Analyst All Stars: Top Takes on Fintech’s Hottest Trends

Sometimes the best way to determine the latest trends is to ask the experts.

So that’s exactly what we’ll be doing at FinovateFall next month when three of fintech’s most renowned analysts take the stage to offer their take on what they see as today’s hottest trend in fintech.

Join us for the Analyst All Star session at FinovateFall next month; September 23 through 25 in New York (you won’t want to miss out; register today). Each analyst will have seven minutes on stage to describe their thoughts on what’s driving fintech innovation today. Here’s who you can expect to see on stage:

Alyson Clarke @alysonmclarke

Clarke is a principal analyst at Forrester. With more than 19 years of financial services industry experience, she is a highly skilled expert with extensive industry experience in both wealth management and banking. Clarke has global expertise, having previously worked at Forrester in the financial services vertical in Forrester’s Sydney, London, and San Francisco offices. She is now based in New York and specializes in digital and non-digital channel strategy and innovation. In particular, Clarke focuses on the sales, service, and customer experience of financial services and advice across online channels, smartphones, tablets, and branches.

Jacob Jegher @jjegher

Jegher is an experienced fintech executive and digital banking thought leader. He advises clients on emerging technologies and business strategies related to retail, small business, and corporate digital banking. Jegher provides strategic consulting to financial institutions and solution providers on issues ranging from digital strategy to vendor selection. In addition to his client-facing responsibilities, Jegher leads Javelin’s overall strategy, marketing, and product development efforts.

Most recently, Jegher was Vice President of Global Solution Marketing and Head of Analyst Relations at FIS, where he was responsible for marketing strategy efforts across all business units and solutions. Jegher also brings extensive expertise in the banking research and consulting field, having spent over 10 years as a Research Director at Celent.

Alissa Knight @alissaknight

Knight is a senior analyst with Aite Group where she is focused on researching cybersecurity issues impacting the financial services, healthcare, and fintech industries by assessing sector trends, creating segment taxonomies, looking at market sizing, preparing forecasts, and developing industry models. She provides market research, competitive intelligence, and consulting services in the cybersecurity market through unbiased, objective and accurate research and content development. Out of her research, Knight produces reports and white papers, as well as provides advisory services and often keynotes at cybersecurity conferences, seminars, and roundtables.

Knight also sits as the Chairperson on the Board of Directors for Brier & Thorn and was previously CEO of Applied Watch and Netstream.

Finovate Alumni News

On Finovate.com

  • Analyst All Stars: Top Takes on Fintech’s Hottest Trends.
  • Artivest Inks Deal with WM Partners.

Around the web

  • Schmidt List podcast hosts ClickSWITCH CEO and Cofounder Cale Johnston.
  • LoanScorecard partners with LoanStream Mortgage to power QualONE.
  • Avaloq onboards Banque Morval onto Intesa Sanpaolo’s BPaaS solution.
  • Jumio joins NICE Actimize’s financial crime, risk management based ecosystem, X-Sight Marketplace.
  • CashFlows partners with Akamai to defend against cybercrime, including Distributed Denial of Service (DDoS) attacks.
  • Bpm’online wins Best CRM Solution for Enterprises at MarTech Breakthrough Awards.
  • Kony launches Conversational AI DevKit to enhance the customer experience.
  • Trustly appoints Louise Nylén as Chief Marketing Officer.
  • Expensify adds CPE credits to its accountant training and certification course.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Prosper Launches Mobile App for Investors

U.S. peer-to-peer lending company Prosper launched a mobile app for investors on its platform this week called Prosper Invest.

The new app, which allows investors to manage their portfolios, offers a visually-rich view of their investments, allows them to transfer to and from their bank account, and shows a clean breakdown of their portfolio and annualized returns.

Unique to the app is an impact map that details how many borrowers the investor has funded. This feel-good feature also shows a high-level geographical view of investments and breaks down the total by each borrower’s stated loan purpose. Adding a more personal touch, the app shares individuals’ stories from Prosper’s #MyProsperStory contests. Held from 2014 to 2017, the annual contest encouraged users to share how the loan has impacted their lives.

In my opinion, the most useful feature of the app details return on investment. The tool shows how much the investor has received in payments over the lifetime of their account and breaks it down by their principal and interest received. It even shows the default/chargeoff amount and net gain.

The native app, available on both Android and iOS, is quite a step up from the web-based app the company launched in 2012. Until this week, the web-based version of the site served as the only way for investors to manage their investments on-the-go.

Today’s app launch comes well after the brief existence of Prosper Daily, a borrower-focused mobile app that was born out of Prosper’s purchase of BillGuard for $30 million in 2015. Launched in 2016, the app was only available for a year before it shuttered in 2017. The launch of an investor-focused mobile app in the absence of a borrower-facing one may indicate Prosper currently has a higher balance of borrowers than investors. Peer-to-peer lending sites have often wrestled with the chicken and egg issue– they can’t get borrowers without enough lenders and they can’t attract lenders without enough borrowers.

Today’s launch isn’t the only release from Prosper we expect to see this year. In November of last year the company disclosed plans to unveil a Home Equity Line of Credit (HELOC) product that will streamline the application process and offer rates competitive to banks’ offerings.

Prosper presented at FinovateSpring 2009 as well as the inaugural Finovate in 2007. The company has raised a total of $410 million and is valued at $550 million.

Finovate Alumni News

On Finovate.com

  • Prosper Launches Mobile App for Investors.
  • Identitii’s Overlay+ to Drive Intelligent Data Exchange for HSBC Bank Australia.

Around the web

  • TechCrunch highlights Lighter Capital’s revenue financing-based approach.
  • Strands celebrates 15th birthday with 700 banks in 30 countries.
  • PyraMax Bank selects Insuritas to launch a bank-owned insurance service.
  • Identitii signs new license agreement with HSBC Bank Australia Limited for its Overlay+ platform.
  • PYMNTS considers how Tuition.io helps employees pay down debt faster.
  • Norima Consulting joins the Quadient Partner Advantage Program to provide financial services companies customer journey mapping and communication management.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Finovate Alumni News

On Finovate.com

  • U.K. Neobank Gravity Chooses Core Banking Tech from Finastra.
  • WattzOn’s SNAP Delivers AI-Enabled Data Extraction for Cleantech Sales Teams.

Around the web

  • Dwolla to power Bento Pay, email-based payments for Bento for Business’ clients.
  • Lendio ranks 28 of 50 on a list of Utah’s fastest growing companies.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

CurrencyCloud’s Grant Boosts Total Funding Over $80 Million

Just over a month after announcing a $40 million Series E funding round, international payments platform Currencycloud received another windfall. The company landed a $12.2 million (£10 million) grant as a part of the Banking Competition Remedies (BCR) program. This week’s funds bring Currencycloud’s total investment to more than $80 million.

Part of the BCR’s Capability and Innovation Fund Pool C, the award aims to include lending, international payments, and local payments services to SMEs in the U.K. The goal fits well with Currencycloud’s API offerings that help businesses accept, pay, and convert foreign currencies. The company’s tools also help businesses manage balances, send notifications, set permissions, and compile reports.

Currencycloud CEO Mike Laven said that the company plans to use the funds to “accelerate product development for SME’s, particularly in the area of collections.” He added, “We will also work on distribution partnerships that enhance our ability to deliver to SMEs. Our current U.K. eco-system of over 150 FX brokers, money transfer firms, payment service firms and banks service 1,000’s of U.K. SMEs with payment services today. Our intent is to widen access to affordable FX and international payments for U.K. SMEs, targeting 40,000 SMEs using our platform by 2024.”

Founded in 2012 and headquartered in London, Currencycloud counts fellow Finovate alums AzimoKlarnaRevolut, and Fidor as clients. The company can make domestic and international payments in 38 currencies to 180+ countries. Currencycloud most recently appeared at FinovateFall 2016 where it debuted its Payment Engine

Finovate Alumni News

On Finovate.com

  • CurrencyCloud’s Grant Boosts Total Funding Over $80 Million.

Around the web

  • Barclays ends partnership with cryptocurrency exchange Coinbase.
  • The ID Co illustrates 12-month plan to expand DirectID’s global data coverage.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

ID R&D Unveils Passive Facial Liveness Detection

Biometrics startup ID R&D released IDLive Face this week. The new solution adds liveness detection to facial recognition technology in an entirely passive manner.

Facial recognition technology has been used in fintech and other verticals to authenticate users for years. And in order to prove that the user wasn’t spoofing their identity using a static photo, many technologies use liveness detection, which requires the user to perform a handful of actions such as blinking, smiling, and turning their head.

With IDLive Face, however, the liveness detection is invisible to the user since it runs in the background of the application. This not only makes a frictionless user experience, it also prevents fraudsters from learning how to spoof the technology.

“IDLive Face requires absolutely no actions from the end user,” said ID R&D CEO Alexey Khitrov. “Eliminating complexity in the user experience is one of the primary focus areas of our research… Armed with excellent real-world results, we are thrilled to offer businesses fully frictionless authentication that aligns with rigorous compliance requirements for onboarding and data management.”

The new technology leverages AI-based algorithms that process images in near real-time. IDLive Face doesn’t require the end user to have any special capture software and is available as an SDK and Docker container on Linux and Windows.

At FinovateFall 2018, Khitrov demoed SafeChat2.0, an application that passively verifies a user’s identity throughout the conversation (typing or speaking) without asking them to do anything special to authenticate themselves.

ID R&D offers authentication technologies that span the biometric spectrum. The company’s IDVoice is a standalone version of its core voice biometric capability,IDSquared is a tool that validates the user by capturing their face as they type their login credentials, and IDBehave is a behavioral biometrics solution that creates a unique biometric template for each user.

Signifyd Offers Ecommerce Protection for Trellis Customers

Ecommerce fraud prevention company Signifyd has partnered with Trellis this week to help the company offer its merchant clients a way to provide a safer purchasing process for customers.

Together with Trellis, which offers digital strategy, web design, web development, digital marketing, and integration services for ecommerce merchants, Signifyd will offer Trellis’ merchant clients confidence that their card-not-present transactions are from real customers.

Signifyd’s technology identifies fraudulent product orders using machine learning algorithms that sift through big data, including user behavior patterns, to reduce merchant chargebacks on fraudulent charges and save money on shipping goods on declined orders. And Signifyd stands behind its technology. If an order turns out to be fraudulent, Signifyd reimburses the merchant for the chargeback.

“The Signifyd – Trellis partnership holds significant value for our clients and customers. Protecting transactions is an integral piece of any ecommerce business and integrating Signifyd ensures your bases are covered,” said Justin Whitaker, Director of Marketing at Trellis. “Signifyd has proven their efficacy time and time again by giving brands an extra layer of security. The relationships Trellis has forged are built on communication, trust, and results which align directly with the values of Signifyd.”

Signifyd demoed its chargeback mitigation solution at FinovateSpring 2013. Headquartered in San Jose, CA., with locations in Barcelona, Belfast, Denver, and London, Signifyd has been named on the Forbes FinTech 50 and was listed among Bloomberg’s 50 Most Promising Startups. Additionally, it has been named a top place to work by Entrepreneur, Inc. Magazine, San Francisco Business Times, and the Silicon Valley Business Journal.

The company has 10,000 merchants in its network which count 250 million customers across the globe. Last May, Signifyd closed a $100 million Series D round, bringing its total funding to $187 million. Rajesh Ramanand is CEO and cofounder.

What’s Trending Across Fintech Verticals

With such a fast news cycle in fintech, sometimes it’s helpful to dissect the news based on verticals; looking at them each independently. And we’ve done just that. Here’s a quick synopsis of what’s trending among six fintech verticals.

We’ll be taking a closer look at each of these topics at FinovateFall (September 23 through 25 in New York), where the brightest minds in fintech will discuss what you need to know about the latest news during our breakout streams. Register today to save your seat.

Challenger banks

Challenger banks got their start during the 2008 financial crisis after consumers lost trust with mega banks and began looking for an alternative. Recently in this space, we’ve started seeing U.K. banks make inroads into the U.S., where there is less competition for non-traditional banking providers. After amassing a waitlist of 100,000 U.S. consumers, German challenger bank N26 launched in the U.S. this July. A few weeks earlier, Monzo also announced a U.S. expansion after amassing a user base of 2.2 million customers in the U.K.

These non-traditional banks are also experiencing a funding boom. Last month alone brought major funding rounds to three challenger banks. U.K.-based Atom raised $60 million at a $644 million valuation, N26 raised an additional $170 million investment at a $3.5 billion valuation, and MoneyLion raised $100 million at a valuation of almost $1 billion. And in June U.K.’s Monzo raised $144 million at a $2.5 billion valuation.

Geographical expansion and strong investor confidence in this space indicate it is ramping up, and we can expect more competing challenger banks to enter the arena soon. The influx of funds also brings the likelihood that, as the startups continue development efforts, new products and features may be on the horizon.

Regtech

In the past, regtech has been looked at as the ugly cousin within fintech sub sectors. While not as sexy as investing technology, this vertical has seen increased popularity as of late. With the API economy making bank-fintech partnerships the new norm, regulators are begging for oversight and regulation-as-a-service companies have stepped in with the solutions banks need to stay compliant.

Similarly, as enabling technology expands, so does the need for regulation. Fortunately, along with this need comes the advances in technology for the regtech sector itself, which has benefitted from increased automation and scalability as AI and machine learning gain traction and become more accessible for firms.

Open banking

The final deadline for PSD2 is looming. September 14 is the final deadline by which all EU companies must comply with PSD2’s regulatory technical standards and impose strong customer authentication methods. This has sparked a lot of recent conversation as it has been reported that 41% of EU banks missed the original deadline. And the stakes are high– not only can regulators impose fines, they can also revoke payment providers’ licenses.

Customer experience

Last fall the hot button topic was customer experience. Since then, there have been endless debates on Twitter and the blogosphere on the necessity of bank branches. Some argue that online and mobile channels are the best avenues to serve consumers whereas others contend that physical bank branches are essential to maintain a personal connection with customers. The biggest voice in this debate, however, are the numbers. According to the Financial Brand, 81% of banks and credit unions do not plan to close any branches this year.

It’s hard to talk about the customer experience without bringing up chatbots. The AI-powered technology can be used to scale and humanize the online experience. Not only have we seen an increase in chatbot technology providers, we’ve also been seeing more companies build chatbot capabilities into their own apps.

Banking and payments

It’s true that banking and payments is almost too broad to be considered a vertical of its own. And with such a big category, it can be difficult to narrow down current trends. One topic that has been bubbling up lately, however, is the need for real-time payments in the U.S. Just a couple of days ago, the Federal Reserve announced it will develop a real-time payment and settlement service, called FedNow, that will support faster payments in the U.S.

Voice banking technology has been another widely discussed topic among banks, fintechs, and analysts in the past few months. With voice assistants such as the Amazon Echo, Google home, and Apple’s Siri becoming commonplace in homes, consumers are getting used to asking their AI assistants for answers to quick questions. However, the possibility of using the technology to conduct day-to-day banking activity hasn’t been on consumers’ radar– that is, until recently. On July 1, the classic game of Monopoly released a voice banking version that eschews paper currency. Instead, Rich Uncle Pennybags (the Monopoly man) manages the players’ money. When consumers get used to using voice technology in a game, they will soon be looking for it in their real bank.

Wealth management

Wealth management and roboadvisory technologies haven’t changed dramatically since 2015, the height of the roboadvisor boom. However, in the past few months some wealthtech companies have been broadening their offerings to compete with traditional banks. Betterment, Wealthfront, and SoFi, for example, have all launched checking accounts. Many firms have also unveiled additional capabilities, as well, such as tools for trusts, donation features, 529 plan options, and more.

And as AIs get smarter and work harder, there will be a backpedaling of pure roboadvisory plays. Many wealthtech companies already offer a hybrid option that combines roboadvisor tools with advice and guidance from human advisors. The human touch will rise to the top as a must-have option as consumers manage their nest egg.