The 2024 edition of Money20/20 USA showcased an industry in transition, with artificial intelligence (AI), open banking, and real-time payments dominating discussions across the packed halls of The Venetian Hotel in Las Vegas. While the event maintained its signature Vegas energy, there was a notable shift in exhibitor composition, with service providers in fraud, security, regtech, and open banking taking center stage, while previous mainstays, including Banking-as-a-Service, neobanks, and crypto maintained a lower profile.
AI: Separating Signal From Noise
AI was undoubtedly the hottest topic at the show, with practical applications taking precedence over speculative use cases. Sarah Friar, CFO of OpenAI, asserted that AI adoption is happening now: “If you think it’s experimental, it’s not. People are absolutely using this technology to up their productivity game, to think about costs, and to help manage their business.”
NVIDIA’s Malcolm deMayo echoed this sentiment, describing AI as “driving the new industrial revolution.” Emily Glassberg Sands from Stripe noted that AI startups are now monetizing faster and achieving global reach sooner than traditional Software-as-a-Service companies have done in the past.
B2B Payments and Data Infrastructure: A Changing Landscape
Erin McCune from Bain & Company discussed the transformation of business-to-business (B2B) money movement, highlighting how the relationship between banks and fintechs is evolving. She suggested that fintechs need to move beyond being seen as merely vendors to banks, emphasizing the importance of value-based pricing for transactions and focusing on attributes rather than just the payment rails.
TSYS’s Dondi Black reinforced these themes while discussing the increasing importance of data infrastructure and AI applications in financial services. She outlined specific use cases for AI in banking, including fraud detection, risk management, and intelligent transaction routing for issuers and merchants. Black referred to AI’s ability to quickly detect anomalies and adapt to new fraud patterns, while also noting its potential to improve internal efficiency and personalize customer recommendations.
Data: The New Currency?
The Consumer Financial Protection Bureau (CFPB)’s Section 1033 rule is a milestone for data sharing in financial services. CFPB Director Rohit Chopra explained its significance: “It’s going to offer a roadmap for a future that’s not dependent on one or two credit scores. It’s going to lower customer acquisition costs for a whole set of players.”
A key theme was the concept of “bringing apps to data, not data to apps,” which points to a fundamental shift in how financial institutions approach data architecture and security. This approach is set to enhance both security and operational efficiency.
Fraud Concerns Remain as Payments Evolve
The payments ecosystem is changing quickly, with virtual cards now showing explosive growth. As Nyca Partners pointed out, traditional payment methods such as checks—which still account for US$2.3 trillion worth of transactions per year—are predicted to decrease by 50% in the short term. B2B payments are finally following consumer trends toward digitization, with real-time payments gaining momentum.
However, this shift brings new challenges in fraud prevention. There is growing concern about scams, especially as payments in the U.S. shift to real-time settlement. Speakers called for urgent, coordinated regulatory action to address these threats, while also underlining the need for enhanced customer education and data sharing.
Innovative Startups Are Reshaping Finance
The conference spotlighted seven startups looking to transform the financial services industry. Ntropy presented its solution for unstructured financial data; according to its CEO and co-founder Naré Vardanyan, 80% of the world’s financial data remains locked in transactions, documents, PDFs, and images. The company processes hundreds of millions of transactions and documents weekly, with over 98% accuracy in under 100 milliseconds.
Other notable startups included Brightwave, which announced a US$15 million Series A funding round for its AI-driven investment research platform, and Footprint, a Series A identity company that has raised US$20 million. NALA, a cross-border payments fintech, reported achieving profitability and securing US$40 million in Series A funding after experiencing tenfold revenue growth in 12 months.
Looking to the Future of Financial Services
As financial services continue to evolve, behavioral analysis is becoming increasingly important. Companies such as Capital One are using customer behavior data to improve loyalty across their user bases. The industry is moving toward more personalized experiences, powered by real-time data analysis and AI-driven insights. The sponsor banking sector is experiencing significant upheaval, with companies such as Column and Lead gaining visibility as fintechs seek stronger banking partnerships.
Money20/20 USA 2024 made it clear that success in financial services depends on effectively combining embedded financial services, AI capabilities, data analytics, and robust security measures. The transformation of B2B payments suggests that the industry is entering a new era, in which data infrastructure and real-time capabilities will be crucial differentiators. In this space, transformation will be the mantra for the next few years.
For more on the global transformation impacting financial services, join Datos Insights in London for Retail Bank Transformation Europe. On November 19 and 20, 2024, Datos Insights will showcase over 30 thought-provoking sessions to help provide unparalleled banking choices, streamline operations across channels, and position banks as leaders in customer-centric innovation.
