The Sage Finance Futurists are a diverse group of finance leaders from a variety of sectors and backgrounds. They have been recognised for driving innovation and showing leadership across businesses of all sizes.
I recently had the pleasure of interviewing one such futurist, Aqsa Zubair, to get her unique perspective on ten hot topics in FinTech.
Aqsa Zubair is a FinTech specialist currently working at the Bermuda Monetary Authority. She is responsible for leading regulatory authorisation and supervision efforts for digital asset businesses and digital asset issuances, and for instigating and advancing FinTech and blockchain innovation. An ex-entrepreneur, she’s co-founded two businesses in technology and social entrepreneurship.
Aqsa’s passion and progress have earned her a seat at the delegation of Blockchain for Impact at the United Nations Headquarters for discussions on using technology to support their sustainable development goals. Sustainable Finance and ESG (Environment, Corporate and Social Governance) is a real talking point in FinTech right now.
Last year, Aqsa co-founded Cryptocamp, Canada’s first Cryptocurrency un-conference, making a wealth of FinTech and Blockchain learning sessions available to hundreds of executives, students, and entrepreneurs. Her goal is to foster greater Blockchain and financial literacy in her community, and discuss issues hindering the wide adoption of FinTech. I was keen to get her thoughts on all things FinTech, from Corporate and Social Responsibility to education, the pandemic, and beyond.
CSR is gaining traction in FinTech and the wider sphere of financial services. Is this a passing trend or is there real currency in conscience?
I do not see this as a passing trend, rather the beginning of a societal norm, expected of all important stakeholders of any organisation large or small. There is more emphasis now than ever before on improving the society we live in to ensure it thrives.
Working, particularly in a digital era, has increasingly merged the work self with the personal self. People want to be a part of organisations that align with their value systems. As such, the employee, customer, and client are evolving, and the organisation must cater accordingly to retain and grow its relevance and position within the market—meaning, yes there is currency in conscience.
The current trends in CSR are set to expand. Organisations’ CSR makeup will reflect their stakeholders, including the causes and initiatives their investors, staff, customers, and target market support. For example, as we have noted from recent investment market developments, providing financial literacy is an opportunity. At the introductory or intermediate level, it opens up mainstream financial services to those who have historically not participated or have not had the opportunity to participate. For companies who do this sustainably, it opens up an entirely new customer base that wants to engage and access existing or new financial products.
How much is Financial Literacy an education challenge for consumers and how much is it an explanation challenge for financial organisations?
Financial literacy is much broader than an education challenge for consumers, or explanation challenge for financial institutions. It is framed by the societal infrastructure that has historically excluded its merit in education.
From a young age, students learn about the intricacies of science, math, and history as a means to understanding the universe. But the education system fails to teach them how to bank, save and strategically invest. When these same students become customers of financial institutions, the gaps in knowledge begin to surface.
In the last decade, we’ve seen FinTech changing this problem statement by building technology-enabled financial products that aim to both educate the consumer through quick videos, complex financial decision-making automation, and general financial services guidance, and build a loyal customer base.
Today’s digital customers expect financial services to be intuitive, user-friendly and offer them what they need, when they need it, and in language that is easy to understand. The more financial institutions learn about the customer, the more they can break into new market segments and retain relevance among increasingly fierce market competition. Financial literacy is a necessity, not only for those learning from it but also for businesses wanting to drive growth.
Blockchain platforms, Blockchain as a Service, Blockchain Frameworks and the like are making blockchain development far more accessible for both corporate and start-up founders. Does one still need to have knowledge of how the underlying blockchain works?
The first step has always been and will always be understanding the problem you want to solve. Understanding the technology may then help to determine whether blockchain technology is a viable and optimal method to solve the problem.
Often, the cost attached to participating in and developing such a solution—even using SaaS platforms—can be quite expensive, in terms of time as well as capacity, and it may be more cost-effective to find an off-chain solution. However, it’s important to, at the very least, understand the merits of the technology and the type of efficiency and cost savings it generally brings.
Blockchain began life in financial services, but what do you feel is the most impactful use of the technology beyond that sector?
Blockchain has the power to influence transactions of any kind. Its underlying infrastructure—which brings about its own evolution—can oversee and trace land, energy, and intellectual property transfers, including maintaining a true and continuous data record available to all relevant stakeholders.
However, we also need to consider the development of this technology, which can greatly influence the scale of its adoption. The influx of decentralised and open-sourced models, like decentralised exchanges, for example, will be interesting to follow in the short and medium-term. These technologies will further democratise access and enhance technology stacks, where services will be built atop the infrastructure and show the market a new means to transact and potentially create efficiency. Beyond this, existing innovations will serve as a good testing ground to identify the limitations of technology and find fresh opportunities for iterative evolutions and potential new offerings in areas, perhaps, that have yet to be imagined.
Coronavirus has pushed us all online, reducing the relevance of geographical proximity. What does a “FinTech Hub” look like in a post-pandemic world?
This is an excellent question. Interestingly, even prior to the pandemic, geographical clusters were already disbanding as professional travel became more popular, and industries and subject matter communities globalised. In the blockchain world, annual events like Consensus and FinTech Festival brought together thousands in New York and Singapore respectively. But beyond this, while hubs have existed, they grew and thrived over time through their participation in a broader ecosystem both at the domestic and international level.
We have seen that while Coronavirus has taken its toll on the world, our industry will continue to push forward. FinTech has used this time to identify problem statements like this to build new solutions and cater to the evolving customer. New smartphone applications like Clubhouse have emerged as great mediums to aggregate a community on a topic of interest, engage in dialogue to further the spread of knowledge, and spark ideas that could formulate new enterprises entirely. With this, we have further democratised access and allowed for greater inclusivity than ever before; the cost of participating in these hubs today is reduced to owning a smartphone and having an internet connection. There is, after all, little to no need for fees that were in place to cover venues, travel, and meals upon arrival.
Digital tools like these have not only aided in the dissemination of ideas, but also:
- Collaboration: an amalgamation of parties across sectors within the FinTech umbrella and beyond that are interested in particular topics can gather, discuss, and perhaps even solve common problems.
- Expanding reach: many companies have used this time to connect with a broader base of players than those traditionally limited to a specific jurisdiction
- Funding: for those seeking funding, it has created an opportunity to pitch to a broader base of stakeholders while saving on travel costs.
- Strategic alliances: for those seeking strategic alliances, it has made it more accessible and appropriate to engage without an in person meet-up to solidify the relationship. The entire process, from due diligence through to contract signing, can all be digital
With the burden of travel eased, those hindered by financial constraints, time constraints or other travel-related hurdles can now get involved in important discussions. FinTech hubs of the future will see greater democratisation, increased participation, and the ability to congregate on short notice for pertinent discussions, alliances, and collaboration. The need to wait for a large physical event will fade as a result.
Recent celebrity pump and dump of meme cryptos and assets has enticed many newcomers to the exciting area of democratised millennial-targeted trading apps and cryptocurrency assets. But this has also introduced a whole new generation to a niche and risky corner of financial services. How can the industry safely support this movement?
I have a few tips, which I’ll split into four key areas for the sake of clarity: education, disclosure, controls, and location.
- Education: Industry can focus on releasing educational materials for consumers that give insight into relevant products.
- Educational mediums: Where educational material is located is just as important as the material itself. Millennial-targeted trading apps, for example, may find part of their target segment on social channels – generally, where the company marketing occurs. Offering links to educational materials on such forums can assist with the profusion of financial literacy to a broader market base
- Disclosure: It is also essential to adequately disclose risks associated to the product that the customer should be aware of prior to purchase.
- Controls: Companies should have the proper controls to monitor product usage. Here, curtailing misinformation is crucial. Platforms must also remain wary of sophisticated players that may take advantage of the lack of financial literacy in some cases, and spread misinformation through social channels. An effective narrative stemming from the company can go a long way in preventing this or at least reducing its impact
- Customer location: The industry should also be wary of where its customers reside, as the regulation, information, and support required will change depending on location.
Outside of China, when will the rest of the world stop talking about Central Bank Digital Currencies (CBDC) and actually start rolling them out? Who is leading here?
Before these types of initiatives can be rolled out, jurisdictions worldwide are building CBDC thought leadership and aiming to understand whether the concept is viable for them. This is why it may seem like there is more talk and less action. But several jurisdictions are acting—it is just not always widely visible.
Currently, many are sharing learnings and investigating the merits, risks, and points for consideration. On that note, a number of jurisdictions worldwide are doing one or more of three things:
- Developing problem statements that address and/or justify the development of CBDCs in their respective jurisdiction
- Actively building CBDC use cases for deployment
- Investigating whether or not CBDCs are a viable solution for the jurisdiction and waiting to see the merits of the use cases in other jurisdictions
As this can be a costly initiative with significant social and economic impacts, it is important to assess fit prior to implementation.
A lot is said about the differences in innovation between corporates and start-ups. Having experience founding your own start-up and working in large companies, is there one piece of advice that holds true for both when it comes to innovation?
I treat any organisation as a lean start-up, no matter where the business is in its growth journey. The best advice here is to really nail down and understand the problem you are looking to solve.
In large corporations, innovation can be stunted because of a failure to find the problem or forcing a solution to fit a problem within. In this case, while innovation may still happen, it may not constitute meaningful innovation that can materially benefit a project or the enterprise more broadly. In a start-up, a multitude of tools are positioned at your disposal and it is easy to get lost in trying to find which tool is best instead of identifying the problem itself.
Millennials have had challenges—and many successes—navigating the corporate world. How can they use their experience to help Gen-Z enter corporate world?
Irrespective of your generation, when you join an organisation, there are three main things you need to identify:
- Your values
- Your short and long-term goals
- Key drivers
Next, learn as much as you can about the brand. From what it stands for and your specific function within the company, to areas that could benefit from transformation and how the organisation makes money.
Meet as many people as possible and get to know their narrative, their motivations. Understand whether the ethos of the brand fits your values. If it does, you will naturally want to go above and beyond the call of duty to make sure your function and the wider organisation are successful. This passion will show in everything you do and, trust me when I say that it does not go unnoticed.
What resources would you recommend for someone starting a career in FinTech or looking to move into the industry?
Take advantage of the digital era we are in. People are now easier to connect with than ever before. Explore LinkedIn and try to find individuals who have been endorsed for skills you are looking to build, have held positions in organisations you admire, or are doing the type of work you wish to be involved in.
Reach out to these people. Have a digital coffee, learn about them, and share what your narrative is. This could help you identify what kinds of projects, teams, and organisations you see yourself working with. Regardless of your age or tenure within your profession, tapping into new ways of thinking and sharing knowledge remain invaluable to your development.
Beyond this, you have a plethora of digital resources at your disposal through educational mediums like Khan Academy, Udemy, and Coursera. These all offer low-cost online courses on a range of topics across skills, industries, and interests.
Some impactful books that have helped shape my thinking in finance are: “The Intelligent Investor” by Benjamin Graham, “Token Economy: How the Web3 reinvents the Internet” by Shermin Voshmgir, “Abundance” by Peter Diamandis, and “Fintech Founders: Inspiring Tales from the Entrepreneurs that are Changing Finance” by Agustin Rubini.