04-07-2025
Innovation Doesn't Necessarily Mean Progress: By Scott Dawson
In 2013, Google launched an ambitious and attention-grabbing experiment: Google Glass. Marketed as a glimpse into the future, it promised a seamless blend of digital and physical reality through an augmented-reality headset. Journalists were enthusiastically promoting it as early as 2012, and by the time its soft launch came around industry observers were heralding the 'year of wearable tech'. Rather than going straight to stores, Glass was released to selected 'Explorers', most of them in the San Francisco Bay Area.
In hindsight, this was the kiss of death for the project: it created literal haves and have-nots, with tech influencers being given access to the future while the rest of us could only watch – and be watched. Explorers soon became known as 'Glassholes' and articles were written on the privacy concerns raised by the product.
Then, quietly and without fanfare, it disappeared. By 2015, production of commercial models had ceased, and what was once seen as a symbol of inevitable progress had become a cautionary tale. Google Glass didn't fail due to a lack of technical sophistication. It failed because Google misread the public's appetite for a solution to a problem they didn't have. This is the lesson we too often forget, particularly in sectors like financial services – not every innovation is progress. Sometimes, progress means making what we already have work better.
What Counts as Innovation?
At its simplest, innovation is the creation of something new. But new doesn't automatically mean better. Financial services, and payments in particular, have seen their fair share of novelty over the past decade. Buy Now, Pay Later (BNPL) stands out as a particularly visible example—disruptive, widely adopted, and clearly innovative. But it's also a model under increasing scrutiny and regulatory pressure. Critics argue that BNPL promotes overextension, encourages poor financial habits, and lacks the consumer protections built into traditional credit.
BNPL reflects a key tension in financial innovation, offering convenience while avoiding exploitation. When the pace of innovation exceeds the frameworks of regulation or ethical practice, we risk creating systems that appear sleek but ultimately prove unsustainable.
The last few years have also seen an explosion of blockchain-based financial products—decentralised finance (DeFi), NFTs, a proliferation of altcoins and memecoins. Much of this activity promised to 'democratise' finance and unseat traditional systems and yet, outside of a relatively niche audience, the vast majority of these projects have failed to achieve practical impact or long-term credibility. Their collapse, or stagnation, underscores the danger of mistaking novelty for necessity.
Can there be progress without innovation? It's possible. Some of the most important changes don't come from new ideas, but systemic change – mandating that bank accounts must be able to be accessed by disabled people for instance. Holding up NFTs next to accessibility shows that there really is little link between progress and innovation.
The Legacy Trap
Financial services often rely on infrastructure that is decades old. Many of the systems that process our daily transactions are built on technologies that have been in place since the 1980s or earlier. These legacy systems may be trusted but that doesn't mean make them resilient enough for purpose. While these systems are desperately due for an upgrade, we need to be careful not to do away with the aspect that work while we're pruning the less effective ones.
But modernising infrastructure doesn't always require a blank slate. In many cases, the more meaningful kind of progress is found in strengthening, streamlining and securing the systems that already underpin the global economy. In essence, that can mean using existing solutions more effectively or, as was the case with expanding access to bank accounts, making them more widely available.
It's not that innovation is inherently dangerous—it's that innovation for its own sake, detached from purpose, regulation or practical application often leads nowhere. Often, what we need is to listen to what people need and respond to it – innovations like the iPod that seemingly arrive from the ether to give the world something that they never thought possible ('1000 songs in your pocket') are rare, and what is more common are creations like the Miracle Mop that apply smart thinking to existing creations.
There's a common myth in fintech circles that regulation is an obstacle to innovation. In reality, it often serves as a crucial foundation. Regulation provides the clarity and stability needed for innovations to scale, especially when those innovations touch-sensitive areas like data privacy, fraud prevention or consumer protection.
At the same time, innovation can easily outpace existing regulatory frameworks. That's not an argument for ignoring regulation, but for approaching innovation with caution and responsibility. The collapse of several unregulated or poorly regulated digital finance platforms in recent years serves as a stark reminder of what happens when innovation races ahead without guardrails.
Progress, Properly Understood
The real engine of progress in payments isn't the next flashy app or protocol—it's the intersection of clear regulatory thinking, problem-solving, and pragmatic use of technology. A prime example of this is the revised Payment Services Directive (PSD2). Introduced in response to growing concerns around fraud and digital security, it not only addressed immediate problems but also laid the groundwork for future innovation.
PSD2 enabled the rise of Open Banking across Europe, giving consumers greater control over their data and creating new opportunities for fintech companies to offer better, more personalised services. This is innovation grounded in need, informed by regulation, and aligned with consumer interest. In other words, it's meaningful progress.
Technology isn't the only—or even the most important—arena for innovation. One of the most overlooked opportunities lies in education. Financial literacy and inclusion remain deeply uneven across demographics and geographies. Without addressing this foundational issue, even the most elegant solutions will leave many behind.
Progress that genuinely benefits people means ensuring they can understand and use financial tools with confidence. Sometimes the right innovation isn't an app, but a curriculum. Not a new platform, but a clearer explanation. The best technological systems are useless if they're inaccessible to those they're meant to serve.
Rebuilding on Solid Ground
The tech industry's long love affair with the mantra 'move fast and break things' is coming to an end. The collapse of several high-profile startups and the tightening of venture capital in a post-cheap-credit era have created a new mood—one that prizes resilience over risk, clarity over chaos.
In this environment, payments companies and fintechs are beginning to ask smarter questions. Not 'What can we build?' but 'What do people need?' Not 'How can we replace what exists?' but 'How can we improve it?'
Google Glass was not a total failure—it was an experiment, and experiments have value. But it reminds us that simply being ahead of your time isn't enough. The future doesn't belong to those who shout the loudest about change. It belongs to those who understand where change is needed—and then build responsibly and with purpose.
Innovation is a means, not an end. Let's keep our eyes on progress.
