Nordic Innovation stands out for its simplicity, elegance and functionality, visible hallmarks in the Nordic fintech solutions that are redefining financial services for the region and the rest of the world.
Original brought in the Nordic Fintech Magazine spring Edition 2022.
In the twinkling of an eye.
The 3rd of January 2009 was the most significant date in current finance. This was the mining date of the Genesis block of Bitcoin (BTC). As diehard Bitcoin enthusiasts know, the Genesis block included a hidden message that served both as a timestamp and as statement of intention. The message read: The Times 03/Jan/2009 Chancellor on brink of second bailout for banks. The intent was clear, it was time for a new monetary system. One protected from the whims and abuses of corrupt and powerful actors, where a new set of checks and balances would be enforced through networks, code, and cryptography. In the twinkling of an eye, a new era of money and finance began.
“The emerging Nordic Fintech ecosystem realizes that Nordic citizens don’t need bank accounts, credit cards or mobile payments, but rather practical solutions that blend in gracefully with their lifestyle, that are available when they need them, and can simply vanish into the background when they don’t.”
Chris Crespo, Head of Content, Nordic Fintech Magazine
No one noticed. More importantly no one cared, as most of us were preoccupied with the uncertainty brought about by the financial crisis that preceded and catalyzed the creation of the first cryptocurrency. Central banks took measures to weather the crisis and new preventive regulation was introduced into the system. At the same time, financial institutions increased their reliance on technology, mostly looking for new ways of doing old things. But something was looming. Technologists in all geographies were reimagining finance through new things to do altogether. The very real possibility of redesigning money and consequently finance from scratch was in sight.
Oh, how things have changed
13 years later, the industry is unrecognizable. Disruption has created a new paradigm. Today, we get credit cards from big-tech companies, we trust our money to branchless, digital neobanks and we get interest-free credit for deferred payments at the point of sale. We buy financial products through our airline of choice, businesses get immediate advanced payment of their invoices through a widget, and diners invest in their favorite stocks through food delivery apps.
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Most astonishingly, what started back in January 2009, as a fringe attempt to tokenize value without the monopoly of the state, has grown into the biggest innovation in modern finance. Today there are 10,363 active cryptocurrencies in circulation with new ones spawning weekly. Each of the top 5 having a market cap of over $50 billion with Bitcoin and Ethereum having a combined market cap of $1,2 trillion. More than 300 million people own cryptocurrency, approximately 13% of those in Europe alone, and an estimate 18,000 businesses already accept them as a form of payment.
As with any movement the ones who stand to lose the most are the most resistant to change. Nevertheless, after going through the various stages of grief: Denial: “Pff, Bitcoin Schmitcoin, Anger: Ban them! Ban them all! Bargaining: Let’s assemble a taskforce, and Acceptance: “Dear customers! Come see our new crypto products”, the traditional financial system is catching on. It wasn’t easy though, it took stark shifts in customer behavior, enormous pressure from customer expectations, and a multiyear global pandemic to “persuade” observers watching it all unfold from the fence.
A distinct Nordic brand of innovation
In 2016, Denmark became my 7th “Home country” in 20 years. As a newcomer to the region, a few things immediately stood out. An unfaltering trust in public institutions, a high level of digitalization, and a rather progressivist approach to social policy. However, none was more salient than the distinct Nordic brand of innovation, palpable everywhere, from driverless public transport to state issued digital IDs, share-economy startups, and new-Nordic cuisine. But after seeing and experiencing innovation in various parts of the world, I concluded that Nordic Innovation’s strength lies not in its volume.
Recommended for you: Get your copy of the Nordic Fintech Magazine Spring Edition 2022
Developing countries, with their many ailments, can reveal just as much, if not more of it. But Nordic innovation is different. Nordic innovation seeks to perfect. It aims to find elegant solutions that solve problems with charm, subtlety, and finesse. It’s been said that sometimes simplicity and elegance are indistinguishable from each other. That, is Nordic Innovation.
The Nordics’ staggering ratio of 1 unicorn per million inhabitants, second only to Silicon Valley, and the fact that with only 4% of the European population, it generates 10% more billion dollar exits than the rest of Europe combined is a testament to the conviction with which Nordic founders approach entrepreneurship.
(Source: A guide to Nordic Innovation: Europe’s Unicorn Factory 2021)
Nordic entrepreneurship is unmistakable.
Its hallmarks of functional minimalism and aesthetic are stamped in their vision of new financial services that are open, free flowing, invisible and crafted to serve the needs of its users. The emerging Nordic Fintech ecosystem realizes that Nordic citizens don’t need bank accounts, credit cards or mobile payments, but rather practical solutions that blend in gracefully with their lifestyle, that are available when they need them, and can simply vanish into the background when they don’t.
This to me, is the power of Nordic Fintech and why the world is turning to this small but mightily innovative region for solutions.
In the Nordic Fintech Magazine spring Edition we celebrate the boldness, vision, and simplicity with which Nordic Fintech has owned the task of reimagining finance. Leveraging the best technological advances and bringing them to serve the needs of its users. The future of Nordic and Global Finance is supercharged with promise and excitement. With new opportunities for cross industry co-creation of fairer, simpler, and more competitive alternatives for users of financial services, in the Nordics and beyond.
