Trend 1: Increase in bankruptcies of Dutch companies
After several volatile years, we anticipate a potentially significant increase in bankruptcies and voluntary business closures among SMEs. This is due to subsidies ending in 2022, rising inflation, supply chain delays, the energy crisis and increasing staff turnover. While the outlook is not entirely bleak, economic and social factors are largely contributing to an increase in insolvencies. These changes are likely to hit sectors with high-energy consumption the hardest. As during the pandemic, the retail, hospitality and food and beverage sectors will also be hit hard – especially small businesses with 4 or fewer employees.
Trend 2: Increasing demand for fraud protection during recession
History teaches us that with every recession, levels of fraud increase, and 2023 is expected to be no exception. In a recessionary environment, customers in need of money become more desperate and potentially more willing to commit fraud. This is compounded by the increased penetration of online purchases and digital transactions. Both consumers and businesses are vulnerable, making seeking vigilant protection ever more important.
Trend 3: Increased use of “Buy Now, Pay Later” (BNPL) among consumers
BNPL is already widely offered as a payment method for online purchases and its use is expected to increase by 2023. However, it is important to educate customers on how to use BNPL wisely, especially in times of recession. The Financial Markets Authority (AFM) predicts a 30% increase in BNPL payments and calls for stricter EU legislation to promote responsible lending and protect consumers from debt. Credit reference agencies, such as Experian, play an important role in preventing over-indebtedness among BNPL users. For companies offering BNPL, it is important to recognise potential payment and fraud risks and protect their customers.
Trend 4: Application of Open Banking increases in popularity
The application of Open Banking is constantly increasing worldwide. According to Experian’s 2022 Business and Consumer Insight Report, 94% of Dutch companies have already invested or plan to invest in Open Banking. Moreover, more than half (52%) see great benefits in their Open Banking projects.
One of the main reasons for this increase is that consumers are increasingly willing to share their data – provided companies guarantee the security of their data and can demonstrate its value. The same survey shows that about half of consumers recognise that their data must be shared if they want to access a product or service. Data can be turned into actionable insights that companies can use to improve performance and provide a personalised customer experience.
Trend 5: Sharing data to prevent debt
Experian advocates the careful sharing of data to better protect consumers and businesses from over-indebtedness and fraud. The Dutch Central Bank (DNB) and the Financial Markets Authority (AFM) recently made a new proposal around data sharing in the financial sector. A more balanced approach will lead to more benefits for society, consumers and businesses. With the rapid growth of the Dutch tech sector and topics like BNPL and Open Banking on the rise, we can expect more attention to finding the right balance between data sharing and innovation. This will lead to more benefits for society, consumers and businesses.
Trend 6: Applying ‘explainability’ to drive justice
With the rise of artificial intelligence (AI) and machine learning (ML), there is an increasing need for in-depth research on how to use these models in understanding and interpreting data, and this will continue well into 2023. It is more important than ever to look at AI formulas to ensure there is no bias. Improving data quality, diversifying datasets and using methods to interpret data are all ways to achieve better ‘explainability’. These data management issues are expected to continue to receive attention well into 2023.