Money 20/20: The Fed asked to find solutions for cross-border payments

Money 20/20 continues to demonstrate that it is the largest event in the world’s fintech ecosystem where its most important personalities meet.

Tuesday began with an exclusive announcement from Consumer Financial Protection Bureau Director Rohit Chopra: The CFPB will activate authority under Section 1033 of the Consumer Financial Protection Act, which will force financial institutions to share data consumers at the request of consumers. While not explicit open banking, this will accelerate a more decentralized consumer finance market structure and has the potential to reshape how companies compete in this sphere, Chopra told attendees.

It will also allow consumers to “break away from banks that provide poor service and trigger more competition in the market,” he said. The CFPB is also exploring safeguards to prevent excessive control or monopolization by one or even a small handful of companies. “An open, decentralized ecosystem will bring the greatest benefits to both creators and consumers,” Chopra said.

Immediately following that announcement, a brainstorming session took place between CFPB’s Ashwin Vasan, Senior Advisor to the Director, Raj Date, Managing Director of Fenway Summer, and Jo Ann Barefoot, Executive Director and Co-Founder of AIR to discuss Chopra’s remarks.

Regulation is needed, but it cannot stifle innovation in the industry, he added. “Dynamic regulatory change is occurring and will continue to increase in this current adverse climate. Regulators need to be front and center as customers will require more protection in these uncertain times,” Vasan said.

Open banking is not a new concept, but today’s decision by the CFPB is a sign that regulation may be “armed forever,” said Stephany Kirkpatrick, CEO and founder of Orum in a panel with Kurtis Lin, director Pinwheel executive Salman Syed, Chief Operating Officer at Fidel API, and Merritt Hummer, Partner at Bain Capital Ventures.

Giving consumers the ability to own their own data would not only make something as simple as switching bank accounts and direct deposit much easier, it would also enable real-time subscription. It would mean consumers could have the financial equivalent of Twitter’s blue check mark, like a token that follows you, Kirkpatrick said. Currently, the closest equivalent is a credit score, which is simply a snapshot dated back in time, the panelists agreed.

The FED also had its space with Christopher Waller, a member of the Federal Reserve Board, who took the stage to also speak about innovation in financial services.

“Cross-border payments take a long time and are expensive. I always try to remind people that the delay is self-imposed by regulators,” Waller said. “If a bank wanted to [send] a payment between you and a customer in Japan, and there was nothing to worry about, they could do it in seconds.”

Instead, the delay is due to due diligence around issues such as tax evasion, money laundering and terrorist financing. Using technology to address this and make payments faster, more efficient and cheaper is a ripe area for innovation.

See more: Money 20/20: Wells Fargo’s announces a new virtual assistant powered by Google Cloud AI

In another panel dedicated to the growth of digital banking, neobanks and payment methods in Latin America, various actors in the region have expressed the opinion that “Innovation in banking is the only way to reach and serve some consumers in underserved countries”, Christianne Canavero, ESG & Nu Institute Global Director of Nubank and Paula Arregui, COO Mercado Pago of Mercado Libre agreed.

Putting your customers at the center of everything you do, seeing what they really need and providing them with solutions in a way they’ve never experienced before is the way to go, Christianne told moderator Hans Koning, chief digital finance industry specialist at International Finance Corporation. To that end, both companies also recently launched crypto functionalities. Mercado Libre reached 1 million users in just one month, Paula said.

The social profile was present at Money 20/20 in a talk about how to carry out donations.

Dominic Kalms, Founder and CEO of B Generous discussed how technology, philanthropy and unique business models can come together to make an impact. However, integrated finance can give people the opportunity to donate with credit, when they are short on cash, he said in a panel with Ibrahim AlHusseini, founder and managing partner of FullCycle, and Gina Clarke, chief content officer of Europe Money20/20. .

For example, buy now, pay later concepts can also be used: a person can donate $10,000 to a cause and have $400 deducted from their account each month.

Fintechs are just beginning to figure out how to make philanthropy accessible in the same way it made banking, but integrated finance has already played an increasingly important role in the next wave of charitable giving, especially for generations. younger, the panelists agreed.

Scarlett Sieber, Director of Strategy and Growth at Money 20/20 brings us to a close on Tuesday with the following conclusions:

“The CFPB’s choice to make such a major statement on the Money 20/20 stage solidifies our position as not only the premier global fintech show, but also the destination for industry-changing news announcements,” said Scarlett. Sieber. “We are honored to be known as the place to speak directly with the fintech industry.”

“Many problems in the world can be addressed with significant money, and integrated finance offers the opportunity to connect funds to causes more efficiently,” said Scarlett Sieber. “With evolving concepts like donate now, pay later, with no interest or fees, fintech can continue to deliver on the promise of improving people’s lives.”

“Day three brought another big round of important dialogue, with a particular focus on how moving money more efficiently can better serve underbanked markets like Latin America and Africa,” said Scarlett Sieber. “Fintech has a responsibility to continually evolve, and Money 20/20 is the proud host of these innovative and promising conversations.”