CRACKING THE CODE TO FINTECH EMPLOYEE LOYALTY An overcrowded labour market, ongoing economic fluctuations, and the ‘Great Resignation’ phenomenon all have one thing in common: they massively impact the way people get paid.

Between 2022 and 2023, Payscale, the compensation data and software solutions provider, observed that more and more organisations are having to adjust pay for their employees twice a year to properly compensate them.

A DESIRE FOR TOP-END TALENT The desire for top-end fintech talent has never been greater.

In fact, according to data consultancy Dufrain, more than 50 per cent of data and analytics leaders cited their most significant business challenge as recruiting individuals with the necessary skills and talents.

Gone are the days when ‘pizza Friday’ was all it took to convince people to stay at your firm. Now employees want to

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be challenged – they need to be working on interesting and scalable solutions. For completing these more challenging tasks, they want to be properly compensated.

Therefore, understanding the key elements which shape pay adjustments is crucial to navigating the ever-evolving landscape of talent and market demands. Lexi Clarke, chief people officer at Payscale, explains: “Implementing pay transparency at any organisation is a powerful tool.

In fact, research supports that

determined and that it’s fair, it builds trust, therefore employees are more likely to feel valued and engaged.

Employees want to stick with employers who they feel truly have their back, and pay transparency is a great way to build that trust.”

ADJUSTING TO AN UNCERTAIN ECONOMIC ENVIRONMENT At the start of 2023, the fintech industry was optimistic that investment would bounce back

Employees want to stick with employers who they feel truly have their back, and pay transparency is a great way to build that trust increasing pay transparency reduces job-seeking behaviour by incumbent employees.

Posting salary bands publicly and having open conversations about pay with your teams is a sign of goodwill to current and future employees.

“When employees understand how their pay is

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following a decline in 2022 to $164.1billion across 6,006 deals, compared to 2021 which reached $238.9billion across 7,321 deals. However, rising inflation and interest rates have made investing in the industry harder than ever. Consequently, 41 per cent of UK and US lenders are having to increase

their default rates. Businesses feel the knock-on effect of this inflation growth and in turn, so are their employees.

Payscale ensures that leaders can keep on top of these evolving trends and treat their employees in kind by using the Payscale Index has tracked quarterly compensation trends since 2006, showcasing the high upward wage pressure of recent years.

“When it comes to compensation management, 85 per cent of organisations have pay structures but only 49 per cent are training managers on pay communications. The needle for what constitutes ‘good’ is shifting and employers are responding,” says Clarke.

The Index shows that the real value of wages, when adjusted for inflation, has witnessed an 11 per cent decline since 2006.

Therefore, to keep top-level talent, employees must be compensated adequately.

Clarke concludes: “More organisations are seeing the importance of strategic compensation management.”

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You’re moving fast.

We’re making it frictionless.

Shaping the future of finance, together. swift.com/future

As virtual assets continue to surge in global prominence, the regulatory landscape governing them becomes increasingly crucial. The jurisdiction in which virtual asset service providers (VASPs) choose to operate can significantly impact their prospects – either nurturing innovation or stifling growth.

In our new 'Where to Relocate' series we put the spotlight on the world's most VASP-friendly jurisdictions, including Gibraltar, Mauritius, Cayman Islands, Switzerland, the UAE and Japan.

We have selected these jurisdictions as they are not simply reacting to change but anticipating it, making deliberate and informed policy decisions to promote

a healthy, dynamic virtual asset ecosystem.

In the first instalment of our 'Where to Relocate' series, we turn to Gibraltar.

PIONEERING A VASP-FRIENDLY ENVIRONMENT Gibraltar has swiftly established itself as a leading hub for VASPs, finding the delicate balance between regulatory diligence and operational flexibility. Its journey towards becoming a haven for VASPs has been marked by proactive policies, robust regulations, and a competitive landscape.

The Gibraltar Financial Services Commission (GFSC) plays a pivotal role in safeguarding consumer interests, enhancing Gibraltar's reputation as a quality financial services hub, and creating an environment conducive to business growth. The GFSC's

mission is to promote good business, protect consumers, and preserve Gibraltar's good reputation as a financial centre.

The Distributed Ledger Technology Provider Regulations (DLTPR), in effect since January 2018, captured virtual asset-related businesses, making Gibraltar one of the first jurisdictions to do so. The DLTPR encompasses a broad scope of financially-based, DLT-related activities and sets out 10 Regulatory Principles that firms must adhere to.

These principles cover conduct, prudential, market integrity, and financial crime expectations and requirements.

The principles-based, outcomes-focused approach ensures that regulation remains proportional to the scale and nature of the activities, preventing stifling overregulation.

TRANSPARENCY Gibraltar's commitment to international anti-money laundering (AML) and countering the financing of terrorism (CFT) standards enhances its reputation as a responsible financial jurisdiction. The government has implemented clear and transparent procedures, reducing bureaucratic complexities and facilitating business setup. The presence of skilled talent and government incentives, including tax benefits and grants, further bolsters Gibraltar's appeal to VASPs. Gibraltar's journey as a crypto-friendly jurisdiction has extended to its fund industry, consistently ranking among the top five crypto fund domiciles in reports like PwC's Annual Crypto Hedge Fund Report.

WHERE TO RELOCATE...

GIBRALTAR EXPLORING VIRTUAL ASSET REGULATION ACROSS VASP-FRIENDLY JURISDICTIONS

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Experienced investor funds (EIFs) have gained popularity among crypto funds seeking the oversight of the GFSC while utilising a Protected Cell Company structure. The EIF route allows fund managers to build a track record cost-effectively.

Take an in-depth journey into Gibraltar with leading experts in the industry: Gibraltar’s Minister for Digital and Financial Services, Albert Isola MP Albert Isola discusses how Gibraltar has established itself as a global hub for distributed ledger technology (DLT) and cryptocurrency innovation through proactive policies, robust regulations, and a competitive landscape. He

highlights Gibraltar's strategic location, balanced regulation, rich expertise in the DLT sector, and commitment to excellence in regulatory processes.

Bullish Gibraltar Robert Quinlivan, CEO of Bullish Gibraltar, highlights the exchange's success as a top institutional digital assets exchange, emphasising its regulated and audited status under Gibraltar's regulatory framework.

The Gibraltar Financial Services Commission (GFSC) William Gracia, head of DLT at Gibraltar Financial Services Commission (GFSC) underscores its crucial role in promoting good business, protecting consumers,

and maintaining Gibraltar's reputation as a quality financial services hub.

Gibraltar law firm ISOLAS Jonathan Garcia, partner at ISOLAS, a full-service Gibraltar law firm, describes Gibraltar's rise as a leading hub for virtual asset service providers (VASPs) by striking a unique balance between regulatory diligence and operational flexibility.

Paul Astengo, Senior Executive at HM Government of Gibraltar Paul Astengo, Senior Executive at HM Government of Gibraltar, discusses Gibraltar's role as a global hub for distributed

ledger technology (DLT) and cryptocurrency innovation. He highlights the contributions of Gibraltar Finance in promoting the financial services sector and fostering collaboration between the industry, public sector, and government.

Luke Walsh, a PwC Gibraltar advisory partner Gibraltar's innovative approach to crypto regulation, the growth of its fund industry and the appealing tax advantages makes it an attractive destination for crypto entities. Luke Walsh, a PwC Gibraltar advisory partner with over 14 years of experience, explores Gibraltar's cryptocurrency regulatory landscape.

Gibraltar has swiftly established itself as a leading hub for VASPs, finding the delicate balance between regulatory diligence and operational flexibility

Scan the QR co de to delve into ou r 'Where to relo cate – Gibraltar fo cus.

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TETHER: CRYPTOCURRENCY

COMBATTING INFLATION USING STABLECOINS IN BRAZIL WITH TETHER

Francis Bignell, journalist and LatAm lead, chats to Paolo Ardoino, CTO at Tether, to learn more about the Brazilian crypto market The Fintech Times: Paolo, tell us more about Tether Paolo Ardoino: Tether is a stablecoin. It makes the crypto economy much more efficient by putting dollars on a blockchain. Tether tokens are currently being used to disrupt everything from the digital payment space to e-commerce purchases to facilitating transactions within decentralised finance.

They are also being used to facilitate cross-border trade and remittances to emerging

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markets. Tether provides a stable and efficient way of transmitting dollars. It is widely used by tens of thousands of traders daily across Asia, Latin America (LatAm) and Europe simply because it makes trading and arbitrage, among other things, more efficient.

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Tether is driven by an aim to revolutionise the global financial landscape. Our mission is to provide accessible, secure, and efficient financial, communication, and energy infrastructure. Today, Tether enables greater financial inclusion. It also enables communication resilience, fosters economic growth, and empowers individuals and businesses alike.

By leveraging blockchain and peer-to-peer technology, we are committed to bridging the gap

between traditional financial systems and the potential of decentralised finance.

TFT: What stablecoin trends are you seeing in Brazil?

PA: Latin America is an exciting hub for the crypto world – it has active and vibrant communities.

Crypto is particularly popular here for achieving financial independence, especially in nations facing currency devaluation.

While more and more

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Brazilians are embracing crypto, stablecoins are stepping in as a reliable medium between traditional finance and the crypto realm.

In the dynamic of emerging markets, stablecoins are rising as a go-to solution. It’s not so surprising, they offer a smooth way to send value across borders, making them quite attractive for remittances and cross-border transactions.

With their tie to major fiat currencies like the US dollar, stablecoins offer a steady value in an economy that’s no stranger to inflation.

This surge in stablecoin use reflects the increasing need for stability and user-friendly options within Brazil’s crypto scene. The dollar-backed stability offers a safe haven amid market fluctuations, appealing to investors and traders alike.

That’s one of the reasons why Tether is the largest form of payment for some of the biggest merchants globally. It allows customers within the LatAm market to safely exchange their native currencies for a safe dollar-pegged currency without relying on cash, while also protecting customers from inflation.

TFT: What is Tether doing to improve the stablecoin and crypto sector in LatAm? PA: Tether has emerged as a foundation for a new financial system amid high inflation and currency depreciation.

In this region, USD , Tether’s crypto asset, takes centre stage for remittances. It offers a cost-effective solution to the growing market of cross-border transactions.

Brazil stands out as a promising market due to

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its demand for financial freedom tools like USD .

Our company is dedicated to shaping a brighter tomorrow for the people of Latin America. USD offers swifter transactions and reduced fees, standing out as a reliable payment method. This sets it apart from other stablecoins.

Tether is unwavering in its commitment to broaden accessibility across various networks. This makes it accessible to a growing number of individuals who utilise it for savings and trading purposes.

Day by day, we can see that stablecoins are facilitating cross-border transactions and remittances in emerging markets like Brazil. In June, the amount transacted in cryptocurrency was R$14.8billion, equivalent to almost 80 per cent of the total for the month.

stablecoin sector is showing a unique blend of growth and potential within the global landscape. Brazil stands out due to its substantial population and economic significance.

Amid high inflation and steady depreciation of the local currencies, 90 per cent of the cryptocurrency that comes into the LatAm region are sent from foreign countries. 22.6 per cent is sent in Tether, making it the most used stablecoin for remittances.

The country’s crypto community is vibrant and eager to embrace innovative financial solutions. The convenience of stablecoins for cross-border transactions and remittances holds immense appeal in a country with a significant diaspora. In Brazil, USD for example is used as a

With their tie to major fiat currencies like the US dollar, stablecoins offer a steady value in an economy that’s no stranger to inflation. This surge in stablecoin use reflects the increasing need for stability and user-friendly options within Brazil’s crypto scene In all, 252,000 operations with the cryptocurrency transacted this amount, with an average value of R$59,000 per operation, making Tether the most used stablecoin for remittances. It was only second to Bitcoin in terms of usage.

TFT: How does Brazil compare to the rest of the world?

PA: There is definitely an emerging market of Brazilian residents who use USD as a way to access the financial system simply and quickly.

The Brazilian crypto and

way to avoid the 10 to 12 per cent fees that banks apply.

The use cases for Tether in the region continue beyond there, as has been the successful use of USD in the peer-to-peer trading markets.

Additionally, an increasing number of people in Latin America are also beginning to accept Tether as a payment method for real-life services.

That’s why Brazil is such a promising market. Simply put, there is a clear demand for access to financial freedom tools like stablecoins.

TFT: What are the unique challenges associated with in this space?

PA: One of the challenges is navigating the complex regulatory landscape, as the industry is still developing.

The need for a regulatory framework is crucial when building trust and awareness among the population. Of course, in a country where millions of people do not have bank accounts, challenges are higher. The growing rate of adults with a bank account (from 56 per cent to 84 per cent in the last decade), mainly driven by regulatory changes, is facing the downside of expanding access to banking.

According to a recent Central Bank report, on the country’s credit ecosystem, 84.7 million are burdened by unpaid credit card debts and face difficulties in managing their finances.

The difficulties and limitations imposed by inflation and a less-than-inclusive financial system have excluded many of Brazil’s citizens from being able to participate in the country’s growing economy.

Challenges persist in the country. The political and financial scenarios in the region have inspired users to find more stable and secure currencies to hold, leading many to Tether. Acting as a reliable option for remittances and removing the high fees, long wait times, and the insecurity of liquidating fiat associated with traditional financial institutions, crypto and stablecoins have become the safest route to achieve financial freedom. https://tether.to/en/

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NTT DATA: DIGITAL TRANSFORMATION

NTT DATA's Platea open banking platform arrives in North America As the global digital revolution continues its transformative journey, the financial sector stands at a crossroads.

North American banks are steadfast in their commitment to modernisation and innovation. However, they face the challenging task of balancing the breakneck speed of technological change with operational risks and implementation costs.

Enter fintech companies and the concept of open banking, offering a pivotal solution to this conundrum.

Global IT consultancy firm NTT DATA is catalysing a new era of opportunity for fintech companies eager to collaborate with traditional banks with the introduction of its Platea open banking platform to North America.

Following an initial debut in 2019 and success across regions including Japan, Latin America, the UK and the EU, the arrival of Platea in North America serves up a platform that empowers

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banks to experiment and innovate swiftly to keep pace with the evolving fintech landscape. While Europe has mandated open banking through regulations, the US market is responding to the growing demands of its tech-savvy customers.

MODULAR APPROACH Built upon cloud-native banking architecture, Platea brings to the table an integrated partner ecosystem and a comprehensive suite of functional modules.

These modules encompass

Platea aligns perfectly with the priorities of banks seeking to transition from legacy systems to the cloud services ranging from seamless customer onboarding to lending, financial planning, card issuance, payment processing, and more.

What sets Platea apart is its cloud-centric approach, offering the twin benefits of scalability and flexibility. Banks can

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leverage Platea to expand their digital offerings at their preferred pace without being tied to a single vendor.

Operating on an event-driven, real-time processing model, Platea aligns with the priorities of banks seeking to transition from legacy systems to the cloud.

Kaoru Kumashiro, manager of global industries, global marketing and communications at NTT DATA Group Corporation, said: “We first launched Platea Banking, our digital banking solution built on our deep industry expertise and extensive partner ecosystem, in Europe back in 2019. At that time, the market was driven by regulation, and we built a solution to meet that demand.

“Now, our next target market is the US, where the shift to open banking is driven mainly by market demand but also potentially by regulation in the future.”

A core strength of Platea lies in its extensive partner ecosystem. NTT DATA collaborates with core banking service providers, payment

platforms and various partners to provide a diverse array of services. Clients have the flexibility to select preferred partners, sidestepping vendor lock-in and expediting their time to market.

PARTNERSHIPS In North America, NTT DATA has forged partnerships with new fintech companies to enhance Platea's capabilities.

This includes bolstering real-time payments, account aggregation, and ID verification features, significantly enhancing the digital onboarding experience.

Prominent fintech partners for Platea include Jumio for ID verification, Mambu for its core banking platform, Volante for real-time payments and Akoya for account aggregation.

NTT DATA's ultimate goal is to extend the concept of banking-as-a-service to a broader spectrum of clients, even encompassing nonfinancial institutions. This vision underscores its commitment to driving innovation and collaboration in the constantly shifting terrain of open banking.

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