2021: Settling into fintech's evolution throughout 2020

If 2020 was a year of accelerated trends and sudden upheaval to digital, 2021 will be the year we see the world settling into the change. Financial institutions, central banks, fintechs and payments players have all had to move operations online, finding digital transformation was no longer optional. But moving forward, I hope a year of reactivity can turn into proactivity, utilising the catalytic change to drive innovation.  

Thanks to significant consumer adoption, digital financial services are now firmly mainstream. Even those who had digital offerings in place had to adapt, with the rise in demand quickly testing companies’ capacity for surges and, in that, challenging the reliability of their tech and its potential to scale. At PayU, for example, some of the e-shops we serve saw 500 to 1000% revenue growth in April and May compared to the same periods last year. It was all-hands-on-deck, but I’m pleased to report we met the challenge. 

Robust technological infrastructure should be a given moving forward. As a company that is both a global fintech investor and a payments operator, PayU aims to set the pace in high-growth markets, not just keep it. Across the board, financial services players in 2021 will be looking to the next stage of innovation and growth, as well as realising that change can be executed much faster than previously thought. The growth potential in emerging markets will be even more compelling, so I expect we’ll see more M&A in unsaturated regions.  

I believe we’ll see central bank digital currencies (CBDCs) roll out across the globe in the next year. Digital currency more broadly will start to see real use cases emerge. This is something I’m personally very excited about; the discussion around crypto has been going on for too long without enough showcasing of the immense potential for financial inclusion and global connectivity. Initiatives like Diem, for example, are introducing how blockchain could democratise and decentralise money, taking us a considerable step closer to truly accessible financial services.

Because of the pivotal year 2020 has turned out to be, even regulators and governments have proven they can adapt, and quickly. I believe that, as an industry, we will look back in 2030 on a decade of innovation powered by disruption.

2020 has been sink or swim. In 2021, perhaps we’ll learn to surf. 

This article was contributed by Fady Abdel-Nour, Global Head of Investments and M&A, PayU