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Disrupt and Protect: Financial Tech Trends

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Accessibility, mobility, security, personalization, gamification, disruption, real-time -- these were some of the trends at Wednesday's session of financial technology trade-and-pitch show Finovate. But  overshadowing the usual drive to amaze and delight, there was the sense that companies are searching for ways to arm consumers with better financial products and the security to match.

There was an emphasis on budgeting and financial planning -- for everyone. There were savings games for kids, such as crowd pleaser PlayMoolah that lets kids play in a currency called "moops." There was also a family-focused spending tool, Virtual Piggy, designed to prevent your kids from going nuts with your credit card online. Waspit also launched social banking for students.

And for the adults, there was a slew of new investing and budgeting tools presented -- those that come with access to advisors, those that will connect to your many accounts and keep you up to date on your financial life, some with fancy widgets and some that can be streamlined across your many devices.

A Word of Caution

If some of the concepts mentioned above sound familiar, it's because many of them already exist and companies are offering new iterations, hoping to tap into that one new feature that will ignite consumer interest.

"While there is a lot of innovation demonstrated by both startups and established companies at this show and in the market in general, there are also a lot of 'me-too' fast-followers out there," says Tom Blaisdell, a partner at venture capital firm DCM.  "It seems like every good new idea spawns three to five startups pursuing the same opportunity, which was a recipe for disaster in the internet boom and bust of '99/2000."

On the bright side, Blaisdell says that, in the 21 years he's been in and around the financial technology industry, he's "never before seen the level of innovation from both startups and large established players that we've seen in the last couple years."

"I think it has as much to do with changing customer attitudes as it does with technology advances [the internet, security] and platform shifts [mobile]," he says.

A Focus on Security

With cyber attacks, identity theft and fraud becoming increasingly worrisome, it's not a surprise that security was a focus at the conference. Among the presentations, there was a web-based biometric application that allows you to use facial and voice recognition instead of passwords. IBSS's internet biometric solution is designed to do third-party real-time verification without any data being saved to a device. Later, the audience watched as Akamai launched a hack on two sites, one that uses Akamai to protect it from unsavory web trollers and one that does not. You can guess which one held up.

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There were also companies trying to find a niche in every possible area of the mobile wallet trend. And of course, the question now is, how can they keep consumers' information secure?

One element of the payment discussion: Chip and Pin tech, EMV smart card technology that's being used in Europe, which relies on an embedded chip and a PIN number, designed to decrease fraud.

"Certainly Pin and Chip is going to be big," says John Ulzheimer president of consumer education at SmartCredit.com. But it's unclear the exact impact for consumers. "Pin and chip is designed to reduce fraud, but consumers aren't liable for fraud, thanks to the Fair Debt Collection Practices Act. And if the card issuers have their way, the consumer is going to be liable for fraudulent charges on pin and chip cards."

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Dynamics presented its multi-account card (debit, credit, points) that is compatible with multiple readers -- EMV tech, magnetic strip and contactless transfer technology.

Another theme at the conference: investing tools and the creations designed to make international business and commerce easier. And, as another sort of consumer protection, Personal Capital touted tools that protect investors from bloated 401(k) fees.

No, Finovate is not the definitive answer to all our financial woes. But it does highlight what some of these woes are, in some interesting and innovative ways.

To wrap up, here is a fitting quote from one of Wednesday's presenters. As Dynamics CEO Jeff Mullen said about some of the developments in tech that have complicated rather than simplified things: "Some people believe the best way to solve the chicken and egg problem is to introduce a turkey."

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