The future of fintech: Q&A with Jay Dorey

 
The fintech industry is undergoing rapid growth amidst evolving regulations. In this Q&A, Brigitte Goulard, Senior Counsel, and Jay Dorey, Head of Global Strategic Initiatives & Canada Government Affairs for Visa, discuss the areas seeing the biggest impact.

Brigitte: The fintech industry is experiencing several developments. Which one are you most excited about and what are the biggest opportunities and challenges facing the industry?

Jay: I think the biggest change that's occurred for the fintech market in Canada over the last decade is the Retail Payments Activities Act (RPAA). It is a massive change to the permission structures that fintechs in Canada will have to operate in, and there's a lot of attention right now on what that does for their access to real-time rail, to other payment networks, and to the infrastructure that exists around payments. But it also creates a level of legitimacy with consumers, financial institutions, and corporations that may have not yet onboarded all the different fintech products that have been developed in Canada. It creates a much better investment thesis for Canadian fintechs.

That is a big part of why we are seeing some renewed enthusiasm in this space from investors, potential markets, and from fintechs themselves. They see this as an opportunity driver, which is an incredibly important trend we need to talk about a lot more as an industry. It is exactly that type of a regulatory clarifying moment that has been the launchpad for fintechs in other jurisdictions.

The US’s origin story is different, but if you look at Europe, at many parts of Asia, at Africa, or Latin America, most of the world's growth follows regulatory certainty, and we, in Canada, are finally coming out of a long period of regulatory uncertainty. I think the next couple of years of fintech in Canada are going to be incredibly vibrant, increasingly competitive, and notable, in that we should see some interesting businesses emerge. There are several global players that are looking towards expansion. Although they had previously been avoiding Canada, they are now actively looking at Canada, which is good for the system as a whole.

Brigitte: Visa partners with fintechs around the globe as part of your Fintech Fast Track program. Can you share more about the tools and resources that are on offer in this program?  

Jay: The Fintech Fast Track program is something that was first developed in Europe and then expanded to the US, Canada, and other global markets. It is a mechanism for a new fintech participant to grow certain elements of their business and to get an idea or product to launch faster. This is done by providing these companies with a curated suite of products and services that are most applicable to fintechs so that some of their key processes, such as onboarding new clients, can be standardized. Having this standardization clears the hurdles to get to a point of safe entry into the payments system for regulated entities so that they can offer new services and products to compete broadly in the marketplace.

Of course, the support a company will access within the Fintech Fast Track program will vary depending on the kind of product and service it is building. Some are building traditional payments services, such as servicing sellers and merchants with a corporate or prepaid card. Others might be building a debit or credit card for consumers in specific verticals that they believe are underserved, while some are developing new, innovative forms of payments. Certain companies leverage Visa Direct for peer-to-peer payments, remittances, or cross-border transactions. Other companies make use of Visa’s product stack, which is everything from authentication tools to the more than 250 value-add products we have that are extraordinarily valuable for companies building out a consumer or a small business product.

Brigitte: Which of these verticals are you most excited about?

Jay: There are two that I get excited about, and they're both in areas where I would say, traditionally, Canadian consumers have been underserved—or, at least, they've been hard to find a product market fit. Fintechs are incredible at going deep and narrowing down to find a market that can really benefit from innovative tools.

First, I’m really excited about what's happening in small business. From small business banking to the whole suite of services being leveraged from both fintech and traditional financial institutions’ technology platforms, small merchants are being provided with a better experience. We have seen an explosion of fintechs in that space. There is a long litany of players that are leveraging card economics and the back-end suite and putting packages together for small businesses. This meets a specific need in the marketplace and, more importantly, fuels both productivity and economic growth.  

The other area I am really excited about is our Visa Direct service. It takes the same ease and speed Canadians expect from a peer-to-peer experience locally and applies it to cross-border payments and situations where domestic systems can’t reach. That product is doing phenomenal things, whether that's at a personal or corporate level. It’s especially valuable for new Canadians moving funds or accounts into the country and for small businesses that need faster, more cost-effective cross-border payments.

Brigitte: I am sure Visa has been spending a lot of time looking at AI and how they can leverage AI to better service their customers. Can you tell us about the plans you have for AI?

Jay: The application of technology to solve complex problems is something that Visa has been doing for decades. What many people may not realize is that the credit card transaction was one of the first to experience the benefits of AI.

Years ago, you would have had to call your bank in advance of your travels to let them know that you would be going out of the country so those transactions would flow. We deployed machine learning to develop complex, broad scoring at a very sophisticated level, and it took away that friction point. It increased revenue for merchants and sellers, it reduced costs for issuers, and it made the process for consumers better—and that was AI. That was years ago. Today, Visa continues to be recognized as a leader in this technology and is currently ranked second globally for corporate adoption and deployment throughout our business.

One of the areas we are most excited about in terms of deploying AI is fraud. The ability to identify fraudulent transactions or scams has grown to a point where AI is a necessary step. We’ve taken the same tools and solutions we built for Visa and scaled them so they can be used across any type of payment. This AI engine we built is proving to be one of the best tools to combat fraud and scams. Our goal is to be the best way to pay and be paid, and AI is accelerating that goal. This AI use case is having direct benefits for Canadian consumers, sellers, and for the Canadian economy.

Another area, which is very new but equally interesting and exciting, is agentic commerce, Visa believes that agentic commerce has the potential to be as big of a shift in selling as booth e-commerce was in the early ’90s.

It won’t be long before searching the internet and then checking out as a guest for any purchase is going to be done in cooperation with an AI agent. Getting the tools right to enable commerce in that environment is vital. For example, merchants need to be confident that the AI agent they have been trying to defend against in a fraud environment is now a good transaction, and consumers have to be confident that their rights and consumer protections are intact in those transactions. This is why we introduced Trusted Agent Protocol, a new solution that lets merchants recognize and verify AI agents acting for real customers so they can tell the difference between trusted agents and malicious bots or fraudsters. This is something we're putting a lot of thought and effort into with our partners across the industry. That deployment of AI has the potential to fundamentally alter the way commerce is conducted.