Google, 21st Century Branch Banking, and the Power of the Platform

Google, 21st Century Branch Banking, and the Power of the Platform
By David Penn Posted on
Categories: FinovateFall 2020, Google, Speaker series

This year, FinovateFall Digital brought representatives from some of technology’s biggest players to our all-digital stage. One of these individuals was Paul Rohan, Solutions Consultant with Google Cloud.

Rohan’s presentation on the future of banking showed a connection between the evolution of branch banking and the necessary changes banking will need to undergo in order to thrive in the 21st century. He also discussed the changing nature of competition in financial services brought on by trends like open banking.

Check out our interview with Rohan ahead of his FinovateFall Digital presentation last month.

On the current state of open banking and PSD2

This is a major change in mindset because you start to realize that you could have the very best banking product with superb features and brilliant pricing. But if it’s not a part of these connected digital experiences across multiple brands that customers are increasingly demanding, it could fail. And you could have a middle of the road, not the best financial product, with not the best prices and not the best features. But, boy, if it pops up with the right context, with the right personalization, and the right customization – in these connected digital experiences – it could be a tremendous success.

On open banking as 21st century branch banking

Why did unit banks fall away and then branch banking become the norm? Because it didn’t matter how superb the staff were in the one branch you had, or how wonderful the customer experience was once they came into the branch, or how fast the decision-making was because everyone in your bank was in that one location. But if your one branch was in the wrong town, or beside the wrong industries, as things changed, it didn’t matter how wonderful the user experience was … In essence, (branch banking) started to allow customers to begin their customer journey with the bank where they were living their lives or where they did business.

On the difference between pursuing an app strategy versus a platform strategy as a financial services provider.

The sociology is quite different. In a traditional enterprise that’s quite reliant on doing everything themselves, and there’s always a human desire to innovate and serve your customers, if you do something clever to serve your customers, there is a big round of applause: “This is exactly what we should be doing.”

Companies that are immersed in the connected experiences of digital ecosystems (are) all about trying to make your partners clever. Enable them to be clever because they’ll do the customization, they’ll do the personalization. So there’s a huge amount of thought that goes into taking friction and difficulty out of your partner’s ability to deal with you, and to extend your brand and your proposition into segments you don’t want to serve yourself directly or you couldn’t serve yourself directly.

Watch the rest of the conversation. And for more from our FinovateFall Digital speakers, check out our Finovate TV YouTube playlist.

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Meniga Launches in U.S.

Meniga Launches in U.S.
By Julie Muhn (@julieschicktanz) Posted on
Categories: Meniga

Oh say, can you see… new digital banking technology landing on U.S. shores? Meniga can.

The U.K.-based company with Icelandic roots is expanding operations into the U.S. with a New York City headquarters location. The U.S. team, led by North America Heads of Sales, Wim Van Lerberghe and Paul Renken, will work remotely until the offices open next year.

Meniga is making the expansion to meet new, pandemic-induced demand for digital banking solutions. “In the current economic climate, it is crucial that Americans are getting the support they need from their banks, and help with the management of their personal finances. But if the bank fails to respond with anything but an efficient and enjoyable user experience, those customers will go elsewhere,” said Meniga CEO and Cofounder Georg Ludviksson. “We know that the unrivalled expertise and local market insight brought by Wim and Paul will allow us to fully export our technology to the U.S., granting American banking partners access to cutting-edge digital products and apps that their customers will love to use every day.”

While many know Meniga as a PFM solutions provider, the company has broadened its approach. The company now has leveraged data to offer a more personalized customer experience via predictive analytics and personalized engagement technologies including spending reports, automated budgeting, personalized nudges, savings challenges, and personalized cashback rewards.

Unique to Meniga is the company’s transaction-based carbon insights tool. Launched earlier this year, the carbon insights tool allows end users to track the carbon emissions that result from their spending.

Meniga has brought this technology to 165+ banks across 30+ countries, reaching more than 90 million end-users across the globe. The company has offices in London, Reykjavik, Stockholm, Warsaw, and, as of last year, Barcelona and Singapore.

“Since expanding into the Southeast Asian market just last year, we’ve also been instrumental in getting some of the area’s most popular banking apps to market. By opening up to the U.S., we’re going to be leading the charge here too,” said Renken. “We see banks as the bastions of the customer, designed to protect and manage assets, particularly during such a financially unstable climate. However, in order to remain competitive, this means they also need to move, and digitalize, with the times. With Meniga’s technology and expertise, banks all across The States will be able to achieve this; creating a customer experience that is intuitive and seamless as well as secure and reliable.”

Among Meniga’s clients are UniCredit, Santander, and UOB. Founded in 2009, the company has raised $43.9 million.

Photo by Duane Swaby on Unsplash

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6 Ways Roboadvisors Have Evolved to Suit 2020

6 Ways Roboadvisors Have Evolved to Suit 2020
By Julie Muhn (@julieschicktanz) Posted on
Categories: Betterment, List series, Personal Capital, Wealthfront

By many accounts, 2020 has been a difficult year full of events nobody could have anticipated or planned for.

As an industry, however, fintech has faired rather well. The shift to digital combined with an enhanced focus on the customer experience have benefitted banks, end users, and even fintechs themselves.

Fintech’s wealthtech subsector is no different. In fact, roboadvisory tools have evolved over the past decade with near-futuristic new features and offerings that are helping today’s consumers battle the challenges of 2020.

Here we’re taking a look at six ways roboadvisors have improved to (unknowingly) prepare for the toughest year yet.

AI has gotten smarter

Thanks to machine learning capabilities, the AI technology that powers investment strategies, forecasting, and reporting has improved significantly since roboadvisors hit their peak in 2015. Additionally, the amount of data has increased and computing power has been significantly upgraded, meaning that AI has never been smarter.

Recession forecasting

One of my favorite tools that launched this year is Personal Capital’s Recession Simulator. While many investment portfolio models offer a range of what-if scenarios, the Recession Simulator helps users illustrate the effects that historical recessions may have on their portfolio. Currently the Recession Simulator allows users to mimic returns of the DotCom crash of 2000 and the Financial Crisis of 2008.

Challenging the challengers

Last year ushered in the era of challenger banks, and roboadvisors were quick to jump on the opportunity. Three of the top roboadvisors by assets under management– Wealthfront, Betterment, and Personal Capital– all launched checking tools last year. These accounts help consumers keep all of their cash in a single, unified place and some offer tandem, high-yield savings accounts.

Automation

While many fintechs have promised to automate savings, investing, and billpay, many have been slow to deliver. Recently, however Wealthfront has made strides toward its Self-Driving Money concept. Last month the company unveiled Autopilot, the first product in its self-driving money suite. Autopilot takes clients’ savings and automatically monitors their balances and moves money around on their behalf to maximize their savings and returns.

Looking beyond retirement

While everyone hopes to save for retirement, there are plenty of other events to save for, too. Many roboadvisors have set up their platforms to enable users to save up for relatively smaller savings goals, such as a kitchen renovation, a child’s education, or a wedding.

Built for everyone

While many investment platforms cater to a variety of risk appetites, some have started to cater to new client bases, such as gig workers. Betterment, for example, launched a promotion with Steady, a gig economy workforce platform, to offer its users free financial advisory services for one year.

Photo by Eugene Zhyvchik on Unsplash

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Instnt Partners with Identity Verification Platform Prove

Instnt Partners with Identity Verification Platform Prove
By David Penn Posted on
Categories: Instnt

A new partnership will enable customer onboarding platform Instnt to leverage phone intelligence-based authentication to enable firms to “green light” more customers without having to resort to time-consuming, knowledge-based authentication protocols. The company announced that it has teamed up with Prove, whose technology is used by more than 1,000 businesses and 500 bank clients to provide frictionless, passive authentication to their customers.

“As mobile devices have become the de-facto second-factor authentication tool, Prove’s robust phone intelligence technology becomes a crucial component to enable frictionless digital acceptance and authentication of consumers on Instnt’s digital customer onboarding managed service,” Instnt CEO and founder Sunil Madhu explained. “Through this partnership, Instnt aims to bring digital inclusion and one-click federated sign-up to consumers across mobile apps and websites on the internet.”

Instnt enables retail financial institutions and e-commerce merchants to sign up more customers with less risk and fewer fraud losses. Using Instnt’s technology, companies follow a simple, three-step process to create their digital sign-up form and generate a single line of code. This code is added to their website or app to create the onboarding functionality. Instnt leverages AI-powered predictive analytics to validate the user and the device being used during the onboarding process, conducting device and cohort analysis, network analysis, and data validation and verification to provide high accuracy and “requirement levels of compliance.” Instnt goes so far as to indemnify users of its customer onboarding offering for up to $100 million in annual fraud losses.

Instnt’s partnership with Prove comes just weeks after the company announced that it was collaborating with ComplyAdvantage. The partnership will bring machine learning and natural language processing-powered financial crime detection capabilities to Instnt’s onboarding and verification platform. Instnt began the year raising $2.9 million in seed funding from Charge Ventures, Fantail Ventures, Third Prime, and Revel Partners.

Based in New York City, Instnt made its Finovate debut last year at FinovateFall. The company returns to Finovate’s all-digital stage in November for FinovateWest Digital. Find out more about our upcoming live and on-demand fintech event, November 23 through 25.

Photo by Magda Ehlers from Pexels

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Alkami Acquires ACH Alert

Alkami Acquires ACH Alert
By Julie Muhn (@julieschicktanz) Posted on
Categories: ACH Alert, Akamai, Mergers & Acquisitions

Digital banking solutions provider Alkami acquired payments fraud prevention technology company ACH Alert this week.

Terms of the deal are undisclosed but the announcement comes just a few days after Alkami closed a $140 million round of funding.

Founded in 2008, ACH Alert offers two flagship solutions, PRO-TECH and PRO-CHEX, which provide a real time ACH approval process and a check positive pay service, respectively. Alkami will leverage ACH Alert’s solutions to provide a platform to enable banks to increase revenue, reduce complexity, and improve fraud prevention.

“ACH Alert provides FIs with a seamless solution that eliminates the flaws and inefficiencies in existing processes. These inefficient, paper-based processes not only undermine customer adoption and profitability, but also lead to a higher incidence of fraud,” said Alkami CEO Mike Hansen.

Among ACH Alert’s latest clients are Mountain America Credit Union and Citizens Union Bank. Last November, the Tennessee-based company signed a distribution agreement with Apiture, which will offer ACH Alert’s fraud detection services to its 450+ financial institution customers.

Headquartered in Dallas, Texas and founded in 2009, Alkami seeks to provide an end-to-end digital banking experience by offering tools for onboarding, user engagement, and account servicing.

“Together with ACH Alert, we expect to continue to create and deliver winning digital solutions to our clients and their consumer and business digital users,” Hansen added.

Photo by Adi Goldstein on Unsplash

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3 Benefits and Drawbacks of Voice Tech for Banks

3 Benefits and Drawbacks of Voice Tech for Banks
By Julie Muhn (@julieschicktanz) Posted on
Categories: Guest Post

This is a guest post written by Shannon Flynn, managing editor at ReHack.com.

Voice recognition technology is experiencing something of a golden age right now. You can control virtually anything with your voice now, from your lights to your TV to your phone. As these technologies keep improving, their applications in banking grow more promising.

Voice tech encompasses a range of technologies that involve recognizing and responding to users’ voices. The potential for these services in the financial industry is immense. You could use your voice to log into your bank, make withdrawals or ask for financial advice.

The advantages of voice tech for banks are impressive, but there are still some roadblocks ahead. Here’s a closer look at three benefits and three drawbacks of the technology.

Benefits

Roughly 111.8 million Americans use voice assistants at least monthly. That’s more than a third of all internet users in the country. The American public is already comfortable with these technologies, so bringing them to banking is a natural next step.

Banks shouldn’t adopt voice tech just because people would use it. Thankfully, the technology has benefits beyond high adoption rates. Here are three of the most significant.

1. Streamlined Banking

Think of how easy voice assistants like Alexa and Google Assistant make routine tasks. You can check the weather, read your messages and hear the news without lifting a finger. Banks can bring those same benefits to their user experience by integrating voice technology into their apps.

Users could make a deposit or withdrawal by merely asking their phones to do so. Mobile banking allows people to perform routine actions in less than three minutes on average. Voice tech could shorten that to a few seconds since users wouldn’t have to press any buttons.

2. Increased Accessibility

Mobile apps made banking more accessible than ever, but the industry can still improve. You still need to have full function of your fingers to work these apps, which can be a barrier to some users. Voice controls can allow more people to experience the convenience of banking apps.

VOIP will also gain some next-gen improvements in the next few years due to 5G. For instance, more banks may achieve faster, unified communication with the help of voice-to-text functionality and faster networks. With the VoIP market gaining $35 billion by 2025, we will most likely see additional innovation for these communication systems.

Voice tech gives users more options, which makes banking services more appealing to consumers and businesses alike.

3. Biometric Security

Voice commands aren’t the only application of voice tech in banking. Banks could also use this technology to as another layer of biometric security. Since voice assistants can differentiate between voices, they can use your voice to verify your identity.

Unlike with passwords and PINs, you can’t steal biometrics. This security advantage is why fingerprints and facial recognition have surpassed passwords, and voice recognition adds another layer of security. With all of these options, banks could offer biometric multi-factor authentication.  

Drawbacks

Despite these advantages, there are still some downsides to voice tech in banking. As much as these technologies have improved, they’re still relatively new and far from perfect. As such, there are a few risks that come with their adoption.

These disadvantages will likely fade as voice technologies improve. At the moment, though, they may dissuade some users from using voice services, making them less profitable for banks. Here are three of the most prominent of these drawbacks.

1. Privacy Concerns

Voice technology may increase security, but it also raises questions about privacy among some users. According to a Microsoft report, 41% of voice users are concerned about issues like passive listening. People may not use banks’ voice tech out of fear that someone may be listening.

Even if users don’t interact with voice recognition features, they may turn away because of them. People may worry that banking apps always listen to them, even while they’re not using voice features. If banks can’t assure people that their privacy is safe, these features could repel users.

2. Faulty Voice Recognition

There are still some lingering concerns about how accurate voice recognition technologies are. A 2017 study found it takes just two years for your voice to change enough that these systems won’t recognize it. Recognition errors could lock people out of their bank accounts, causing unneeded complications.

In fact, foreign language barriers don’t just exist between humans. When you’re dealing with finances, any translations errors could be costly. If your system misunderstands your voice commands, it could make unwanted transfers or deposits. Voice recognition has to be almost perfect for banks to use it extensively.

3. Regulatory Complications

Any financial institution has to comply with strict regulations, and voice tech could be an issue here. Right now, there aren’t any standards for how banks can or should use this technology. The legal ambiguity could cause banks to run into some complications while using these services.

Finding out how voice tech fits into existing regulations could be a headache. Working through these gray areas could be more trouble than it’s worth to many institutions.

Voice Tech Is Promising but Imperfect

The efficiency and security of voice technology is enticing for financial institutions. Still, many banks may avoid the technology right now due to its current drawbacks. More firms will embrace it as the technology improves, but that could take a few years.

Voice tech today is far from perfect, but it does have potential. With further advancement, it could revolutionize digital banking.

Shannon Flynn is a technology and culture writer with two plus years of experience writing about consumer trends and tech news.

Photo by Mason Kimbarovsky on Unsplash

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See Me, Hear Me: Revation and the Revolution in Digital Customer Engagement

See Me, Hear Me: Revation and the Revolution in Digital Customer Engagement
By David Penn Posted on
Categories: Alumni profile, FinovateWest 2020, Revation

The big changes we are seeing in the realm of customer engagement have to do with inevitable trends becoming immediate demands. Whether the need is reaching customers over the digital channel for the first time or automating and streamlining processes to improve efficiency and maximize productivity, the global health pandemic has been the midwife – if not the mother – of the fast-changing technology landscape we live in today.

“Meeting customers where they are” has been a rallying cry for customer engagement specialists for years. And as the number of channels grows, more companies are offering new solutions that provide easy-to-use, secure, and compliant ways for businesses to more comprehensively engage with their customers and clients.

One company in this space is Revation Systems. A Minneapolis, Minnesota-based firm, founded in 2003, Revation recently partnered with fintech and regtech solution provider Computer Services Inc. (CSI), who will offer Revation’s LinkLive Banking platform to community banks. LinkLive Banking provides regional and community banks, as well as credit unions, with key capabilities such as digital messaging, AI-powered chatbots, voice and video communications, and the ability to move seamlessly between physical and digital channels.

“Given the remote work demands of COVID-19, LinkLive Banking empowers our banks to provide a world-class customer experience while taking precautions to protect the health and safety of their employees and customers,” CSI Group President of Enterprise Banking Giovanni Mastronardi said. “Together with Revation Systems, we’re providing the innovative technology necessary to increase customer satisfaction and reduce friction in the customer journey.”

In addition to its messaging, chatbot, voice, and video functionalities, the platform also provides secure desktop sharing and encrypted email. LinkLive Banking leverages AI to power service chatbots with keyword recognition and the ability provide fast, automated responses to common banking queries. The video banking capabilities, announced in August, are the most recent addition to the platform.

“We are extremely excited about utilizing LinkLive’s video banking features as we seek to improve our member experience,” United Educators Credit Union CTO Dennis Griesgraber said. He noted that the new feature integrated not only with the LinkLive contact center the credit union used, but also with the institution’s digital banking platform. John Eyre, Assistant VP of Information Technology at TAPCO Credit Union underscored the technology’s value for enhancing communications among employees, as well. “LinkLive’s video banking feature will not only enhance the interactions between our members and representatives, but will also help improve communication among our own staff internally,” Eyre said.

Active in the healthcare vertical as well as financial services, Revation has more than 400 customers using its LinkLive Banking platform, representing more than 100 million digital banking customers. Adding the video banking component, Revation notes, requires only a few configuration changes to the LinkLive platform, and does not require the customer to download an app or manage a separate communications account to participate in video banking.

Perry Price, Revation CEO, echoed the now-common wisdom that the pandemic has accelerated pre-existing, if not inevitable technology trends. He noted that while adoption of video banking before COVID-19 had been a “long-term goal,” the onset of the crisis had turned those goals into “urgent” priorities.

Featured in CIOReview’s Most Promising FinTech Solution Providers for 2020 this spring, Revation is scheduled to make its Finovate debut next month at FinovateWest Digital. To learn more about our upcoming, all-digital event and how to watch Revation’s technology in action, visit our FinovateWest Digital hub.

Photo by Cristian Dina from Pexels

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Venmo Ships Credit Card Offering

Venmo Ships Credit Card Offering
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Venmo

Venmo is one step closer to being a full-service bank competitor with today’s news. The PayPal-owned company is rolling out a credit card offering that is available to select customers starting this week.

The Visa-branded card, which is issued by Synchrony Bank, offers many features one would expect to pair with a mobile-first account, such as an app-based virtual card for online shopping, tools to track spending and rewards, and the ability to pay off the card balance from within the app. The cards, which pander to a mostly millennial user base, also offer five unique color designs.

One feature specific to Venmo’s new credit card is the use of a QR code printed on the card. Similar to Venmo accounts, users can scan their friends’ unique QR code to send or request money. This QR code technology, along with an embedded RFID chip that enables users to tap to pay, provides an (almost) contactless payments.

Another unique feature is the way the Venmo card handles rewards. Instead of offering a pre-determined rewards category or even allowing users to choose which category they’d like to receive rewards for, Venmo rewards consumers based on the categories in which they actually spend.

To do this, the company separates customers’ spending into categories such as dining, travel, bills, health and beauty, grocery, gas, transportation, and entertainment. Venmo rewards users 3% cash back for purchases made in the category in which they spend the most, 2% cash back for purchases in the second-highest spending category, and 1% cash back on everything else. The rewards cash is automatically transferred to the user’s Venmo account at the end of each period.

The card adds to Venmo’s existing offerings, including a robust P2P payments ecosystem and its Mastercard-branded debit card launched in 2018. Venmo plans to market the new credit card to its 60 million active users, a built-in audience comprised of its target market.

Photo by Trinity Nguyen on Unsplash

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Expensify Does Billpay

Expensify Does Billpay
By David Penn Posted on
Categories: Expensify

As of October, Expensify isn’t just for expense management anymore.

This week, the company announced that it has added a new service that will enable Expensify users to leverage the platform to pay their bills, as well. For free.

“A little known fact is that Expensify was never intended to be an expense reporting company: it was always intended to be a platform for all things accounts payable and receivable,” company founder and CEO Dave Barrett wrote.  “Expenses, invoices, bills — they’re all slight variations on the same thing.  But the variations are so slight, there’s really no reason to Frankenstein together a bunch of financial tools to cover all your needs: Expensify is a one-stop shop for everything you need to run your back office.”

All Expensify users need to do in order to take advantage of the new service is to have their vendors send their invoices to:

“yourdomain.com@expensify.cash.”

Expensify will SmartScan the invoices, present them to the payer, and then send payments to the vendors from the payer’s business bank account. Expensify will also ensure that the transaction is accurately and promptly noted in the company’s accounting system, as well.

The goal is to show how Expensify serves as a small business platform rather than just an expense management solution. After all, that’s how Expensify treats it. “We’ve got hundreds of employees split between several international subsidiaries,” Barrett wrote, “thousands of vendors scattered around the world in multiple currencies, a hundred thousand customers spanning dozens of countries — and we run the whole business on Expensify.”

A long time Finovate alum, San Francisco, California-based Expensify has demonstrated its technology and its solutions at both our developers conference, FinDEVr, as well as at our Finovate events. Over the summer, the company unveiled its Concierge Travel solution, a virtual travel assistant that helps travelers build their itineraries and plan their trips – free of charge.

Expensify has raised more than $38 million in funding from investors including OpenView, PJC, Redpoint. The company began the year with the launch of its corporate card, the Expensify Card, that offers a special reward called Karma Points. Cardholders can use these points to make charitable donations to one of five partnering philanthropic organizations. Expensify also will donate 10% of all revenue from the card to charity, During the COVID-19 health crisis, donations are being directed to the Expensify.org/hunger fund.

Photo by Ann H from Pexels

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NEC Acquires Avaloq in $2.2 Billion Deal

NEC Acquires Avaloq in $2.2 Billion Deal
By David Penn Posted on
Categories: Acquisition, Avaloq, Mergers & Acquisitions

After 35 years in operation, Swiss-based digital banking solution provider Avaloq has agreed to be acquired by Japan’s NEC Corporation. The deal, in which NEC will buy 100% of the company’s shares from existing shareholders, valued the Swiss firm at more than $2.2 billion (CHF 2.05 billion), is billed at enabling Avaloq to “accelerate” its “growth, global expansion, and value creation strategy.”

“With NEC, Avaloq found a perfect new home to continue our success story of serving our clients with solutions that make their lives simpler in an ever more complex world,” Avaloq CEO Jürg Hunziker said. Company founder and chairman Francisco Fernandez added that acquisition would help the company continue to “invest heavily in R&D,” and highlighted the two firms’ shared emphasis on the “caring about customers and people.”

The transaction is expected to be completed in April 2021. The company will continue to operate as its own entity, based in Zurich.

First introduced to our audiences at our developers conference, FinDEVr London, in 2017, Avaloq made its Finovate debut a year later at FinovateEurope with a demonstration of its goal-based, wealth management solution. The cloud-based microservice enables wealth managers to provide risk-optimized investment objectives for their clients, which helps ensure that the client and their investment preferences, concerns, and risk tolerance are at the center of the investment advisory experience.

With more than 150 clients in 30 countries and nearly $5 trillion (4.5 trillion CHF) in client assets managed using its software, Avaloq recently announced partnerships with Belgium’s Banque Degroof Petercam in October and integrated with Enterprise Bot, an conversational AI and automation solution provider, in September. Also that month, FintechNews Switzerland featured Avaloq Group Chief Product Officer Martin Greweldinger, author of a report on the need for wealth managers to “democratize” their offerings to a wider audience in order to survive and grow.

“This democratization requires wealth managers to deliver personalized advice at scale while addressing the specific needs of this new affluent clientele through a balance of industrialization, innovation, and individualization,” Greweldinger noted. Read more about Avaloq’s report.

Photo by Bing HAO on Unsplash

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Has the U.S. Reached a Tipping Point with Open Banking?

Has the U.S. Reached a Tipping Point with Open Banking?
By Julie Muhn (@julieschicktanz) Posted on
Categories: Julie's Column, Thought Leadership

This year has brought on a lot of changes for U.S. businesses and individuals alike– some for the worse, and others for the better.

One change that fits into the latter category– open banking– has heated up in 2020. There are four indications that the U.S. may be at a tipping point when it comes to open banking:

  • More consumers than ever are using digital financial services. Not only has the coronavirus has halted in-person activities, it has also prompted users to focus on their finances.
  • We’ve finally agreed that screen scraping is a bad way to aggregate accounts. Last week, even Wells Fargo announced it has stopped using screen scraping as a data aggregation technique.
  • Consumers have become aware of their data usage. Big tech companies like Facebook were put on trial in the U.S. in 2018 for questionable usage of consumer data. Now, in an election year, and with films like Netflix’s The Social Dilemma, users are more aware than ever of how tech platforms use their data to sway their opinions.
  • There’s more competition than ever in the B2C fintech space. New competitors are laser-focused on perfecting the user experience, and have started making data management as easy as possible for consumers. Many, for example, provide users a dashboard that allows them to manage third party data sharing, toggling certain platforms on and off.

All of these elements have aligned to bring the U.S. to a tipping point in open banking. There is still one thing missing, however, and that is a unified approach for data sharing.

Whereas Europe enjoys standardization through common API specifications thanks to PSD2, the U.S. is lacking direction. Instead of a government-mandated approach, the market is currently being driven by private players such as Plaid, MX, Envestnet|Yodlee, and others.

Despite challenges, 2021 may the year for open banking in the U.S. As the global pandemic continues next year, so will consumers’ online presence, and ultimately their awareness of their digital rights. Earlier this week, the U.K. surpassed 2 million consumers using open banking, more than double the number recorded in January of this year. And even though the U.S. still has a long road ahead to fully realize open banking, take hope– we’re closer than we’ve ever been.

Photo by Michał Parzuchowski on Unsplash

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iCapital Closes Acquisition of Alternative Investment Platform Artivest

iCapital Closes Acquisition of Alternative Investment Platform Artivest
By David Penn Posted on
Categories: Artivest, Mergers & Acquisitions

Here’s a bit of news that slipped beneath our radar: online investing platform Artivest, which made its Finovate debut six years ago at FinovateSpring, is now a part of the iCapital Network. iCapital announced its intention to acquire the New York-based firm this spring and in August, announced that the transaction has been completed.

The acquisition includes management of Artivest’s 28 proprietary alternative investment funds, as well as the company’s Open Network platform, which provides access to alternative financial products and investment strategies to 1,800 advisors and their investors. The deal will result in iCapital servicing more than $55 billion in client assets. Artivest’s 28 team members are expected to join iCapital.

Chairman and CEO of iCapital Network Lawrence Calcano praised Artivest’s “technical innovations and capabilities in registered funds and direct investments” when the deal was announced. He said that the two companies shared a goal of making alternative investments more broadly available to wealth and asset managers, and added that the integration of Artivest’s technology with iCapital’s platform would create a “powerful combination delivering a ‘best-in-breed’ technology experience.”

Founded in 2012, Artivest offers a curated investment experience that leverages expert insight and exclusive access to reduce the time and complexity involved in discovering, evaluating, and engaging in investment opportunities such as private investment funds. Ahead of its acquisition by iCapital, the company had forged partnerships with EJF Capital, WM Partners, KKR, Wellington Management, and MacKay Municipal Managers all in the second half of 2019.

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