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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
From the continued relevance of paper checks to the rapid growth of digital technology, payments continues to be one of the most fascinating — and important — areas in fintech.
In this week’s Streamly interview, William Mills, CEO of the William Mills Agency, talks with Kevin Brown, CMO and Head of Corporate Development for Onbe. The two men discuss a variety of key issues in the payments world, including the potential for AI to revolutionize payment systems and the future of cross-border payments.
“One of the very prevalent modalities, or payment instruments, that still exist are paper-based checks. We did research with the team at Oliver Wyman and, in 2023, there were still 1.7 trillion dollars of paper check or cash-based B2C payments. A huge amount of paper that’s out there. Checks are dated, not a great customer experience, require action on behalf of the consumer and they’re really expensive to corporate clients … As an industry, we have a huge opportunity to still alleviate a significant amount of pain, both for the ultimate enterprises and then their consumers and recipients, just by the doing away of paper checks.”
Onbe manages and modernizes consumer and workforce disbursements for corporate customers. The company’s technology platform powers a suite of turnkey managed disbursement solutions that enable its customers to outsource their entire B2C disbursement operations. Headquartered in Chicago, Illinois, Onbe was founded in 1996. Bala Janakiraman Iyer is CEO.
In his role at Onbe, Kevin Brown leads marketing, corporate development, business development, and communications. A fintech and payments operator with experience at both public and private equity-backed businesses, Brown is a graduate of Marist College (BA) and Pace University (MBA).
How is digital transformation impacting community banking? What can community banks do to maximize the opportunities that digitalization can provide? And what role should enabling technologies like AI play in helping community banks develop new products, new services, and new sources of revenue?
These are some of the questions posed to our fintech experts in our latest Streamly Subject Snapshot video on the digital transformation of community banking. Today’s conversation features insights and observations from:
Barb Maclean, SVP, Head of Technology Operations and Implementation at Coastal Community Bank (Linkedin)
“Your customers today are expecting to interact with their money at the time and place and mechanism of their choosing and they’re going to drive it off their phone, for the most part. So if you haven’t yet put in the kind of technology that enables them to do that in the way that they choose to do it, when they choose to do it, you’re definitely already behind the eight ball.”
John Waupsh, Chief Revenue Officer at Manifest Financial (LinkedIn)
“Certainly a lot of time the core is the scapegoat, whether it’s a real issue or not. ‘We as a bank have a challenge with X or building Y or doing some tactical thing because our data is being held by the core’ … The end of the story here is while it’s very challenging to switch core providers, every core, just like every vendor, wants to keep their customers around, wants to keep their clients around. So having progressive discussions with these providers, at an executive level, sharing strategy and moving forward together can usually be very productive.”
Brian Solis, Author of Mindshift: Ignite Change, Inspire Action, and Innovate for a Better Tomorrow (LinkedIn)
“Right now we have an ability to run our company as an intelligent company, an AI-first company, one that’s more intelligent, more integrated, and one that’s more focused on not just using AI to automate what we do, but looking to unlock the future. It’s prioritizing the use of AI in shaping new business models and operational models, products, services, with AI influencing every decision, from the problems the company chooses to solve, to explore new horizons, to the way it interacts with customers and employees.”
“Building the relationship is not about being personable, about saying, ‘Oh, we’ve got dog treats in our branch.’ That’s not going to grow your deposits. You need to bundle in additional services that grow your deposits without growing the cost of those. These include things like, say, account protection against scams and frauds. Things like an AI assistant that helps you answer tough questions about retirement and health care choices attached to it.”
Greg Palmer, Vice President at Finovate (LinkedIn)
“Community banks are in desperate need of new technologies, but they lack the resources that some of their larger competitors have, which means there’s a real opportunity for fintechs to come in and help them, give them new access to technologies that they need to stay competitive with their larger counterparts.”
For the first time, Finovate will offer a dedicated wealthtech/wealth management track at FinovateFall. Featuring keynote addresses, power panels, and more, our new wealthtech track will cover topics ranging from the rise of alternative assets to the role of technology and digitization in helping meet the needs of a new generation of investors.
“I’m really excited about the new Wealthtech track we’re offering at FinovateFall this year,” said Greg Palmer, host of Finovate. “So much innovation is taking place on the wealth management side of the fintech industry right now, and there are a lot of opportunities out there. Customer demographics are shifting, new assets are gaining popularity, and new technologies are raising the bar for every industry. It’s a crucial time to be paying attention to the space.”
Over the next few weeks, we’ll share a preview of the wealthtech content we have in store for you this year at FinovateFall. Today, we’re highlighting a pair of Power Panels that will take place on Day Three, September 11, of the conference.
Both of these Power Panels will be moderated by April Rudin, CEO and Founder of The Rudin Group. LinkedIn.
The Rudin Group is a global wealth management/wealthtech marketing consultancy serving banks, wealth management firms, fintechs, and wealthtechs.
The Future of Client Centricity in a Tech-Disrupted Wealth Landscape
Our Power Panel on the Future of Client Centricity will examine ways in which technology has altered the landscape of wealth management. The panel will discuss the impact of the Great Wealth Transfer from Baby Boomers to Millennials and what wealth managers should do to meet a new generation of investors’ growing preference for digital solutions and tools.
Andrea Finan, Head of J.P. Morgan Self-Directed Investing, J.P. Morgan Wealth Management
Finan is responsible for developing strategy, driving scale and profitability, and expanding capabilities to serve the firm’s Self-Directed and broader Wealth Management clients. She has 20 years of experience in financial services and is well-versed in creating high-performing digital products. LinkedIn.
Ali Geramian, Managing Director, Anthemis
Geramian is currently a Partner at Anthemis, where he steers the Anthemis ecosystem and investor relations platform to catalyze mutual value creation, collaboration, and transformative partnership opportunities across the firm’s global portfolio companies and strategic investor base. LinkedIn.
Michelle Julia Ng, Software Engineer, Apple
Ng is a software engineer with Apple. Educated at Stanford University (double majoring in Computer Science/Artificial Intelligence and History), Ng brings experience in the practical application of emerging technologies – including system intelligence, machine learning, and robustness analysis – having worked with Apple’s Vision Pro and Watch products. LinkedIn.
How Will Technology Transform How Alternative Assets are Managed?
This Power Panel will look at the rise of alternative assets through the lens of a shift toward diversification, a search for yield, a demand for uncorrelated returns, and a growing desire among a new generation of investors for investment opportunities that are aligned with their personal values. The Panel will also discuss how enabling technologies – from AI to the blockchain – will influence the way alternative assets are managed.
Bundeep Singh Rangar, CEO of Fineqia
A thought leader in blockchain technologies, Rangar is CEO of Fineqia International. Fineqia is a digital asset business that builds and targets investments in early and growth-stage technology companies. An investor in digital industries, Rangar has raised venture capital from entities such as Rakuten and secured private equity investment from U.S. financial institutions. LinkedIn.
David Teten, Venture Partner at Coolwater Capital
Teten is a Partner with Coolwater Capital. Known as the “Y Combinator for Emerging VCs,” Coolwater offers an accelerator for emerging VC fund managers and invests as a limited partner, into general partnerships and fund management companies. Coolwater also invests directly into startups. He is Chair of PEVCTech, a community of investors in private companies using AI, technology, and analytics to generate alpha. LinkedIn.
Everyone in our industry sits in a unique place. Because of this, there is immense value in taking the time to listen to others’ perspectives. At our FinovateSpring conference earlier this year, we spoke with Akita Somani, SVP of BNPL and Lending at U.S. Bank, and Bhavana Prathipati, Managing Director, Payments Product Manager at Silicon Valley Bank.
Both experts offered their insights on two key themes in the payments world. Somani discussed how U.S. Bank’s own buy now, pay later point of sale lending solution can help consumers pay for essentials such as home repairs. “It’s all about providing options, and therefore opportunities,” she said. Somani also highlighted regulatory issues in the BNPL arena.
On the opposite side of the traditional bank space, where U.S. Bank sits, Prathipati has a wide view of the fintech payments scene. In her interview, Prathipati discusses how real time payments has changed the lives of consumers by, for example, making real-time insurance claim payouts possible. She also touches on some of the challenges and risks involved in real-time payments.
The role of AI in financial services is rapidly evolving. Not since the heady days of the Internet boom has an emerging technology so powerfully captured the imagination of companies, investors, workers, and consumers around the world.
As financial services companies search for ways to take advantage of AI to improve efficiency, better understand data, and engage more proactively and personally with their customers, it is all the more worthwhile for us to listen to those entrepreneurs, analysts, and investors who have taken the time to understand both AI’s promise as well as its limitations. Here, in our latest series of Streamly interviews, we present three individuals whose insights into AI are worth hearing and sharing.
Generative AI: Extending the boundaries of what automation can do
In this interview with Sarah Hinkfuss, Partner of Bain Capital Ventures, we learn how generative AI is transforming the way financial institutions leverage unstructured data, streamline processes, improve underwriting, and expand their product offerings. The conversation also touches on the importance of data quality and change management in AI adoption for financial institutions, providing valuable lessons from early adopters.
How can you make AI adoption profitable?
Chris Brown, President of Intelygenz USAA, talks about two decades of optimizing banking and fintech through deep tech and AI solutions, and shares his top takeaways from his keynote address at FinovateSpring earlier this year. Brown discusses some of Intelygenz’s strategies to overcome common AI project pitfalls, and explains the company’s end-to-end approach to client engagement.
Navigating fraud prevention challenges with AI
Intellicheck CEO Bryan Lewis explores contemporary challenges in fraud prevention, the limitations of traditional methods, and the role of AI in enhancing security measures. Lewis discusses how AI can both help and hinder fraud prevention, as well as how you can protect yourself and your business from fraud.
The rapid evolution of technology turned regulatory compliance into a daunting frontier. Firms are not only required to keep up with changing technologies, but they also need to stay on top of increasingly complex requirements. Priya V. Misra, who sits at the forefront of this arena, is a pioneer in using LLMs to do the heavy lifting when it comes to compliance.
We recently spoke with Misra about his latest venture, the current regulatory environment, the landscape of LLMs, and advice for leveraging GenAI tools.
Tell us about EKAI and the problem you are trying to solve.
Priya V Misra: EKAI is the first AI compliance ‘co-worker’ for risk and finance professionals. The newer regulations are more complex and reporting on them is more frequent. Compliance platforms of the past are not able to cope with these new kind of reporting requirements. As a private SaaS platform, our proprietary AI software addresses the newer compliance requirements with ease. Our platform is designed to support the compliance plan development and sit at the holistic level for the Chief Compliance Officer and managers to digitally manage their compliance and prepare for regulation engagements and compliance submissions to the regulator. We are currently focusing on newer regulations like Operational Resilience, Consumer Duty, and ESG.
EKAI provides a natural language chat interface to make it easy to use. We believe that as the nature of data has evolved, compliance professionals in financial services also need enhanced systems and tools for this new normal to enable them to support the business and meet the requirements of regulators in a cost effective way. We tested the model with the United Kingdom’s Financial Conduct Authority as part of their sandbox and found regulator alignment for a tool such as our own to aid the industry in meeting their compliance requirements.
Banks and fintechs have always faced regulatory challenges. Why have concerns around regulation been so heightened in the past few months?
Misra: The concerns around regulation have been heightened in the past few months due to a fundamental shift in different kinds of regulations. The newer regulations are moving from ‘what’ to ‘how’. This basically means that organizations need to show the evidence of compliance, the ‘how’ they are meeting the compliance and not just ‘what’ their compliance approach is. The regulation horizon we see is placing consumer protection at the heart. This could be multi-jurisdictional with the advent of the Consumer Duty regulation in the U.K., to follow similar types of regulations in Europe. For the industry, we see the impacts on costs from being able to handle the multiple and, at times, competing priorities between regulations and maintaining business-as-usual in an environment still competitive for talent. Tools like EKAI offer compliance professionals in financial services better oversight on how they are performing from a delivery perspective against the compliance requirements across multiple programs.
How have you seen the conversation around GenAI and LLMs evolve in the financial services industry in the last year-and-a-half?
Misra: The conversation around GenAI and LLMs in the financial services industry has evolved in the right direction. The initial trepidation has now been met with wider adoption, with at least of ChatGPT opening the doorway for productivity enhancements from more business intelligence software like EKAI sitting at the intersection of compliance. EKAI has pioneered the use of the Small Language Model (SLM) for AI in corporate usage. SLMs de-risk AI implementation and provide a way to progressively deploy features. SLMs are eco-friendly as they require lower GPU usage and are quicker to train.
Apart from EKAI’s application of GenAI, what is the most powerful application of GenAI for financial services you have seen?
Misra: One of the most widely implemented GenAI applications within financial services that I have seen is in customer support. The power of GenAI lies in its ability to use company-specific information for answering customer queries and intelligently switch to a human counterpart for sensitive queries.
How do LLMs compare to traditional methods of regulatory compliance and risk assessment in terms of efficiency and accuracy?
Misra: The traditional methods of regulatory compliance work for traditional regulations. The data for these regulations was structured and mainly consisted of numbers. LLMs and GenAI are critical in compliance moving forward. They can handle unstructured data of documents, messages, and transcripts. This gives the organizations a strong foundation to build and use compliance platforms.
What advice would you offer firms who are avoiding GenAI tools because of regulatory and compliance concerns?
Misra: Every industry will be impacted by GenAI and/or LLMs eventually. I would advise them to embrace it selectively because it is coming anyway. The GenAI Act coming into force in Europe in the upcoming months will transform the landscape from a sort of ‘wild west’ into one with the types of benchmarks and controls that will ensure its wider and confident adoption across industries in a way that an industrial revolution is supposed to, transforming skillsets and producing efficiency gains future generations should benefit from.
Late last month, the Consumer Financial Protection Bureau (CFPB) issued an interpretive rule stating that Buy Now, Pay Later (BNPL) lenders are credit card providers. This ruling is slated to have some significant impact on BNPL, which was once one of the hottest subsectors in fintech.
To gain an understanding of the specific implications of the new rule, we spoke with Yaacov Martin, CEO of The JifitiGroup, a global fintech company that powers embedded lending solutions for banks, lenders and merchants.
For those unfamiliar with the matter, summarize the CFPB’s recent ruling on BNPL.
Yaacov Martin: The Consumer Financial Protection Bureau (CFPB) recently released an interpretive rule for the BNPL industry, which classifies BNPL providers as credit card issuers under the Truth in Lending Act. BNPL lenders must now extend key consumer protections that credit card users have long enjoyed, including investigating customer billing disputes in a timely manner, issuing refunds when goods are returned or services canceled and providing periodic statements detailing transactions and balances.
What will this mean for both fintechs and banks operating in the BNPL space going forward?
Martin: Adhering to comprehensive consumer protection requirements like those stemming from the Truth in Lending Act and the CFPB’s new interpretive rule demands significant resources, specialized knowledge, and thorough processes.
Implementing these controls necessitates substantial overhead investments, which poses a challenge for BNPL fintechs competing against banks, as higher operational costs put them at an inherent competitive disadvantage to banks, which have a low cost of capital and powerful balance sheets.
Therefore, a consolidation within the BNPL market is anticipated as only a select cohort of fintechs are poised to fully comply with these heightened obligations.
Banks and traditional financial institutions already have compliant frameworks in place, positioning them favorably to capture significant market share.
Do you envision the recent ruling impacting international BNPL operations?
Martin: The CFPB’s new interpretive rule might have an impact on international BNPL operations as this U.S. legislation will also be applicable to BNPL providers located outside the U.S. territories. This means that these international providers will need to ensure the correct investigation of customer billing disputes in a timely manner, issue refunds when goods are returned or services canceled, and provide the requisite periodic statements detailing transactions and balances. Even while operating from outside the U.S., these companies will likely need to set up U.S.-based customer support teams.
What impact will the new ruling have on end consumers?
Martin: End consumers will benefit from enhanced protection and more transparency when using a BNPL service. The rule will also boost consumer confidence in BNPL, encouraging increased usage of the service.
How will the ruling impact new innovations in the payments space?
Martin: The new interpretive rule will probably have a limited impact on innovation in the payments space, however it might lead to an increased use of BNPL by customers as a result of the additional safeguards.
The conversation continues with Finovate VP and host of the Finovate Podcast Greg Palmer!
In recent episodes of the Finovate Podcast, Greg Palmer has discussed a number of key topics in fintech and financial services. These topics include the current state of venture capital funding, the opportunities presented by new technologies like AI and faster payments, and a look at the current challenges faced by credit unions. Catch up on the latest from Greg and the Finovate Podcast below!
Greg Palmer sits down with Pete Cherecwich, President of Asset Servicing at Northern Trust, to discuss the new technologies available to financial institutions and how FIs can push their tech stack forward.
Greg Palmer and Bain Capital Venture Partner Sarah Hinkfuss talk about the current state of venture capital funding and the best opportunities for investment in fintech.
Greg Palmer interviews Jean Pesme, Global Director of Finance at the World Bank, to discuss the impact of fast payments on the world economy, including the role of the World Bank’s Project FASTT.
Greg Palmer talks with Brian Lee, CEO of Landings Credit Union, on the role of emerging technologies in helping credit unions better serve their members and grow deposits.
Innovative technologies are proliferating. From the renewed excitement around cryptocurrencies and blockchain technology to the challenges and opportunities of AI, individuals and organizations alike are discovering novel ways to live, learn, and earn.
Banks, financial services companies, and fintechs are no exception – which makes us all the more excited to feature futurist, digital anthropologist, and author Brian Solis as our FinovateSpring Out of the Box Keynote speaker at our upcoming fintech conference in May.
Titled The Cycle for Emerging Technologies: Which Will Really Matter to Financial Services Providers and Why?, Solis’ keynote address will encourage financial institutions to be proactive when it comes to engaging emerging technologies. Indeed, the extended title of his presentation warns: “If You’re Waiting for Someone to Tell You What to Do, You’re On the Wrong Side of Change.”
Referred to as “one of the more creative and brilliant business minds of our time” by Forbes, Brian Solis specializes in the impact of technological innovation on business and society. In his most recent book, Lifescale: How to Live a More Creative, Productive, and Happy Life, Solis discusses the challenges of – and solutions to – living in a world of ever-present digital distractions. His upcoming book, Mindshift: Ignite Change, Inspire Action, and Innovate for a Better Tomorrow, is designed to help people navigate, or even lead, in a digital-first, post-industrial era.
Formerly VP of Global Innovation for Salesforce, Solis is currently Head of Global Innovation for ServiceNow. As such, he leads vision, strategy, and programming for the company’s international innovation and Executive Briefing Centers. In addition to his keynote address on Day One of FinovateSpring, Solis will also join attendees for a book signing during the networking session immediately following his presentation.
Want to dive into the latest trends and discussions in the fintech world? Check out the conversations we’ve curated in these four videos recorded at last month’s FinovateEurope conference. From the future of payments to the role of banks in embedded finance, these videos offer valuable insights into some of the industry’s most pressing topics.
Hear from IFX Payments’ Head of Operations Stephen Hutchinson on changes in the payments scene, Ericsson’s Head of Mobile Financial Services Solutions & Strategy Ville Sointu on the future of CBDCs in Europe, Innovate Finance’s CEO Janine Hirt on embedded finance, and Harrington Star Group’s Co-Founder & Chief Customer Officer Nadia Edwards-Dashti on how fintech is engaging with DEI.
Payments in 2024: New challenges, regulations, and innovation
The future of CBDCs in Europe: What does the ECB have in store?
Embedded finance and the role of banks in its future
Driving positive changes in fintech: How is the industry engaging with DEI?
En route to FinovateEurope in London last month, a cab driver asked me what I did for a living. After giving it a few moments of thought (“fintech research analyst” doesn’t always cut it), I told him, “I get to meet interesting people and ask them interesting questions.”
This year at FinovateEurope, I had the opportunity to sit down with more than a baker’s dozen of fintech entrepreneurs, analysts, and authors to talk about some of the top trends in fintech and financial services. Here, as part of our Finovate Speaker Series, I’m looking forward to sharing these conversations with you over the next few weeks.
First up, in commemoration of International Women’s History Month, my interviews with Samantha Seaton, CEO of Moneyhub, and Anette Broløs, founder of Finthropology.
Samantha Seaton is CEO of open banking, open finance, and open data platform Moneyhub. The company’s technology helps transform data into personalized digital experiences and initiate payments. Seaton is also a Non-Executive Director at the Charities Aid Foundation Bank and at The Investing and Savings Alliance (TISA).
In our conversation, Seaton discusses the contemporary “obsession with personalization.” We also talk about the latest trends in financial services, the impact of AI, and what financial services can learn from other sectors when it comes to best leveraging new technologies.
How can the study of human cultures benefit banks? We posed this question to Dr. Anette Broløs, co-founder and Director of Finthropology.
For all the discussion of the power of data in financial services in recent years, Broløs believes that companies in this space have not yet done all they can do in order to take advantage of qualitative research that can help them become more customer-centric. As the co-author of the soon-to-be-released book, Customer-Centric Innovation in Finance, Broløs explains how methods common in anthropology can be effectively applied to financial services, potentially revealing insights that banks have been missing for years.
The stage is not the only place where Finovate celebrates the accomplishments of Black and African-American fintech and financial services professionals.
Since inception, Greg Palmer and the Finovate Podcast have showcased Black and African-American innovators, entrepreneurs, and thought leaders in the fintech and financial services space.
As part of our continued commemoration of Black and African-American History Month, today we highlight those conversations. Click the image to access the interview.
Nneka Ukpai – Better
Nate Gibbons – QuickFi
Jacqueline Baker – Author, The Unexpected Leader
Joseph Akintolayo – Deposits
Ariam Sium – FinGoal
William Crowder – Aperture Venture Capital
Sesie Bonsi – Bleu
Sharon Kimathi – Fintech Futures
Adrienne Harris – Superintendent NYS Department of Financial Services
