Fintech and insurtech's trajectory: navigating through sustainability, groundbreaking innovation, and digitally-savvy consumers
The 2024 Conference of the Politecnico di Milano Observatory underscored the critical role of digitalization, new technological solutions, and sustainability in revolutionizing the banking, financial, and insurance sectors. Key findings from the conference emphasize the importance of integrating advanced digital skills, innovative AI applications, and sustainable operational models to boost productivity, efficiency, and long-term resilience.
Digital Skills Development and Impact
The Observatory highlighted the need for measuring and enhancing digital competencies among employees and citizens to foster better adoption and performance of digital services in these sectors. Effective training policies and overcoming barriers to digital adoption are crucial for sustainable digital transformation.
Hybrid AI and Technological Innovation
Emerging technological solutions such as hybrid AI (combining symbolic and data-driven approaches) have demonstrated the potential to improve decision-making efficiency and sustainability. Use cases from related sectors have shown how machine learning models can optimize operational processes, with implications for logistics and risk management in finance and insurance contexts.
Sustainability as a Strategic Imperative
Incorporating sustainable practices powered by digital and AI technologies is reshaping businesses towards more efficient resource management and environmental responsibility. This reinforces the sectors’ role in advancing broader sustainability goals while maintaining competitive advantage.
Policy and Entrepreneurial Finance Impact
Research associated with Politecnico di Milano recognised the transformative potential of Generative AI on firm-level productivity and the influence of government policies on startup internationalization, which are relevant for innovation dynamics within banking and financial services.
The Italian Fintech Landscape
The Italian Fintech landscape is more vibrant than ever, with 596 operational entities. Many startups collaborate with traditional banks and insurers, creating ecosystems where innovation thrives. In 2024, startups have raised 250 million euros, confirming their role as the driving force behind sector transformation.
Consumer Comfort and Data Privacy
While the digital landscape offers numerous opportunities, concerns regarding personal data privacy persist. Only one in four consumers feels comfortable providing personal documents such as payslips through digital channels. Overcoming the barrier of reluctance to share personal data requires trust, which comes through transparent communication and demonstrating concrete benefits for customers.
ESG Themes and Sustainability Strategies
74% of sector players consider ESG themes fundamental for the long term. However, only 24% of entities adopt sustainability as a strategic pillar, and 76% of entities do not consider sustainability KPIs. Those startups with SDG objectives mainly focus on social objectives. 60% of startups do not have SDG objectives.
The Future Challenges and Opportunities
Corrado Passera, who spoke at the Final Conference of the Politecnico di Milano's Fintech and Insuretech Observatory, believes that these entities will be better prepared to face future challenges. The future of Fintech and Insurtech depends on the ability to bravely tackle global challenges and seize the opportunities offered by innovation. The new regulations DORA (Digital Operational Resilience Act) and FIDA (Financial Data Access) are designed to strengthen digital resilience and improve access to financial data.
In a Nutshell
In conclusion, the convergence of digitalization, AI-driven innovation, and sustainability strategies is shaping the future of these sectors through enhanced skills, smarter technologies, and responsible business models. The banking, financial, and insurance sectors have shown a positive trend in terms of margins and profits over the last five years, with the Italian Fintech landscape more vibrant than ever. To ensure continued growth and success, it is essential to prioritize digital skills development, embrace hybrid AI and technological innovation, and incorporate sustainability as a strategic imperative.
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