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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Multi-currency payment services company Conotoxia launched multi-currency card 2.0.
The update enables cardholders to add users to their card.
The multi-currency card 2.0 enables cardholders to hold accounts in 20 currencies and pay in more than 160 currencies.
Multi-currency payment services company Conotoxia is making it easier for users to share payment cards with friends, family, and employees. The new capabilities come as part of the company’s new launch, multi-currency card 2.0.
“We have been observing very strong interest in our multi-currency cards. Customers recognize their advantages and their superiority over bank debit cards,” said Conotoxia Vice President Pitor Kicinski. “The multi-currency card 2.0 and its new functionality can mean significant savings for families and businesses, as well as, for example, an interesting gift for those traveling abroad or shopping in international shops.”
Existing cardholders can share their card with new users after they register with Conotoxia. Once the new user is registered, they can begin making transactions using both physical and virtual cards. Meanwhile, the primary cardholder can view the card balance, control expenses, and set spending limits.
With the multi-currency card 2.0, cardholders can hold accounts in 20 currencies and can pay in more than 160 currencies. The tandem Conotoxia mobile app for iOS and Android enable users to view their transaction history, manage cards, and more. At the start of 2022, Conotoxia added Apple Pay as a payment option for cardholders, and contactless payments are also available with Google Pay, Fitbit Pay, and Garmin Pay.
Launched in 2014, Conotoxia offers foreign exchange and cryptocurrency trading, online payments, and online currency exchange in addition to its multi-currency cards. The company employs more than 250 people in its offices based in Poland, Illinois, and The Republic of Cyprus.
If you plan on binge watching holiday movies in the next few weeks (or if you have been since October), here’s something to think about. Did you know that many of these films come with lessons for the fintech industry?
Here are some films you may want to watch over your winter break, along with some of the wisdom they hold.
Home Alone (1990)
In this movie, Kevin McCallister finds himself left at home without any adults to help him carry out daily tasks and defend himself against burglars. In the same way, many customers are conducting their banking activities from home on their own devices. The only tools they have to successfully conduct banking activities are a strong password and your bank’s user-friendly design.
Lesson: Don’t make your customers feel at home alone. Provide them with tools they need to successfully conduct everyday banking tasks from your app.
It’s a Wonderful Life (1946)
After George Bailey contemplates suicide during a time of financial instability, his guardian angel comes to show him all the ways in which he has made a difference in the lives of others. In the end, he begs his angel to give him his life back. After he does, his community rallies around him to help him regain financial stability. The current economy is impacting firms across banking and fintech differently. Every organization has a storm to weather.
Lesson: Pay attention to what’s truly important in life and maintain a focus on community, especially in the midst of economic turmoil.
Family Stone (2005)
When a woman from the big city, Meredith, accompanies Everett, her boyfriend, to his childhood home for Christmas, they both discover that they aren’t right for one another. As the story progresses, it becomes apparent that Everett and Meredith’s sister Julie are falling for each other. Keep your bank or fintech partners in mind while watching this one.
Lesson: Finding the right bank or fintech partners can be a struggle. However, it is worth conducting proper due diligence to find the right partner before committing.
The Santa Clause (1994)
Toy salesman Scott Calvin is unexpectedly forced to become Santa Clause after the original Santa Clause falls off his roof. After spending much of the movie in denial and resisting his new role as Saint Nick, Scott Calvin ultimately accepts his new role, and everyone is better off because of it. Has your organization ever had to make a similarly drastic pivot?
Lesson: When the needs of the customer evolve, so should your business. Being able to pivot to meet customer expectation not only benefits end users, it will also be good for your bottom line.
Die Hard (1988)
When New York City Policeman John McClane visits his ex-wife at a holiday party on Christmas Eve, terrorists attempt to take over the building and John realizes that he is the only one who can save everyone. Whether you can see the fraudsters or not, everyone deals with them on a daily basis.
Lesson: You are responsible for creating the first line of defense between your customers and cybercriminals.
Jingle All the Way (1996)
In this holiday movie, Howard Langston tries to impress his son by giving him the season’s hottest toy, the Turbo-Man, for Christmas. The toy is almost sold out, however, and Howard goes to great lengths to compete with another father to get the toy. Ultimately– and only after proving himself a hero– Howard gets the Turbo-Man toy to give to his son in time for Christmas. While the customer acquisition race isn’t as competitive as a war over the Turbo-Man toy, it may seem like a battle at times.
Lesson: There will always be competition between and among banks and fintechs. And just like Howard’s fight for Turbo-Man, fighting to gain customers takes sacrifices and ultimately may require your organization to prove itself a hero to the customer before winning them over.
How the Grinch Stole Christmas (1966)
The Grinch, who hates Christmas, tries to take the joy away from the townspeople of Whoville by stealing their presents and other Christmas paraphernalia. Even after he does so, however, he hears the townsfolk joyfully celebrating Christmas, despite the lack of presents, food, and decorations. In the end, the Grinch realizes that Christmas is more than presents, tinsel, and bows. Just as the Grinch discovered there is more to Christmas than the money-making aspects of it, perhaps we can all look beyond our bottom lines this season to discover how we can better serve our target market.
Lesson: Perhaps there is more to fintech than just pandering to populations that seem the most profitable. Look for ways to benefit to others, even if they may be a net-zero opportunity.
Any Hallmark Christmas special
Many Hallmark holiday movies seem to share a similar premise. A big-city girl inherits a vineyard or a bed and breakfast in a small town. During her visit to the country, she meets a charming man and falls in love with both him and the small town lifestyle. You don’t have to watch a Hallmark movie to realize that expanding your horizons can be beneficial.
Lesson: It may profitable to serve the underserved populations found in rural locations. They could have more in common with your existing target audience than you think.
National Lampoon’s Christmas Vacation (1989)
Clark Griswold tries to create the perfect Christmas for his family, but when the Christmas bonus he expected for the year fails to come through, Clark’s cousin Eddie takes the issue up with Clark’s boss. Though Clark ends up receiving his bonus after all, the movie serves as a reminder not to financially overcommit before funds are guaranteed.
Lesson: Even when times are good, don’t count on extra cash to get your company through. Watch your burn rate.
Frozen (2013)
The main characters, sisters Anna and Elsa, illustrate the ups and downs of the crypto market. After Elsa freezes the town, the damage seems permanent, and residents wonder if they will have to live in wintertime conditions forever. At the end of the film, Elsa figures out how to control her magic and returns the town to its regular climate.
Lesson: Crypto will one day exit the crypto winter and will once again level out. The key to achieving this stasis may be the arrival of regulation in the cryptocurrency space, which is already be on its way. Today, U.S. Senator Elizabeth Warren unveiled a bill to enforce against crypto money laundering.
The financial services industry has seen a breathtaking amount of innovation over the last decade thanks to fintech applications that streamline user experiences and improve operational efficiencies. Many of these solutions incorporate third-party viewing integrations that allow people to view and manage documents, eliminating the need to switch back and forth between different software.
Implementing specialized viewing technology saves time and resources during the development process so fintechs can get their products to market faster. By selecting the right integration partner from the beginning, they can put themselves in a position to scale capabilities in the future without suffering unexpected costs or compromising performance.
Viewing Integrations and the Problem of Scale
Fintech developers often turn to API-based viewing integrations like Accusoft’s PrizmDoc because they provide the tremendous power and flexibility that modern financial services applications require. Whether it’s file conversion, robust annotation, document assembly, or redaction, fintech software must be able to provide extensive document processing features to meet customer expectations.
In order to implement those advanced viewing capabilities, the developer usually needs to set up a dedicated server as part of their on-premises infrastructure or in a cloud deployment. One of the biggest advantages of API-based integrations is that customers only have to pay for the processing resources they use, but this can also pose some challenges when it comes to scaling application capacity.
As fintech companies expand their services, they need to be able to deliver document viewing capabilities to a larger number of users. If each viewing session requires the server to prepare and render documents for viewing, costs can quickly escalate. As server workloads increase, viewing responsiveness may be affected, resulting in delays and slower performance.
While some users may still need to use server-based viewing to access more powerful imaging and conversion features, many customers simply need a quick and easy way to view and make minor document alterations. Fintech developers need a versatile solution that can meet both requirements if they want to scale their services smoothly.
Introducing PrizmDoc Hybrid Viewing
PrizmDoc’s new Hybrid Viewing feature provides fintech applications the best of both worlds by offloading the document processing workloads required for viewing to client-side devices. Rather than using server resources to convert files into SVG format and render them for display, Hybrid Viewing instead converts files into PDF format and then delivers that document to the end user’s browser for viewing.
Shifting the bulk of document processing work to client-side devices significantly reduces server workloads, which translates into lower costs for fintech applications.
For documents not already in PDF format, the PrizmDoc Hybrid Viewing feature offers new PDF viewing packages that pre-convert documents into PDF for fast, responsive local viewing. By reducing the server requirements for rendering files, fintech providers can easily scale their applications without worrying about additional users increasing their document processing costs. PrizmDoc Hybrid Viewing also eliminates the need for separate viewing solutions implemented to work around server-based viewing, which allows developers to streamline their tech stack and further optimize customer experiences.
PrizmDoc’s Hybrid Viewing feature provides FinTech developers with several important benefits that improve application flexibility and deliver greater value to their customers.
Resource Savings Hybrid Viewing minimizes server loads by offloading the bulk of the processing required to view a document to client-side devices. Reducing server requirements translates into lower costs and frees up valuable processing resources for other critical fintech workloads.
Scalable Viewing Shifting the processing work required for viewing to local devices allows fintech applications to scale their user base with minimal cost.
Enhanced Performance Offloading document preparation to the end user’s device improves viewing speed and responsiveness, especially for large documents.
Increased Productivity Diverting workloads to client-side devices allows application users to process, view, and manage multiple documents faster. Fintech developers can leverage Hybrid Viewing to provide a better user experience that helps their customers to be more efficient and productive.
Improved Storage Management For documents not already in PDF format, Hybrid Viewing can utilize PDF-based viewing packages that are significantly smaller than conventional SVG viewing files. Files can be pre-converted for fast, easy viewing without taking up extra storage space.
Enhance FinTech Applications with PrizmDoc Hybrid Viewing
PrizmDoc’s new Hybrid Viewing feature allows fintech developers to seamlessly scale their application’s viewing capabilities without having to deploy new servers or rethink their cost structure. Shifting document processing to local devices provides end-users with faster, more responsive performance, especially when viewing lengthy documents. By keeping viewing-related costs low, fintech developers can focus their resources on developing new application features that help their products stand out in an increasingly competitive market.
ING Germany has tapped Paysafe’s cash arm, viafintech, to offer its users cash deposit and withdrawal services.
Using ING Germany’s Banking to Go app, customers can deposit and withdrawal cash at more than 12,500 participating brick-and-mortar stores.
Withdrawals are free, but customers will be charged a 1.5% fee on the total amount they deposit.
Global payments platform Paysafeannounced today that its cash arm, viafintech, has partnered with ING Germany. Under the agreement, ING Germany will leverage viafintech for its cash deposit and withdrawal features.
viafintech’s technology will enable ING Germany to offer its nine-plus million customers to access a new feature, ING Cash, in its Banking to Go app. The tool will empower users to make cash deposits or withdrawals from their current account at participating brick-and-mortar retailers.
Here’s how it works: a customer decides how much they want to withdraw or deposit, and the app generates a barcode that they can scan at a participating brick-and-mortar store. Currently, ING Germany has more than 12,500 participating stores in Germany, including Rewe, Penny, Rossmann, and dm drogerie Markt.
Users are not required to make a minimum purchase at the retail locations. And while it is free for them to withdrawal funds, ING Germany charges a 1.5% fee on the total amount they deposit.
viafintech was founded in 2011 and was acquired by Paysafe in 2021. The company’s API offers organizations access to its payment infrastructure that enables cash withdrawals and deposits, bill payments, credit payouts, cashless payment methods, prepaid solutions, and gift cards.
Paysafe is a legacy player in the fintech space, having launched in 1996. The U.K.-based company offers payment processing, digital wallet, and online cash solutions connecting businesses and consumers across 100 payment types in over 40 currencies around the world. Last year, Paysafe processed $120 billion in transactions. The company is publicly listed on the New York Stock Exchange under the ticker PSFE and has a market capitalization of $824 million.
Insurtech company Oyster received $3.6 million in seed funding.
The round was led by New Stack Ventures.
Oyster was founded in 2021 by Blend, Stripe, and Strategy& alumni Vic Yeh, Jon Patel, and Nikhil Kansal.
Insurtech company Oysterreceived $3.6 million in funding this week. The Seed Round was led by New Stack Ventures with contributions from Global Founders Capital, Conversion Capital, Cambrian Ventures, SNR VC, Kearny Jackson, Valia Ventures, Interlace Ventures, V1 VC, and a group of angel investors.
Oyster a new take on insurance. It provides merchants an embedded insurance tool to integrate into their point-of-sale that offers customers insurance for a good or service they are about to purchase. Oyster will use today’s investment to fuel its point-of-sale insurance platform and add more merchant partners. The company’s list of merchant partners currently includes Bulls Bikes, Jewels by Grace, Zooz Bikes, Bario Neal, Area 13 Ebikes, and The New Wheel.
“You can buy a $5,000 ebike or engagement ring online in just a few clicks and get it delivered the next day. Want to get insurance for that purchase? Good luck! It’s an offline process that can take many days and lots of paperwork,” said Cambrian Ventures Founding Partner Rex Salisbury. “Oyster is offering embedded insurance for high growth ecommerce categories to allow consumers to seamlessly insure some of their most important possessions at point of sale in a few minutes. It’s a huge opportunity to move personal insurance into the digital age.”
Oyster differentiates itself by offering affordable insurance rates for products including bikes, ebikes, jewelry, phones, collectibles, and electronics. The company provides full coverage from theft, loss, and accidental damage– and many policies offer a zero dollar deductible.
The company was founded in 2021 by Blend, Stripe, and Strategy& alumni Vic Yeh, Jon Patel, and Nikhil Kansal. The team recognized the insurance market as one of the last financial sectors to be disrupted by the technological innovations of the past two decades. “The insurance industry is still in the early innings of digital transformation,” the company said in a blog post announcement. “As such, we’re accelerating the speed of innovation in order to provide the best-in-class products and services to our customers and partners.”
What does it take to be a fintech analyst? You have to be willing to get things wrong on occasion. Along with that, you need to be able to admit when you’re wrong. This becomes most apparent every December, when it comes time to share predictions on what the fintech industry can expect in the coming year.
Many of my predictions for 2023, which you can find published in this month’s eMagazine, were shaped from looking back at the trends I predicted for the latter half of 2022. Here’s a look at some of those trends, along with an assessment of how I did and a prediction for how the trend will fare in 2023.
Prediction #1: Beginning the era of “neo super apps”
How I did: Wrong. With every other fintech company claiming to be a super app these days, this prediction is slightly subjective. In my opinion, however, we haven’t entered an era of neo-super apps.
What to expect: A year ago, I would have identified the first potential U.S. super app as PayPal. However, Walmart has been making strides in this area and is getting ready to compete in the fintech arena. As a bottomline, we are still a ways out from super apps taking over fintech.
Prediction #2: Accelerating M&A activity
How I did: Somewhat correct. In comparing M&A activity to pre-pandemic 2019 levels, M&A activity has indeed increased. Though year-end data for 2022 hasn’t been published yet, according to FT Partners’ Q3 2022 Fintech Insights Report, there have been 998 deals so far in 2022. While this represents a slight increase over the 986 M&A deals conducted in 2019, it is a large slide from the 1,486 deals closed last year.
What to expect: The recent economic decline is causing companies to watch their pockets closely and mitigate risk where they can. Many large fintechs have already made major layoffs in order to maintain their bottomline or reduce their burn rate. These factors will contribute to both lower deal numbers and deal volume in 2023.
Prediction #3: Dwindling conversation around digital transformation
How I did: Correct. While the need for digital transformation across verticals has not subsided, the continuous pulse of conversation around digital transformation has eased up.
What to expect: This does not mean that digital transformation is over. In fact, many of the conversations we can expect to have in 2023– such as embedded finance, banking-as-a-service, and personalization– are built on the foundation of digital transformation.
Prediction #4: More discussion around Central Bank Digital Currencies (CBDCs)
How I did: Correct. In the U.S., the Federal Reserve has not taken much action toward creating a CBDC other than issuing a discussion paper on the topic. However, there has been a flurry of activity around CBDCs across the globe. In December of 2021, nine countries had launched a CBDC, while today, 11 have launched their own CBDC. Similarly, CBDC development has increased. In December of 2021, 14 companies had a CBDC in development, while today there are 26 countries with a CBDC in development.
What to expect: In the U.S. the discussion around CBDCs will progress, especially now that the FTX scandal has brought to light the need for more governmental intervention and oversight.
Prediction #5: BNPL takes a backseat
How I did: Wrong. Though there have been many publications warning consumers about the dangers of misusing BNPL tools, we are still seeing a regular pulse of new BNPL launches throughout the industry. And while the CFPB published a study on the growth of BNPL and its impact on consumers, the organization has not implemented any formal regulation restricting BNPL players’ movements in the market.
What to expect: I’m refreshing this prediction for 2023. Consumers have over-leveraged themselves when it comes to BNPL, and it is not only starting to catch up with them, but it is also catching up with the BNPL companies themselves. According to the CFPB’s study, “Lenders’ profit margins are shrinking: Margins in 2021 were 1.01% of the total amount of loan originated, down from 1.27% in 2020.”
Additionally, though the CFPB has been vague on the timing, there is looming regulation facing BNPL tools. “Buy Now, Pay Later is a rapidly growing type of loan that serves as a close substitute for credit cards,” said CFPB Director Rohit Chopra. “We will be working to ensure that borrowers have similar protections, regardless of whether they use a credit card or a Buy Now, Pay Later loan.”
Subsiding talent acquisition
How I did: Correct. Though companies will always face difficulties trying to secure quality employees, we are no longer seeing the tech talent war that we experienced in 2021. In fact, in the latter half of 2022, we saw the opposite. A handful of fintech companies, including Plaid, Autobooks, MX, Klarna, Brex, Stripe, Chime, and more, have laid off sizable portions of their staff.
What to expect: The painful reality is that the layoffs will likely continue into 2023 as the economy continues to contract.
Thoma Bravo has acquired business spend management software company Coupa for $8 billion.
The deal is expected to close in the first half of 2023.
The acquisition follows rumors that Vista Equity Partners had planned to acquire Coupa earlier this year.
Private equity firm Thoma Bravoannounced this week it is scooping up business spend management software company Coupa for a total of $8 billion. The all-cash transaction will make Coupa a privately held company and is expected to close in the first half of next year.
Coupa was founded in 2006 to offer businesses spend management solutions that help them view and control their indirect spending. Some of the company’s business spend management tools include e-invoicing, travel and expense management, spend analysis, treasury management, and more. Coupa went public in 2016 and has a current market capitalization of $5.98 billion.
“For more than a decade, we’ve been building an incredible Business Spend Management Community and have proudly cemented our position as the market-leading platform in our category. We’re looking forward to partnering with Thoma Bravo and accelerating our vision to digitally transform the Office of the CFO,” said Coupa Chairman and CEO Rob Bernshteyn. “While our ownership may change, our values do not. Every one of us at Coupa will continue to put our customers at the center of everything we do and help them maximize the value of every dollar they spend.”
Today’s report follows last month’s rumors that Texas-based private equity firm Vista Equity Partners planned to purchase Coupa. Vista Equity Partners is not only a well-known investor in the fintech space, it has also made a handful of large acquisitions in the fintech space in the past few years, having acquired tax compliance firm Avalara earlier this year and cloud identity solutions provider Ping Identity in 2016.
Interestingly enough, Thoma Bravo acquired Ping Identity earlier this year for $2.8 billion after Vista Equity Partners exited its investment in the company. Thoma Bravo takes a buy-and-build approach in which it acquires similar companies and consolidates them to create synergies and develop companies with greater scale, scope, and broader service offerings. Among Thoma Bravo’s other investments in the fintech space are Bottomline Technologies, Digital Insight, SailPoint, Ellie Mae, and Kofax.
Regarding the company’s Coupa purchase, Thoma Bravo Managing Partner Holden Spaht said, “Coupa has created and led the large and growing Business Spend Management category. We’ve followed the company’s success for many years and have been impressed by its consistent track record of delivering high levels of value for its global customer base. We look forward to partnering with Rob and the rest of the management team to keep investing in the company’s product strategy while driving growth both organically and through M&A.”
The partnership enables AvidXchange to expand on the global payments capabilities it launched last month.
The partnership will help AvidXchange offer its U.S.-based clients an embedded payment experience, creating a more convenient payment process.
Payment automation solutions company AvidXchangeannounced this week it has selected international money transfer company Wise (formerly known as Transferwise) to expand its international payment capabilities.
“Partnering with Wise to provide our customers with best-in-class international payment capabilities was an easy decision because of their market-leading platform and seamless integration capabilities,” said AvidXchange Chief Growth Officer Dan Drees. “Together, we stand firm as leaders and remain dedicated to making our customers’ payments process more efficient regardless of country lines.”
AvidXchange launched its global payments last month to create an embedded cross-border payment solution for its middle market business clients and their suppliers. Piloting the launch is Oracle NetSuite. The company will enable its clients to access the tool using AvidXchange’s SuiteApp within NetSuite’s SuiteCloud platform.
AvidXchange offers a range of payment automation products, which include invoicing, electronic bill payment, accounts payable automation software, purchase order requisitions, and more. The company serves a range of industries, including real estate, construction, financial services, hospitality, healthcare, and more.
Today’s partnership with Wise helps AvidXchange offer its U.S.-based clients an embedded payment experience that creates a more convenient payment process. The integration enables users to pay both domestic and international suppliers, all within the AvidXchange platform. Wise also offers AvidXchange clients more visibility into fees, gains, and losses to help them better control costs and view cash flow.
“Current systems don’t allow businesses to easily send, spend, or receive money internationally,” said Wise Platform Head Steve Naude. “Through our collaboration with AvidXchange, Wise is helping businesses gain access to a faster, more cost-effective and seamless way to manage finances with domestic and international suppliers in multiple currencies and countries. With 50% of transfers sent instantly, always at the mid-market rate, AvidXchange customers can now have confidence knowing they are saving time and money with each transaction.”
With more than 50 bank and business clients, Wise is one of the best-known players in the international remittance market. The London-based company was founded in 2010 with a simple mission: money without borders.
AvidXchange was founded in 2000 and currently processes over $140 billion transactions annually across its network of more than 680,000 suppliers. Despite its long tenure in the space, AvidXchange has only been a public company for a little over a year. The company debuted on the NASDAQ in October of 2021 and currently has a market capitalization of $1.69 billion.
This is a sponsored post by Tim FitzGerald, EMEA Financial Services Sales Manager, InterSystems
The use of analytics within the financial services sector has evolved over the years, with some suggesting that it could be about to evolve even further, moving from a landscape where decisions are “data-dictated”, rather than “data-informed.”
There is a distinct difference between the two concepts and the role, or lack of, that humans play in each scenario. In the case of data-informed, humans remain in the loop to make decisions and take the appropriate actions based on data and analytics, whereas data-dictated refers to applications executing programmatic actions automatically in response to some stimulus or event.
So, are financial services organisations really at a point today where human insight is no longer a vital requirement of the decision-making process and are there really just two types of data-related decision-making at play? In short, no. But it’s not completely black and white, as discussed in a recent Economist Intelligence webinar. Instead of just two options, today’s financial services firms typically implement four different categories of analytics: panoramic, predictive, prescriptive, and programmatic. Depending on the use case and the organisation, each of these types of analytics provide businesses with immense value.
Panoramic, predictive, prescriptive, and programmatic
Firstly, panoramic is about providing the business with a real time, accurate, expansive view of what’s happening inside and even outside the organization. For financial services, that might be the real-time liquidity across an entire firm.
Predictive, on the other hand, calculates the probability that events are likely to occur. For example, what’s the probability the Bank of England will cut interest rates if inflation pressures ease, as has been mooted, and how will this impact the firm’s positions?
Prescriptive analytics analyzes data to suggest the most appropriate actions to take, based on what is likely to occur, or what is already happening. This type of analytics would allow an investment bank for example to continuously predict the probability that their total market exposure will breach their risk utilization limits. With the right data and analytics platform in place, firms can also obtain prescriptive guidance that presents various options they can take to prevent or eliminate a breach, with the expected outcomes and trade-offs associated with each option.
These insights allow risk managers, who tend to have extensive experience in handling these kinds of situations, to make decisions based on their experiences, and guided by data-driven prescriptive analytics. For instance, it can help them to determine whether to initiate a hedge or unwind some positions. Prescriptive analytics therefore ensures experienced experts remain in the loop and at the heart of decision-making, rather than actions happening programmatically.
The final of the four Ps is about executing real time programmatic actions based on predictive and prescriptive analytics. Often, programmatic analytics are employed when there’s no time for human intervention, for cases like fraud prevention, pre-trade analytics, trading, and customer next-best action. Programmatic actions are also deployed in use cases when there’s simply no need for a human to be in the loop, which allows the organization to streamline operations and improve productivity.
Pragmatic application of the four Ps
Consequently, rather than moving away from a data-informed (human in the loop) to data-dictated (no human in the loop) state, the financial services sector is instead opting for the pragmatic application of any or all of these four Ps of analytics.
This use of analytics is providing firms with the capabilities needed to gain a 360-degree view of enterprise data, delivering a wide range of benefits to the business including better compliance, increased revenue generation, and improved decision support. When financial business leaders are empowered by real-time data and analytics, they are able to make decisions based on accurate and current data, not data that is weeks old, thereby eliminating errors and missed business opportunities.
Additionally, by incorporating advanced analytics into real-time processes flows, dashboards, and reporting, businesses can obtain better insights to guide decision-making, helping to understand what happened, why it happened, and what is likely to happen.
Armed with a current, trusted, and comprehensive view of what’s happening in the moment ensures financial services firms are prepared for events and disruptions that are likely to occur, can manage events and disruptions faster as they arise, and are in the best position to take advantage of new opportunities as they present themselves.
Challenger credit card X1 has raised $15 million, bringing its total funding to more than $60 million.
Along with today’s announcement, X1 is also unveiling a new in-app stock investing tool that will enable cardholders to purchase stocks using points.
X1 will use the funds to fuel growth and roll out new services for its members.
Challenger credit card X1 has raised $15 million this week. The funds bring the company’s Series B round to $40 million and elevate its total funds to more than $60 million. The investment was led by Soma Capital and included contributions from Brian Kelly (The Points Guy) and Kyle Vogt.
While the self-described smart credit card did not provide an exact valuation, the company said that today’s round increases X1’s total valuation by more than 50% over where it stood four months ago, when the company raised $25 million in Series B funding.
X1 will use the funds to fuel growth and roll out new services for its members. One such new feature is X1’s new investing platform that enables cardholders to buy stocks in the X1 app using their rewards points. X1 will guide investors by recommending stocks based on the cardholder’s spending habits, risk preferences, investment goals, income, and time horizon. The new capability will begin rolling out to select cardholders in the coming weeks.
The company said in the press release that it has future plans to expand the stock purchasing features “to compete with more traditional investment options.” Based on this, we can expect features common to Acorns and Robinhood such as spare change investing and automatic investment deposits.
For a card with no annual fee, X1’s rewards are hard to beat. The company offers cardholders 2x points on every dollar spent, 3x points on every dollar spent for the year if transactions exceed $15,000, and 4x points on each dollar for one month of purchases for each referral. X1 has paid out more than $10 million in rewards points since exiting its beta last October.
“With X1, we want to build an iconic and enduring consumer finance brand in an industry that’s long overdue for disruption,” said X1 CEO and Co-founder Deepak Rao. “We’re honored by the reception our card has continued to receive and to have raised this funding from Soma Capital, an early investor in more than 20 unicorns. With our innovative new investing platform, we’re excited to reimagine yet another sector in the consumer financial market.”
Outside of its rewards structure, X1 has other unique features that help differentiate itself in the crowded credit card market. The company has a stainless steel card and offers users virtual card numbers that they can set to expire on a specified date in order to avoid forgetting a subscription or a free trial period. The former automatically expires after one use, while the latter automatically expires 24 hours after it is activated.
Finastra and Clinc have partnered to integrate Clinc’s conversational AI technology into Finastra’s Fusion Digital Banking platform.
Finastra will offer its 8,600 financial instiution clients access to Clinc’s AI virtual assistants to help mitigate the load on call centers while providing quality answers to end users.
Finastra was founded in 2017 as a merger between Misys and D+H.
Financial software company Finastra has tapped conversational AI fintech Clinc this week. The two have partnered to integrate Clinc’s Virtual Banking Assistant technology into Finastra’s Fusion Digital Banking platform.
The added capabilities will enable Finastra’s 8,600 financial institution clients to increase digital engagement with their customers. Clinc’s Virtual Banking Assistant helps banks manage common banking requests through different channels, which ultimately helps reduce the volume of calls into the call center.
Clinc was founded in 2015 to build what it calls a “human-in-the-room” level of virtual assistant powered by AI technology and machine learning. The company’s solution understands natural language and leverages elements from the user’s inquiry– such as wording, sentiment, intent, tone of voice, time of day, location, and relationships– to craft an answer that is not only human-like, but also useful in answering the original question.
“We are incredibly pleased to be able to offer our AI solution to banks in collaboration with Finastra, whose FusionFabric.cloud platform is viewed around the world as a leading financial technology ecosystem,” said Clinc CEO Jon Newhard. “Our Virtual Banking Assistant, which can be integrated seamlessly as part of a digital transformation strategy, enables financial institutions to engage customers efficiently but without losing the personal touch. This is vital in an era when increasing numbers of consumers are demanding authentic and intuitive experiences from chatbots.”
Clinc’s technology will be available in Finastra’s FusionFabric.cloud, a marketplace that helps financial services firms find pre-built, ready-to-integrate apps into their Finastra products. Since launching in 2017, FusionFabric.cloud has had 566 customers sign up and has helped form more than 153 partnerships.
“Financial institutions worldwide will benefit from increased access to Clinc’s innovative chatbot technology,” said Finastra Chief Product Officer, Universal Banking Narendra Mistry. “Understanding how real people talk and interact is critical as banks and credit unions work to ensure that the customer experience remains strong while embracing new technologies. We’re delighted to welcome Clinc to our technology ecosystem, and for Finastra’s customers to be able to easily offer conversational AI as part of their digital strategy.”
Finastra was founded in 2017 as a merger between Misys and D+H. The latter acquired Mortgagebot in 2011 for $232 million. Mortgagebot was among the first companies to demo at a Finovate event. The company won Best of Show at FinovateFall 2007. Finastra’s technology spans lending, payments, treasury and capital markets, and universal banking. The U.K.-based company counts 90 of the world’s top 100 banks as clients.
The following is written by Lance Boyer, a recent college graduate and a Gen Z journalist.
Generation Z made up about 40% of active U.S. consumers in 2020, according to Fast Company. It also has more buying power than any of the Generation X, Boomer, or Silent generations. And it’s growing rapidly.
Generation Z is better off than the Millennial generation too. “Core” Millennials graduated high school and college into one of the worst economies in living memory. Despite the pandemic recession, Generation Z’s job and earning prospects have improved.
Financial technology providers can’t ignore Gen Z any longer. If you’re in the business of making budgeting, banking, and investing accessible to mobile users in the United States, you need to tailor your offerings to Gen Z — and now, not in 10 years.
That means designing your mobile app with younger users in mind. Here’s where to start.
5 Key Mobile Features for Gen Z Users
If you plan to market your mobile fintech app to Gen Z users, ensure it includes these five features.
1. A Unified View of User Finances
Most of the best personal finance apps have something in common: they give users a unified view of their finances inside and outside the app.
Your app shouldn’t only show balance and transaction information for accounts accessible directly through the app (if any). It should also display real-time or near real-time data from securely linked external accounts. It’s ultimately the user’s choice to link or not link these accounts, but your app should create as little friction as possible in that decision.
This adds a layer of development complexity for apps with money management functionality, as opposed to “simpler” budgeting apps that should link to external accounts. But it’s well worth the added investment and will increasingly become essential as the lines between banking and budgeting apps blur.
2. Social Sharing Capabilities
And not just standard Facebook, Twitter, Instagram, and Snapchat integrations. That’s old news.
Your app needs to make it easy — and fun and worthwhile — for users to generate their own content within the interface. Venmo does this simply but very well by allowing users to make transaction details public. Find an equal balance between privacy and disclosure in your product.
3. Stringent Privacy Controls (Beyond What’s Required by Law)
Your fintech app should have stringent privacy controls above and beyond what’s required by applicable law.
Your app shouldn’t make “low privacy” the default, and certainly not because you’re banking on monetizing your users’ data. That data is valuable, but you should come by it honestly. Gen Z is much more digital savvy than older generations and knows “if you’re not paying, you’re the product.”
You can undoubtedly incentivize users to share more with a freemium model or rewards for more sharing if you make it clear that you have users’ interests at heart.
4. Flexible Subscription Options
The more control you give your users over how and when they pay for your product, the more trust you’ll earn and the more you’ll make from them in the long run.
Don’t overcomplicate your payment options. Too many choices paralyze the user. Simple, straightforward payment verticals — one for pay as you go, one for pay for what you use, one for annual or quarterly subscriptions, and so on — are the way to go.
5. On-Call Support
The misconception that Gen Z doesn’t like talking to real humans must go away. Sure, the average Gen Z’er isn’t apt to chat on the phone for hours, but if you consider texting a form of talking — and it is — then Gen Z is just as chatty as its predecessors.
Maybe, more importantly, Gen Z is happier to be micromanaged than its predecessors. The average Gen Z’er seeks positive reinforcement and isn’t afraid to ask questions.
Lean into these preferences by investing in on-call support for your fintech app. This is a big ask for smaller enterprises, so it’s OK to charge for this service as long as it’s optional. Albert’s Genius function is a great example. It’s a built-in financial sherpa operating on a pay-what-you-want model, starting at a few dollars per month.
Final Thoughts
Generation Z makes up a larger percentage of active U.S. consumers than the Millennial generation, and it’s about to have more buying power. Its oldest members are already aging into the coveted 25-to-54 age demographic.
If your fintech app isn’t tailored to Gen Z’s preferences, you’re already behind the curve.
Fortunately, your development team doesn’t have to reinvent the wheel to appeal to Generation Z. Including five key value propositions does the trick:
A single-dashboard view of user finances — both in the app and in external linked accounts
Seamless social sharing capabilities and user-generated content tools
Stringent privacy controls that keep users in the driver’s seat
Flexible payment options rather than one-size-fits-all subscription or flat-fee models
On-call human support, whether free or paid
These “big five” are just the start. You’ll likely find your younger users demanding additional features and functions. But the big five are non-negotiable. The sooner you work on them, the better.
