When you want to understand where fintech innovation is heading, it is worth watching the smaller, more agile organisations. This was clear at this year’s FinTech North event in Manchester. The companies not weighed down by bureaucracy, legacy complexity, and long decision cycles are the ones finding faster, better ways to solve real problems.
With 400 fintechs contributing £5 billion per year to the regional economy and growing twice as fast as the national average, it is worth paying close attention to what is happening here. Listening to speakers across academia, regulators, established financial services organisations and high-growth fintechs, three themes stood out.
1. Smart data will determine who captures the value of AI
Open finance and smart data surfaced repeatedly, and for good reason. Whether it is underwriting, fraud detection, complaint handling or payments, progress hinges on being able to use data well. We see the same pattern across our clients. Many are trying to use AI but getting blocked by the basics.
Access to accurate data, in the right formats, with the right structure, and available through reliable, easily accessible pathways, is still the limiting factor. Until those foundations are in place, even the most ambitious AI programmes will stall; we’ve heard of institutions investing in over 100 proofs-of-concept, with few making it to production.
Smart data platforms are becoming essential for anyone wanting to participate in the next phase of financial services. They give real-time access to the right data, simplify data management, and improve traceability so teams always know the source and integrity of the information they are using.
They also allow clearer visualisation of trends, support more confident decision making, and let teams slice, combine and compare data at speed. Most importantly, they make it possible to generate larger and more useful datasets, which are vital for training effective AI systems.
We’ve been working with AI for years in highly regulated sectors, which show what’s coming. Healthcare is already pushing the boundaries, with work like the research from Moorfields Eye Hospital demonstrating what is possible when data foundations are strong.
2. Trust is being rebuilt through data, fraud prevention and digital identity
The conversation around digital identity, fraud prevention and consumer trust has moved on quickly. The challenge is how to manage the double-edged nature of AI safely.
Earning consumer and regulatory trust is critical. AI can strengthen controls, but firms must be able to show that these systems make sensible, transparent decisions. Otherwise, customers risk seeing AI as an impersonal black box.
We are close to the point where the AI currently embedded quietly in back-office operations will become visible to customers. It will shape products, journeys and decisions in ways that consumers can understand and trust.
Use cases are already emerging:
- AI-supported financial guidance and money-saving insights
- Cross-selling and upselling based on genuine customer needs
- Faster, more consistent application decisions
- Personalised trading recommendations
- AI chat interfaces that adapt to how people want to interact, rather than to product constraints
However, the reverse is also true. Neglecting trust creates real risk. Deep fakes, convincing phishing attempts and automated AI phone scams can drive customers to leave for newer firms with more modern controls.
Building trust now puts firms in a better position as consumer-facing AI becomes standard across financial services. Once data foundations mature, a wave of strong AI-first customer experiences will follow.
3. Regulation is aiming to support safe innovation
Laura Dawes from the FCA gave a strong overview of how regulation is adjusting. With the FCA’s Innovation Pathways service, its regulatory sandboxes, and a focus on protecting consumers without slowing progress, regulators are adapting to the grey areas created by AI. This matters because AI will soon be a routine part of mainstream financial services.
My view is that supporting innovation is essential if the UK wants to stay competitive. Other regions, including the UAE, are moving decisively. It is an advantage for Softwire to operate in both the UK and the UAE as these ecosystems evolve. With the FCA guiding the UK roll-out and offering timely support through Innovation Pathways, it is clear that compliant and forward-looking solutions are already possible.
Legacy issues: the quiet blocker behind every trend
Smart data, trustworthy AI and safe innovation only work when the technical foundations are sound. Many organisations are pushing legacy modernisation down the priority list because AI feels more exciting. Yet outdated systems already limit what these trends can deliver. If the foundations remain weak, the gap between ambition and execution will grow.
For a clear view of how legacy systems are constraining your AI and data goals, our modernisation guide breaks the work into practical steps and shows how to move forward without large and disruptive rebuilds.
Change the modernisation conversation
Our customer lookbook helps you:
- – Drive better conversations with CFOs, CROs, and CEOs
- – Share common challenges
- – Draw inspiration from real success stories in financial services and insurance
Whether you’re just beginning or need to re-energise a stalled programme, our lookbook helps you drive more compelling conversations to align stakeholders around the outcomes that matter most.
