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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
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Around the web
Spreedly – in partnership with Webio – wins 2019 Innovation Lab Award at Payments Ed Forum.
Australian FinTech looks at the possibility of iSignthis becoming the next big neobank.
Infosecurity Magazine featuresVeridium Chief Revenue Officer Jason Tooley on the challenges law enforcement faces when using biometrics.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.
Mortgage Cadence’s new integration with DataVerify, announced this week, will enable the Denver, Colorado-based mortgage tech company to enhance its loan origination system, boost data verification and fraud prevention, and provide compliance assistance.
The combination of DataVerify’s functionality and Mortgage Cadence’s Enterprise Lending Center (ELC) will improve the customer experience by streamlining authentication and automating the data verification process for borrowers. Lenders benefit, as well. The integration will enable them to avoid the cumbersome process of extracting data from institutions like the IRS, and instead request and access the necessary information without leaving the ELC platform.
“Optimized workflows and increased automation are essential to reducing time and cost to close,” EVP and MD of Product Management at Mortgage Cadence Paul Wetzel said. “This latest integration between our Enterprise Lending Center and Data Verify is yet another example of how we help lenders improve operating performance.”
DataVerify leverages advanced analytics to provide risk mitigation, data validation, and workflow management solutions for the mortgage industry. The company’s platform helps lenders make better decisions by recognizing data integrity errors and misrepresentations, as well as identity theft, and property and application risk. DataVerify was named to the 2018 Ellie Mae Hall of Fame after winning the Lenders’ Choice for Best Service Provider award that year. The Chesterfield, Missouri-based company was founded in 1948.
“(O)ur mission is to deliver flexible solutions tailored to meet the ever-changing needs of our customers,” DataVerify president Brad Bogel said. “Our integration with Mortgage Cadence furthers this mission by providing convenient access to secure verification processes that address industry compliance regulations all within the lender’s origination platform, Enterprise Lending Center.”
Founded in 1999, Mortgage Cadence demonstrated its Collaboration Center at FinovateFall 2017. The solution offers financial institutions a secure, multi-channel communication portal that brings all the participants, workflow, and data for a loan into a single location for greater efficiency and security.
Last month, Bank of the West announced that it had teamed up with Mortgage Cadence to improve its loan origination operations. The bank also deployed Mortgage Cadence’s Borrower Center to enhance the experience for both borrowers and loan officers. Named to the 2019 HousingWire Tech 100 this spring, Mortgage Cadence includes partnerships with Radian Mortgage Insurance and MGIC among its more recent integrations, both of which enabled the companies to streamline the mortgage insurance process during loan origination.
A wholly-owned subsidiary of Accenture, Mortgage Cadence has processed more than 17 million loans from point-of-sale through post-closing. Trevor Gauthier is President and COO.
As Finovate goes increasingly global, so does our coverage of financial technology. Finovate Global: Fintech News from Around the World is our weekly look at fintech innovation in developing economies in Asia, Africa, the Middle East, Latin America, and Central and Eastern Europe.
Asia-Pacific
CompareAsiaGroup picks up $20 million in Series B1 funding in round led by Experian.
Standard Chartered Bank’s eXcelerator innovation lab goes live in Shanghai.
Finish fintech PearlPay announces partnership with the Philippines’ Rural Bank.
Sub-Saharan Africa
Ghana’s Vice President Dr. Mahamudu Bawumia declares his country to be “the undisputed leader in Africa” in terms of innovation in payment services.
Oromia International Bank of Ethiopia goes live with core banking software from ICS Financial Systems.
Fintech Futures examines the challenger bank scene in South Africa.
Central and Eastern Europe
Piotr Jan Pietrzak of ING Bank Slaski looks at the fintech scene in Poland.
Romania open banking solution provider Finqware raises €180,000 in seed funding.
Poland introduces $737 million co-investment plan to attract private equity firms.
Middle East and Northern Africa
Bahrain-based cryptocurrency exchange Rain earns its license from the nation’s central bank, and announces a fundraising of $2.5 million.
Egypt’s MoneyFellows raises more than $1 million in pre Series A funding.
African payment gateway Innovate 1 Pay opens office in Dubai.
Central and Southern Asia
Indian SME lender Indifi raises $21 million in Series C funding.
Mashreq Global Services, a subsidiary of Mashreq Bank, teams up with Indian fintechs.
India’s biggest mobile payments company Paytm now boasts 10 million customers in Japan.
Latin America and the Caribbean
Brazil’s Nubank raises $400 million in funding in round led by TCV.
Argentina’s largest national private bank Banco Galicia integrates PFM technology from Strands.
Biometrics startup ID R&D released IDLive Face this week. The new solution adds liveness detection to facial recognition technology in an entirely passive manner.
Facial recognition technology has been used in fintech and other verticals to authenticate users for years. And in order to prove that the user wasn’t spoofing their identity using a static photo, many technologies use liveness detection, which requires the user to perform a handful of actions such as blinking, smiling, and turning their head.
With IDLive Face, however, the liveness detection is invisible to the user since it runs in the background of the application. This not only makes a frictionless user experience, it also prevents fraudsters from learning how to spoof the technology.
“IDLive Face requires absolutely no actions from the end user,” said ID R&D CEO Alexey Khitrov. “Eliminating complexity in the user experience is one of the primary focus areas of our research… Armed with excellent real-world results, we are thrilled to offer businesses fully frictionless authentication that aligns with rigorous compliance requirements for onboarding and data management.”
The new technology leverages AI-based algorithms that process images in near real-time. IDLive Face doesn’t require the end user to have any special capture software and is available as an SDK and Docker container on Linux and Windows.
At FinovateFall 2018, Khitrov demoedSafeChat2.0, an application that passively verifies a user’s identity throughout the conversation (typing or speaking) without asking them to do anything special to authenticate themselves.
ID R&D offers authentication technologies that span the biometric spectrum. The company’s IDVoice is a standalone version of its core voice biometric capability,IDSquared is a tool that validates the user by capturing their face as they type their login credentials, and IDBehave is a behavioral biometrics solution that creates a unique biometric template for each user.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.
By making it easier for cardholders to recognize and read merchant names, logos, and contact information on purchases, Transaction Intelligence from Ondot Systems, unveiled this week, helps firms reduce call center volumes and dispute costs while boosting customer satisfaction.
Ondot Systems General Manager for the Americas Gary Singh credited the recent launch of the Apple Card for raising awareness of the problem of incomplete or indecipherable transaction data. “We’ve seen huge interest in Transaction Intelligence from both consumers and card issuers,” Singh said, “particularly after enriched transactions were featured so prominently during the Apple Card launch.”
The company’s own investigation into the demand for enriched transactions makes the point, as well. A research finding sponsored by Ondot showed that 99% of mobile banking users were interested in better transaction data, with more than 80% indicating they were “very interested.” Singh noted, “It’s not that often that you find a product that both increases customer satisfaction and lowers cost.”
Ondot’s Transaction Intelligence provides real-time merchant and transaction data enrichment, including clarified merchant names, logos, location maps, advanced tags, memos, receipt captures, and more. This enriched data helps consumers identify their purchases, and turns transaction data into insights consumers can use to make smarter spending decisions.
“Ondot believes we have the best transaction and merchant data enrichment solution in the market right now, and we have won proof-of-concepts against other big names to prove it,” Singh said. “We are the only service available on any device to bring together all of these data sources for an accurate picture of where a purchase was made, and do it in real-time.”
The company noted that it initially will launch Transaction Intelligence this month with “one of the top 10 largest banks in the world,” but added that the solution will be available to FIs regardless of size.
Founded in 2011 and headquartered in San Jose, California, Ondot demonstrated its Digital Card Mobile App at FinovateSpring 2018. The company is a Best of Show winner, as well, having picked up top honors at our inaugural FinovateMiddleEast conference last year.
Ondot has raised $51 million in funding from investors including Citi Ventures. Bharghavan Vaduvur is CEO.
Ecommerce fraud prevention company Signifyd has partnered with Trellis this week to help the company offer its merchant clients a way to provide a safer purchasing process for customers.
Together with Trellis, which offers digital strategy, web design, web development, digital marketing, and integration services for ecommerce merchants, Signifyd will offer Trellis’ merchant clients confidence that their card-not-present transactions are from real customers.
Signifyd’s technology identifies fraudulent product orders using machine learning algorithms that sift through big data, including user behavior patterns, to reduce merchant chargebacks on fraudulent charges and save money on shipping goods on declined orders. And Signifyd stands behind its technology. If an order turns out to be fraudulent, Signifyd reimburses the merchant for the chargeback.
“The Signifyd – Trellis partnership holds significant value for our clients and customers. Protecting transactions is an integral piece of any ecommerce business and integrating Signifyd ensures your bases are covered,” said Justin Whitaker, Director of Marketing at Trellis. “Signifyd has proven their efficacy time and time again by giving brands an extra layer of security. The relationships Trellis has forged are built on communication, trust, and results which align directly with the values of Signifyd.”
Signifyd demoed its chargeback mitigation solution at FinovateSpring 2013. Headquartered in San Jose, CA., with locations in Barcelona, Belfast, Denver, and London, Signifyd has been named on the Forbes FinTech 50 and was listed among Bloomberg’s 50 Most Promising Startups. Additionally, it has been named a top place to work by Entrepreneur, Inc. Magazine, San Francisco Business Times, and the Silicon Valley Business Journal.
The company has 10,000 merchants in its network which count 250 million customers across the globe. Last May, Signifyd closed a $100 million Series D round, bringing its total funding to $187 million. Rajesh Ramanand is CEO and cofounder.
IIG Bank, a specialist trade finance bank based in Malta, will leverage a pair of solutions from Temenos to offer its clients a wider variety of differentiated services from treasury cash management and deposit accounts to documentary credit and trade financing. The bank has gone live with Temenos Infinity, a digital front office platform, as well as Temenos T24 Transact, the firm’s next generation core banking solution.
“Temenos has given us much more flexibility to be able to tailor deposit and trade finance products to specific customer needs,” IIG Bank Managing Director and CEO Raymond Busuttil said. “Temenos banking software is providing us with cutting-edge technology combined with the most complete functionality in private and corporate banking.”
The new technologies will replace legacy systems that IIG Bank said had become both highly restrictive and unable to support new business initiatives. In the context of the country’s anticipated GDP growth of more than 5% this year, IIG Bank believes Temenos’ technology will help it compete in a financial services sector that is becoming more competitive.
Praising the speed of the Temenos implementation, Busuttil added that the partnership will help the bank respond to current demand as well as better prepare for the challenges of the future. “We are already seeing significant improvement which will enable further growth for IIG Bank,” he said. “Corporate customers are demanding more from their banking experience and expect a seamless customer journey. We selected Temenos to future-proof our operations, enabling us to deliver a great customer experience going forward.”
The partnership with IIG Bank is the second big fintech announcement from Temenos this week. The Geneva, Switzerland-based banking software provider teamed up with Mizrahi-Tefahot, the third largest bank in Israel, to replace its capital market systems with Temenos T24 Transact.
Recognized last month by Gartner Magic Quadrant as a Leader in Global Retail Core Banking, and at the Finnovex Awards for Excellence in Digital Banking, Temenos demonstrated its Connect Mobile Banking solution at FinovateEurope 2015. The company is also an alum of our developers conference, presenting its B2B Financial Apps Marketplace at FinDEVr Silicon Valley 2015.
Temenos was founded in 1993. Max Chuard, who joined the company as Chief Financial Officer in 2012, was appointed CEO in February.
Onfido to provide identity verification for blockchain identity and payment solution provider Civic.
Ping Identity successfully completes financial grade API (FAPI) conformance testing.
EdgeVerve SystemsunveilsAssistEdge RPA 18.0 to help organizations reach broader automation coverage of their processes.
iSignthisinks Australian Principal Member licensing agreement with Visa.
Business Insider highlightsFlywire CEO’s unique way of attracting investment.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.
Kantox’sDynamic Hedging solution is the latest FX risk management option for U.K.-based corporate clients of Silicon Valley Bank. The deal with SVB, announced this week, is Kantox’s first bank partnership.
“By offering our Dynamic Hedging software to their corporate clients,” Kantox co-founder and CEO Philippe Gelis said, “we are providing a sophisticated solution which makes the treasurer’s job easier, while providing added value to SVB’s existing FX services.”
Kantox’s Dynamic Hedging technology makes treasury operations more efficient by automating FX risk management. The solution automatically hedges transactions in real-time to mitigate risk and improve competitiveness. Treasurers also gain greater visibility into FX exposure.
Kantox and SVB are no strangers. Silicon Valley Bank was behind the $5.6 million (€5 million) venture debt financing Kantox picked up in April. This marked the second such arrangement between the two parties, having previously inked a financing agreement in December 2017.
Calling Kantox “a technology partner that understands the innovation economy and the sectors in which they operate,” Erin Platts, Head of EMEA and President of SVB’s U.K. branch, explained the importance of efficiently managing FX operations for many of the bank’s corporate clients. “Through this partnership with Kantox, we aim to create genuine value for our clients by bringing automation and efficiency to their transactional FX management activities.”
Founded in 1983, Silicon Valley Bank provides financial services and expertise to companies in innovation centers around the world. More than 30,000 startups have benefitted from the bank’s funding.
Kantox’s first bank partnership announcement comes just over a month after CEO Gelis discussed the challenges of fintech/bank partnerships in a candid post at Kantox’s LinkedIn page.
“One of my key lessons learned is that navigating banks is very complex,” he wrote. “There are many people there whose jobs are basically to spend time speaking with fintechs about innovation – and not much else.” His takeaway? Among other insights, Gelis urged fellow fintechs: “Do not look for partnerships, instead engage with banks that are approaching you proactively.”
Kantox demonstrated its Peer FX solution at FinovateEurope 2013. The London, U.K.-based firm, founded in 2011, works with both top tier companies and SMEs to help them save money when exchanging foreign currencies. Kantox estimates that for every $100,000 transaction, it is able to save clients an average of $1,500. Offering spot and forward transactions in more than 20 international currencies, Kantox serves businesses in a wide variety of verticals ranging from e-commerce to travel to digital advertising.
In June, Kantox announced that clients have exchanged more than $10 billion on its platform. Last fall, the company was named to CB Insights Fintech 250 roster of the fastest growing fintech startups in the world. Kantox has raised more than $35 million in funding, and includes Partech and Idinvest Partners among its equity investors.
With such a fast news cycle in fintech, sometimes it’s helpful to dissect the news based on verticals; looking at them each independently. And we’ve done just that. Here’s a quick synopsis of what’s trending among six fintech verticals.
We’ll be taking a closer look at each of these topics at FinovateFall (September 23 through 25 in New York), where the brightest minds in fintech will discuss what you need to know about the latest news during our breakout streams. Register today to save your seat.
Challenger banks got their start during the 2008 financial crisis after consumers lost trust with mega banks and began looking for an alternative. Recently in this space, we’ve started seeing U.K. banks make inroads into the U.S., where there is less competition for non-traditional banking providers. After amassing a waitlist of 100,000 U.S. consumers, German challenger bank N26 launched in the U.S. this July. A few weeks earlier, Monzo also announced a U.S. expansion after amassing a user base of 2.2 million customers in the U.K.
These non-traditional banks are also experiencing a funding boom. Last month alone brought major funding rounds to three challenger banks. U.K.-based Atom raised $60 million at a $644 million valuation, N26 raised an additional $170 million investment at a $3.5 billion valuation, and MoneyLion raised $100 million at a valuation of almost $1 billion. And in June U.K.’s Monzo raised $144 million at a $2.5 billion valuation.
Geographical expansion and strong investor confidence in this space indicate it is ramping up, and we can expect more competing challenger banks to enter the arena soon. The influx of funds also brings the likelihood that, as the startups continue development efforts, new products and features may be on the horizon.
In the past, regtech has been looked at as the ugly cousin within fintech sub sectors. While not as sexy as investing technology, this vertical has seen increased popularity as of late. With the API economy making bank-fintech partnerships the new norm, regulators are begging for oversight and regulation-as-a-service companies have stepped in with the solutions banks need to stay compliant.
Similarly, as enabling technology expands, so does the need for regulation. Fortunately, along with this need comes the advances in technology for the regtech sector itself, which has benefitted from increased automation and scalability as AI and machine learning gain traction and become more accessible for firms.
The final deadline for PSD2 is looming. September 14 is the final deadline by which all EU companies must comply with PSD2’s regulatory technical standards and impose strong customer authentication methods. This has sparked a lot of recent conversation as it has been reported that 41% of EU banks missed the original deadline. And the stakes are high– not only can regulators impose fines, they can also revoke payment providers’ licenses.
Last fall the hot button topic was customer experience. Since then, there have been endless debates on Twitter and the blogosphere on the necessity of bank branches. Some argue that online and mobile channels are the best avenues to serve consumers whereas others contend that physical bank branches are essential to maintain a personal connection with customers. The biggest voice in this debate, however, are the numbers. According to the Financial Brand, 81% of banks and credit unions do not plan to close any branches this year.
It’s hard to talk about the customer experience without bringing up chatbots. The AI-powered technology can be used to scale and humanize the online experience. Not only have we seen an increase in chatbot technology providers, we’ve also been seeing more companies build chatbot capabilities into their own apps.
It’s true that banking and payments is almost too broad to be considered a vertical of its own. And with such a big category, it can be difficult to narrow down current trends. One topic that has been bubbling up lately, however, is the need for real-time payments in the U.S. Just a couple of days ago, the Federal Reserve announced it will develop a real-time payment and settlement service, called FedNow, that will support faster payments in the U.S.
Voice banking technology has been another widely discussed topic among banks, fintechs, and analysts in the past few months. With voice assistants such as the Amazon Echo, Google home, and Apple’s Siri becoming commonplace in homes, consumers are getting used to asking their AI assistants for answers to quick questions. However, the possibility of using the technology to conduct day-to-day banking activity hasn’t been on consumers’ radar– that is, until recently. On July 1, the classic game of Monopoly released a voice banking version that eschews paper currency. Instead, Rich Uncle Pennybags (the Monopoly man) manages the players’ money. When consumers get used to using voice technology in a game, they will soon be looking for it in their real bank.
Wealth management and roboadvisory technologies haven’t changed dramatically since 2015, the height of the roboadvisor boom. However, in the past few months some wealthtech companies have been broadening their offerings to compete with traditional banks. Betterment, Wealthfront, and SoFi, for example, have all launched checking accounts. Many firms have also unveiled additional capabilities, as well, such as tools for trusts, donation features, 529 plan options, and more.
And as AIs get smarter and work harder, there will be a backpedaling of pure roboadvisory plays. Many wealthtech companies already offer a hybrid option that combines roboadvisor tools with advice and guidance from human advisors. The human touch will rise to the top as a must-have option as consumers manage their nest egg.
We’re delighted to announce the finalists for the first ever Finovate Awards! We were amazed by the number of quality entries, and paring the field down to the short list in each category was no easy feat. And of course it doesn’t get any easier for our impressive team of judges, who now have the challenging task of selecting a single winner in each category.
We’ll be announcing the winners at a gala dinner taking place on September 24 (the middle night of FinovateFall) at the Edison Ballroom in Manhattan. In the meantime, please join us in celebrating the individuals and companies who have made it to this stage.
Don’t miss out on the chance see which individuals, companies, and technologies take top honors. Individual seats, half-tables, and full tables are all available for purchase. If you’d like to learn more about how to attend click here for more information or email [email protected] to reserve your table.
