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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Scalable Capitallanded $58 million (€50 million) for its roboadvisory platform this week. The new funds come courtesy of BlackRock, HV Holtzbrinck Ventures, and Tengelmann Ventures.
Today’s round brings Scalable Capital’s total funding to $133 million (€116 million) and boosts the Germany-based company’s valuation to $460 million. Scalable Capital will use the investment to grow in the wealth management and brokerage spaces, and invest in the B2B side of its business.
“In times of COVID-19, our funding round is a powerful signal; it shows that our focused, digital business model is convincing the investors,” said company Co-founder and Co-CEO, Erik Podzuweit. “We will use the additional capital to expand our position as the market leader in digital wealth management and to reach new customer segments with the broker.”
With 80,000 customers across Germany, Austria, the U.K., and Switzerland, Scalable Capital has $2 billion in assets under management. The company offers personalized, fully managed investment portfolios.
Using its risk management technology, Scalable Capital’s B2C offering aims to make investing accessible for everyone by charging simple, transparent fees.
“We established Scalable Capital to make investing easier and better through technology,” said Scalable Capital Co-founder and Co-CEO Florian Prucker. “Not only has our B2C business grown strongly over the last few years, but Scalable Capital’s technology is also used by more and more B2B partners; most recently we launched our partnership with Barclays. With this funding round, we also want to expand our team of currently 130 employees in order to drive our expansion and the further development of our platform.”
The company’s flagship offering is a B2B approach that brings its roboadvisory technology to help banks offer their clients a different flavor of investing. Scalable Capital recently added three additional partners to its roster and now boasts partnerships with firms including Barclays, Gerd Kommer Capital, Raiffeisen Banking Group Austria, ING Deutschland, Siemens Private Finance, Openbank, Targobank, Oskar, and Baader Bank, and others.
It’s been five years since eBay and PayPal split into separate companies – which means the five-year operating agreement that maintained the firms’ payments relationship in the years since the breakup is about to run out.
This week eBay announced that it is now ready to expand the managed payment system that will take PayPal’s place. Developed in partnership with payments provider Adyen, the new payment system is being used by 42,000 sellers – with more than 255,000 additional merchants who the company said will be activated by the end of the year. eBay has processed more than $4.7 billion in volume in the U.S. and Germany via its managed payments offering, and the company reported that sellers using managed payments have saved $17 million in transaction fees. eBay President and CEO Jamie Iannone praised the momentum behind managed payments, and said he expects it to “deliver $2 billion in revenue and $500 million of operating income in 2022.”
eBay is currently managing payments in five countries – the U.S., Canada, Germany, Australia, and the U.K. – and plans to expand the program to all countries where it operates.
For buyers, eBay’s managed payments provides a more flexible checkout experience with more payment options. Sellers benefit from a simplified process – involving one company (eBay) rather than two (eBay + PayPal) – that provides for easier reconciliation, faster service, and more effective support when issues arise. The company quoted one 20-year veteran eBay merchant from Germany who has been using managed payments since the spring. “I don’t care how the payment goes,” she said, “the main thing is that the customer buys and pays and my account fills up.”
VP of Global Payments Alyssa Cutright added that the offering was a win for both buyers and sellers that provides a simpler, more modern managed marketplace. “By managing payments, eBay is taking control of its own destiny,” Cutright wrote. “We are investing in our buyers and sellers, creating an integrated end-to-end platform, and enhancing the eBay experience by breaking down and removing complexities for our customers.”
Adyen, eBay’s payments partner, is based in Amsterdam, The Netherlands, and was founded in 2006. Companies ranging from Facebook and Uber to Microsoft and Singapore Airlines rely on Adyen’s technology to deliver seamless, friction-free payments across mobile, online, and in-person channels. The company, which processed $278 billion (€240 billion) in volume last year, is publicly traded on the Euronext and has a market capitalization of $47 billion.
There aren’t many industries where organisations have so much data about customers for such a long period of time. For example, I have had the same bank for the last 25 years which, by the way, is the same as my father’s.
My bank has been my partner when I wanted to go to university or buy my first apartment. It knows how much I make and where I spend it, but I never truly felt they used that knowledge to either enrich my experience or deliver tailored offers. Why is that?
There is a wealth of value to explore in untapped customers’ financial behaviour and banks are in prime position to reap the benefits, but they need to adapt.
The transformation has already begun with banks introducing more channels, learning best practices from digital native banks and fintechs, and even creating new digital business models to test what works, aiming to later integrate those learnings into the core business.
Still, banks are drowning in data and have very little insight on how to transform it into actionable knowledge to better serve customers, personalise offers, and deliver a consistent customer experience.
Furthermore, through segmentation, banks can use their knowledge about current customers to define campaigns and other initiatives to fulfill one of their main objectives, attract new customers. Their continuous appetite for growth steams from delivering unique and innovative value propositions to current but also future customers which today can be, in many situations, hallenging.
From risk takers, tech-savvy, and hungry for innovation customers to techavoiders that value human touch, banks must accommodate different engagement approaches and insights to differentiate customer profiles. This happens not because they don’t have the data, but because they can’t mine it.
It’s clear that very soon ‘Customer intelligence’ will be the most important predictor of revenue growth and profitability. The use of behavioural analytics will be key to identify customer friction points and there will be a surge in building technological capabilities to get more insight on customers’ needs.
A New Engagement Model for the Digital Age
By nature, financial products are complex and both companies and individuals are deeply affected by their financial choices, so there’s a foreseeable need for contact, ensuring a correct understanding of what is at stake.
Bank tellers, financial advisers, and other resources are key in accommodating customers’ requests and providing value-added and timely information. They benefit first-hand from customer insights, which enable them to provide not only a better service, but also to increase the customer value by offering the best solutions.
In addition to assisted channels, there is the emergence of self-service applications aiming to allow customers to engage on their terms, when they want, going as far as allowing customers to configure product features, including pricing. If, in this case, the human factor is eliminated, the need for accuracy is even greater, otherwise, the sale may fail or the inquiry can go unanswered.
Customer expectations have changed mainly due to the experience from other digital native organisations, coming or not, from the financial sector. The easy interactions, the tailored offers, integration between physical and digital channels or the unmatched service, creates a gap between what many financial institutions can deliver and what customers are getting elsewhere.
Responding to the pressure to change, banks must find a balance between opening but guaranteeing trust continues to be paramount, at all levels. Up to this point, the perspectives presented argued for the need for banks to not only gain insights and knowledge from the data they already have, but also the challenge in adjusting to new customers’ demands and how they choose to engage.
However, the biggest challenge is how to orchestrate these two dimensions and provide customers with experiences that leverage the knowledge banks have delivered in a seamless way, using whatever channel customers choose from.
The holy grail of an enhanced experience in the banking sector is to have an holistic and end-to-end perspective of the customer experience.
Introducing Celfocus Customer Knowledge Augmentation and Activation
Celfocus Customer Knowledge Augmentation and Activation is a modular and integrated framework tailored to leverage banks’ customer knowledge and deliver tailored services.
This framework is anchored in 2 main modules. The first comprises the tools and technologies to augment customer knowledge by activating every single customer through automated AI and Cognitive data insights, and the second aims at delivering tailored experiences that trigger new targets, portfolios, and customer lock.
By encompassing the Customer Value Augmentation and Enhance Customer Experience modules, the solution provides banks’ full control of the customer journey from planning to execution, focusing on building the technology capabilities to get more intelligence about customers’ needs, and how to best serve them.
P2P lender and challenger bank Zopa recently formed a partnership with Paylink Solutions to tap into the company’s cloud-based digital income and expenditure product, Embark.
Paylink’s Embark will help Zopa quickly find the most suitable loan product for clients by understanding their affordability. The tool taps into credit report data and leverages open banking technology to offer lenders a 12-month view of customer bank statements. Embark also provides identity verification and document upload technology.
“Teaming up with Paylink Solutions to deploy the Embark tool at this time has enabled us to provide an even better experience for our customers,” said Zopa Chief Customer Officer Clare Gambardella.
The partnership is part of Zopa’s initiative to increase its digital efforts. Embark will enable Zopa’s potential borrowers to use the self-service portal or use an online form with the help of a live customer service agent.
With Embark, Zopa customers also have access to free debt advice. Customers can self-refer to PayPlan, a U.K.-based debt help tool that provides personalized debt management plans.
“From day one, we have seen Zopa’s customers referring themselves to PayPlan; this is in an age where customers want to self-serve more,” said PayPlan’s Head of Partnerships, Andrew Alder. “It’s becoming more important for organizations, solution providers, and debt advice providers to work closely to create innovative ways for customers to still be able to access advice in a frictionless way.”
There may still be a few weeks of summer left, but high-growth vertical payments innovator Flywire is already in back-to-school mode. The company announced today that it has enhanced its digital payment platform to make it easier for educational institutions and student recruitment agents to manage student data and track payments.
“Education agents play a very important role in the relationship between schools and their international students,” Flywire EVP of Education Sharon Butler explained. “Their ability to represent educational institutions locally can make a big difference in how a school is viewed by prospective students.” Butler added that the new enhancements will “streamline the international student recruitment process” and improve the way that agents are able to engage with students and institutions.
A worldwide payment provider for students and educational institutions, Flywire helps schools offer their students a secure and convenient payment process that accelerates the flow of funds, makes reconciliation simpler, and keeps operating costs low. The enhancements to Flywire’s platform will make recruitment agents’ jobs easier by centralizing student data and providing transparency over the payments process. Educational institutions will benefit from this payment transparency and tracking, as well, and are able to use the technology to build custom payment plans to give students more flexibility.
Flywire also announced today that it has forged a strategic partnership with China’s international education industry association, BOSSA. A non-profit, government-supported organization, the Beijing Overseas Study Service Association will get expanded access to Flywire’s cross-border services for Chinese students studying abroad. The partnership leverages Flywire’s extensive experience working with education recruitment agents in China; BOSSA has 300 such member agents who are responsible for recruiting and advising more than 60% of all Chinese students studying overseas each year.
“Flywire offers state-of-the-art technology and services for cross-border payments,” BOSSA spokesperson Jon Santangelo said. “We are pleased to endorse them to Chinese education agencies, and China’s wider international education sector as a whole. The level of integrity they’ve achieved in the higher education field is a big differentiator to Chinese agencies.”
Founded in 2009 as peerTransfer, Flywire has raised more than $263 million in funding from investors including Goldman Sachs, Temasek Holdings, and Bain Capital Ventures. Mike Massaro is CEO.
The round was led by Coatue, and featured participation from both Goldman Sachs and Mastercard. Canaan, B Capital, XYZ Ventures, and angel investors including former Morgan Stanley CEO John Mack were also involved in the round.
“The ongoing global pandemic and renewed focus on societal inequities make Bond’s mission of driving financial innovation and inclusion more important now than ever before,” Bond CEO and co-founder Roy Ng said in a statement. “Opportunity starts with access. We look to lead the industry in enabling banks and innovators across industries to level the playing field for consumers and small business.”
Bond offers banks a suite of developer-focused APIs and SDKs that remove friction from many of the critical processes involved in bank-brand partnerships, such as onboarding, technical integration, and product monitoring. Bond’s AI-enabled technology centralizes and streamlines these processes, and uses automation to provide oversight and ensure compliance.
“Today, more than ever, speed to market with a proven, reliable product is a competitive advantage,” explained Sherri Haymond, EVP, Digital Partnerships, Mastercard. “Bond provides an entirely new approach to help its fintech and bank partners deliver for the end user. We look forward to working with them as they move to this next stage.”
In a blog post discussing the announcement, Ng articulated the challenge facing smaller regional banks and community lenders when they try to forge partnerships with technology companies. He blamed a wide variety of factors – from compliance to operational constraints – for making it difficult for these partnerships to even “get off the ground.” This, Ng said, is where Bond comes in. “Rather than have every app and every bank recreate the wheel for each new partnership, Bond now does the hard work in the middle so banks and brands can each concentrate on what they do best,” he said.
New information has come out this week about Ant Group’s IPO plans.
Instead of listing on the tech-heavy (and U.S.-based) NASDAQ, Ant Group will list concurrently on Hong Kong’s Hang Seng and Shanghai’s Star Market. This comes after Ant’s parent company, Alibaba listed on the New York Stock exchange in 2014.
Analysts suspect that Ant’s listing plan is largely a response to rising geopolitical tensions between the U.S. and China. There are practical reasons, however, for Ant to list in Hong Kong and Shanghai. Hong Kong introduced weighted voting rights in 2018 and Shanghai’s Star Market offers more market-driven pricing than other domestic exchanges.
“The innovative measures implemented by the Shanghai Star Market and the stock exchange of Hong Kong have opened the door for global investors to access leading-edge technology companies from the most dynamic economies in the world,” said Ant’s executive chairman Eric Jing. “and for those companies to have access to the capital markets.”
Ant’s parent company Alibaba still holds the record for the second-largest IPO when it listed on the New York Stock Exchange in 2014 and raised $24 billion. It is too early for Ant to discuss size and timing of the share sales; analysts have valued the company in the range of $210 billion to $218 billion.
What are the challenges of launching a challenger bank in today’s environment? What do these neobanks offer that traditional banks do not? And what will the path forward look like for these newcomers in terms of disruption versus collaboration with both incumbent financial services companies, as well as fintechs?
We caught up with Renaud Laplanche, co-founder and CEO of Upgrade. The San Francisco, California-based neobank, which recently announced a major fundraising, was founded in 2016 and specializes in offering credit solutions rather than savings products to mainstream consumers.
We talked with Renaud about what makes Upgrade different from other challenger banks and what the company has in store for the second half of 2020. We also drew upon his experience as the founder and CEO of LendingClub to discuss the challenges of fintech innovation in times of crisis.
Finovate: Most founders would consider themselves lucky to be responsible for bringing one company to unicorn status. With Upgrade’s most recent fundraising, we can now say that you’ve brought two companies to this level. How big of a deal was the June investment for the company?
Renaud Laplanche: Thank you, David, that was a big deal indeed. Reaching a billion-dollar valuation in just three years was an amazing achievement from the team, but more importantly we secured the backing of a formidable ally with Santander Group, a top 10 global bank, leading the round. We have been growing at a triple-digit rate in the last 12 months, and recently hit $100 million revenue run rate, so we would certainly have commanded a higher valuation from a growth-stage VC fund, but the strategic value of Santander was key to us. We believe this is the first time a top 10 global bank backs a neobank, which is a very positive development for the fintech industry as a whole as it shows that the largest banks in the world see tremendous value in fintech product innovation.
Finovate: One of the aspects about Upgrade that has attracted special attention is the idea of being a neobank “with credit at its heart.” What does that mean and why pursue this route?
Laplanche: Credit represents 70% of banks’ revenue in the U.S. and globally, and obtaining credit is often the number one reason consumers seek a bank relationship to start with. So credit is an essential component of any bank, and particularly a neobank that doesn’t benefit from a branch network and must establish trust and loyalty through other means. A credit relationship achieves that very purpose.
Our ability to deliver a mobile banking experience offering payments and deposit capabilities coupled with loans and credit cards at scale makes us unique in the neobank space. Credit is difficult to scale because it requires billions of dollars of capital, which means either a very large balance sheet and a capital-intensive model that doesn’t generally fit with a fintech framework, or outsourcing that balance sheet to investors, which itself requires a long track record of credit performance. Building the underwriting and servicing infrastructure to handle billions of dollars of credit is also challenging.
We started offering credit products in 2017, and have built the necessary track record, underwriting and servicing infrastructure, delivered billions of dollars of credit to consumers and are now about to roll out our full mobile banking experience.
Finovate: What are the signature offerings from Upgrade? How many users are taking advantage of them and what kind of growth has the company experienced so far?
Laplanche: Our signature offering is Upgrade Card, a credit card that delivers the low cost and responsible credit of installment lending through millions of points of sale. Instead of turning charges into a never-ending revolving balance like traditional credit cards, Upgrade Card turns each monthly balance into an installment plan that consumers pay down in monthly equal installments over 1 to 5 years. This approach encourages the discipline of paying the balance down every month, and eventually lowers the cost of credit for consumers.
Since launching in 2017, we have delivered over $3 billion in credit through both cards and loans. We launched Upgrade Card in October of 2019 and already passed half a billion dollars in annual origination run rate. Even through the crisis over the last several months we continued to record 20%+ monthly growth.
Finovate: One of the investors in Upgrade said that they were excited to support the company in its “next stage of growth.” What does that next stage look like? What are the goals, for example, over the balance of 2020?
Laplanche: We are doubling down on the existing strategy and will be using the new capital to fuel the continued rapid growth of Upgrade Card and launch Upgrade Banking, a full suite of mobile banking products and services. Overall we expect to add approximately $2.5 billion in credit origination this year, and launch what we believe to be the most innovative mobile banking product for mainstream consumers.
Finovate: What has the impact of the global health crisis had on Upgrade – both in terms of your relationships with customers and partners, as well as how Upgrade itself may have had to adjust internally to adapt to the “New Normal”?
Laplanche: With many bank branches being closed over the last few months, a lot of consumers have turned to online banking. This was generally a small adjustment to the “millennial” population, but a much bigger adjustment to the generations that grew up in a world of in-person banking. The COVID-19 crisis accelerated the digitalization of financial services, and gave many consumers an opportunity to discover online banking and online credit for the first time. I believe the corresponding changes in consumer behavior are here to stay.
The crisis also caused us to re-prioritize some of our product development, including the introduction of a contactless version and a mobile-payment version of Upgrade Card in April of 2020, several months ahead of the planned release date. Both features have helped our customers avoid surface contacts during in-store checkouts.
Internally, we made the decision early on to allow all of our San Francisco and Montreal employees to work from home. Everyone has stepped up to the challenge and we’ve seen no loss of productivity as a result.
Finovate: You co-founded LendingClub shortly before the Great Financial Crisis and managed to steer the company through that challenge to great success. Some people have compared our current situation – with the COVID-19 pandemic and growing social unrest worldwide – to that previous crisis environment. From the point of view of someone who has led a fintech company through a major crisis, what advice do you have for fintech entrepreneurs in terms of dealing with this one?
Laplanche: There are similarities and differences between the two situations. The economic crisis caused by COVID-19 is a lot more severe in terms of job losses, and came in more abruptly than the 2008 financial crisis. But the financial health of the U.S. consumer, the banking system and the overall economy immediately prior to the crisis was a lot better than in 2008. The monetary and fiscal policy response has also been stronger, and so far more effective this time around. It is still hard to know the exact economic and social impact of the pandemic, as so much is still in play.
That being said, some parts of the 2008 playbook remain relevant: cut costs early, conserve cash, raise more cash if you can, and always assume the downturn will be longer and more painful than initial estimates would have you believe. A prudent approach is generally rewarded in the early phase of a downturn. There will likely be opportunities toward the end of the downturn and early phases of the recovery, but these opportunities will only be available to those who weathered the storm in the first place.
A number of Finovate alums made international fintech headlines this week. Open banking specialists were particularly active, with Canada’s Salt Edge inking partnerships with fintechs in Ireland, and Sweden’s Tink announcing an acquisition of credit decision solution provider, Instantor.
“We will be able to get a full suite of bank data for any regulated lender in this country within seconds, meaning loan applications can be assessed quicker,” Karl Deeter, founder of OnlineApplication said of the partnership with Salt Edge. “In the Irish market that’s a new proposition.”
Tink’s acquisition of Instantor is only the latest news from a company that has spent much of the year forging strategic partnerships, securing multi-million euro investments, and … acquiring companies. Before Tink’s announced purchase of the Stockholm, Sweden-based credit decisions solution provider this week, the company had pulled out the checkbook to buy fellow Finovate alum Eurobits Technologies.
With regards to its Instantor purchase, Tink sees the company helping it to offer intelligent data-services based on open banking. Instantor supports five million credit decisions a year and reported annual revenues of $4.5 million (€4 million) in 2019.
“This move will help Tink expand their product offering and is unique opportunity to continue to make significant investments in our portfolio of credit decision solutions,” Instantor CEO Simon Edström said. “Together with Tink we will create an even stronger European market leader in open banking.”
Here is our weekly look at fintech around the world.
Middle East and Northern Africa
Is Qatar the next big fintech hub for companies looking to expand to India, Pakistan, and Bangladesh? MENA FN investigates.
Lean, a financial API platform based in Riyadh, Saudi Arabia, raises $3.5 million in seed funding.
UAE-based cross-border fintech marketplace Fintech Galaxy unveils its open innovation platform.
Central and Southern Asia
Payment solutions company PayU announces partnerships with a pair of e-commerce platforms: Shiprocket Social and Quick eSelling.
Is Qatar the next big fintech hub for companies looking to expand to India, Pakistan, and Bangladesh? MENA FN investigates.
Pakistan Observer looks at how fintech help support innovation in the Islamic finance sector.
Latin America and the Caribbean
JP Morgan buys stake in Brazilian digital banking fintech FitBank.
“Loans for phones” consumer financing company Finnu raises $800,000 in pre-seed funding to help bring credit options to the underbanked of Mexico and Latin America.
Contexto looks at the state of the challenger bank movement in Brazil.
Asia-Pacific
PayMaya and Bonds.Ph are working together to drive financial inclusion in the retail investment market in the Philippines.
A feature at the World Economic Forum website discusses the role of fintech in helping small businesses in Southeast Asia recover from the global pandemic.
Vietnamese digital real estate investment platform RealStake secures seed funding from 500 Startups, as well as angel investors.
Sub-Saharan Africa
A partnership between Crown Agents Bank and Paycode of South Africa will help promote financial inclusion in sub-Saharan Africa.
Zazu, a fintech based in Zambia, teams up with global payments company Tutuka to launch its Mastercard-issued virtual card.
Techpoint Africa profiles Capetown, South Africa-based remittance specialist, Mukuru.
Central and Eastern Europe
German digital banking solution provider CoCoNet launches new business unit.
Mastercard takes its partnership with Verestro to the next level with an announcement that the card company has become an investor in the Polish payment solutions provider.
Wall Street Journal looks at the Wirecard warning signals missed by German regulators.
IDology on the challenge of faster, safer, easier cybersecurity – When it comes to using digital services, consumers are increasingly concerned about fraud, but still tend to underestimate the severity of cybercrime more broadly. Consumers are also more likely to abandon online account set-up than they have been in recent years. And while they rate security above both ease-of-use and speed when it comes to the onboarding experience, any friction in the security process can be costly.
These are some of the takeaways from the just-released report from real-time identity verification company IDology. The company’s Third Annual Consumer Digital Identity Survey takes a look at consumer attitudes toward cybersecurity, the willingness of consumers to work with companies that have suffered a cyberattack or data breach, and the ability of consumers – and fintech innovators – to balance between security and seamlessness.
“So while consumers overwhelmingly demand security,” the report noted, “there’s only so much friction they are willing to endure to receive it.”
Other insights from the survey, conducted between February 25 and March 7 of this year and including 1,499 online respondents, underscored the fact that consumers increasingly see their mobile devices as both a “component” of their identity as well as a tool for facilitating digital interactions. The report concluded that identity verification “can serve as a strategic differentiator” for organizations competing in the digital environment.
PayPal Letter Confirms Company’s Interest in Crypto – News that PayPal has been developing cryptocurrency capabilities, including reports that PayPal and Venmo would soon enable their users to buy and sell cryptocurrencies directly, have been a welcome sign for innovators in the digital asset space. PayPal’s initiative was revealed in a letter the company sent to the European Commission in June, which expressed PayPal’s views on a “regulatory framework for blockchain, distributed ledger technology, and crypto-assets”.
Interestingly, PayPal emphasized the capacity of cryptocurrencies to play a positive role in improving financial services for underserved communities. “Of particular interest for us is how these technologies and crypto-assets can be utilized to achieve greater financial inclusion and help reduce/eliminate some of the pain points that exist today in financial services,” the letter read.
Here is the latest news from our Finovate alums.
Salt Edgepartners with Irish fintech OnlineApplication to help the company improve its mortgage application process.
Educational Systems Federal Credit Union to deploy digital banking technology from Finastra.
Revolutlaunches Open Banking features for its customers in France.
Open banking platform Tinkacquires credit decision solution provider Instantor.
Data security specialist ALTRlaunchesStackable Margins program in bid to broaden its channel community and add new partners.
Sitehands reports that its current President and Chief Operating Officer Chris Corrado will become the company’s next Chief Executive Officer.
Lendionamed one of the 2020 Best Places to Work in New York by Work and Fortune. The company also announced a strategic partnership with Web.com.
Altamaha Bank of Georgia partners with Ondot Systems to bring the company’s card management app to its debit cardholders.
Orion Advisor Solutionsmerges with investment management company Brinker Capital.
Fenergowins the Breadth of Functionality category at the xCelent Awards 2020.
Finance and Commerce profiles automated account switching specialist, ClickSWITCH.
Stockhead featuresIdentitii in its look at Australian fintechs that are embracing collaboration rather than disruption.
Biometric Update looks atIlluma Labs and how credit unions are adopting its voice biometric authentication technology.
The two discussed Marous’ latest research on the changing face of work in banking and financial services in the age of COVID-19. Here are a few excerpts from their conversation.
On the future of work-from-home (WFM) and working remotely in financial services
What we would found was that a lot of jobs worked almost as well if not as well from a work-at-home or work remotely environment as they did at the business place. One of the biggest examples were call centers. A lot of call centers, when they went remote, found out there wasn’t really a dramatic negative impact. In fact, from a quality of life basis, there actually was a better impact from the standpoint of employee happiness, awareness, and the ability to actually get the job done.
On the ability of new video and audio technologies to transform the way bankers work with small businesses
Let’s say you’re a small business banker. You can do a better collaborative call by not being in-person. (Instead) bring in three or four other specialists from the small business world into a (video) call to serve the client. An innovation example from Deniz Bank in Turkey was that for their agricultural division they found that their business bankers spent a lot of time traveling from farm to farm. But when they did it centrally (with video conferencing), they were able to bring in meteorologists, fertilizer people, equipment people, people that dealt with crop rotations and different elements that brought value to the farmer …
On overcoming the skills gap that can accompany rapid adoption of new technologies
Organizations and governments are going to be required … to help up-skill employees to be ready for the future. The challenge is going to be that employees and companies can’t wait for this to happen. Organizations right now need to find the people to fill those skill areas. Amazon, I believe, has committed to training 100,000 of (its) employees in moving to the digital world in their organization. They’re going to train their own employees because they realize it’s going to be easier to train them than it is to find them in the outside marketplace. But that’s not going to be enough. Employers and organizations are really going to have to encourage people to do this training on their own.
Check out the rest of the conversation. Join Jim and Greg on Episode 55 of the Finovate Podcast.
Whether you believe our climbing stock markets around the world are a result of massive, coronavirus-fighting monetary and fiscal stimulus, or merely Millennials easing into their family formation years, there’s no doubting the demand for solutions that help investors maximize the opportunities of advancing markets.
This makes the news that Barclays has launched a new digital wealth management service – Barclays Plan and Invest – all the more timely. It also makes the fact that they’ve partnered with Finovate alum Scalable Capital to launch the new service all the more interesting.
“Over the last few months, we’ve seen a rise in the number of people wanting to invest for the first time and it feels more important than ever that we give people the right tools and advice to plan for their financial future,” Dirk Klee, CEO of Wealth Management and Investments at Barclays explained.
“We launched Plan & Invest after listening to our customers, who said they wanted an investment service that gave them the convenience and affordability of robo-advice, but with more of the personalization of Wealth Management.”
Barclays will pilot the new roboadvisory service with current account customers that have at least £5,000 to invest. The solution will be accessible via Online Banking, and features dedicated customer support via telephone. Barclays said that it will add to the service over the balance of the year, including adding it to the Barclays app this summer.
Customers will be able to set up their own personalized investment plans using Barclays Plan & Invest for free. They will be charged an annual fee of between 1.39% and 1.59% once accounts are established and funded; the actual amount of the annual fee is based on the value of the customer’s investments, and is divided between service and product costs.
Founded in 2014 and making its Finovate debut two years later at FinovateEurope, Scalable Capital specializes in leveraging technology to make sophisticated investment management accessible to the average investor. Headquartered in Munich, Germany, and in London, U.K., the company offers investors access to globally diversified, cost-efficient, ETF portfolios based on their individual risk preferences and investment goals.
Among the largest roboadvisors in Europe, Scalable Capital serves more than 60,000 customers and manages more than £2 billion for its clients. The company has raised €66 million in funding, and includes BlackRock, HV Holtzbrinck Ventures, and Monk’s Hill Ventures, among its investors.
