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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
For a year that began with Visa’s headline-making acquisition of Plaid, it seems almost poetic that near 2020’s midway mark, Mastercard would make a major fintech bid of its own.
The company has agreed to acquire Finicity, a real-time financial data and analytics provider and long-time Finovate alum, in a deal valued at nearly $1 billion. This figure represents a combination of the $825 million purchase price of the Salt Lake City, Utah fintech, as well as a potential earn-out for Finicity’s existing shareholders – subject to the company meeting certain performance targets.
“Since our founding, Nick Thomas and I have focused on developing industry-leading technology and building an organization that empowers consumers and organizations to better understand, manage, and use their financial data to improve their financial lives,” Finicity co-founder and CEO Steve Smith said. “Enabling people to access and control their data, while ensuring best practices to protect that data, will continue to drive tremendous innovation that increases financial literacy, inclusion, and health. This partnership with Mastercard helps us accelerate this mission globally.”
Mastercard President Michael Miebach cited open banking as one of the reasons for the company’s interest in Finicity. Referring to open banking as both a “growing global trend” and a “strategically important space,” Miebach praised Finicity’s ability to leverage open banking APIs to enable financial data and insights to streamline lending and mortgage processes, account-based payment initiation, and other PFM services. He also credited the company for its focus on the data rights of the consumer.
“(Finicity) shares our commitment to consumer-centric data practices, ensuring consumers have a say in how and where their information should be used,” Miebach said.
Founded in 2000, Finicity provides financial data APIs, credit decisioning tools, and financial wellness solutions that help financial institutions and fintechs better serve their customers. The company’s technology helps power solutions like ExperianBoost and Rocket Mortgage from Quicken Loans. Named a Best Place to Work in Fintech by American Banker for the last three consecutive years, Finicity began 2020 partnering with SaaS-based marketing automation, CRM, and POS solution provider for banks and mortgage companies, Volly.
In a brief statement shared on Monday, the Wilmington, North Carolina-based company reported that it had publicly filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission for their proposed initial public offering. nCino made its Finovate debut at FinovateEurope in 2017.
The company’s announcement did not disclose the number of shares to be offered, nor the price range of the offering. Renaissance Capital reported that nCino is seeking to raise $100 million. The company expects to trade on the Nasdaq Global Select Market under the ticker “NCNO.”
Underwriting the IPO are Bank of America Securities, Barclays, KeyBanc Capital Markets, and SunTrust Robinson Humphrey.
nCino’s Bank Operating System, built on the Salesforce platform, provides financial institutions of all sizes with an end-to-end banking solution that enables them to deliver the kind of digital experience banking customers have come to expect. The platform combines customer relationship management, loan origination, workflow, enterprise content management, as well as business intelligence and reporting, all in a single, secure, cloud-based environment. On average, financial institutions using nCino’s Bank Operating System have enjoyed a 40% decrease in loan closing time, a 92% reduction in servicing costs, and a 127% increase in account opening completion rates.
Founded in 2012, nCino has raised more than $213 million in funding. The company reported revenue growth of almost 50%, reaching $44.7 million, for the quarter ending in April. nCino also reported revenue of $138.2 million in its most recent fiscal year, ending in January. This year, the company has forged partnerships with Alterna Bank, a subsidiary of Alterna Savings and Credit Union Limited, and with Swedish SME lender Yourban. Additional partnerships announced in the first half of the year include collaborations with Fulton Bank and Black Hills FCU. Pierre Naudé is President and Chief Executive Officer.
In the middle of the first month of the year, one of the biggest names in the payments business acquired one of the most innovative fintech infrastructure companies in the industry, in a deal valued at more than $5 billion.
Six months later, Visa’sacquisition of Plaid almost seems like news from another time.
The arrival of the coronavirus to virtually every corner of the globe – and the worldwide response to the killing of a black man in police custody in the U.S. – have sent shock waves through the fintech industry – as they have the rest of the world. Now, at the same time, fintech is engaged in both the struggle to help businesses and consumers cope with the closures and shelter-in-place restrictions of the COVID-19 crisis, as well as the challenge of correcting decades of discriminatory practices against African Americans and members of other underrepresented ethnic groups. As we approach the middle of 2020, fintech is facing different kind of crisis that, while not of its own making, will require a response that is uniquely tailored to the world it operates in.
This is a world that is both heavily technical, relying on the latest innovations in machine learning, artificial intelligence, and distributed ledger technology, while simultaneously pledging to bring the benefits of 21st century financial services to the underbanked and underserved populations of both post-industrial and developing economies. This is a world that has grown tremendously through the contributions of people from diverse backgrounds, representing cultures from almost every corner of the globe. Yet, at the same time, it is a world that is still struggling to achieve true gender and ethnic diversity, particularly in the C-suite and in the boardroom.
There are many ways to value an industry: the quality of the goods it produces; the entertainment, education, or simple well-being its services provide; even just the degree of pure, gee-whiz innovation the industry may deliver, often seeming to grant us what we want even before we summon up the nerve to wish for it.
But as the fintech industry edges closer, inexorably, toward maturity, it now finds itself increasingly judged on the kind of criteria Corporate America – often to its own surprise and bewilderment – can find itself judged on from time to time. This is a judgement that has less to do with what Corporate America makes and sells, and more with who Corporate America is and what it values.
Both the global public health crisis and the renewed determination to fight racial inequality are providing fintech as an industry with an opportunity to show the world just what it’s made of. As we move into the second half of this historic year, I am hopeful and optimistic that fintech will rise to the challenge.
Identity verification and authentication company Payfone – which made its debut on the Finovate stage more than a decade ago – has announced a major fundraising of $100 million. The Series H investment, led by funds advised by Apax Digital (the growth equity division of Apax Partners), takes the company’s total funding to more than $217 million, according to Crunchbase. Although no valuation information was provided in last week’s announcement, TechCrunch noted that Payfone had earned a previous valuation of $270 million with its previous fundraising in April 2019.
Payfone’s customer identity platform helps financial institutions identify a range of potentially fraudulent activities – from the presence of a burner phone or a synthetic identity to spoofed calls and real-time SIM swap fraud. The company’s authentication solutions use proprietary “phone intelligence,” which processes behavioral signals in real-time to measure a phone number’s reputation and risk. This gives the authenticating party a Trust Score that helps them separate potentially suspicious activity from legitimate transactions. In addition, Payfone provides call verification solutions that run in the background of the phone call, making it easier and faster to resolve any authentication issues that arise.
“The mobile phone is rapidly becoming the secure passport for navigating our digital lives,” Payfone CEO Rodger Desai said. “With one in three U.S. consumers already authenticated by Payfone, this investment accelerates our ability to set the standard for the authentication process. As we build out a cross-industry consortium, more enterprises will be able to access Payfone’s real-time fraud and risk signals to prevent account takeovers while passing more transactions.”
In addition to helping the company build the forementioned industry-spanning consortium, the additional capital will be used to acquire strategic assets, and bolster the machine learning capabilities of its digital identity and authentication technology.
Also participating in the Series H round were new investors Sandbox Insurtech Ventures, and individual investor Ralph de la Vega, former Vice Chairman at AT&T. Existing Payfone investors MassMutual Ventures, Synchrony, Blue Venture Fund, Wellington Management LLP, as well as individual investor Andrew Prozes, former CEO of LexisNexis, were also involved in the fundraising.
Headquartered in New York City and founded in 2008, Payfone launched in the U.K. this spring with its Mobile Authentication product. The solution gives financial institutions in the U.K. a secure and easy-to-use alternative to one-time, SMS-based passwords for activities like customer onboarding, login, and two-factor authentication.
Payfone VP Keiron Dalton explained that while one-time passwords (OTP) have a role to play in the authentication process, they often fall short of what is required in the financial services industry. “(The) market demands placed on financial institutions in the U.K. are particularly acute,” Dalton said, “leading to a clamor of activity as these institutions search for what’s next in terms of authentication.” He called Mobile Authentication a “game-changing experience” for customers that provided a superior level of security against fraud, and added that the solution has seen “huge success in the U.S.”
Named one of the fastest growing companies on Deloitte’s 2019 Technology Fast 500 last fall, Payfone earned similar commendations this year from the Financial Times. The U.K.-based publication featured the company in the top 500 of its inaugural, The Americas’ Fastest Growing Companies 2020 roster.
The international fintech community received an unexpected jolt on Friday on news that the CEO of Wirecard, Markus Braun, was stepping down. Braun’s resignation comes amid reports that the German digital financial platform he has led since 2002 cannot account for $2.1 billion in cash, and a delay in the release of its 2019 financial report. Reuters reported that the company admits it could be have been “the victim of fraud of considerable proportions.”
Up until recently Wirecard appeared poised for success as a leading European payment processor for both consumers and businesses. The company reported revenues of $2.2 billion in 2018 and, by the fall of that year, had reached a valuation of $26.9 billion.
But suspicious of the company deepened early last year. A Financial Times report in January alleging suspicious financial activity in Singapore, and the announcement of an official investigation by Singapore authorities a month later, tarnished Wirecard’s image despite the company’s denials. This was followed by claims of further questionable financial activity – this time in Ireland – in October.
In this week’s news, auditors at EY, formerly known as Ernst & Young, were not able to locate cash at two Asian banks – Bank of the Philippine Islands and BDO Unibank – where Wirecard said $2 billion had been deposited. Both banks have denied having a business relationship with Wirecard. Moreover, documents indicating that such a relationship did exist, according to BDO, were falsified and bore forged signatures.
In a statement, Wirecard announced that James Freis, who was recently appointed to the company’s management board, will serve as interim CEO. the Federal Financial Supervisory Authority, known as BaFin, is investigating.
Here is our weekly look at fintech around the world.
Latin America and the Caribbean
Brazil-based SME lender BizCapital raises $12 million in Series B funding to support development of new products.
Banco Sabadell partners with IBM to enhances its digital banking operations in Mexico.
Banco Safra, based in Brazil, to deployACI Worldwide’sUP Retail Payments solution and UP Framework.
Asia-Pacific
Vietnam Plus reports surge in contactless payments in Vietnam.
Crowdfund Insider investigates the rise of Sharia fintech in Indonesia.
Malaysian fintech Curlec, which helps businesses manage recurring payments and cash flow, secures investment from 500 Startups.
Sub-Saharan Africa
South African open banking startup – and FinovateAfrica alum – truIDannounces seed funding.
Nigeria’s Chipper Cash secures $13.8 million in Series A funding.
WapiPay, a fintech based in Kenya and Singapore that provides platform-to-platform integration for virtual and global accounts, raises seed funding via accelerator network FutureHub.
Central and Eastern Europe
Estonia’s Planet42 announces $2.4 million seed round led by Change Ventures. The company helps facilitate automobile access for the underbanked in South Africa.
Russia’s Tinkoffteams up with online marketplace goods.ru.
Bokuacquires Estonia-based mobile payments company Fortumo in deal valued at $45 million.
Middle East and Northern Africa
UAE-based Buy Now Pay Later e-commerce company Postpay introduces a trio of new installment payment options.
The Fintech Times takes a look at the state of the fintech and financial services industry in Lebanon.
Tpay Mobile, based in Dubai, acquires Turkish payments company Payguru.
Central and Southern Asia
Cryptocurrency exchange Binance joins the Indian Tech Association.
Kaspi, an e-commerce banking app based in Kazakhstan, to expand to Azerbaijan and other neighboring countries.
India Infoline launches #IIFLDisrupt, an initiative to help early-stage Indian fintechs during the COVID-19 crisis.
India-based Buy Now Pay Later company Tabby raises $7 million in funding to support expansion into Saudi Arabia.
Six companies that have demonstrated their fintech innovations on the Finovate stage have been recognized this year by CNBC as part of their Disruptor 50 roster for 2020.
This year’s list, the eighth in the series, is marked by the high number of billion-dollar companies, or “unicorns.” Fully 36 of the firms in the 2020 CNBC Disruptor 50 have reached or surpassed the $1 billion valuation mark. Combined, the 50 companies have raised more than $74 billion in VC funding and achieved an implied market valuation of almost $277 billion.
The companies making the cut range in industry from cybersecurity and healthcare IT to education and, of course, fintech. In fact, the top-ranked company in the 2020 Disruptor 50 is none other than Stripe, the $36 billion payments platform founded in 2010. Stripe earned a #13 ranking in last year’s Disruptor 50 roster, and likely owes its first place appearance this year to a major $600 million funding raising – the company’s largest to date – and the economic and social consequences of the global health crisis.
“With many people throughout the world under lockdown to prevent the spread of Covid-19,” CNBC’s capsule on the company noted, “the move to shopping online has never been greater. That’s good news for digital payments platform Stripe.”
Stripe was not the only fintech to earn high marks from the 2020 Disruptor 50’s methodology. In addition to the half dozen Finovate alums below, some of the other fintechs on this year’s roster include:
Virtual bank WeLab (Hong Kong)
Digital mortgage company Better.com (New York City)
“Buy now pay later” e-commerce company Affirm (San Francisco, California)
Challenger bank Chime (San Francisco, California)
Banking app Dave (Los Angeles, California)
Microfinancier TALA (Santa Monica, California)
Trading and investing platform Robinhood (Menlo Park, California)
Also earning spots in this year’s list were a pair of insurtech companies, Lemonade and Root Insurance, as well as cybersecurity and biometric authentication firms SentinelOne and CLEAR, respectively.
Here’s a look at the Finovate alums that made this year’s list.
In a round led by Santander InnoVentures, Upgrade, the San Francisco, California-based neobank co-launched by LendingClub founder Renaud Laplanche, has raised $40 million in new funding. The Series D round takes the company’s total funding to $202 million, and gives the neobank a valuation of $1 billion.
“We are thrilled to welcome Santander InnoVentures as a new shareholder,” said Laplanche, who is Upgrade’s CEO. “Our strategy of partnering with banks and credit unions of all sizes is delivering tremendous value to our partners and customers, and we are delighted to add one of the world’s largest banks to our partner roster.”
Also participating in the Series D were new investors Ventura Capital and Uncorrelated Ventures, as well as existing investors Union Square Ventures, Ribbit, Vy Capital, and Silicon Valley Bank.
Opening its doors in 2017, Upgrade specializes in providing financing for mainstream consumers via its card and personal loan products. The company, which also provides free credit monitoring and financial education tools, has provided more than $3 billion in consumer credit via its solutions. More than ten million consumers have applied for either the company’s Upgrade card or loan.
“We’re excited to support Upgrade in their next stage of growth,” senior advisor at Santander InnoVentures Chris Gottschalk said. “Upgrade is building a neobank with credit at its heart, which we believe is a smart strategy as credit represents 70% of banking revenue globally and is often the main reason customers seek banking services.”
In addition to helping drive growth at the company, the funding will support the upcoming launch of a new mobile banking product, the Upgrade Account. Named “Best Place to Work in the Bay Area” by the San Francisco Business Times and Silicon Valley Business Journal for three years in a row, Upgrade launched its first contactless-enabled Upgrade Card – as well as a digital form of the card facilitate mobile payments via Apple Pay and Google Pay – in April.
Upgrade’s personal credit lines and personal loans are issued by partner Cross River Bank. The firm’s Upgrade Card is issued by Sutton Bank, via a license from Visa.
With a growing consciousness worldwide on the topic of systemic racism, corporations are doing everything from pro-diversity affirmations (arguably not enough) to mass board resignations (arguably far too much) in order to stay (or get) on the right side of public opinion on a key issue for many of their customers.
We took a look at some of the ways those fighting in favor of a more inclusive financial services and fintech sector can learn from the successes of the women’s movement a few days ago. Here, we offer a few more specific examples of not just what financial institutions can do to help promote ethnic diversity in their companies, but also what financial institutions and fintechs are actually doing.
Celebrate Diversity
With Juneteenth taking place this Friday, some financial institutions have decided to treat the date – which marks the moment African slaves in Texas in 1865 learned of the Emancipation Proclamation – as the official occasion many African Americans have always believed it to be. Fifth Third Bancorp and Truist Financial are among a number of companies that have elected to recognize Juneteenth as a holiday for their employees and customers.
“As we consider the tremendous significance of this day and what it represents, it also reminds us of how far we still must go to have equality and inclusion for all,” Greg D. Carmichael, chairman, president and CEO of Fifth Third Bancorp said earlier this week. “As we observe Juneteeth, each of us should pause, reflect, and contemplate its significance and what it meant 155 years ago, what it means today, and how we might take action to make tomorrow better for everyone.”
Fifth Third will close its offices early on Friday, shutting down at 2pm local time. And while a number of other major financial institutions have made similar commemorations, Fifth Third is believed to be the first FI to offer its employees Juneteenth as a paid holiday.
Show the Money
The $40 million Netflix CEO Reed Hastings and his wife Patty Quillin have announced they will donate to the United Negro College Fund, and a pair of historically black colleges Spelman and Morehouse, is an example of the kind of “put your money where your mouth is” act that many pro-diversity advocates have called for.
Some of the biggest financial services companies and banks in the United States have unveiled similar initiatives. Citi, for example, announced that it will direct $8 million to the NAACP Legal Defense Fund, the Lawyers’ Committee for Civil Rights, the National Urban League, and the National Fair Housing Alliance.
Also pulling out the checkbook in the name of diversity are firms like Bank of America, which announced a $1 billion/four year commitment to help local communities of color at a time when the COVID-19 crisis is making a disproportionate impact on black and brown Americans.
“Underlying economic and social disparities that exist have accelerated and intensified during the global pandemic,” Bank of America CEO Brian Moynihan said earlier this month when the initiative was announced. “The events of the past week have created a sense of true urgency that has arisen across our nation, particularly in view of the racial injustices we have seen in the communities where we work and live. We all need to do more.”
People Who Need People
Honoring the past is important. And putting real resources to work to make opportunities possible for historically excluded groups is a critical component in achieving a more inclusive world. But, without putting too fine a point to it, the best way to promote diversity is to hire more diverse people.
Analysts looking at the barriers to increasing diversity have cited three chief hurdles: (1) finding diverse candidates to interview, (2) retaining diverse employees, and (3) getting diverse candidates past interview stage. And while the second two issues have a lot to do with the culture of a company, something that may not substantially improve until after diversity and inclusivity gains are made, the first challenge – finding good candidates – is one all companies and organizations should pledge to overcome.
For many companies, this may mean looking in typically overlooked places for otherwise untapped talent. Student organizations, including a very active African American collegiate and post-collegiate fraternity and sorority system, can be a an excellent way to reach today many of the people who will be leaders in their communities tomorrow. Diversity-oriented venture capital firms – such as Harlem Capital Partners, the Black Angel Tech Fund, and Base Ventures – are excellent sources for insight into black and brown entrepreneurship in the technology sector.
As Chamath Palihaptiya, venture capitalist and founder of Social Capital, wrote almost five years ago:
We need to recapture our potential and open the doors. Invite more people into the decision making: young people, Blacks, Latinos, females, LGBT and others who aren’t necessarily part of the obvious majority. Surround ourselves with a more diverse set of experiences and maybe we will prioritize a more diverse set of things. Maybe we will find more courage to do the hard things.
Half a decade later, many of us in the technology community in general and the fintech world in specific are still waiting. But it appears increasingly the case that, for now, our communities are ready to act.
Expense management platform Expensifylaunched its latest solution today. The offering, Concierge Travel, is a virtual travel assistant that makes it easier for travelers to build their itineraries and plan their excursions in the COVID-19 era.
“While most of us are avoiding travel right now, there are still essential workers whose trips can’t be cancelled or postponed,” Expensify CEO and founder David Barrett explained. “We want to help them travel in the safest possible way.”
Concierge Travel is available to Expensify cardholders and can be used to book flights, make hotel reservations, reserve rental cars and more – free of charge. All bookings via Concierge Travel also feature complimentary safety alerts and travel risk advisories from Global Rescue. The free Global Rescue membership offers a range of services for travelers including transportation to the cardholder’s hospital of choice in an emergency, as well as health and security assessments and entry and exit requirements for international travelers.
“With Concierge Travel, your free Global Rescue membership provides world-class safety and medical services,” Barrett added. “On top of that, Concierge lets you know about any COVID-related travel restrictions in advance, including specific stay-at-home orders in place, social distancing measures, and other info on the city you’re visiting.”
A Finovate alum since 2009, Expensify demonstrated the technology behind its expense management platform at our developers conference, FinDEVr Silicon Valley, in 2016. The company introduced its corporate card last fall, offering spending controls and expense management in a single solution that in some ways harkens back to the firm’s origins more than a decade ago.
“Expensify started as a corporate card way back in 2008 before we decided to focus on expense,” Barrett said when the card was launched, “so it’s fun to see the product come full circle with a card that naturally extends our existing platform.”
Founded in 2008 and headquartered in San Francisco, California, Expensify has raised $38.2 million in funding according to Crunchbase. The company includes Redpoint Ventures, OpenView, PJC, and Canadian Imperial Bank of Commerce (CIBC) among its investors.
Some of the biggest disruptions in financial services are coming from some of the least likely places. The challenger bank revolution, for one, is bringing new levels of competition to “old” finance.
The rise of challenger banks will be one of chief topics of our upcoming, all-digital FinovateAsia event next month. Helping drive that conversation will be Araminta Robertson of Mint Studios, a speaker, podcaster, and fintech writer who will moderate our Challenger Bank Power Panel on July 6th.
By way of introduction, we’ve invited Ms. Robertson to address another disruptive elephant in the financial services room: the rise of financial services offerings from popular technology companies with deep pockets and powerful brands.
Everyone working in the financial sector held their breath when Apple announced it was releasing a credit card.
Araminta Robertson
People have been discussing for years when the Big Tech companies will enter the world of financial service. In 2019, it became true. Apple released a credit card in the U.S. that allows you to sign up through your phone, connects with all your Apple devices and offers 2% cashback on transactions. Customers can immediately start using their Apple Card and even use the balance to send money to friends and family members. On top of that, customers can track all their spending on their phone and aren’t charged any late fees, international fees or general accounts fees.
How fintechs can compete with Apple
Fintechs, specifically challenger banks, are going to have to find new ways to up their game. Although some may not need to compete directly with Apple just yet (the Apple Card is only available in the U.S.), fintechs should start looking at strategies that will prepare them for a much more ambitious market. This is because Apple will soon be setting the bar for the industry, and customers will be expecting the same level of privacy, customer experience and quality of features as they get with Big Tech products. Here are a few approaches fintechs can consider in order to stand out.
Take branding seriously
To start with, it’s unlikely people will buy an Apple phone just to use the Apple card. This means that the Apple card will be primarily be used by iPhone and Apple fans. The good news is there is a large segment of the population that does not use Apple products and services or iPhones – and many who don’t want to be associated with the brand or would never trust Apple with their money.
This means that fintechs still have a chance to create their own brand, community, and customer base and should, therefore, take branding seriously.
Not only can fintechs use branding to stand out more, but with the appropriate licenses, they can offer other financial features that a Big Tech cannot. The Apple card does not allow users to invest in the stock market, buy cryptocurrencies, or perform bank-related actions. This is because Apple does not have a banking license, and will likely never hold one: becoming a bank is expensive, cumbersome, and not very profitable for a Big Tech.
Ted Rossman from CreditCards.com says so himself: he thinks people will only sign up to the Apple card because they love Apple. At the moment, they don’t offer any features that you can’t find somewhere else. Although they may offer unique features in the future, fintechs can still use this opportunity to position themselves as a trustworthy banking solution that is 100% devoted to managing people’s money securely. Apple does not have the flexibility to adjust its branding to a more banking-friendly image.
Focus on the underserved
The issue with Apple and the Apple Card is that it excludes a large section of the population. In fact, Apple as a brand does not work well with “financial inclusion”; if their phone costs $500, they can hardly say they are proponents of financial inclusion.
This is an important point because many challenger banks and fintechs have financial inclusion and literacy as a core principle, and are focusing on helping the underserved – it’s what drives them to create accessible products, offer lower fees and build a community around financial education. Those fintechs that are consumer-focused and take financial inclusion seriously can use this as a competitive advantage to build a brand that takes into account the underbanked.
Apple will not become a brand that provides for the underserved anytime soon, so that’s a market that will always be open for fintechs.
Encourage localization
As mentioned above, Apple will raise the bar and set the standard worldwide. However, it also means that their products and features are more generalized and meet a broader spectrum of audiences.
This is where fintechs in different countries can gain a competitive advantage by partnering up with local businesses, offering location-specific services, and building a brand that is more regional. Spanish citizens will likely appreciate a neobank that partners with the local food delivery apps, offers a unique Spanish bank card, and a specific Spanish saving product. In addition, local fintechs may be able to take advantage of country-specific regulations that may favor local companies rather than international conglomerates.
Although Apple will be able to localize the more it grows, it will only be able to do so to a certain extent. In many cases, we may find that locals would rather use a product that serves them extremely well in their own country rather than one that works pretty well in several countries. Having said that, Apple aggregates tons of data every year and there is no telling what kind of features may attract locals as well.
Although Apple is one of the most innovative and forward-thinking Big Tech companies in the world, local fintechs still have a chance to build their own brand and community. If anything, this may propel fintechs to up their game and keep adapting their products to customer demand.
Araminta Robertson is a writer and content strategist at Mint Studios. She helps fintech companies from all around the world use content marketing to create a community, build trust, and acquire quality customers. She has worked with some of the fastest growing fintech startups in SE Asia and London, U.K., and regularly speaks at conferences and events.
Facial recognition may be the hottest form of biometric authentication. But it’s far from the only – or even the most effective – biometric authentication method for all instances. In fact, as far as Redrock Biometrics is concerned, a superior alternative may lie in the palm of your hand.
“The PalmID solution far outperforms competitive touchless technologies, such as facial recognition, in terms of accuracy and reliability,” Redrock Biometrics co-founder Hua Yang said in a statement announcing the company’s latest partnership a few weeks ago. “It is the best available solution for touchless identity management, authentication and security.”
Founded in 2015 and headquartered in San Francisco, California, Redrock Biometrics is the developer of PalmID, a palm-scanning authentication solution that provides accurate, robust, no-additional-hardware-required biometric authentication via camera-bearing devices – ranging from smartphone, tablets, and laptops, to payment terminals (including ATMs), IOT devices, and even cars.
And at a time of social distancing and a preference for as much contact-free activity as possible, authentication technologies like PalmID are likely to be seen as increasingly attractive options. Add to this the challenge of face-based authentication in a world of mask-wearing employees and consumers, and the case for palm-based authentication becomes all the more compelling.
Identity management solution provider Q5id is the latest company to deploy Redrock Biometrics’ technology. Q5id, based in Beaverton, Oregon, announced last month that it would integrate PalmID into its biometric enrollment and authentication solutions. Q5id works with institutions in multiple verticals, including financial services, telecommunications, education, and e-commerce, to provide identity verification services via multi-factor authentication, live video, and active voice authentication. The fact that palm-scanning technologies are particularly hard to fool, according to Q5id chairman and CEO Steve Larson, is one of the reasons why the company partnered with Redrock. The solution’s high accuracy rate – and lack of a hardware requirement (compared to fingerprint scanners, for example) were additional selling points for the technology.
Redrock Biometrics’ PalmID works with both standard RGB and infrared cameras. The company notes that from a distance of approximately six inches, the average smartphone, laptop, or ATM camera can capture a good quality image of the unique skin patterns of the users palm. The captured image then undergoes a two-step process. First, the PalmID Capture Module uses machine learning technology to convert the RGB video input stream into a palm image that is ready for authentication. Second, the PalmID Matching Module, in real-time, matches the captured image against stored references. The technology uses proprietary algorithms to test images against large databases of palm images to prevent false positives.
PalmID has also been deployed recently to help provide an identity verification solution for mass transit and payments. The company partnered with FalconPro Technology in May, adding its PalmID software to a FalconPro camera module to create a simultaneous palm print and palm vein image capture. The goal is to create a large-scale authentication solution; pilot projects using the technology will be conducted in both the payments and public transit industries, according to FalconPro Technology CEO Xun You. FalconPro is a founding member of the Chinese Automatic Fare Collection System Association, and provides QR-code based digital ticketing systems for rail systems throughout China. The company sees its partnership with Redrock as potentially enabling it to “expand (its) product offering beyond barcode technology.”
Also this year, Redrock Biometrics forged a partnership with passwordless authentication solution provider HYPR, which will add the company’s PalmID technology to its platform. Redrock has also waived the license fee for its PalmID software for all essential businesses using the technology during the global public health crisis.
“COVID-19 quarantine made us acutely aware that touching devices represents a threat to our lives,” Redrock co-founder Lenny Kontsevich said. “People become touch-phobic and their faces are covered by masks, which creates a need for a touchless palm solution.”
Digital receipt management specialist – and FinovateFall Best of Show winner – Sensibill has forged a new partnership that will put its receipt capture and management solution in the hands of more banking customers.
JPMorgan has agreed to integrate Sensibill’s technology into its Chase Mobile Banking app, making it easier for the firm’s customers to manage expenses, provide proof of purchase for insurance claims, and monitor spending “at a granular level.”
The offering will be made available to the 38 million active users of Chase’s mobile app as part of a progressive rollout later this year. As the U.S. consumer and commercial banking business of JPMorgan Chase & Co., Chase has 4,900+ branches in 38 states and the District of Columbia, as well as a network of 16,000 ATMs.
“Chase has created a digital banking experience that makes it easier for consumers and businesses to manage their finances,” co-founder and Sensibill CEO Corey Gross said. “Through our partners with Chase, millions of customers will have access to a best-in-class product that solves the hassle of expense and receipt management.”
Sensibill’s smart receipt management enables users to capture any physical receipt or invoice by taking a photo or forwarding an email. The solution leverages optical character recognition (OCR) and AI to turn receipt images into categorizable data that can be downloaded into expense reports, spreadsheets, or other digital documents. Sensibill makes it easier to organize and add context to expenses, and includes functionality to link receipts to card transactions for SKU-level visibility into spending.
The technology also helps financial institutions enhance their customer engagement by leveraging digital receipt data to offer more personalized solutions. Sensibill’s 75 financial institution partners in North America and the U.K. have used the technology to spot small businesses that may be ready to migrate from a personal to a business account, identify non-card spending patterns to better guide their own product offerings, and build brand loyalty.
Founded in 2013, Sensibill has raised $55.4 million in funding according to Crunchbase. The company, based in Toronto, Ontario, Canada, includes Radical Ventures, First Ascent Ventures, Information Venture Partners, Impression Ventures, and Mistral Venture Partners among its investors.
