Exploring the Next Generation of Financial Models: What changes will we see in the future?

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Recently Frank Breuss, CEO and Co-Founder of Nikulipe, participated as a panelist at “Fintech Day 2023,” a conference dedicated to exploring the latest innovations in the financial technology industry. Together with Airidas Puodžiūnas (Solaris), Rūta Bučinskaite (Ondato), Denas Jonas Gadeikis (Bank of Lithuania), and Jekaterina Govina (AMLYZE), Frank Breuss held a discussion about changing financial landscape and its regulation, and different factors shaping fintech industry. During the panel, experts analyzed how and in what ways artificial intelligence and machine learning, embedded finance, crypto, and blockchain set the stage for the emergence of new financial models.

How will AI affect business models?

While many believe that 2023 will be the year of AI, and this technology itself will revolutionize many areas of business, it has yet to be the case that AI will be the predominant tool in the fintech field. In the panel discussion, Mr. Breuss revealed that he does not believe that AI will radically change everything. According to him, AI is just one of the many other aspects affecting the industry that plays a certain role in the payments business model.

“I believe that AI should not replace people but support businesses and people. For us in fintech, for example, one of the things we all have to deal with is how to prevent money laundering, how to do risk scoring, all these kinds of things. I think artificial intelligence is a good way to support us, make decisions better, be ahead of the curve in detecting things, and help our teams to be better,” said Mr. Breuss. “For our business model, it’s not directly impacting our core product which people buy, but it affects the background to service our clients. For example, AML and compliance are very important. Customer service might be where AI can play a role, so it’s more supporting functions for our product, but not the product itself.”

How is embedded finance changing the models of finance companies?

Without doubt, embedded finance will be a critical component of the next generation of financial models. According to Frank Breuss, many financial services would not exist today if only traditional banks provided them. Embedded finance helps consumers and merchants resolve issues, improves the customer experience, and gives various services and options.

“We are all trying to solve a problem for consumers or merchants and improve customer experience. With embedded finance, consumers have the immediate benefit of not relying on the classical bank routes but having services that simplify their lives, and fintechs enable that,” said Frank Breuss.

How will the payment market be integrated with crypto? 

According to Mr. Breuss, blockchain, and cryptocurrency will not replace existing payment methods but will provide solutions that will benefit both fintechs and customers.

“When people think about crypto, they think about bitcoin and similar currencies that are still quite volatile and niche. However, blockchain could simplify our lives with things like smart contracts. In 5 years, we should see integrated cryptocurrencies, blockchain, and the traditional finance world,” Frank Breuss shared his insight. “The new regulation of the Bank of Lithuania should make the crypto sector more stable and secure.”

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