This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.
Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Marketing services company Kasasa is partnering with BSI Financial Services to provide a new mortgage loan product that community banks and credit unions can offer their clients.
The new offering, Kasasa Mortgage, helps small financial institutions compete with large banks by offering a unique loan product. What’s distinctive about Kasasa Mortgage is that it uses the Take-Back concept the company piloted in 2018. Every month the borrower has the option to overpay on their mortgage payment. If, at any time in the future, they need to access cash quickly, they have the option to take back any portion of the overpayment.
Making the new launch possible, BSI Financial will conduct the loan servicing on behalf of community banks and credit unions using the new product, Kasasa Mortgage.
“Through Kasasa’s partnership with BSI Financial, we are enabling a greater number of local financial institutions to help their borrowers better understand their mortgage loan and get out of debt quicker,” said Kasasa’s EVP of Product Management, Chris Cohen. “By offering the most consumer-friendly loan available today, community banks and credit unions can achieve higher yields without the additional risk and maintain their fair share of the market.”
Earlier this month Kasasa improved on its Take Back loan by integrating Carleton’s insurance and debt protection calculations to help tailor loan limits.
This November, 20+ startups and established organizations will demo their latest technology virtually at FinovateWest Digital. In these 10-minute showcases, you’ll have the chance to see how these services and solutions work and how they can benefit your business. Need to know more? All demoers will be available at virtual booths for Q&A and 1-to-1+ meetings.
Here’s a look at those already confirmed to demo from across the US and beyond:
The themes, trends and technologies from these companies encompass the new state of financial services in 2020:
Risk management connected to financial wellness, SMB financing, and intelligent data
Customer experience connected to call center contact, collaborative engagement, digital development, and balancing remote versus in-person support
Financial planning connected to fluctuating portfolio performance, employer benefits, and unemployment
Financial crime connected to growing corona opportunists
And much more. Click here to learn more about how their technology can help you spot opportunities for growth in your organization and run with that potential.
See these companies live in November! Book this week for $795.
What have the companies that won Best of Show awards at last year’s FinovateFall conference been up to in the months since our New York show? With our autumn event less than a month away, we thought it would be a great time to check in on the nine companies that took home top honors this time last year.
BlytzPay – Integrated its digital payments technology with Dealer Management Systems (DMS) leader ABCoA Deal Pack. Announced strategic partnership with AFS Dealers.
Cinchy – Joined the 2020 MassChallenge FinTech Program in December 2019 along with five fellow Finovate alums. The program noted that 70% of the participants in its previous cohort launched a pilot or proof of concept within a year. Earned a $500,000 cash prize as one of the winners of the 2019 VentureClash competition. Raised $10 million in funding in May.
College Aid Pro – Partnered with Horsesmouth, a company that provides educational and marketing solutions for financial advisors and their clients. Announced collaboration with the American Institute of Certified College Financial Consultants. Teamed up with online student loan refinancing marketplace Credible.
ebankIT – Forged North American partnership with fellow Finovate alum Enterprise Engineering this spring. Announced updates to its multichannel banking platform.
Glia – Won Best of Show at FinovateEurope for a second year in a row. Integrated its technology with fellow Finovate alum Alkami’sOnline Banking Platform. Inked partnerships with 20 credit unions across the U.S.
MX – Topped 50,000 direct-to-bank API agreements to major financial institutions and fintechs. Launched data connectivity API, Path by MX. Named one of Inc. Magazine’s Best Workplaces 2020.
owl.co – Named one of Canada’s Most Innovative Tech Companies by the Canadian Innovation Exchange. Delivered $1 million in revenue within six months of launching.
Pinkaloo Technologies – Raised $1.25 million in funding. Joined Goldman Sachs-owned Ayco Marketplace for financial counseling and wellness services. Partnered with Eastern Bank to power its Give for Good charitable giving program.
Zogo Finance – Teamed up with fellow Finovate alum Bankjoy. Announced partnerships with 11 community banks and credit unions across 12 states. Surpassed 1,000,000 financial literacy modules completed.
FinovateFall Digital 2020 kicks off Monday, September 14 and continues through Friday, September 18 with hours of live and on-demand content. Visit our registration page today and join us for Finovate’s biggest, digital-first event to date.
A look at the companies demoing at FinovateAsia Digital on June 22, 2021. Register today and save your spot.
Microsoft’sPower Platform solution protects your teams and streamlines your return to the workplace by equipping leaders with tools to make informed decisions to safely reopen locations.
Features
Prepare locations for reopening
Ensure safety of employees and customers
Ongoing management and prevention
Why it’s great With the Power Platform, you’re not just investing in today, you’re investing in your future. Stay agile and innovative by creating intelligent, custom apps and automating processes with low-code solutions.
Presenter
Thymio Barbatsis, Senior Technical Specialist Barbatsis has spent the last 20 years implementing Microsoft technologies and services. He is helping customers to focus on capabilities to empower every person and organization on the planet to achieve more.
A look at the companies demoing at FinovateAsia Digital on June 22, 2021. Register today and save your spot.
Glia is a digital customer service platform that connects financial institutions to their customers using chat, voice, video, co-browsing and AI.
Features
Seamlessly move between modes of communication
Receive improved sales results and customer satisfaction via richer customer interactions
Deliver the best experience for customers and agents
Why it’s great By employing a digital-first approach to customer conversations, financial institutions improve customer satisfaction, reduce customer effort, and gain operational efficiencies.
Presenters
Dan Michaeli, CEO & Co-Founder Michaeli is the driving force behind Glia’s vision to combine the human touch with technology to create the best customer experiences. LinkedIn
A look at the companies demoing at FinovateAsia Digital on June 22, 2021. Register today and save your spot.
Monit is a predicative cashflow and financial optimization platform designed by, and for, small business owners, provided for free by banks and partners to SMBs. It connects to any accounting package.
Features
Reveals past and future cashflow and financials
Navigates COVID-19 and maximizes PPP forgiveness
Prompts key actions, insights, and planning with a patent-pending engine that learns over time
Why it’s great In a time of unprecedented turmoil for small businesses, Monit is the only application that addresses the critical needs of the small business owner today and into the future, and is provided for free.
Presenter
Steve Dow, CEO & Co-Founder Dow has extensive financial services experience including corporate strategy, business banking, and fintech investing. He is experienced in commercial lending, deposits, SBA lending, consumer loans and payments. LinkedIn
A look at the companies demoing at FinovateAsia Digital on June 22, 2021. Register today and save your spot.
Unlock your customer data for AI training, testing, or external data sharing with MOSTLY AI’sSynthetic Data Platform. Synthetic data is as-good-as-real, yet fully anonymous. GDPR/CCPA/HIPPA compliant.
Features
As-good-as-real, yet fully anonymous synthetic data (exempt from GDPR/CCPA)
Innovate safer and faster by reducing time-to-data by 90%
Used by leading U.S. banks for AI training, testing, and data sharing
Why it’s great MOSTLY AI’s Synthetic Data Platform unlocks privacy-sensitive customer data and allows you to reconcile AI innovation and big data utilization with privacy protection.
Presenters
Alexandra Ebert, Chief Trust Officer Ebert is a privacy and GDPR expert and the Chief Trust Officer of MOSTLY AI. Before joining the company, she researched GDPR’s impact on the deployment of artificial intelligence in Europe. LinkedIn
Klaudius Kalcher, Chief Data Scientist Dr. Kalcher is co-founder and Chief Data Scientist at MOSTLY AI. He is a globally recognized privacy and deep learning expert and has a PhD in Medical Physics. LinkedIn
In a round led by Sorenson Ventures, identity verification innovator Socure has locked in $35 million in new funding. The investment, which takes the company’s total capital to $96 million, featured the participation of three new funders: Citi Ventures, Wells Fargo Strategic Capital, and MVB Financial Corp, as well as existing investors Commerce Ventures, Scale Venture Partners, and Flint Capital. Socure said the additional funding will support the firm’s growth objectives and enable the company to add to its platform’s machine learning capabilities.
“We are grateful to have had significant investor interest despite the current economic environment, and are proud to have taken less money than was on the table,” Socure CEO Tom Thimot said. “As we continue to build on our position as the leader in Day Zero identity, we are prioritizing investment in new verticals, talent, products, and capabilities.”
The investment reflects a growing importance on identity verification at a time when more and more individuals and businesses are relying on digital channels. Companies with identity verification solutions that can quickly – i.e., in real-time – establish that individuals are who they say they are and do so with as few mistakes as possible will become increasingly valuable partners for businesses looking to maximize engagement and commerce via digital channels.
Socure’s funding news comes just a few months after the company unveiled its latest digital identity verification solution, Intelligent KYC. The company’s technology accelerates customer acquisition and boosts auto-approval rates by leveraging advanced graph analysis and machine learning to verify identity in real-time. With partners ranging from banks and lenders to telecommunications firms and insurance companies, Socure enables its clients to achieve 85% fraud capture rates, a 90% increase in auto enrollments, and up to 10x reduction in false positives.
Most recently demonstrating its technology at FinovateFall in 2017, Socure was founded five years earlier by Sunil Madhu and Johnny Ayers (SVP). Named one of Forbes’ Top 25 Machine Learning Startups to Watch, and recognized by Gartner as a Cool Vendor in AI for Banking and Investment Services this spring, the company added a document verification module, DocV, to its Socure ID+ platform earlier this month.
Socure is headquartered in New York, and maintains offices in San Diego, San Jose, and Chennai, India.
Customer engagement specialist Digital Onboardingannounced its Series A round today. The amount of funding was undisclosed and adds to the company’s existing $4.3 million in seed funds. Contributors include Detroit Venture Partners and other institutional and individual investors.
Along with today’s investment, FINTOP Capital Partner John Philpott, Jack Henry Senior Managing Director Shawn Ward, and a founding member of S1 Corporation joined the Board of Directors.
The company plans to use the funds, along with the fresh influx of expertise on its board, to begin “accelerating the execution of [its] product roadmap, scaling account management, and expanding sales.”
Digital Onboarding’s SaaS offering helps banks deliver compelling services that keep customers around for the long-term. The company is especially effective in helping motivate accountholders to take action because it aggregates data across banks with similar business objectives.
“Banks have myopically focused on getting new accounts opened to meet aggressive sales targets and are now being forced to contend with the reality that new accounts are worthless if they’re not converted into engaged relationships,” said Digital Onboarding CEO Ted Brown. “The Digital Onboarding platform has been proven to drive the adoption of additional products and services like digital banking, direct deposit, and automatic payments which drive long-term profitability.”
The funding comes at a time of increased demand for digital services of all kinds. Since many non-digital native customers are now needing to conduct much of their banking activities remotely, maintaining connection with them through digital channels is more essential than ever.
Digital Onboarding was founded in 2015 and is partnered with 40+ financial institutions that together represent $160+ billion in assets. The company most recently demoed at FinovateFall 2018. You can catch an all-new round of demos at FinovateFall Digital next month. Stream the event from anywhere on the globe September 14 through September 18.
The following is sponsored content from LendingFront.
With Covid-19 on the minds of businesses and lenders alike, conversations about the capital needs of small businesses have revolved—with obvious justification—around the Paycheck Protection Program (PPP) and other forms of relief provided under the CARES Act.
Yet the capital needs of many small businesses don’t begin and end with the PPP.
Let’s start with a few facts
According to the U.S. Federal Reserve’s 2019 Small Business Credit Survey:
43% of small businesses sought external funding for their businesses in 2018
And more than half experienced a funding shortfall.
These funds—when small businesses can obtain them—are often used to purchase inventory, replace equipment, finance expansion, and hire new workers.
These needs will persist long after PPP lending has come to an end, yet even in a strong economy, up to 80% of bank-originated small business loan applications are rejected.
In the post Covid-19 environment, we can expect that percentage to be even higher
That’s because the conventional underwriting criteria for small business loans will no longer work. Traditionally, both bank- and non-bank lenders have relied on four criteria for underwriting small business loans:
Tax/Financial Statements
Credit Scores
Collateral
Owner Wealth
In a normal economy, these criteria are fine, but they’ll do little to show the true state of a business in the post Covid-19 environment. 2019’s tax/financial statements will be all but irrelevant. Credit scores will be damaged as a result of the inability to make payments during a forced closure. Collateral will have questionable value if bankruptcies spike. And owner wealth will have been tapped in an effort to keep many businesses afloat.
Are we headed towards a capital drought?
With traditional underwriting criteria no longer useful, are we headed toward a capital drought? We certainly don’t need to, but the answer largely hinges upon lenders doing two things:
Adopting new criteria that are more appropriate for the post Covid-19 environment
Adopting new product structures that enable the lender to manage risk
New credit criteria include information such as:
Real-time Cash Flow Cash flow helps you gauge how quickly the business is recovering from Covid-19. Is it in irreversible decline? Is it struggling but stable? Has it gotten back to normal? Insight into real-time cash flow helps lenders make better decisions about who to lend to along with the terms of any offers.
Consumer Sentiment Customers who vote with their reviews also vote with their wallets. Examine reviews from Google, Yelp, and other sources to answer, Is this a business that customers love? Businesses that are well-regarded by customers stand a much better chance of recovering than those that had problems before the pandemic shut them down.
New product structures also enable lenders to deliver capital efficiently while managing risk
Here’s how:
Shorter Terms First, lenders should emphasize shorter payback periods in the range of 6-12 months. Shorter terms get the lender paid back faster while enabling the business owner to show that he/she is creditworthy before seeking a larger amount of capital.
Daily ACH Payments Second, lenders should collect payments from the borrower on a daily—rather than monthly—basis. Monthly payments introduce unnecessary operational risk. Daily payments are smaller, consistent, and more predictable from the standpoint of the business’ cash flow.
Tie Payments to Performance Lastly, lenders should tie payment terms to current cash flow performance—and with visibility into cash flow, this is very easy to do.
A new economy needs new rules for lending
If the Great Recession taught us anything, it’s that opportunities exist for lenders to increase their assets, gain market share and, of course, to meet the capital needs of their borrowers. In the post Covid-19 environment, lending is only as risky as the information used to make decisions. With better underwriting criteria and more appropriate product structures, the most forward-thinking lenders will position themselves for success and reap the rewards.
A recent analysis by Brookings looked how technology, platform regulation, and China policy may be impacted by the policies of a future Joe Biden/Kamala Harris administration should President Trump fail to be re-elected. As might be expected, the review pointed to greater regulation – including anti-bias and worker rights advocacy – as one likely outcome if a new administration takes office next year.
Also interesting are the ways that the Brookings analysts – and others – see a Biden/Harris administration as an enabler of technological advancement and innovation, especially in the area of technology infrastructure. This is also one of the ways where a Biden/Harris administration could be most constructive for fintech.
As the Brookings analysts point out, the fact that the Democratic vice presidential nominee is a Senator from California (who represents Silicon Valley) suggests that there might be greater insight into the issues and challenges of the 21st century technology industry than exists in the current administration.
This likely cuts both ways. A Democratic administration would likely be more supportive of immigration policies that would enable tech firms to keep and attract more talent – as well as for international talent to decide to innovate and build in the U.S. rather than in Europe or Asia. This would benefit fintechs across the board as much as it would benefit technology companies generally.
At the same, there’s no doubt that regulation – especially financial regulation – would likely see a resurgence. While many are wondering about the prospects of an Obamacare 2.0 in a Biden/Harris administration, fewer are discussing the possibility of a CPFB 2.0 and the likelihood of a renewed attention on fintech’s lenders in particular. I think that the CPFB’s creator, Massachusetts Senator Elizabeth Warren, would probably not be headed to Treasury in the event the American people put Joe Biden in the White House, but her influence on the resurrection of the agency would be powerful.
At the same time, it is worth remembering that Joe Biden has a far different historical relationship to the world of finance, if not fintech, compared to Senator Warren. As a multi-decade senator of Delaware, Biden has been criticized – including by Senator Warren – for his “energetic work on behalf of the credit card companies.” A 19th century Delaware law allows any American company to incorporate in the state and not a few firms over the years have taken advantage of this to “place their profits in Delaware-based holding companies to avoid paying taxes in the places where they actually operate” as Tim Murphy described in Mother Jones last year.
It may be too much to suggest that the First 100 Days of a Biden Administration would feature a tug-of-war between the new president and Warren over the appropriate attitude toward consumer lending and credit. But the presence of both does suggest that any policy that emerges could be more moderate than might otherwise seem.
Tandem Bank announced its latest acquisition this week. The U.K.-based bank has purchased Allium Money, an alternative lender that offers consumers financing to improve the energy efficiency of their homes.
Specific terms of the deal were not disclosed, but it is made possible by Tandem’s $78 million (£60 million) funding round that was led by Qatar Investment Authority and closed last week.
Tandem Bank will use Allium to enhance its existing in-house lending suite, tapping into Allium’s green lending solutions that help homeowners finance everything from insulation to efficient windows to solar panels.
“This is great news for our customers and the team that have worked tirelessly to develop the business focussing on financing improvements for our environment,” said Allium CEO Paul Noble. “The combination of Allium and Tandem will create the ability to rapidly scale a green banking proposition and help more customers access green finance products.” Noble will join Tandem’s executive team.
The partnership comes at a good time. With an increased focus on climate change and awareness of their impact on the environment, consumers have shown heightened interest in green initiatives. Along with home improvements, ESG (environmental, social, and governance) investing is also gaining interest.
Tandem Bank has raised $175 million (£134.3 million) since it was founded in 2013. The challenger bank’s 700,000 customers have access to Tandem’s accounts that include Autosavings technology, credit card, and, coming soon, cashback rewards.
