Plaid Exchange Offers Open Banking in a Box

Since the dawn of APIs, the U.S. has struggled to create a consistent open banking approach. Banks and fintechs have battled with each other on screen scraping, customer data, and open access to third party providers.

Banking technology company Plaid announced a new launch today to solve this struggle and unite banks, fintechs, and consumers. The new tool, Plaid Exchange, offers banks a way to provide open banking connectivity to their clients while keeping their clients’ data safe and giving them control of their data.

Plaid Exchange helps banks establish token-based API connectivity with the 2,600 third party apps in Plaid’s network. This single connection simplifies integration for banks, helping their clients connect with more third party providers securely. Additionally, the API helps banks build a control center that empowers their customers to manage which third parties they share their data with.

To help banks with legacy systems, Plaid is working closely with integration partners to ease the transition. The company’s partners in this effort include Kunai and Core10.

“We believe APIs are the future of open finance, and we want to make it as easy as possible for all financial institutions to incorporate APIs into their broader digital transformation agendas regardless of budget size and resources,” said Plaid Product Lead Niko Karvounis in a blog post.

Plaid Exchange can help banks bring an API solution to market in 12 weeks. The company is already working with financial institutions for Plaid Exchange and expects to partner with even more as banks seek to meet increased customer demand for digital services in the post-COVID-19 era.

Counter-intuitive Brilliance: Zafin’s Strategy for Success in Trying Times

Photo by Burak K from Pexels

A global product and pricing solution provider for banks, Zafin finished 2019 with a new Salesforce integration and began this year with a major change at the top: adding financial services veteran Venkataraman Balasubramanian (known informally as “Bala”) as the company’s new Chief Technology Officer.

Balasubramanian arrived at the Toronto, Ontario, Canada-based company at a time of major innovation in the financial services industry – as well as a time of significant disruption in the everyday lives of people all over the world due to the coronavirus pandemic. How is Zafin helping banks and other financial institutions cope with the current environment? How do some of the most compelling technology innovations of our time – from advanced machine learning and AI to the blockchain and Big Data – give innovators the tools they need to find new solutions to old – and new – problems? We talk with “Bala” about all this and more in our latest Finovate Alumni profile.


Finovate: You have only been at Zafin for a month or two. How are you finding your new position? Any surprises?

Venkataraman Balasubramanian: It has been an incredible first few months for me here at Zafin. First and foremost, I find myself in the midst of a very talented group of people: engineers, business and technical analysts, a robust management team, and a very dedicated client success team. The depth of these teams is a testament to the value our clients see in our products. 

Counter-intuitive yet brilliant has been the approach our management team has taken during these very trying times: to continue to bring in strong talent that will put us in a strong position coming out of this period of economic uncertainty.

Zafin was among the first to move to protect our employees by requiring all to work remotely. Our employees have access to extra “care days” for this year as a benefit. Recognition that the safety and well-being of our team is paramount to our client success is unusual to see in a business our size and one we continue to focus on.

Finovate: You have more than 35 years of experience in financial services and information technology. What attracted you to Zafin?

Balasubramanian: Digital was here to stay even before our current crisis. It is now even more so cemented in our everyday lives. This aspect of digital, however, goes far beyond the creation of experiences into the digitization of entire workflows — propositions that resonate in this context with a cloud-first service architecture, enabled by artificial intelligence and machine learning.

The implementation of such a system typically requires truly digital fintech partners (such as Zafin) and services integration (SI) partners. Having spent considerable time with SI partners in my prior roles, I felt that the timing is appropriate to work with a specific digital enabler. Zafin provided that opportunity in that its solution truly enables a digital transformation of the customer experience across the entire customer relationship and banks’ business lines.  

Finovate: What are some of the things you are most eager to accomplish in your first year as CTO?

Balasubramanian: We are a cloud-based solution today, and I would like for us to be a multi-cloud solution in a manner that is unique. We are currently defining that framework, and I hope to get it to completion during the year. 

In the era of digital transformation, core systems transformation will progress considerably. To that end, I expect to work with both existing core providers and transformational core providers to enable a “Bank-in-a-Box,” with a modernized core and externalized cross-product layers that enable product, pricing, and billing functionalities. Further, we will look to incorporate AI/ML capabilities into our solution to create proactive end-user interfaces. 

Finovate: What are some of the most significant changes in the banking industry going on right now and what role is Zafin playing to help banks and other financial institutions successfully navigate these changes?

Balasubramanian: COVID-19 has redefined life as we know it, and financial services are no exception. Whether it is social distancing, phased restarts of the economy, or just the uncertainty that this virus has created, it has made us all think about the experiences we want in our everyday lives. Naturally, this means digitizing many facets of those experiences. 

We want payments to be contactless and frictionless. We want highly relevant products and offers that seek to simplify our lives. From a banking perspective, Zafin works with banks to digitize the product lifecycle and its applicability to pricing and billing by injecting the customer and relationship context. We also enable banks with a cross-product layer that allows the centralization of product variants across the various systems. These are fundamental building blocks as a bank strives to digitize customer journeys.

Finovate: There are a number of enabling technologies that are helping drive innovation in fintech right now: AI, Big Data, blockchain, machine learning, and so on. Which technologies do you believe are being leveraged most effectively in the industry and how?

Balasubramanian: Each of these enabling technologies is at various stages of maturity, depending on the use case. Blockchain has great applicability not merely as a decentralized ledger, but also in immutability. Yet, that set of applications has some adoption in capital markets and not quite yet in other facets of the industry. Community creation has been a major impediment to its success. 

Big Data, AI and ML have a slightly more nuanced twist: These require a considerable upfront investment in terms of data and infrastructure, hypothesis creation, testing and validation to produce a result. This will likely only be valuable if it is integrated into the delivery system — otherwise, it may turn out to be nothing more than an interesting experiment. 

As these technologies and usage mature, they will prove more valuable. The discontinuity that the current situation creates allows for value systems to be re-arranged, and, in so doing, I believe many more interesting use cases will be discovered.

Finovate: Tell us more about how the COVID-19 pandemic is impacting Zafin and the work it does? How is it impacting you and your work, having just arrived at the company?

Balasubramanian: If there was one major surprise for me that I didn’t answer in the very first question, it is this. We were among the first companies to transition our entire workforce to a remote setup. We rapidly implemented technologies to enhance internal collaboration and client communication. Working remotely may have impeded my own ability to get to know my team personally (as I would have typically done), but given the circumstances, our transition has been about as seamless as it could have been. 

In some cases, COVID-19 has accelerated banks’ plans for digital transformation. Based on the volume and nature of conversations we’re having with banks and partners, if anything, the interest in and demand for what we offer has only increased over the past few months. 

As much as we hope for the return to what we knew as “normal”, we are also certain that a new normal will emerge. And we think we are well prepared for that.

Alums Assemble! A Look at Finovate Merger and Acquisition Activity in H1 2020

Visa’s acquisition of Plaid for $5.3 billion at the beginning of the year set a high mark for mergers and acquisitions among Finovate alums in 2020. How have subsequent deals among our alums in the fintech space measured up?

Unfortunately, many M&A deals keep their financials well under wraps, which makes comparisons difficult. But we can take a look at some of the brighter lights in the merger and acquisition sky, and gain some sense of just how big some of these fintech stars truly are.

Looking at the first few months of the year, we have no figures for the four alums that were acquired in the first half of 2020. Of the acquirers, however, two deals stick out, rivaling the Visa/Plaid purchase in January: Intuit’s $7.1 billion buy of Credit Karma, and Worldline’s decision to put down $8.6 billion for Ingenico.

Below is our quick rundown of some of the biggest M&A action from our Finovate alums so far in 2020.

The Acquired

  • Emailage acquired by LexisNexis Risk Solutions. May 7.
  • Arxan merged with CollabNet VersionOne and XebiaLabs to form new company, Digital.ai. April 17.
  • IdentityMind Global acquired by Acuant. April 1.

The Acquirers

  • SoFi acquired Galileo in $1.2 billion deal. April 7.
  • Tink acquired Eurobits Technologies. March 29.
  • Fiserv acquired Bypass Mobile. March 18.
  • DocuSign acquired Seal Software in $188 million deal. March 1.
  • Intuit acquired Credit Karma in $7.1 billion deal. February 28.
  • Envestnet | Yodlee acquired FinBit.io. February 25.
  • Lending Club acquired Radius Bank. February 19.
  • Worldline acquired Ingenico for $8.6 billion. February 3.

If you are a Finovate alum that was involved in a merger or acquisition in the first half of 2020, and do not see your company listed, please drop us a note at research@finovate.com. We would love to share the good news! M&A activity prior to becoming an alum not included.

Ant Financial to Invest $73.5 Million in Wave Money

Photo by Jannes Glas on Unsplash

Mobile financial services provider and financial inclusion company Wave Money is receiving a boost today from Alipay parent Ant Financial. In an agreement announced, Ant Financial disclosed plans to invest $73.5 million in Wave Money, bringing the company’s total funding to $92.9 million.

The move will position Ant Financial as a substantial minority stakeholder in Wave Money, which is a joint venture between existing stakeholders Telenor and Yoma Bank.

Wave Money is headquartered in Myanmar and seeks to drive financial inclusion across the country. The company operates 57,000 Wave shops located in 295 out of 330 townships nationwide, covering approximately 89% of the country. In all, more than 21 million people have used Wave Money’s services, including Wave Pay, which is used for remittances, utility payments, airtime top-ups, and digital payments.

On the strategic side of the investment, Wave Money will tap Ant Financial’s expertise in mobile payments to help build out its digital capabilities and enhance its user experience.

“Myanmar’s population is still massively underserved by formal banking institutions with only a quarter of people having a bank account,” said Yoma Strategic CEO Melvyn Pun. “Ant Group brings a wealth of expertise in mobile payment and financial services. The covid-19 situation is accelerating the trend towards a cashless society and drives the growth of ecommerce, and we expect this strategic partnership to massively boost Wave Money’s capabilities to support these trends.”

The investment comes amid a time of growth for Wave Money. Last year the company’s transfer volume more than tripled year-on-year to $4.3 billion. During the same period, Wave Money’s revenue and transaction numbers also tripled. Additionally, the number of monthly active users for Wave Pay have increased 14% per month since the service launched in 2018.

nCino Drives Digital Banking in Sweden; Access Softek Unveils Roboadvisory Tool

Cloud banking innovator nCino has picked up another partner. The Wilmington, North Carolina company – which made its Finovate debut at FinovateEurope in 2017 – has teamed up with Swedish SME lender Yourban. The firm will deploy the nCino Bank Operating System to power its SME lending operations.

“Our vision for Yourban was to create an institution that could be in place for the long-term,” Yourban CEO and founder Marthin Larsson explained. “With this in mind, we wanted to partner with a technology provider that could adapt and scale our operations as we expand firstly across Sweden and then Europe.”

nCino’s Banking Operating System leverages the Salesforce platform to deliver an end-to-end banking solution that enables banks, credit unions, and other financial institutions to grow market share, meet compliance obligations and boost profitability. The cloud-based platform combines CRM, ECM, loan origination, workflow, business intelligence and reporting in a single, digitally-optimized experience, providing greater security, efficiency, as well as time- and cost-savings.

“In a competitive SME lending market, Yourban understands the need to provide customers with an unparalleled digital experience,” nCino VP of Sales, EMEA Edward Lane said. “We’re excited to be helping Yourban achieve its goals at such a critical time in its lifecycle.”

With the company’s SME loan business as a starting point, the partnership between nCino and Yourban is designed to expand to include additional product offerings as the lender’s business grows.


Two years ago, Access Softek demonstrated its white label roboadvisory technology at FinovateFall in New York. Last week, the company announced the launch of its latest roboadvisory solution, EasyVest. The new offering provides investors with an automated personal investment advisor that seamlessly connects with bank, credit union, and mobile banking platforms.

“Over the next decade, America will experience the largest generational transfer of wealth we’ve ever seen as Baby Boomers pass along their assets to their children and grandchildren,” Access Softek founder and CEO Chris Doner said. “Robo-advisors especially appeal to the generations receiving the wealth transfer. Financial institutions that provide the technology recipients want will benefit from the transfer.”

Investors can use EasyVest to build wealth via a variety of low-cast exchange-traded fund portfolios. The technology supports individual and retirement accounts, conducts automatic portfolio rebalancing, and supports fractional share purchases. Investors can open an account with as little as $200.


Finovate Podcast Interviews Jim Bruene

In the latest episode of the Finovate podcast, host Greg Palmer talks with Jim Bruene, founder of the Online Banking Report – the first and longest lasting specialty information publication for the digital banking industry. Bruene is currently a Principal at Fintech Labs UX, a firm that collaborates with banks, credit unions, and fintechs to improve ROI.

Bruene is also the “Father of Finovate,” having founded the fintech conference series in 1994. In this podcast conversation, he talks about the third recession of the fintech era, how to apply lessons learned from the dot.com crash, the Great Recession, and the COVID-19 crisis.


Here is the latest news from our Finovate alums.

  • Overbond introduces live ETF NAV pricing.
  • Jack Henry to automate lending for Kentucky’s Commonwealth Credit Union.
  • Nordea goes live with new account aggregation and #PFM management tools from Tink.
  • NICE Actimize extends its strategic collaboration with Infosys to provide end-to-end financial crime management.
  • Hive selects ID R&D for passive facial liveness.
  • FalconPro Technology selects Redrock Biometrics to co-develop a palm-based biometric identification solution for mass transportation.
  • Trulioo adds new features to its EmbedID developer tool.
  • Daon extends partnership with ForgeRock to bring multi-factor authentication and digital onboarding to ForgeRock authentication trees.
  • Featurespace to grow behavioral analytics with fresh $37.4 million round.
  • nanopay to power self-service international payments for Brazil-based Treviso.
  • Envestnet provides new integrated unified managed account (UMA) platform to Canaccord Genuity Group.
  • Washington Trust Bank deploys digital account opening technology from Terafina.
  • Prolific London interviews Datasine CEO Igor Volzhanin.
  • Eigen Technologies announces new Chief Customer Officer David Brooks.
  • Infosys Finacle inks joint partnership agreement with Traydstream to drive automation in trade finance.
  • Thomson Reuters partners with Path Solutions to add automation and greater efficiency to tax workflows and core banking processes.
  • Fiserv launches new feature of its Clover POS platform, Clover Online Ordering, to help restaurants more easily serve take-out customers during the COVID-19 pandemic.
  • Jumio brings its online identity verification technology to Mobiquity’s digital onboarding service.
  • Salt Edge introduces new feature for third party providers that streamlines PSD2 onboarding with banks.
  • Tradeshift partners with Denmark’s ECA Eksport Kredit Fonden on supply chain finance program for businesses.
  • Caixabank introduces new mentoring program for female entrepreneurs and SME founders.
  • TransUnion announces partnership with Horizon Media to support digital identity initiative.
  • Payoneer partners with banking app ANNA to help SMEs and freelancers receive international payments in U.S. dollars or Euros.
  • Blytzpay forges strategic partnership with AFS Dealers.
  • Yukka Lab earns spot in the F10 Scaleup Program.
  • Avaloq extends contract with First Abu Dhabi Bank Switzerland.
  • ClickSWITCH and Deluxe partner to offer a digital deposit solution for FIs.
  • Tavant launches new machine learning-based conditioning management and decisioning solution for Ellie Mae’s digital lending platform, Encompass.

Finovate Alumni Features and Profiles

Big Bank Meets Big Bitcoin: JPMorgan Partners with Gemini and Coinbase – This week the Wall Street Journal reported that JPMorgan had established an official banking relationship with two cryptocurrency exchanges: Gemini and long-time Finovate alum Coinbase

eToro Reaches 13 Million Users, Spurred by COVID-19 – The U.K.-based company recently announced it has now reached 13 million active users.

Featurespace to Grow Behavioral Analytics with Fresh $37.4 Million Round – Behavioral analytics technology provider Featurespace announced today that it closed a $37.4 million (£30 million) round of funding.

FIS Unveils Portal to Help SMEs Access PPP Loan Forgiveness – This portal, available to FIs and merchants participating in the SBA’s PPP, automates and streamlines the process of applying for loan forgiveness under the provisions of the new program.

Ephesoft Brings Power of Context to Accounts Payable with Semantik Invoice – The new data acquisition solution from Ephesoft will bring 97% accuracy and 30% cost-savings to companies looking for ways to enhance their accounts payable processes.

Eltropy and Prisma Campaigns Help Credit Unions Better Engage Members – Text messaging platform Eltropy and omnichannel marketing innovator Prisma Campaigns have teamed up to help credit unions communicate more effectively with their customers.

China and Ghana Reflect Rise of QR Codes as Cash Alternative

QR code payments may not inherit the earth. But they may be one of the key technologies developing countries can leverage in order to bring both untaxed merchants and underbanked consumers into their formal national economies.

These are some of the top level conclusions reached in the report – QR Code Developments May Disrupt the Disrupters – from Mercator Advisory Group published late last year. The author, Brian Riley, credited three factors: better authentication, centralized clearance, and improvements to the payments network as giving QR codes renewed viability as a payment acceptance option in some markets.

The convenience of QR (Quick Response) codes as a payment option is clear. They are a fast, easy-to-use compliment to mobile commerce that requires little to no equipment. Armed with a QR code scanning app, their ubiquitous mobile devices and their cameras, consumers can make in-person purchases without relying on cash or physical cards. QR codes also have shown promise as an option for ecommerce, as well.

Adoption of QR code based mobile payments has been modest in markets in the West, such as the U.S. and the U.K. However in regions like the Asia-Pacific, QR code usage has soared. Greg Geng, VP of Tencent’s WeChat Business Group told CNBC last fall that in China, “payment methods using QR codes have replaced cash and cards in just five years.” In fact, the country is now making headlines for the way it is leveraging its affection for QR codes to help fight the spread of the coronavirus.

The news from Ghana this week is further evidence that QR codes continue to prove their mettle. A subsidiary of Ghana’s national bank, Ghana Interbank Payment and Settlement Systems (GhIPSS) has partnered with global payments solution provider HPS to launch its Universal QR Code and Proxy Pay platform. The solution will enable consumers to make instant payments from mobile wallets, cards, and bank accounts by scanning QR codes with their mobile devices.

Ghana is a pioneer in this regard, being the first country in Africa to introduce a national, QR code payment system. The initiative is believed to be a part of the country’s attempt to transition toward significantly less reliance on cash. “At this time, our quest toward a modern, cashless society is more important than ever and we are proud to be the first African country to implement this universal QR code solution,” GhIPSS CEO Archie Hesse said. “HPS has delivered an agile, comprehensive solution during a time of global crisis and we can foresee incredible benefits.”

Abdeslam Alaoui Smaili, HPS CEO, echoed Hesse’s sentiments about the power of QR codes to support a move away from paper currency, calling the initiative “an important part to a long-term goal of a cashless society.”

HPS offers a comprehensive suite of solutions, PowerCARD, that covers the entire payment value chain and enables its partners to process payments regardless of channel or initiated means-of-payment. With more than 400 institutions in 90+ countries using HPS’ technology, the company was founded in 1995 and maintains offices in Africa, Europe, the Middle East, and Asia.


Here is our weekly look at fintech around the world.

Central and Eastern Europe

  • Billon announced blockchain-based proof of concept with Polish electric company Tauron.
  • Euromoney looks at how finechs in the CEE region are benefitting as consumers opt for digital payments rather than cash.
  • Silicon Canals features Ukrainian fintech startups that are “taking the industry to the next level.”

Middle East and Northern Africa

  • Dubai-based Spotii goes live in UAE with its Shop Now Pay Later platform.
  • Egyptian digital lender Shahry locks in $650,000 in pre-seed funding.
  • Securrency forges strategic partnership with investment management and banking company, Musharaka Capital, to develop digital asset issuance platform in Saudi Arabia.

Central and Southern Asia

  • Partnership between MoneyGram and India’s Federal Bank to bring a direct-to-bank-account credit solution to Indian consumers.
  • Uzbekistan president pledges reform of banking system, including the privatization of six bank.
  • Indian cryptocurrency exchange Shiftal to leverage digital identity verification technology from Yoti to support compliant customer onboarding.

Latin America and the Caribbean

  • Mexico’s Flux partners with Bonnuscard, Moneypool, and Cuando Volvamos to enable businesses to offer pre-paid digital gift cards.
  • Financial inclusion-based accelerator makes its Latin American debut with a launch in Mexico.
  • SME payments company Kushki goes live in Mexico, having already expanded to Colombia, Ecuador, Chile, and Peru.

Asia-Pacific

  • Validus, a Singapore-based P2P lending platform, raises another $20 million in Series B+ funding ahead of its expansion into Thailand.
  • Indonesia’s Pintek, which helps students and educational institutions alike access credit, raises an undisclosed amount of funding from Accion Ventures Lab.
  • Fintech News Singapore features the top ten fintech companies in the Philippines.

Sub-Saharan Africa

  • Voyance, a data science startup based in Nigeria, launches fintech fraud tracking database, Sigma.
  • South African cryptocurrency exchange Altcoin Trader enables instant EFT withdrawals from any bank account.
  • WeeTracker looks at the strength of the wealthtech component of Kenya’s fintech industry.

Top image designed by Freepik

Protecting your Data Whilst your Employees Work from Home

The following is a guest post written by Josephine Jacobs, writer at Academicbrits.com and PhdKingdom.com and an executive coach and organizational consultant.

As we move into an unprecedented era of remote working (or rather, working from home!), companies and employees need to consider how to protect sensitive data. Several security considerations must be explored. Employees working from home will have access to work systems without the protections an office brings – they will be using different IT infrastructure, bandwidths and Wi-Fi connections that may not be secure. This all brings an element of danger to your company’s data – as your employees access your database or databases remotely, the risk to that data grows. Usually the risk is only between the server, internal network and end user machine. External working adds the risks of public internet connections, local networks and consumer-grade security systems.

Here are some of the best ways to protect your data whilst your employees work from home.

Tutor your Employees in Data Protection and Computer Security

“It’s worth giving your employees a basic training on how to stay safe online and digitally,” says Joey Garcia, a tech writer at 1Day2Write and NextCoursework. “This can include warning them about phishing emails, avoiding public Wi-Fi, securing home Wi-Fi routers and verifying the security of devices they use for work. Remind employees not to click links in emails from people they don’t know, not to install third-party apps, and to be aware that hacking and phishing attacks will increase during the quarantine period.”

Create an Emergency Response Team

Whilst teaching your employees some basic computer security is a useful preventative measure, you need an emergency response team for the unfortunate event of your data being compromised. Ensure this team can be contacted by everyone in the company and everyone knows exactly what to do in the event of a cyber-attack.

Provide your Employees a VPN

Using a VPN (virtual private network) is a good way to ensure data remains secure. A VPN provides more security by hiding the user’s IP address, encrypting data as it is transferred, and masking the user’s location. Most companies use some sort of VPN already – all you need to do is expand it to all of your employees as they work from home and allow them to use it for all business-related activity.

Security Software

Provide your employees with the best security protection on all of their devices – this can be anti-virus software, firewalls, and device encryption.

“Have a look at the best security software for Macs or Windows, depending on what devices your company employees use,” says Melisa Cueva, data analyst at Australia2Write and Britstudent. “Norton Anti-Virus consistently ranks highly, but there are many other options out there.”

Password Audits

It’s a good idea to have your employees regularly change their passwords, and to teach them how to make the best passwords. Perform an audit and ensure all passwords meet a strict security police: alphanumeric codes are much better than names or dates that are easily guessed. Two-factor authentication should be put in place as a mandatory procedure.

Update all Software

Windows and Apple Mac’s have their own useful security measures in place to protect devices from attacks. Ensuring all updates are completed and software is at its latest version can also prevent devices from attacks. Ask your employees to check their computers and phones are up to date and activate automatic updating on all devices.

Don’t Store Information Locally

You can instead store information on the cloud, using services like Google Drive or Microsoft Office 365 Online. This also includes avoiding the use of USB sticks, as these devices can be infested with malware. Content should be stored on cloud-based software wherever possible, and employees should use cloud-based apps, too. Locally stored information means it is stored on a physical disk, like the hard drive of a computer. Cloud software is great because you can backup all data here, too.

Backups

In case of any need to reset and wipe devices of viruses, encourage your employees to back up all their data – whether that’s on the cloud, or to local storage (but this isn’t recommended for reasons mentioned above!).


Josephine Jacobs is a writer at Academicbrits.com and PhdKingdom.com, an executive coach and organizational consultant with more than 10 years of experience enhancing the performance of individual executives, teams and organizations. Her background encompasses a wide range of programs and initiatives for individual development, team building, organization design, and facilitation. She also writes for Essay Help Service.

Big Bank Meets Big Bitcoin: JPMorgan Partners with Gemini and Coinbase

Blame it on the halving?

This week the Wall Street Journal reported that JPMorgan had established an official banking relationship with two cryptocurrency exchanges: Gemini and long-time Finovate alum Coinbase. JPMorgan is not going all-in on crypto; the agreement calls for the bank to process only the exchange’s fiat-based transactions. Nevertheless, the partnership is a notable milestone in the relationship between big banks and the bitcoin business.

The news is interesting for a variety of reasons. For one, JPMorgan CEO and Jamie Dimon has been a notorious critic of, if not all cryptocurrencies, then at least bitcoin. In 2017, Dimon called bitcoin “a fraud,” adding that bitcoin is “worse than tulip bulbs. It won’t end well. Someone is going to get killed.” He has since moderated his critique, and his bank, like most other major financial institutions, are piloting various initiatives that use bitcoin’s underlying blockchain technology – even if not embracing bitcoin itself. That said, last year the bank announced the creation of a JPM Coin that can be used as a digital token to instantly settle transactions. The initiative was the first real-world use of a digital coin by a major bank in the U.S.

The partnership news also comes just after the bitcoin halving, in which the reward for mining BTC transactions is reduced by 50% in order to manage supply. This week’s process is the third in the cryptocurrency’s history; bitcoin was halved first in 2012 and again in 2016. After the most recent halving four years ago, bitcoin saw significant price appreciation, climbing from approximately $650 that July to nearly $20,000 a year and a half later. And while the halving has helped draw renewed attention to cryptocurrencies as alternative stores of value, few anticipate bitcoin making the same kind of post-halving run this time around as it did in 2016.

Whether or not JP Morgan will seek out other customers in the cryptocurrency industry remains to be seen. One advantage both Gemini and Coinbase have is that they are among the most heavily regulated cryptocurrency exchanges in the U.S. Both have earned BitLicenses from the New York State Department of Financial Services, and are registered as money services with FinCEN. These may prove to be high hurdles for many other crypto businesses.

Coinbase made its Finovate debut in 2014 at our west coast conference. Founded two years earlier, the company has raised more than $547 million in funding, and had an estimated global revenue of approximately $520 million in 2018 according to Reuters. Since inception, Coinbase has facilitated the exchange of $150 billion in cryptocurrencies, and served more than 30 million customers in 102 countries.

eToro Reaches 13 Million Users, Spurred by COVID-19

photo credit: Hans Eiskonen on Unsplash

Across the globe, many people have shifted their attention to focus on two things: their health and their finances. Fintech companies have stepped up in recent weeks to help citizens with the latter. In fact, many are seeing record app downloads, usage, logins, and a surge of new users.

eToro is one such fintech. In fact, the U.K.-based company recently announced it has now reached 13 million active users. This milestone comes in part thanks to the comparatively large number of new users that have registered in the first quarter of this year. eToro saw more than a fourfold increase in the number of new users in the first quarter of 2020 than it saw in the first quarter of 2019.

“Coronavirus induced market volatility has been a focus for media globally and has brought the topic of investing increasingly onto people’s radars,” said eToro CEO Yoni Assia. “We have seen a large increase in trading volumes on eToro since the start of 2020 from both new and existing users.”

Activity on the stock-trading platform has also ramped up this year, with stock trading transactions increasing by 3x since January 1. Much of this activity can be attributed to the fact that eToro launched commission-free stock investing for its Europe-based users in May.

As for what’s next, eToro said it plans to expand its commission-free stock investing to users in the U.S. and Asia Pacific regions later this year. The company also noted that it plans to ramp up its acquisitions to keep up with customer demand.

EToro is, by all accounts, in the middle of a growth spurt. In addition to its boosted user numbers and acquisition plans, the company is also in the middle of a hiring spree. It is currently seeking to fill 60+ job vacancies at a time when many fintechs are laying off or furloughing their staff.

Tools for Digital Transformation in the COVID-19 Era

Photo credit: Georg Eiermann

With ongoing stay-at-home orders in place due to COVID-19, companies of all sizes across many industries have had to find a way to take their operations into the digital realm. So while digital transformation had previously been on financial services firms’ radars, it has quickly evolved into a priority.

Bajaj Allianz has experienced particular success with its digital transformation efforts. To get some insight into best practices, we caught up with KV Dipu, President – Head Operations, Customer Service & Communities of Bajaj Allianz.

Many firms have recently had to fast-track their digital transformation efforts. What is your advice to ensure a smooth transition?

KV Dipu: The key is to move from the classic two-speed approach to a big bang approach. Since the accelerator (CEO, CXO or COVID-19 – no prizes for guessing!) for digital transformation is obvious, the most effective starting point is the touch point which generates maximum friction in terms of process performance vs. customer feedback. Secondly, transformation efforts follow use cases, not the other way around. Only when business owners own use cases do transformation efforts bear fruit! Thirdly, look for early wins to create competitive fervor across departments.

Disproportionate awards for early birds can help propel the lagging units forward. Fourthly, since deployment and adoption are entirely different buckets of fish, a strong reward program for fast adoption helps. Lastly, agility – defined here as the ability to recalibrate one’s approach with amoebic speed- in an era when the situation is changing by the day is important to carry the transformation through!

Bajaj Allianz has success in collecting and digitizing data with IoT-based devices. Talk to us about this initiative.

KV Dipu: Charles Darwin said, “It is the long history of humankind that those who learned to collaborate and improvise most effectively have prevailed.”

At Bajaj Allianz, we strongly focus on collaboration and 100% adherence to regulatory compliance when initiating IoT projects. DriveSmart, our IoT-based telematics program, offers five unique benefits to customers: driving optimization, geofencing, 24/7 road assistance, social integration, and gamification. Some of these benefits are possible only through IoT. For instance, geofencing lets you know if the car strays off the beaten path! Similarly, social integration lets you know if a friend is on the route to your weekend destination!

Likewise, when we launched our “connected school” initiative which included an IoT-enabled solution combining safety, security, as well as insurance coverage for school students, we addressed parents’ worries around school travel. We tracked children using RFID cards and geofenced their travel routes to ensure maximum safety.

Do you have other IoT device projects in the works?

KV Dipu: We have also leveraged IoT to digitize our health insurance medical check-up process. It is now automated and paperless end–to-end; we even won the Celent Model Insurer 2020 Award for the same!

What other tools have you relied on to enhance digital operations?

KV Dipu: We have deployed an array of tools to enhance digital operations. For starters, we walked the talk on blockchain when we deployed it in the area of claim settlement for international travel insurance. In case your flight is delayed beyond the terms and conditions in the policy, you don’t even need to notify us of the claim! Once you submit your documents, we get to know of the flight delay and can send you the amount even when you are still in the airport. Similarly, our bot leverages AI to offer 24/7 assistance via the website, Whatsapp, and even Alexa! We have also deployed robotic process automation (RPA) to automate a range of activities in the back office.

One of the most difficult aspects to digitize can be tools that rely heavily on collaboration and communication. What was your experience in making communication digital?

KV Dipu: We have had a wonderful experience making our communication digital! Our motto during the current phase of social distancing was to stay digitally connected with our employees, customers, and partners while being physically distanced. With our employees and partners, work from home became an opportunity to bond from home by celebrating virtual birthday parties and organizing painting, cooking, and singing team activities using digital collaboration tools. With customers, digitizing communication involved a shift from the call centre to digital servicing tools such as Whatsapp, bots, website, app, and portal.

We also leveraged social media to connect with customers. The highlight was digital launches of new products! In fact, based on recent engagement levels, we scored the highest brand engagement rate in the insurance industry! Since we continuously engaged our customers using email, SMS, and digital platforms and enabled transactions on digital assets, our customer satisfaction scores actually improved!

How are you balancing the need to keep things as stable as possible for customers and employees during an uncertain time with the need to drive digital change?

KV Dipu: Communication is the key when trying to perform a balancing act between stability for the present and digital change for the future. We embarked on a multi-modal communication exercise, informing customers that we are just a call or click away. With employees, we propelled our home-grown engagement program christened “Celebrating You” with a strong focus on four fulcrums: fun at work, digital learning, virtual town halls, and videos and podcasts for mental health and physical workout tips.

Digital change gets established as customers experience the ease and convenience of digital assets. Work from home, for instance, given the win-win for both – employees save on commutes to work, firms save on expensive real estate – is likely to be a permanent feature. Similarly bots, Whatsapp, portals, and websites with 1-click features are here to stay. Tomorrow’s organization chart may well show a manager leading a team of both humans and machines!

Featurespace to Grow Behavioral Analytics with Fresh $37.4 Million Round

Behavioral analytics technology provider Featurespace announced today that it closed a $37.4 million (£30 million) round of funding.

The round, which brings Featurespace’s total funding to $108.6 million, was led by Merian Chrysalis Investment Company Limited with additional contributions from existing investors.

“During these challenging times, our machine learning models have automatically adapted to the shift in consumer, business and criminal behavior,” said Featurespace CEO Martina King. “It is our continued focus to deliver industry-leading, fraud and anti-money laundering solutions to our customers and partners.”

Featurespace will use the funding to “support continued growth” of its financial crime detection technology. The company launched its adaptive behavioral analytics platform, the ARIC Risk Hub, in 2008. The ARIC Risk Hub helps organizations fight financial crime by leveraging machine learning and anomaly detection to flag suspicious activity in real time.

The company has more than 30 major bank clients including four of the five largest banks in the U.K. Among Featurespaces customers are HSBC, TSYS, Worldpay, RBS NatWest Group, Danske Bank, ClearBank, and more.

FIS Unveils Portal to Help SMEs Access PPP Loan Forgiveness

Photo by Andrea Piacquadio from Pexels

There may be no second acts in politics. But with the Small Business Administration’s Paycheck Protection Program (PPP) rolling out the next phase in its loan forgiveness initiative for SMEs, it’s good to see that the economic rescue plan has another shot at getting it right.

We chronicled some of the challenges that PPP 1.0 faced. Fortunately, this time around, many of the cooperating financial institutions, financial services companies, and fintechs are in a better, more informed position to help make sure the businesses that need the help actually get the help.

One example of this is the new portal powered by the FIS Real-time Lending Platform. This portal, available to FIs and merchants participating in the SBA’s PPP, automates and streamlines the process of applying for loan forgiveness under the provisions of the new program.

“As a critical infrastructure provider, FIS is focused on making it as easy as possible for small businesses and merchants to complete the loan forgiveness process and help them get back to business as soon as possible,” FIS Head of Global Core Banking and Channels Rob Lee said. “Our new portal uses advanced automation technology to handle the entire process, reducing the time and complexity for businesses in getting forgiveness of the essential loans that are critical to their business.”

Using pre-filled applications and documentation uploads for efficiency, the portal figures loan forgiveness amounts, and allows FIs to review and e-sign the requests. The document packages are sent to the borrower and bank for e-signing and then, via the portal, the materials are submitted to the SBA for validation. The portal is 100% digital and can be easily deployed by banks who can get started by uploading a file of eligible loans from their current PPP customers. FIS notes that via its Real-Time Lending Platform, it has facilitated “billions” in PPP loan funds through lenders to SMEs whose businesses have been affected by the COVID-19 crisis.

A Finovate alum since 2013, FIS made fintech headlines last month when the company unveiled a new venture arm and a plan to invest $150 million in fintech startups. Last year, FIS was part of fintech’s biggest transactions of 2019 with its $34 billion acquisition of fellow Finovate alum Worldpay.