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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
A look at the companies demoing at FinovateSpring Digital on May 10 through 13, 2021. Register today and save your spot.
DQLabs is an artificial intelligence/ machine learning (AI/ML) augmented data quality platform that provides a simple way for organizations to handle issues around data quality, governance, curation, and master data management effectively.
Features
Discover trustable, high quality data in minutes using AI/ML
View a unified platform for data management needs
Conduct data ingestion, catalog, profiling, curation, governance, and MDM – all done in a few clicks
Why it’s great DQLabs’ AI augmented data quality platform gives organizations the ability to manage data smarter and leverage an immediate ROI in weeks, rather than months.
Presenter
Raj Joseph, CEO & President Joseph is a thought leader and visionary in the field of modern data management and augmented analytics and has two decades of experience around data science, AI/ML and enterprise data solutions. LinkedIn
A look at the companies demoing at FinovateSpring Digital on May 10 through 13, 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.
Presenter
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 FinovateSpring Digital on May 10 through 13, 2021. Register today and save your spot.
CoCoNet’s fully digital onboarding software for corporate customers optimizes common processes, making them up to 66% faster and more efficient.
Features
Mapping of complex structures with many individuals and permissions
Convenient digital legitimation and signature processes
Integrated customer analytics for process improvements
Why it’s great Unlike other onboarding solutions developed for retail customers, CoCoNet’s solution is only developed for corporate customers to fulfill the specific and complex needs of this niche.
Presenters
Björn Hassing, CEO Hassing is responsible for innovation, technology, marketing, and sales. He’s been a member of the board since January 2017. He started in 2005 as an IT Architect. LinkedIn
Dennis Rochel, MD & Head of Innovations Rochel started in 2013 as Mobile Development Architect at CoCoNet. He also studied computer science and IT security. LinkedIn
A look at the companies demoing at FinovateSpring Digital on May 10 through 13, 2021. Register today and save your spot.
ArnexaBinbox is the world’s first secure messaging platform that is phishing-free.
Features
Zero phishing engenders greater trust and engagement amongst users
End-to-end encryption
Simple APIs for easy sending and receiving of messages
Why it’s great Arnexa Binbox achieves zero phishing without content scanning and analyzing sender attributes. It uses unique signals that enable it to sift phishing messages cleanly, easily, and correctly.
Presenter
Sridhar Ramakrishnan, CEO & Founder Ramakrishnan is a long-time entrepreneur having worked in several startups. He serves on the board of CA Jump$tart, an organization dedicated to youth financial literacy. LinkedIn
The Consumer Financial Protection Bureau (CFPB) made a small move with big potential today. The U.S. agency issued an advanced notice of proposed rulemaking (ANPR) that requests information from the public on how consumers’ access to their financial records should be regulated.
The CFPB is asking “all interested parties” to comment on how the agency develops regulations to implement Section 1033 of the Dodd-Frank Act, which provides for consumer rights to access financial records.
This ANPR is the first step in creating formal regulation in the U.S. around open banking. This explicit regulation around structured data access is something that the E.U. has had in place via PSD2 for nearly three years.
The open banking environment in the U.S. is slightly hostile at the moment. This is partially because of the number of stakeholders involved. Consumers want to be able to use their financial data across a multitude of third party platforms, third party fintechs want to create compelling services to help individuals manage their finances, banks want to keep their consumers’ information secure, and data access providers are in the business of opening up the data.
Over the past few years, there have been multiple instances of large banks clashing with data access providers. Unfortunately, when banks shut out data access companies, the main loser is the end consumer, who usually ends up frustrated that their bank won’t connect to their favorite new fintech app. Banks would argue, however, that they are protecting the consumer from unnecessary risk.
Today’s move by the CFPB is a monumental step because once regulation is formalized in the U.S., all players will work from a standardized approach.
If you’re interested in submitting your thoughts to the CFPB, you can do so via the Federal eRulemaking Portal at https://www.regulations.gov or you can email [email protected]. Include Docket No. CFPB-2020-0034 or RIN 3170-AA78 in the subject line.
Another day, another acquisition in the payments space: U.S. payment processor PaymentCloud announced this week that it has acquired contactless payments provider Paysley. Payment Cloud purchased the majority share of the Los Angeles, California-based company; the amount of the transaction was not disclosed.
Paysley’s technology enables customers to use their smartphone as the point of sale device – without having to set up an account with the merchant in advance. Paysley leverages QR code technology – an approach common to payments in South Africa where the company’s founders are from – to power secure mobile payments directly from the user’s card, Apple Pay, or Samsung Pay account.
And with one-click payment verification, Paysley’s solution works well with the kind of transactions that are increasingly popular in our post-COVID, gig economy, subscriber-based, P2P world.
“The future of payments is already shifting toward contactless means and now, with the acquisition of Paysley, we will be at the forefront of this shift,” PaymentCloud CEO Shawn Silver said. “I’m eager to bring this innovative solution to fruition at such a pivotal time.”
Currently in the process of relocating its 55 employees to new offices in Encino, California, PaymentCloud processes credit cards for thousands of clients around the country. The firm also works with more than 80% of the top digital independent sales organizations (ISOs) to help them boost approval rates, onboard merchants quickly, and limit attrition.
Named to Digital.com’s list of the Best Credit Card Processing Services of 2020, and ranked #295 on the Inc. 5,000, PaymentCloud was founded in 2016.
The growing presence of BigTech in the fintech ecosystem is one of the stories of 2020 that will likely be among the top stories of 2021, as well. As companies like Apple, Google, Amazon, and Microsoft look to fintech for new markets and opportunities to innovate, how will their relationship with the fintech ecosystem evolve and change?
For a few answers to this and other questions, check out our interview with Microsoft’s Sandeep Mangaraj and Tom Feher, industry executives, Digital Transformation, Financial Services. Both Mangaraj and Feher participated in our all-digital fintech conference, FinovateFall Digital, in September.
What is the value of partnership as BigTech becomes more involved in fintech?
Mangaraj: Microsoft leads with partners. That’s been true throughout our history and especially given what we are facing now, all the uncertainty and challenges that our partners are facing. I don’t see that changing. Our partners were quick to respond to what happened with COVID. They leveraged the power of our platform, and they were there immediately with creative and innovative solutions.
That has been the story of Microsoft. What is it that we provide? We have a secure, compliant, scalable platform that they can innovate on, and we are here to help them and support them, and make sure that they take advantage of the full power of what we offer, what they offer, and what our other partners offer, to take to their clients.
Feher: Partners are key to our success. We have several programs to help incubate and expand our fintech ecosystem. This includes everything from Microsoft for Startups, a program that assists startups in building solutions on our platform, to our M12 Ventures program that invests in a portfolio of fintechs in the industry. We also have our worldwide partner organization that focuses on strategic alliances and partnerships with fintechs that enable us to bring net new solutions to market on our platform that accelerate our clients’ innovation and well as helping them drive business outcomes.
The following is a guest post from RJ Sherman, VP of Innovation, Citizens Bank.
The word innovation is often thrown around casually to describe anything new that an organization is doing. However, for an organization to be truly innovative, it must adopt an “innovation mindset.”
Broadly, this means the organization needs to: take an empathetic approach to customer research to fully understand the customer’s needs; think longer term to identify potential disruptors that are further out on the horizon; and “test and learn, fast and cheap” by quickly exploring new ideas in a calculated manner to understand their value.
Innovation is more than simply creating new products or exploring emerging technologies. Innovation means acting on ideas that accelerate growth and challenge the status quo.
Here are five specific ways an organization can foster innovation:
Focus on the customer experience
Innovation starts with a deep and nuanced understanding of the customer journey and the associated pain points. Innovating for the sake of innovation doesn’t work – instead, use your customer’s pain points as a ‘North Star’ and design a compelling offering around them. Don’t be afraid to iterate in partnership with your customers (the solution is for them, after all). Despite the pandemic, there are still many ways to collaborate and co-create with customers, it just requires us to be more creative with how we conduct research.
Take a balanced approach to building the innovation portfolio
A balanced innovation portfolio is made up of opportunities from all areas of the business, including internal (organization-facing) and external (customer-facing) opportunities. This is critical as it signals to colleagues that all aspects of the business play a role in positioning the organization to win in the future. Continuously monitor your balance and partner with executive leaders across the organization to identify and explore strategically aligned opportunities (especially in underrepresented business areas).
Partner with fintechs when and where appropriate
While fintechs can pose a threat to financial incumbents, there is a significant opportunity for banks and traditional financial institutions to join forces to better serve the customer. Fintechs have a significant advantage when it comes to designing great customer experiences, but lack the customer relationships, scale, expertise, or risk management muscle needed to operate as broad-based financial services institutions. Fintechs can help power and accelerate a smart, data-enabled strategy, and offer a quick and relatively low-risk way to support business strategies.
Create the appropriate organizational mechanisms to explore early stage ideas
Citizens is investing in innovation using an Innovation Fund as part of its annual Tapping Our Potential (TOP) program. The fund operates like an internal venture capital firm, placing small-scale investments in colleague ideas. It is a great way to generate a grassroots movement around innovation and invest in the ideas of colleagues.
Encourage idea generation from everyone in the enterprise
When someone asks me “how big is the innovation team at Citizens?” I say 18,000 colleagues because every person at our organization has a role to play in innovation. Encouraging colleagues to participate in innovation begins at the top and, if done successfully, colleagues will buy-in and it will be embedded into everything you do. That way, when it comes to evaluating new opportunities or reimagining traditional business lines, innovation will always have a seat at the table.
To sum up, there isn’t a single “one size fits all” innovation model that will work for every financial institution to bring new ideas to life. Instead, leaders must create a bespoke solution for their organization, establishing mechanisms to leverage the cumulative power of their colleagues to identify and solve for the most pressing customer problems.
It is a truism that many of our greatest technological innovations have come as a result of trying to empower people challenged with physical limitations. Whether the circumstances are sensory, mobility-oriented, or cognitive, the role of technology for many of us is to make the phrase “differently-abled” something more than a politically-correct euphemism.
The rise of mobile banking itself has been a tremendous boon for many disabled customers, rendering unnecessary those often-expensive, time-consuming, and potentially dangerous regular visits to physical bank branches. Technologies that turn text-into-speech or that enable speech to drive digital processes have revolutionized access to financial services for those with sensory limitations. Even more modest innovations that enable seamless debit card spending controls and transaction monitoring are valuable tools not just for small business owners, but for caretakers of adults with limited cognitive capacity, as well.
In financial services, there have been even more focused efforts to serve the adults with disabilities. One is to build institutions that are dedicated to serving populations that have been overlooked in general because of “able-ism.” Purple is a challenger bank that was launched over the summer by a company called youBelong, who built the first social network for “people with special needs.” The bank is the evolution of youBelong’s mobile bank for families with special need children, youBelong Cash, and emphasizes financial literacy and education as a strategy for helping people with disabilities enjoy security and independence.
Founded by CEO John Ciocca, Purple offers a digital savings account with no hidden fees and no minimum balance. Account holders can set up their accounts to receive any Social Security Insurance and Disability payments they are eligible for. Access to PFM features such as money transfers and transaction tracking are included in Purple’s banking app. The accounts come with a Purple Mastercard Debit card, and Purple donates a portion of its revenues to the Special Olympics with every card transaction.
Among fintechs, True Link Financial is a company that has dedicated itself to improving the financial well-being of people with disabilities as well as vulnerable older adults. Payment cards that can be administered by a responsible family member or guardian on behalf of an intellectually-challenged adult, for example, are among True Link’s offerings. The company announced a $35 million Series B round over the summer and its founder and CEO, Kai Stinchcombe, highlighted the way the platform can serve people with disabilities.
“When we launched the True Link Card, it quickly became clear that its features could protect a wider range of people who weren’t being served by traditional financial institutions,” Stinchcombe wrote. “We found that people with disabilities and individuals in recovery from addiction could use our product to meet their unique needs and circumstances.”
Other Finovate alums – from Best of Show winner Golden to Eversafe – also have platforms geared toward helping vulnerable seniors that can be similarly leveraged to benefit members of the disabled community and their families.
Still there are significant challenges. According to a Pew Research Center study from 2017, the rate of technology adoption among the disabled across age groups lags behind those without disabilities – and significantly so in some areas. The home broadband gap between seniors with disabilities and seniors without disabilities is more than 20%. The smartphone gap between non-seniors (ages 18 to 64) with disabilities and non-seniors without disabilities is 17%. If anything, the research suggests that an emphasis on not just the disabled, but disabled seniors in particular – where smartphone and home broadband adoption rates are below 40% – would go a long way toward helping the neediest among those with disabilities.
What happens when you combine two of fintech’s hottest trends– buy now, pay later (BNPL) and banking-as-a-service? Afterpay is about to find out.
That’s because the Australia-based company has inked an agreement with Westpac to become the bank’s first client for its digital banking-as-a-service offering. The deal will allow Afterpay to offer WestPac checking accounts, savings accounts, and cash flow management tools to its 3.3 million Australian customers.
Afterpay will make the new banking products available in the second quarter of next year.
“The platform allows us to combine our banking experience with the innovation of our partners to support new customer experiences,” said Westpac CEO Peter King. “We look forward to working with Afterpay to deliver new products and services.”
By selling a banking-as-a-service offering, Westpac is finding a way to work alongside third party fintechs. Instead of competing with them, the bank will not only profit from them by selling its banking-as-a-service tools, but also acquire additional client accounts in the process.
Founded in 2014, Afterpay helps merchants to allow shoppers to pay for their purchases in four interest-free installments over a short period of time. The service is offered by more than 50,000 retailers across the globe and is used by more than 9 million shoppers. The company is listed on the Australian Stock Exchange under the ticker ASX and has a market capitalization of almost $29 billion. Anthony Eisen is CEO.
Today’s news comes a week after the Australian Transaction Reports and Analysis Centre (Austrac) cleared Afterpay from anti-money laundering accusations.
A new merger in the payments space will bolster the accounts receivables and payments solutions available to small and medium businesses. Versapay, a customer-centric order-to-cash solution provider based in Canada, announced this week that it has completed its merger with Twinsburg, Ohio-based, payment services provider Solupay. The combined entity will operate as Versapay in name and will be led by the company’s current CEO Craig O’Neill.
Financial terms of the deal were not disclosed. But the merger does include a pair of Solupay subsidiaries: payment processors ChargeLogic and 2CP. Solupay’s technology simplifies payment acceptance, provides click-to-pay invoicing, and automates AR processes, and will give Versapay additional opportunities to serve its SME customers.
“Simplifying invoice presentment and reducing the cost of accepting digital payments are the building blocks for a customer-centric order-to-cash process,” O’Neill said. “We’re excited to welcome the complimentary capabilities of the Solupay team and its innovative integrated payments and AR automation technology as we seek to better serve businesses through their digital payments transformation.”
Founded in 2006 and headquartered in Toronto, Ontario, Canada, Versapay has a worldwide network of 8,000 customers and 50,000 users, accounting for $10 billion in payment volume a year. The company’s solutions help businesses accelerate cash conversion, automate manual processes, as well as reduce costs and boost efficiency.
Versapay was acquired by Great Hill Partners in February in a deal that valued the company at $96 million (CAD $126 million).
A pair of partnerships this month have helped Unblu bring its digital conversational platform to a larger number of financial services customers. The company announced at the beginning of the month that digital technology solutions provider Celero will use Unblu’s conversational platform to enable its credit union customers to leverage digital channels to better engage with their members. The integration adds to Celero’s digital banking platform, Celero Xpress, which is powered by another Finovate alum, ebankIT.
“Our new digital platform offers credit union members an intuitive, engaging and secure digital banking experience,” Celero General Manager for Digital Banking Dean Rathwell explained. “By integrating Unblu, our clients can ensure these digital experiences also deliver a personal connection, which is core to the credit union difference.”
Set to launch later this year, the enhanced Celero Xpress platform will provide must-have communication functionalities such as live and video chat, as well as messaging and collaborative co-browsing. The platform is connected to Celero’s digital ecosystem, Celero Xchange, which leverages modern APIs to enable institutions to integrate their own or third party applications. Headquartered in Calgary, Alberta, Canada, Celero was founded in 2003 and counts more than 110 credit unions and financial institutions in Canada as its customers.
Unblu’s partnership with Celero came just a week after it announced that it had teamed up with Luzerner Kantonalbank (LUKB), the leading retailing banking group in the Swiss canton of Lucerne with more than $46 billion (CHF 42 billion) in assets as of 2019. LUKB has begun a pilot project to test an online customer advice feature powered by Unblu’s conversational platform. The feature uses a hybrid approach, with customers engaging with a live LUKB agent who works in tandem with the customer by way of Unblu’s screen sharing technology.
“With this new online function, LUKB’s advisors can make the documents on their screens visible on their customers’ devices. That way, the documents or online applications can be clearly explained in a conversation,” LUKB Head of Digitization and Multichannel Management Stefan Lüthy said. He added that while the new solution will save customers a trip to the branch, it is not intended to replace in-person meetings and consultations.
Headquartered in Basel, Switzerland, Unblu made its most recent Finovate appearance at our European conference in Berlin earlier this year. Unblu was founded in 2012. Luc Haldimann is CEO.
