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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
A look at the companies demoing at FinovateFall in New York on September 12 and 13. Register today and save your spot.
NYDIG delivers Bitcoin products across industries, from banking and insurance to fintech and nonprofits. NYDIG fuses stringent regulatory standards with ironclad technology to make Bitcoin universal.
Features
NYDIG’s Bitcoin Savings Plan:
Integrates directly with a company’s payroll services
Allows an employee to seamlessly convert a portion of their paycheck to bitcoin
Offers new cutting-edge benefits
Why it’s great
For the BSP, there is little direct competition in the space. NYDIG’s value proposition is that employees are offered an easy-to-use way to buy, sell, and hold bitcoin without having to pay high fees.
Presenter
Rahm McDaniel, Head of Banking Solutions Rahm McDaniel is Head of Banking Solutions with NYDIG, partnering with banks and credit unions to serve their communities with innovative digital asset services, such as Bitcoin trading. Prior to NYDIG, he was VP of Strategic Solutions for Q2, helping to build Q2’s Banking as a Service business. He lives in Austin, Texas with his family. LinkedIn
With a little over a month to go before FinovateFall 2022 in New York City, our agenda for the autumn event is still being finalized. But there are a few highlights we can share with you this week to further whet your appetite for the fintech feast to come on September 12 through September 14. Today we’ll take a look at the mastermind keynote speakers we have scheduled for FinovateFall, each of whom was selected for their unique understanding of what’s driving innovation in financial technology today.
Day One will feature a Mastermind Keynote from Chris Cox, Chief Operating Officer of Apiture. Titled “Closing the Data Intelligence Gap”, Cox’s address will look at ways that financial institutions can better process and analyze available data while simultaneously (1) helping their businesses, (2) supporting their customers, and (3) maintaining regulatory compliance. Cox will examine ways that banks and credit unions can close the “expertise gap” that may be preventing them from innovating in the ways their customers want.
Before becoming COO of Apiture, Cox was General Manager of First Data’s digital banking business. He also led the mobile payment product development efforts at the company. He is a graduate of Miami University in Ohio, where he earned a bachelor’s degree in mathematics, and of Duke University, where he earned an MBA.
Day Two will include a Mastermind Keynote from Claudio Cungi, Chief Product Officer, and Alice Menenti, Product Manager, both of Strands. Cungi and Menenti will present “Providing Actionable Insights to Create the Banking Platform of Tomorrow.” This address will review how enabling technologies have given banks the ability to dramatically increase the degree of personalization they can bring to their products and services. Cungi and Menenti will show how financial institutions can use the insights made available through more personalized engagement with customers to build better, more personalized business banking platforms
The final day of FinovateFall 2022 will feature a number of Mastermind Keynotes as part of our various tracks on Payments, AI, Customer Experience, Lending, Cryptocurrencies, and Digital Transformation. Among the day’s highlights are a discussion on the Consumer Financial Protection Board (CFPB) and its priorities for fintech in 2022 and beyond conducted by Thomas Ward, the organization’s current Enforcement Director. The day will also feature a presentation by Tiffany Kaminsky, co-founder and Chief Impact Officer for Symend titled “Upping the Ante: Using the Science of Decision-Making for Effective Customer Engagement.” This presentation will discuss the concepts of behavioral engagement and hyper-personalization and examines initiatives that financial institutions can take to integrate both into their current business strategies.
These are only a handful of the Master Keynotes scheduled for FinovateFall this year. For more information, visit our FinovateFall hub to learn more about our agenda, our speakers, and, of course, how to register today and save your spot at our upcoming fintech event. Pick up your ticket by Friday, August 12 and take advantage of big, early-bird savings!
Western Union is bolstering its partnership with Visa by expanding its integration with Visa Direct.
Visa Direct is Visa’s real-time money movement network.
The expansion will bring Visa Direct to Western Union’s U.S. clients, enabling them to send money in near-real-time to Visa debit cards in Colombia, El Salvador, Jamaica, Romania, and Thailand.
Money transfer firm Western Union is building on its partnership with Visa this week. The Colorado-based company is expanding its integration with Visa Direct, Visa’s real-time money movement network.
Under the agreement, the pair will bring Visa Direct to Western Union’s U.S. clients, enabling them to send money in near-real-time to Visa debit cards in Colombia, El Salvador, Jamaica, Romania, and Thailand. Western Union and Visa first teamed up in 2019 to enable Western Union customers in more than 20 countries across Europe to send and/or receive funds directly to Visa debit card holders.
“Western Union and Visa share a vision for modern money movement, one that ensures cross-border payments are reliable, efficient and transparent, with convenience and the customer’s channel of choice at the center of our customer experience,” said Western Union President of the Americas Gabriella Fitzgerald. “Our partnership with Visa underscores the benefits that collaboration brings to realizing this shared vision for our joint customers around the globe.”
Visa first launched Visa Direct in Europe in 2017 as a real-time payments platform to allow companies to leverage Visa’s global reach and scale for cross-border payments. In addition to Western Union, nearly 550 partners, including Adyen, The Bancorp, Fiserv, and Stripe support Visa Direct solutions.
“Visa is transforming cross-border payments with Visa Direct by helping to bring the ability to securely send and receive funds in near-real-time to more use cases around the world,” said Senior VP North America Head Yanilsa Gonzalez-Ore. “Through this partnership, we are using Western Union’s digital capabilities to help US customers send money to their family and friends and provide a means to help with bills, as a gift, or for an emergency.”
Founded in 1851, Western Union is one of the oldest cross-border money transfer pioneers. The company’s global financial network bridges more than 200 countries and territories and approximately 130 currencies. In a partnership earlier this year, Western Union integratedMarqeta’s payment cards solution into its digital wallet and digital banking platform in Europe.
A look at the companies demoing at FinovateFall in New York on September 12 and 13. Register today and save your spot.
Finotta is a provider of embedded fintech for digital banking. Finotta’s Personified platform is a combination of products that help financial institutions better meet the needs of their customers.
Features
Personalized financial guidance
Predictive product recommendations
Gamification
Why it’s great
Finotta empowers its FI customers to deliver the right experience, service, or product at the right time to their users with a gamified Financial Health Level that helps improve their financial life.
Presenter
Parker Graham, Founder and CEO Parker Graham serves as Founder and CEO of Finotta. Graham began his professional career in the NFL. After working at BOK, Graham founded Destiny Wealth in 2018 and pivoted to Finotta in 2020. LinkedIn
A look at the companies demoing at FinovateFall in New York on September 12 and 13. Register today and save your spot.
ebankIT is an Omnichannel Banking Platform. This Finovate, ebankIT will demo new features, from crypto management to open banking, all while gathering user feedback.
Features
User Engagement Hub to transform FIs:
Knowledge based with in-app interactive demos of all features
Ability for users to vote on new feature releases
Features available through an early adopter program
Why it’s great
It’s all about agility and having financial institutions launch exceptional user experiences at a fast speed. ebankIT does it all through its Omnichannel Digital Banking Platform.
Presenters
Pete Atkinson, Vice President of Sales Atkinson has spent much of his career working at the convergent point of technology, business, and consumers. He is VP of Sales at ebankIT and for the last 15 years has helped FIs to digitally transform. LinkedIn
Joana Lucas, Sales Development Representative Financial industry enthusiast, experienced in Financial Markets, Banking, and Fintech space. Current mission: help FIs humanize their digital banking worldwide via ebankIT’s omnichannel capabilities. LinkedIn
A look at the companies demoing at FinovateFall in New York on September 12 and 13. Register today and save your spot.
autologic was founded in 2021 and lets non-technical people build highly complex logic to power automated decisioning and digital experiences across any division of a financial services organization.
Features
Build complex rules & calculations with no code at the cost of spinning up a server on Google
Deploy into any application (custom or third party) that supports JSON in minutes
Why it’s great
UNO (a mortgage broker) maintains pricing, underwriting, servicing, documentation and policy information for 20 lenders with 1 non-technical person.
Presenter
Vincent Turner, CEO 4x Founder, 2 exits across Australia and US. Built technology used by 90% of Australian banks. Founder of UNO Home Loans, #1 Online Mortgage Broker in Australia. LinkedIn
A look at the companies demoing at FinovateFall in New York on September 12 and 13. Register today and save your spot.
Cable was founded in 2020 to provide automated assurance of financial crime controls, enabling real-time, continuous monitoring for regulatory breaches and control failures across all of a business’ accounts.
Features
Reduces remediation projects with real-time regulatory breach or control failure detection
Automates and centralizes partner bank oversight of fintech partners
Increases ROI of other compliance tools
Why it’s great
Why manually test 100 accounts when you can automatically monitor 100%? Scale efficiently and compliantly with Cable by ensuring your controls’ effectiveness as you grow.
Presenter
Natasha Vernier, CEO Before founding Cable, Vernier was Head of Financial Crime at Monzo Bank, one of the first UK fintechs to become FCA-authorized and regulated. LinkedIn
Truework has raised $50 million to bolster its income verification product.
The Series C round brings Truework’s total funding to $95 million.
G Squared led the round, which the company plans to use to grow its business “through instant, accessible, and accurate consumer data.”
Income and employment verification startup Truework is taking on an extra $50 million in capital today in a Series C round. When added to the $45 million in funding the California-based company has raised since it was founded in 2017, Truework’s total funding now reaches $95 million.
The round was led by G Squared; with contributions from existing investors Sequoia, Activant, and Khosla Ventures; as well as new investors Indeed, Human Capital, and Four Rivers Group. “Support from these incredible teams inspire[s] us to keep building the future of financial identity, and is bolstered by our continued focus on promoting transparency and data ownership for consumers,” the company said in a blog post.
Truework’s goal is to change the way consumers’ personal information is shared during life events such as a home purchase or getting a new job. The company has built a network for verified identity that places the consumer in control of their data by offering them the decision when to share their information and when to withhold it.
Truework anticipates it will power more than 12 million income and employment verifications by the end of this year, which will service more than 20,000 small businesses and 100 enterprises. The company will use today’s investment to help customers grow their businesses “through instant, accessible, and accurate consumer data.”
Last year, Truework launched a few new offerings, including Payroll NetworkPreapprovals, and Credentials. The Payroll Network tool offers consumers visibility into and control over how their data is being shared with third parties and also enables consumers to generate their own employment verification letters. The Pre-approvals product offers lenders more accurate underwriting and increased conversions, while the Credentials tool allows applicants to instantly and directly share their payroll data in their loan application.
“Truework is putting millions in control of their data and streamlining the lending process for both lenders and borrowers,” the company said in a blog post announcement. “Building the future with a consumer first mindset goes into every decision we make, and Series C funding will help us further empower both sides of the verification equation to help build a more efficient, secure, and stable credit system.”
We’re more than halfway through the year, and before you know it, we’ll be publishing trends predictions for 2023. However, a lot can happen over the course of five months, so we’ve decided to examine what to look for and what you can expect in fintech between now and the new year.
Beginning the era of “neo super apps”
Over the past year, there has been much debate on whether or not the U.S. and Europe will ever have a super app. Plaid CEO Zach Perret takes a different angle on this. He is expecting “neo super apps” to rise in popularity.
“Within lending, brokerage, and banking, super apps will emerge, adding every bit of functionality within financial services. Over time, they’ll actually be able to add in things that are above and beyond financial services,” said Perret in a Plaid report.
Accelerating M&A activity
It’s no secret that fintech funding is down, especially in later stage deals. Because of this, some fintechs have been driven to sell sooner than they had hoped. As for acquirers, many are looking to cash in on the “neo super app” trend by adding to their firm’s expertise, bundling multiple services into a single offering. In the first half of the year, we have seen an increase in M&A activity over 2019 levels, and we expect that to continue into the second half of the year.
Ramping up a focus on ESG
Fintech companies and traditional financial institutions alike have sharpened their focus on ESG initiatives in the past couple of years. And while climate change may be enough of a reason for firms to implement new ESG practices, the SEC is giving laggards an incentive to step up their game. The commission recently proposed amendments to rules and reporting forms to promote consistent, comparable, and reliable information for investors concerning funds’ and advisers’ incorporation of ESG factors.
Increasing solutions surrounding consumer credit
After dipping in 2020, Americans’ credit usage is now on the rise. Inflation, and especially the increase in costs of everyday expenses such as housing and gas, is prompting higher credit usage while consumers iron out their budgets and adjust their lifestyles to fit the extra expenses.
Dwindling conversation around digital transformation
We have finally arrived at the moment when digital offerings have become the rule, not the exception. While we can still expect to hear the phrase “digital transformation,” it is becoming less and less common.
More discussion around Central Bank Digital Currencies (CBDCs)
The progress toward CBDCs has been slow, but steady. Currently, 10 countries have fully launched a digital currency and more than 105 countries are exploring them. Just two years ago, only 35 countries were considering a CBDC. This digital currency race will only become more heated as more countries seek to be among the first to offer a CBDC.
Growing competition in alternative business payments solutions
After launching just five years ago, Brex has quickly risen to become one of the most successful fintechs, boasting a valuation of $12.3 billion. The startup is a super app for businesses, offering companies credit cards and cash management solutions.
At three years old, Brex’s competitor Ramp isn’t too far behind. The company is valued at $8.1 billion. Clearly, these companies are filling a need for businesses that has not previously been met. We can expect others to follow their footsteps to cash in on the gold rush.
BNPL takes a backseat
It’s no secret that BNPL payment schemes are causing cash flow difficulties for younger, less financially savvy consumers. Many are finding it difficult to keep up with the repayment obligations. This, combined with a lack of regulatory oversight, is tarnishing BNPL’s reputation.
We can expect to see a slowdown in BNPL newcomers, though I do think we’ll still see more large firms add BNPL schemes to their existing offerings.
Subsiding talent acquisition
A year ago, the workforce shortage was taking its toll on the fintech industry and we were discussing strategies to acquire new employees. After the economic sedation started this spring, however, this discussion has slowed. Startups have started to worry about burn rate and corporations have shifted their focus to their bottomline, which has already resulted in layoffs. With VC funding down, we can expect to see a continuation of this decline in the next five months.
Providing everything-as-a-service
These days companies can fill holes in their offerings by purchasing just about anything as a service, including ESG-investing-as-a-service, credit-cards-as-a-service, accounting-data-as-a-service, and more. As banks, startups, financial services, and even non-financial players seek to build up their customer base and play into the “neo super apps” trend Perret discussed, we can expect to see even more companies take the “-as-a-service” model to increase their customer base.
Tax compliance firm Avalara has agreed to be acquired by Vista Equity Partners for $8.4 billion.
Avalara has more than 30,000 customers in 95 countries.
The transaction will take Avalara private, removing it from the New York Stock Exchange.
Avalara is starting the week with a big move. The tax compliance firm has agreed to be acquired by global investment firm Vista Equity Partners for $8.4 billion. Vista Equity Partners is acquiring Avalara at $93.50 per share, which represents a 27% premium of Avalara’s closing share price on July 6, 2022.
Founded in 2004, Avalara helps its more than 30,000 customers in 95 countries comply with tax regulations. The Washington-based company offers compliance solutions for various transaction taxes, including sales and use, VAT, GST, excise, communications, lodging, and other indirect tax types. In addition to tax compliance, Avalara also helps companies secure business licenses and provides sales tax data analysis that offer business insights. Among the company’s clients are Zillow, Pinterest, and Roku.
“Avalara is a mission-critical platform serving customers in a variety of end-markets, including retail, manufacturing, hospitality, and software,” said Vista Equity Partners Managing Director Adrian Alonso. “Avalara’s solutions, its commitment to product innovation, and its network of extensive partner integrations, resellers, and accountants make it a true leader in the space.”
Once complete, the transaction will take Avalara private, removing it from the New York Stock Exchange. Prior to going public in 2018, Avalara had raised $341 million. Scott McFarlane is co-founder and CEO.
Denver, Colorado-based PayOps innovator Infinicept unveiled its open payment operations solution, Infiniport.
The new offering will support orchestration between multiple processing platforms, enabling businesses to “bring their own processor” (BYOP) to their payments operations.
Infinicept secured $23 million in new funding this spring in a round co-led by SVB Financial Group and Piper Sandler Merchant Banking.
PayOps innovator company Infiniceptlaunched its new open payment operations capability, Infiniport. The new offering gives customers the ability to interface with the processor or alternative payment rail of their choice, enabling companies using embedded payments to “bring their own processor” (BYOP) to their payments and business operations.
Infiniport will help support orchestration between processing platforms, which is essential for businesses that rely upon more than one payment processing relationship. The new offering from Infinicept means that companies will no longer be forced to choose between the cost and inflexibility of having a sole provider on the one hand, and building their own embedded payments platform on the other. Instead, Infiniport provides a universal platform giving firms the ability to work with a variety of payment processors, gateways, terminal providers, token solutions, and more.
“Infiniport is part of our vision to help the payment ecosystem avoid lock in and choose the right combination of solutions which best support their business needs,” Infinicept co-founder and co-CEO Deana Rich explained. “Most off-the-shelf payments solutions come with trade-offs, but Infinicept is focused on allowing customers to keep their payments revenue, ownership of their data, and control over their payments product and ultimately the customer experience.”
Among Infiniport’s features are compatibility with any gateway, terminal, orchestration solution, across any processor; standardized fee management and settlement operations across multiple processor relationships; and a one-to-many capability to operate and manage payments with any processor. The offering also enables companies to mix and match payment types, processors, and payout vendors.
Infinicept’s new product announcement comes as the company acknowledges a 1,400% increase in payment volume since 2020. A major player in the embedded finance market, more than 300 software companies are served either directly by Infinicept or through its banking and payments customers. Headquartered in Denver, Colorado and founded in 2011, Infinicept secured $23 million in new funding in May. The investment was led by SVB Financial Group and Piper Sandler Merchant Banking and featured participation from existing investor MissionOG and others. The company said that it will use the capital to further develop its PayOps technology, pursue market expansion opportunities, and invest in ways to continue supporting embedded finance.
This is a sponsored post by Ann Kuelzow, Global Head of Financial Services at InterSystems.
A staggering 86% of financial services firms globally are concerned about using data to drive decision-making within their organizations, according to the latest research from InterSystems of 554 business leaders within financial services companies, including commercial, investment, and retail banks, across 12 countries globally. This lack of confidence largely stems from an inability to access data from all the needed sources and the time taken to access data. Given the wealth of data financial services firms have, this is a major concern, with the potential to open organizations up to risk and severely impede key business initiatives. In fact, more than a third of firms in the survey cite the primary impact of these challenges as being difficulty in gaining a 360-degree picture of customers.
As competition intensifies within the financial services sector, customer 360 is something that all firms must confidently be able to obtain. Doing so will empower firms to provide clients with the products, services, and hyper-personalized, real-time experiences they have come to expect across all aspects of their lives. But this relies on gaining access to accurate, consistent, and real-time data encompassing all touchpoints. Consequently, firms must first address underlying issues with their data architecture.
Solving data challenges
Gaining a holistic view of the customer requires firms to pull together all available information on each customer. As customers are likely to interact with a variety of different departments and personnel within the firm, this information can be spread across multiple systems and silos, including trading, savings, credit cards, loans, insurance, CRM, support, data warehouses, data lakes, and other applications and silos, as well as data from external sources and suppliers. The data is often in dissimilar structures and formats and follows different naming conventions and metadata. Therefore, making sense of this dispersed data typically requires significant effort and expense, and using it to make informed, accurate, and fast decisions is a major challenge.
As organizations look to solve these problems, data fabrics, a next-generation architectural approach, have emerged to provide financial services firms with a way to speed and simplify access to data assets across the entire organization. It does this by connecting to existing systems and data silos containing relevant data, both inside and outside the organization, and ingesting the relevant data on demand as it’s needed. It accesses, integrates, and transforms the data as it’s being requested, providing a real-time, consistent, harmonized view of the data from different sources, all from a single view. This allows firms to gain a complete 360-degree view of the customer.
Going a step further
A smart data fabric takes this approach a step further by providing built-in analytics capabilities which enable business users to understand customer behaviors and actions better and even to predict the likelihood of future behaviors, such as purchase of new services, churn, or response to targeted offers. It also provides the business with self-service analytics capabilities, so line-of-business personnel can drill into the data for answers without relying on IT, eliminating the usual delays associated with adding custom requests to the IT department’s queue.
This next generation approach also helps solve latency issues, as smart data fabrics lets the data reside in the source systems, where it’s accessed on demand, as it’s required.
Adopting this approach will help to restore firms’ trust in their data, ensuring that they can quickly access consistent, reliable, and accurate information on which to base decisions, fuel data initiatives, and build up a comprehensive view of the customer.
Elevating the customer experience
Being able to leverage the wealth of customer data inside and outside of the organization for customer 360 will empower firms to offer a vastly improved customer experience. For instance, with a single view of the customer, advisors, help desk, and support teams will be able to provide customers with the immediate answers and recommendations and thereby enhance their interactions with the organization.
Armed with customer 360, firms will also be able to increase revenue streams by predicting customer behavior to maximize cross-sell and up-sell opportunities. For example, incorporating and analyzing dozens of data points from different systems enables firms to determine which customers are likely to respond to a premium credit card offer and least likely to default on payments. This allows firms to identify which customers to target with particular offerings and services. Similarly, firms will be able to predict which customers are at risk of churning and take appropriate corrective actions in advance to reduce churn.
Together, these capabilities will help to elevate the experience and services being offered to customers, while also helping financial services firms to create and cement a competitive edge.
Restoring trust in data
Ultimately, by adopting smart data fabrics, firms will be able to overcome the data challenges that are currently preventing them from using their data to make better decisions by leveraging a more complete and more current 360-degree view of each and every customer. With a complete and trusted 360-degree view of the customer, firms will be in a strong position to fuel new customer initiatives, enhance the customer experience by delivering cohesive and personalized interactions and offerings across departments, and set their institution apart.
