{"componentChunkName":"component---src-templates-blogpost-tsx","path":"/blog/paybase-predictions-2020","result":{"pageContext":{"isCreatedByStatefulCreatePages":false,"id":"8733d965-b467-5950-ac71-faca0c501cef","title":"Paybase predicts...","slug":"paybase-predictions-2020","published":"2020-02-21T00:00:00.000Z","author":"Gemma Doswell","content":"## What we said in 2018\n\nIn 2018, we spoke to the [Fintech Times](https://thefintechtimes.com/payments-paybase/) about what was to come in 2019. We predicted that as the effects of open banking and PSD2 developed, we would see the Payment Initiation Services Provider (PISP) functionality become a more mainstream alternative to the checkout experience. We also predicted that regulation would be viewed by more businesses as an enabler to innovation as opposed to a restriction from it. Finally, we foresaw that there would be a greater appreciation for the need for smooth crypto-to-fiat (and vice versa) interoperability, bringing blockchain tech further into mainstream culture and making it more accessible to businesses and consumers alike.\n\n## Trends\n\nLast year, we came to the end of another technologically-driven decade, seeing payments regulation intensify and widen (with 5AMLD set to affect cryptocurrencies for the first time), financial innovation continue to develop and rapid growth in the blockchain space. We also saw banks increasingly partnering with FinTechs to offer more innovative capabilities, the rise of biometric technology to secure our transactions and a plethora of flexible ways to pay.\n\nHere are the top five trends that we saw emerge across the FinTech, platform and crypto industries:\n\n**1. The above and beyond marketplace**\n\nOver the last decade, the platform business model exploded in popularity with startups being launched every day around the world. But owing to the short life span of many startups, a new trend emerged: growth at all costs was no longer the be-all and end-all. Many marketplaces focused on growing efficiently and going above and beyond to reduce the risk of early [disintermediation](https://paybase.io/blog/retaining-buyers-sellers). Rather than focusing purely on bringing new users to a platform, many businesses encouraged existing buyers and sellers to migrate their relationships online, therefore securing a wider range of users to their platform.\n\n**2. Libra and the push for crypto regulation** \n\nThe buzzword of last year. Libra divided the opinions of the financial community and regulators alike. Facebook’s proposed cryptocurrency, Libra, was to launch in 2020, but the project was described as a risk to financial stability, financial crime and [“a threat to sovereign currencies”](https://www.coindesk.com/facebooks-zuckerberg-appears-to-put-libra-launch-date-in-doubt). Libra did however open the conversation for regulation in the cryptocurrency space. 5AMLD - the 5th Anti-money Laundering Directive - which was already set to include cryptocurrencies in its legislation, came into force in January 2020 and we believe that it is the first of many significant steps forward in the legislative treatment of digital currencies.\n\n **3. The rise in popularity of Progressive Web Apps**\n\nDespite not being strictly new, Progressive Web Apps are the new standard for building a web application. They are the evolution of traditional web pages into immersive apps which provides a first-class user experience. The key features of a PWA are:\n\n* A user interface (UI) that is similar to a mobile app in terms of usability\n\n* Push notifications\n\n* Offline capabilities enabling users to continue using the application if they lose connection\n\n* Automatic updates behind the scenes\n\n* Fully responsive (mobile, tablet and desktop-friendly) with a capacity to work across browsers with little difference\n\n**4. The prominence of network effects**\n\nNetwork effects work on the basic principle that the more people join a network, the stronger the network becomes - think of the way a business like Monzo is able to build value. The more people that use Monzo, the wider their network and the more valuable their features (such as P2P payments) become. With the likes of platform giants like Uber, Amazon Marketplace, Airbnb and more, the power of building a strong community became even more apparent. Network effects allow businesses to extend their reach significantly - and Facebook’s announcement of Libra brought the monopolising potential of network effects even further to the forefront of attention.\n\n **5. Strong UX and the tribal consumer**\n\nAs the trend of hyper-personalisation grew across the FinTech industry with both challenger banks and financial products honing in on the technology, consumers began to form loyal communities in support of them. [“Tribes arise when consumers identify as a group based more on common collective behaviors than on demographics.”](https://www.forbes.com/sites/nikkibaird/2018/08/26/tribal-marketing-and-the-need-for-a-radical-redefinition-of-brand/#33fee47d7090) Monzo, Starling, N26 and Klarna were just a few examples of businesses that attracted tribes of users. And they did this by putting seamless UX at the forefront of their offering, making it easier than ever for their users to pay, receive payment and navigate around their products.\n\n## Predictions\n\n![](https://paybase.imgix.net/blog/paybase-predictions-infographic.png)\n\n","excerpt":"What we said in 2018\n\nIn 2018, we spoke to the Fintech Times about what was to come in 2019. We predicted that as the effects of open banking and PSD2 developed, we would see the Payment Initiation Services Provider (PISP) functionality become a more...","cover":{"src":"https://paybase.imgix.net/blog/money-growth.jpg","alt":"need one"},"link":{"to":"/blog/paybase-predictions-2020","copy":"Read more"},"tags":["Predictions","FinTech trends","Blockchain trends"],"related":[{"id":"aae95b4b-3da0-55bb-9a70-3f181ad82f10","title":"Our predictions for 2018","slug":"our-predictions-for-2018","published":"2018-01-31T00:00:00.000Z","author":null,"content":"\nChanges in regulation, the rise of cryptocurrencies, Brexit - 2018 is certainly going to be a year that throws up both challenges and possibilities for the world of FinTech.\n\nAt Paybase we’re very excited about the year ahead, and after speaking to our CEO, Head of Partnerships and Head of Compliance, we’ve compiled three separate perspectives on what 2018 may look like.\n\n#### Russ West, Head of Partnerships\n**Russ is a payments specialist who has been working in FinTech for over a decade.**\n\n“I’ve seen a few blogs and articles recently making predictions for 2018, but they tend to be centred around the technological capabilities. What is much more relevant is what is actually going to happen for the consumer. With this in mind, my predictions are threefold.\n\nFirstly, Open Banking, one of the key features of PSD2, is definitely going to have ramifications, but perhaps not in the way some of the PR is suggesting. The accessibility of bank account data (for example, consumers giving authorized third parties access to details such as their transaction history and balance in order to receive deals and/or save money) will surely prove to be a catalyst for innovation, with many FinTechs and banks alike exploring what can be done with this change in regulation.\n\nHowever, I see that’s about as far as it will go in 2018, because although open banking has the potential to transform consumers' relationships with financial products (and indeed the institutions themselves), it will hinge on the consumers’ willingness to embrace it. That is down to both trust and user experience, but mainly trust. After all is a consumer likely to adopt something completely different straight away when it comes to their money? Unless it benefits them in a substantial way, the majority will stick to what they know and trust.\n\nIn short, Open Banking will undoubtedly affect the discussions going on, and help shape decisions on innovation within finance, but its impact won’t extend to many consumer experiences in 2018.\n\nSecondly, I think we’re likely to see a lot more cooperation between banks and FinTechs. The banks are beginning to realise that FinTechs are in a better position to build innovative financial products, as they are not tied to outdated systems and technology. Because of this, banks will adopt some of the financial technology being created by FinTechs through partnerships and acquisitions. In fact, by the end of 2018 I expect a lot of banks to replicate FinTech services themselves, as they realise that what these firms are offering is more than just a lot of hot air.\n\nFinally, I think online marketplaces and the gig/sharing economy will continue to soar, with their presence becoming even more mainstream. The trust towards online marketplaces has been cemented in recent times - I don’t see why that would change - and the money being poured into these types of business from investors has to be a huge validation of their potential.\n\nBut it’s not just the investors that are showing interest in this, it’s the regulators as well. The latest Budget included the world’s first [‘Sharing Economy Tax Allowance’](http://www.sharingeconomyuk.com/news-and-views/post.php?s=2017-11-23-sharing-economy-uk-budget2017-blog) for those working within the gig/sharing economy, and whilst Uber may currently find itself in a [bit of trouble](https://www.theguardian.com/technology/2017/sep/22/uber-licence-transport-for-london-tfl), greater regulation of the cab-hailing company and this sector in general will ultimately benefit all. Furthermore, as marketplaces increase in number they will also become more specified in order to differentiate from one another. When this happens, I think we’ll see bigger companies, relevant to the marketplace, buying them. Grub Club, for example, is a catering-based sharing economy platform which [has already been acquired](http://www.cityam.com/279226/london-foodie-startup-grub-club-acquired-vizeat-and) by VizEat. By the end of 2018 I think we will have seen some pretty big name acquisitions.”\n\n#### Danielle Herndon - Head of Compliance\n**Danielle is a compliance and risk specialist with particular experience in bringing together compliance and tech.**\n\n“PSD2 coming in will have an impact, at the very least due to financial institutions having to get reauthorised with the Financial Conduct Authority (FCA). Whilst the additional bureaucracy may be burdensome for firms - particularly startups - the opportunity it brings to build innovative new products based on richer bank account data makes the process worthwhile. But far from it being just the startups, I think banks are also likely to look at their own possibilities under PSD2. There may not be much to enforce banks to implement PSD2, but considering that they have to offer the API allowing third parties access to bank account information, they’re not going to leave themselves unprepared.\n\nSomething that will affect all businesses in Europe are the [changes to the General Data Protection Regulation](https://www.eugdpr.org/key-changes.html) (GDPR). The changes taking effect from May 2018 will require all businesses to look at the data that they hold on both staff and customers. If they do not have a legitimate reason to store any piece of data that can be used to identify a person, they will need to delete it or face possible penalisation. This process is likely to evoke questions within companies on what data they should work to retain and what to do with it once they have it. Nonetheless, it is undoubtedly a good thing for the average person that the data held on them will be handled more carefully, and that they will have more transparency as to what information firms collect about them.\n\nAnother factor that cannot be ignored is, of course, Brexit. At this stage, it’s near impossible to predict its effect on FinTech with so much still unknown, but all financial institutions are watching the situation very closely. What will happen in terms of passporting - the right for UK authorised firms to offer financial services in other EEA states without getting separately authorised in other EEA states - will be particularly relevant once the UK has left the EU/EEA. Banks have already announced that they are [moving staff to EU countries](https://www.independent.co.uk/news/business/news/brexit-latest-news-uk-city-job-losses-move-eu-frankfurt-paris-luxembourg-banks-europe-sam-woods-a8104176.html) and we could see a lot more of that depending on what deal is made.\n\nLastly, I think cryptocurrencies will make a big impact this year. It has been interesting to see how different countries have reacted to the growth of crypto; Gibraltar is drawing up a regulatory framework for it whereas South Korea has banned it entirely. I think the potential of cryptocurrency relies on how quickly an effective regulatory framework can be established, as whilst its qualities are clear, it is currently so attractive for financial crime. Whilst the [Fifth Money Laundering Directive](https://www.bovill.com/topic/mld5/) (5MLD) will set out controls to govern virtual currencies, it is still [debated](https://www.lexology.com/library/detail.aspx?g=a8f3255b-1742-445b-ac47-37d1571b24ad) when this will come into effect (which may not be for another 18 months). If the regulators can get it right, virtual currencies will be much safer for the consumer and become something genuinely usable in 2018.\n\nIn short there is still a lot to be decided in 2018, but if firms are able to keep up with the incoming regulation, it could be a great year for the consumer.”\n\n#### Anna Tsyupko - CEO\n**Anna is the CEO and co-founder of Paybase and in 2017 was nominated as one of PayExpo’s Payments Power 10.**\n\n“One of the main things that will continue to happen in 2018 is B2B firms entering and changing the FinTech industry. Historically, FinTechs have been a lot more consumer focused, offering products and services for peer-to-peer payments, money management, personal investment, etc. Whilst this is great for the consumer, the truth is that many of these FinTechs can’t reach their full potential because underlying legacy payments technology prevents them from creating the product they want. Since the market has started realising this, there has been a ‘second wave’ of FinTechs aimed at tackling the problems of payments infrastructure itself.\n\nOne example of this trend that I see continuing through 2018 is more firms tackling Customer Due Diligence (CDD) challenges and modernizing and automating them. Modern FinTechs require more granularity. Whether it be on the matching criteria within the checks, how much information is delivered through the API or the way checks are bundled, companies have different needs and the configurability to serve those needs is something that is currently missing. It is this type of issue that more firms will attempt to solve in 2018.\n\nNot only this, but regulatory changes will also spark a need for more B2B services. With PSD2 coming into effect and 5MLD on the horizon, businesses will be keen to meet regulation standards without sacrificing user experience. This creates space in the market for firms that can assist in implementing and ensuring the new regulatory standards in a seamless way. ‘RegTech’ itself has been touted to make a [big impact in the near future](https://www.wired.co.uk/article/the-new-fintech-watch-out-for-regtech). But far from just creating space for new B2B companies, PSD2 will mean that some types of businesses that didn’t need to be regulated before will fall under the scope of regulation. Marketplaces and other non-regulated firms will most likely partner with a regulated payments firm to avoid getting regulated themselves. Whilst this may seem restrictive on these businesses, it is to the benefit of the customer as well as their industry. The responsibility of holding consumer money should not be born by marketplaces, and tighter regulation will offer customers protection, improving trust towards marketplaces and therefore helping them succeed.\n\nFinally, as I think many are predicting, cryptocurrencies will take off in 2018. We have reached the stage where the man on the street is not only aware of it but beginning to experiment with it. I’m certainly not suggesting that 2018 will see cryptocurrency completely upheave and replace the traditional payment rails, but it will start to be taken more seriously. There are companies appearing, such as [Stellar](https://www.stellar.org/), that are combining crypto with the more traditional payments world. This interoperability between crypto and the fiat landscape is where ground will be broken in 2018.\n\nTo sum up, I believe 2018 will be an important year for FinTech. One which is less centred around selling things to the consumer, and more about changing the genuine problems which exist in payments today.”\n\nIf you want to know more about what Paybase plans to do to change payments in 2018, please get in touch!\n\n\n[Twitter](https://twitter.com/paybase)  [LinkedIn](https://www.linkedin.com/company/paybase/)\n","excerpt":"\nChanges in regulation, the rise of cryptocurrencies, Brexit - 2018 is certainly going to be a year that throws up both challenges and possibilities for the world of FinTech.\n\nAt Paybase we’re very excited about the year ahead, and after speaking to ...","cover":{"src":"https://paybase.imgix.net/blog/2018-predictions-hero.jpg","alt":"need one"},"link":{"to":"/blog/our-predictions-for-2018","copy":"Read more"},"tags":["Predictions","2018","FinTech"]},{"id":"ab52ac81-b0c2-5f8a-afe2-ff24583881eb","title":"#EachForEqual","slug":"international-womens-day","published":"2020-03-06T00:00:00.000Z","author":"Gemma Doswell","content":"On Sunday 8th March, we’ll be celebrating International Women’s Day, a day that celebrates women’s (aplenty) achievements, raises awareness about gender inequality and encourages us to take action against bias. So of course, at Paybase, it’s something that we firmly stand behind.\n\nThe theme this year is #EachforEqual - because an equal world is an enabled world. In the context of tech, this is especially important. [PWC](https://www.pwc.co.uk/who-we-are/women-in-technology/time-to-close-the-gender-gap.html) found in 2017 that just 3% of women said that a career in technology was their first choice and that 78% of students were unable to name a famous woman working in technology. In 2018, [Tech Nation](https://technation.io/insights/diversity-and-inclusion-in-uk-tech-companies/) found that just 22% of tech directors were women and an even lower 19% of tech workers were female despite the statistic of female workers in the UK being 49%.\n\nBut [\"we can actively choose to challenge stereotypes, fight bias, broaden perceptions, improve situations and celebrate women's achievements.\"](https://www.internationalwomensday.com/Theme) For those of us working in tech, in particular those of us in leadership roles, we can endeavour to create a culture of diversity and to champion equality within the workspaces that we inhabit.\n\n## What can be done?\n\n[In 2018](https://www.wisecampaign.org.uk/statistics/core-stem-graduates-2018/), the portion of female graduates in STEM subjects (Science, Technology, Engineering and Maths) was just 9%. A [UCAS](https://www.stemwomen.co.uk/blog/2019/09/women-in-stem-percentages-of-women-in-stem-statistics) study furthermore found that specifically in computer science, engineering and technology, the fields \"show the largest gender imbalances from current students, to graduates and the workforce figures\". The figures decrease as the candidates progress through each stage, demonstrating that retention is also a problem in the STEM space.\n\nTo address this, three steps that can be taken are:\n\n![](https://paybase.imgix.net/blog/iwd-steps.png)\n\n## The women of Paybase\n\nAt Paybase, we’re proud to maintain a good gender balance in our senior management team, confronting head-on the traditional lack of women in leadership roles in the FinTech space. We asked some of our team about why a gender balance at work was important to them and how they thought it could impact overall experience.\n\nWe spoke to our Product Designer Ella who works closely with the tech team. She said, *\"I think if you are the only woman in a tech team, the amount of emotional labour expected of you can be high. The men (I think subconsciously) can try and seek more emotional support/guidance from you which makes establishing boundaries difficult.\"* She continued, *\"I also feel the level of scrutiny of your work can be higher because you stand out more as a woman in that environment. Even within the best intended teams, it’s hard to remove our own bias.\"*\n\n*\"The personality traits of men and women are vastly different,\"* Head of Growth, Jessy told us. *\"And any organisation benefits from having a bit of both to balance their culture. I’ve generally found the following characteristics to be common in the female colleagues that I’ve worked with*:\n\n* *a stronger tendency to pay attention to detail*\n\n* *a strong ability to multitask*\n\n* *high levels of empathy\"*\n\nFor me (Gemma, Content Manager), I’ve found that a gender mix works better than a single-gendered organisation. I’ve worked with all women and with mostly male-led businesses and both felt like they lacked balance. But a gender balance isn’t the only ingredient to diversity. Ethnicity, sexuality, socio-economics, experience, age etc. are as important - and I really believe that they need to be a conscious concern of the business to be tackled effectively. It is not enough to hope for diversity to occur and to applaud its coincidence; maintaining (or creating) diversity should be a consideration at the forefront of the recruitment process.\n\nOur Office Manager, Lola, also believes that tackling diversity is best executed with a formal function. *\"I think that companies should work towards having a full diversity function. Sheree Atcheson, who works as the Head of Diversity and Inclusion for Monzo, is a great role model for women in tech. She emphasises the importance of understanding all different types of diversity and making them a priority, not only diversity of gender.\"*\n\nOur Head of Compliance Rachel, former Head of Compliance in Banking Services at Starling Bank, agreed. *\"Gender equality/diversity brings with it greater diversity of thought, which is so important to a) increase relevance to your customers, and b) to provide better problem solving through diversity of experiences. We therefore need to make sure that we think not only about gender, but also about race, age, affluence, educational background, etc. Having visible senior women is also crucial to inspiring future female leaders to enter a career in FinTech and to stay in the sector.\"*\n\nWe then spoke to Anna, our CEO. *“I’ve been lucky in my career so far that the roles that led me to Paybase were all unusually female-first (given the traditionally male-led industries). Working in these female-empowered environments has been a significant advantage, especially in terms of dispelling myths and misconceptions about women working in certain positions in male-led industries. Businesses significantly benefit from varied, healthy dialogue; a gender-balanced workforce at all levels of seniority is crucial to this.”*\n\nFinally, we spoke with Ana, one of our tech team. *“I couldn’t agree more with every single one of the points my colleagues made. On being an outnumbered woman in the Tech Team, as Ella pointed out, it can be difficult from a work scrutiny and emotional labour point of view as well as in terms of varying styles of communication.”* She continued, *“Of course, I understand that this because we all grew up in different societies - and each with meticulously designed boxes of what we should and shouldn’t be - but it’s really important that we feel safe to just speak up. At Paybase I feel I am empowered enough to do just that - to speak up and stand by my views without fear of consequences and hopefully empower others regardless of gender, ethnicity or sexuality to do the same”*\n\n## Say hello to our team\n\n![](https://paybase.imgix.net/blog/iwd-group.png)","excerpt":"On Sunday 8th March, we’ll be celebrating International Women’s Day, a day that celebrates women’s (aplenty) achievements, raises awareness about gender inequality and encourages us to take action against bias. So of course, at Paybase, it’s somethin...","cover":{"src":"https://paybase.imgix.net/blog/iwd-power.jpg","alt":"need one"},"link":{"to":"/blog/international-womens-day","copy":"Read more"},"tags":["International Women’s Day","Women in Tech","Diversity"]},{"id":"e1c7e509-c45e-5a81-9d38-c22a68adb712","title":"Coins and tokens - can you spot the difference?","slug":"coins-and-tokens","published":"2020-02-26T00:00:00.000Z","author":"Gemma Doswell","content":"Although the terms are often used interchangeably, crypto coins and crypto tokens are in fact not the same. Both are decentralised and based on blockchain technology, but coins and tokens have different functions. They, therefore, reside in different spaces of the digital finance market.\n\n## So what is Bitcoin?\n\n[Bitcoin](https://www.paybase.io/blog/crypto-intro) was the first and most popularised cryptocurrency. It is a coin - its function is a store of value and it can be used, similar to fiat money, to pay for things. Like Bitcoin, crypto coins all exist on their own individual blockchains and it is on these that all coin transactions can be recorded. More examples of crypto coins are Litecoin, Monero, Stellar and Namecoin.\n\nThe [European Central Bank](https://www.ecb.europa.eu/pub/pdf/other/virtualcurrencyschemesen.pdf) described virtual currencies as “digital money in an unregulated environment, issued and controlled by its developers and used as a payment method among members of a specific virtual community.” As on the Bitcoin blockchain, the exchange of crypto coins is maintained and authorised democratically by the network (or [nodes](https://www.paybase.io/blog/crypto-jargon)) on each blockchain.\n\nCoins have all of the six following properties:\n\n![](https://paybase.imgix.net/blog/coin-properties.png)\n\n## Why not just use traditional money?\n\nThere are copious reasons why people opt to use crypto coins. The most obvious is to attempt to make money. Over the past decade, the value of certain high-profile currencies (namely Bitcoin) has fluctuated so much that the value of one unit has gone from fractions of a penny to over £18,000. But investment in crypto coins is only the start.\n\nAnother popular use case is anonymity. Coins like Monero offer near-untraceable, anonymous transactions, boasting resilient security and high levels of privacy - and this has gained it a loyal user-base. Further use cases include security, censorship resistance and international remittances.\n\n## What is a token?\n\nA token is more like an asset. In the same way that Virgin air miles can only be used with Virgin, a crypto token sits on a blockchain (or a [dApp](https://www.paybase.io/blog/crypto-jargon) built on a blockchain) and can only be used to power services within that ecosystem. [CoinTelegraph](https://cointelegraph.com/ico-101/what-is-an-ico-token-and-how-does-it-work) explained, “If it's a fashion startup, one token can be equal to one dress or a yearly license of a software in the case of a hi-tech startup. You even can issue tokens of yourself and a token holder will be able to buy an hour of your work with the token.”\n\nTheoretically, anything in the world can be tokenised. Examples of prominent tokens are Tether, Waves and ERC-20.\n\n![](https://paybase.imgix.net/blog/token-properties.png)\n\n## Where does that leave Ethereum?\n\nJust to be confusing, the Ethereum blockchain combines both coins and tokens.\n\nIt is made up of Ether (ETH) coins and ERC-20 tokens. How could this be? Ether is used to fuel the transactions on the Ethereum blockchain and ERC-20 tokens fuel Ethereum’s main use case.\n\n![](https://paybase.imgix.net/blog/ethereum-exchange.png)\n\nUsing these tokens, the Ethereum blockchain enables developers to build their own decentralised apps. Tokens that are built on the Ethereum blockchain enable developers both to utilise smart contract technology and they also maintain a consistent technical standard for all dApps created.\n\nWant to find out more about the blockchain basics? Take a look at our latest blogs [here](https://www.paybase.io/blog).","excerpt":"Although the terms are often used interchangeably, crypto coins and crypto tokens are in fact not the same. Both are decentralised and based on blockchain technology, but coins and tokens have different functions. They, therefore, reside in different...","cover":{"src":"https://paybase.imgix.net/blog/coins-centred.jpg","alt":"need one"},"link":{"to":"/blog/coins-and-tokens","copy":"Read more"},"tags":["Blockchain","Cryptocurrency","Digital Currency"]}]}}}