COVID-19 has catalysed the evolution of digital finance
Although digital technology was permeating the payments space prior to the pandemic, few would contend that changes haven’t now been accelerated.
What was once an opportunity for tech companies to transform the relationship between consumers and the financial institutions that served them has become a necessity, particularly in light of the impracticality of cash when trying to prevent the spread of infection.
Reflecting on how the sector has evolved, Vaduvur Bharghavan, President and CEO of card app platform Ondot, told FinTech Magazine, “Apple Card was the first to enter and really set the expectation for what a modern, digital-first card should be: get a card quickly, understand spending clearly, manage your account on-the-go, and engage with perks and offers.
“Google and Samsung have built on these experiences, but could be even more disruptive. Google is looking beyond just one card portfolio and has already signed eight financial institutions with more expected, meaning they could try to become a platform for banking rather than just a card portfolio.”
Furthermore, following the announcement of Samsung’s new Pay Card (in collaboration with Curve), Conor Pierce, Corporate VP of Samsung UK & Ireland, intimated that the development was a direct attempt at reconciling consumer needs with current socio-economic conditions:
“Now, more than ever, people need a secure payment solution they can rely on. We’re excited to be able to put the control back into our customers’ hands by launching Samsung Pay Card,” he said.
However, the developments don’t stop at payments and transactions; fintech startup PrizePool recently made headlines when it raised US$4.25m for its savings account platform which also allowed customers to win monthly cash prizes of up to $50k.
“Now more than ever, Americans need to be saving money to protect their future,” commented Frank Chien, Co-Founder and CEO. “We know that saving can be hard to prioritize and our goal is to reduce the barrier to saving money by making it fun.”
Also, Stem managed to secure $10m in funding for its distribution and payments platform in support of independent artists, who are struggling to adjust to the new post-COVID-19 restrictions on their income.
Adam Nash, one of the ventures’ angel investors, said, “The music industry has been extremely slow to bring the transparency and capabilities of modern software to creators. Stem’s fintech solution brings opportunities to a wider range of artists than ever before.”
It seems readily apparent, then, that financial backing for new, digitally-inflected forms of finance management are being actively developed in the fintech community as a direct result of COVID-19.
The diversity and spread of this innovation give a positive indication for the future: each industry could soon receive the bespoke solutions it needs to thrive in this new economic environment.
