Call from front line

During a session at the event Paul Taylor, co-founder and CEO at fintech unicorn Thought Machine, was asked on stage about the current challenges facing fintech. He said leaders should always prepare “because there is always something coming along.”

On stage with Taylor was Zopa Bank CEO Jaidev Janardana, who listed Brexit and the Covid-19 pandemic among the crises faced in recent years, said: “As organisations, we are now used to dealing with these.”

Samina Hussain-Letch, executive director at SME-focused e-commerce fintech Square UK, agreed that “change is a constant”, with crises and political upheaval ceaseless – as is the tech sector’s ability to navigate disruption. Hussain-Letch said that Square UK has experienced growth during crisis moments as businesses and consumers “look for technologies that can actually help them weather the storm”.

But politics and the government could help through appropriate regulation, with Francesco Simoneschi, co-founder of fintech TrueLayer, asked if now is the time to become less reliant on US payment schemes.

Recent comments from Christine Lagarde, head of the European Central Bank, emphasised the heavy reliance on overseas payment infrastructures: “Whether you use a card or a phone, typically it goes through Visa, MasterCard, PayPal, Alipay – where are all those coming from? Either the US or China. The whole infrastructure mechanism that allows for payments – credit and debit – is not a European solution. Brussels should make sure there is a European offer.”

Simoneschi agreed it was the time for an alternative to schemes such as Visa and Mastercard. “We have come a long way in 10 years and have laid the foundation of what is going to happen next,” he told the audience.

Zopa’s Janardana also called for a UK digital ID to remove “inefficiencies”, while John Baxter at Thought Machine wants the UK to remain a flexible jobs market, adding that proposed changes in the Employment Rights Bill will be a “complete disaster for fintechs”.

Challenger banks in patient game

While fintechs face challenges, the future for traditional banks is one with declining market shares, said Atom Bank CEO Mark Mullen during an IFGS session titled, ‘The Growth Engine: What’s next for challenger banks?’.

“These are banks whose primary revenue comes from customers they have had for decades,” said Mullen. “They are not growing when it comes to new customers. These banks are living in the past, living from past revenues, and it will bite them on the arse.”

The challenge for new digitally led banks, such as Atom, is to become more than just a secondary account for people. To date, consumers have typically retained traditional banks and used challenger banks as a second account.

But this is beginning to change, according to Alex Mollart, CEO at Tandem Bank, because of trust, adding: “Trust is probably one of the most important factors in banking – the system is built on it.”

He said that traditional banks have lost trust over time while challenger banks have built it. This is in large part related to tech, with challenger banks built on modern reliable tech foundations.

“You build trust over time through many engagements,” said Mollart. This can be through the front end where it’s simple to log into an app, which works every time and is simple to use, and “where customers get what they want, when they want, and it’s hassle free”.

Trust is also built through back-end engagements where customer support is smooth, he added: “Consumers are seeing in the news that traditional banks are experiencing downtime and they have lost trust in their customer services.

“We are built on modern architecture. We don’t have a digital legacy and we are able to keep that trust going, and I think we are starting to see challenger banks offer wider services to more customers. People are moving from primary bank services to secondary providers because trust has been built over the past 10 years.”

Recent high-profile tech problems experienced by traditional banks – such as the three-day outage at Barclays – has seen criticism, including in Parliament, of traditional banks.

Following the outage experienced by Barclays Bank customers, MPs demanded answers from bank CEOs and discovered that nine of the UK’s biggest banks accumulated more than 33 days of IT downtime over the past two years, with millions of people affected.

Data also revealed that there were at least 158 banking IT failures between January 2023 and February 2025, equating to more than 800 hours of service unavailability.