The year 2024 proved to be full of transformative shifts and strategic pivots.
PYMNTS sat down with some of the industry’s most influential leaders, capturing insights that shaped the narrative of financial innovation. From the pressing need for robust compliance in an increasingly scrutinized FinTech space to the revolutionary potential of cloud migration and artificial intelligence integration, our conversations spanned the spectrum of challenges and opportunities facing the sector.
Join us as we revisit the key moments and revelations that defined the financial services landscape in 2024, straight from the mouths of the visionaries steering the ship.
Let’s start with arguably the most quotable executive in the payments and FinTech space, Thredd CEO Jim McCarthy.
Back in April, as the Synapse case was starting to unfold, McCarthy stressed the importance of risk management and compliance in an environment marked by heightened regulatory oversight, particularly in areas like anti-money laundering and know your customer/know your business protocols.
“The FinTech space is in choppy waters, at least compared to a couple years ago, where it was nothing but wind at your back,” he said.
“There’s a real focus on risk and compliance, and that is necessary,” he said. “It’s hygiene. But there was a lot of fast growth across banking and FinTech without a focus on that.”
Then in May, we focused on data.
Managing it is a daunting, maybe even impossible, task for financial services companies as well as other industries. Twenty-seven percent of all global companies now have a C-level executive assigned strictly to data, either as a chief data officer or chief digital officer.
One of the leaders in the field is Citi Chief Digital Officer for U.S. Personal Banking Michael Naggar. After six years on the job — most recently adding chief information officer to his title — Naggar has been one of the key executives behind Citi’s digital transformation.
“I like to look within our own industry to see where the consumer will be as well as what our competitors are doing,” he told PYMNTS. “But I also look at other industries, like in the airline industry, retail, healthcare — I like to see how users are adopting new technologies and how that could apply to what we’re doing in banking. Then I marry those observations to the internal data of what consumers are actually doing on our platforms. We have an extensive focus over the last two to three years on our data. We connect all of it to understanding what our customers are doing so we can get ahead of them before they need it.”
May also saw a conversation about payments automation with American Express.
“For those of us who provide payment solutions to companies, we need to make it easy for middle-market companies to use a fit-for-purpose solution,” American Express President of Merchant Services Colleen Taylor told PYMNTS. “And because they don’t have big technology budgets, they want access to the tools that are going to give them that certainty and that transparency. But it needs to be easy to implement. It needs to be something that can integrate with the accounting platforms and give them that working capital benefit that they’re looking for through efficiency and digitization.”
There’s the payment, and then there’s everything that happens around it.
That’s why financial services companies, from insurance to FinTechs to enterprise-grade banks, add services to protect, analyze and optimize each transaction. We discussed the issue in July with Visa’s Antony Cahill, who at the time was executive vice president and global head of value-added services and is now president of value-added services.
Cahill told PYMNTS that growth comes as issuers look to reimagine their transaction and account experiences as payments economics and customer expectations are changing across the world.
“We are very intentional about our approach,” Cahill said. “Building capabilities in-house is often our preference due to our robust engineering resources. However, acquiring external technologies or forming strategic partnerships are equally pivotal when they offer us a significant competitive edge or faster market entry.”
There was also a good amount of attention paid to deposits in 2024.
One of the other most quotable executives, Ingo Payments CEO Drew Edwards, was the driving force behind his company’s acquisition of Deposits.com. What if an outbound payment into a new account created the foundation for a new closed-loop ecosystem? What if banks and their commercial clients could offer incentives for senders and receivers to store and spend money? What if issuers had new opportunities to monetize those accounts? What would it take to turn the “what ifs” into operational reality?
“To actually drive adoption, to me it comes down to choices and incentives,” Edwards said. “And the incentives can be financial, they can be the speed of money, they can be rewards, they can be any number of things. And as these things become reality, and we start to see some more of these hallmark use cases, we will see banks … really press the envelope of what I would call batch-based treasury banking.”
Toward the end of the year, checkout technology got its fair share of attention.
Mastercard, in particular, puts the challenges and opportunities in this area under the spotlight with its latest tool, Authorization Optimizer, which offers real-time insights into transaction retries. Often, merchants attempt to retry declined transactions multiple times, which can inadvertently trigger issuer risk policies, further reducing the likelihood of approval.
“Merchants are looking to drive higher conversions,” Mastercard Senior Vice President of Payments Optimization Sumeet Bhatt told PYMNTS in November. “They want every purchase to go through. And what happens is that with these excessive retries, risk policies get triggered and getting an approval becomes further and further out of reach.”
“Ninety-two percent of the declines are either due to poor lifecycle management, suspected fraud, insufficient funds, lack of funds and issuers’ risk policies,” he added.
As the year closed out, it seemed like everything was moving to the cloud — from data to infrastructure — as companies sought to cut costs and scale their operations.
In financial services, that meant bringing new products and payments to new markets and users as new ecosystems took shape, especially as artificial intelligence gained prominence. It was a topic of conversation for AWS Head of Payment Networks Paul Chang in December.
“It’s about breaking down the monolith into microservices, but at the same time being able to sync that mainframe data to the cloud,” Chang said. “It’s important that there’s still a period of time where the data will reside both on-premise and in the cloud.”
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