This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.
Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
As part of our Finovate FinTech Halftime Review, Finovate Analyst David Penn sat down with João Lima Pinto, Chairman of ITSCREDIT. With nearly 20 years of solid experience in the financial sector, actively participating in the design and implementation of innovative omnichannel and credit solutions, Pinto has garnered much success by leading a variety of business development, product and project management, business analysis, and product operations functions.
Among the topics discussed include ITSCREDIT’S Genie Advisor app, how the company has seen the COVID-19 crisis impact its customer base, and its plan to address the challenges and move forward in 2020.
The international fintech community received an unexpected jolt on Friday on news that the CEO of Wirecard, Markus Braun, was stepping down. Braun’s resignation comes amid reports that the German digital financial platform he has led since 2002 cannot account for $2.1 billion in cash, and a delay in the release of its 2019 financial report. Reuters reported that the company admits it could be have been “the victim of fraud of considerable proportions.”
Up until recently Wirecard appeared poised for success as a leading European payment processor for both consumers and businesses. The company reported revenues of $2.2 billion in 2018 and, by the fall of that year, had reached a valuation of $26.9 billion.
But suspicious of the company deepened early last year. A Financial Times report in January alleging suspicious financial activity in Singapore, and the announcement of an official investigation by Singapore authorities a month later, tarnished Wirecard’s image despite the company’s denials. This was followed by claims of further questionable financial activity – this time in Ireland – in October.
In this week’s news, auditors at EY, formerly known as Ernst & Young, were not able to locate cash at two Asian banks – Bank of the Philippine Islands and BDO Unibank – where Wirecard said $2 billion had been deposited. Both banks have denied having a business relationship with Wirecard. Moreover, documents indicating that such a relationship did exist, according to BDO, were falsified and bore forged signatures.
In a statement, Wirecard announced that James Freis, who was recently appointed to the company’s management board, will serve as interim CEO. the Federal Financial Supervisory Authority, known as BaFin, is investigating.
Here is our weekly look at fintech around the world.
Latin America and the Caribbean
Brazil-based SME lender BizCapital raises $12 million in Series B funding to support development of new products.
Banco Sabadell partners with IBM to enhances its digital banking operations in Mexico.
Banco Safra, based in Brazil, to deployACI Worldwide’sUP Retail Payments solution and UP Framework.
Asia-Pacific
Vietnam Plus reports surge in contactless payments in Vietnam.
Crowdfund Insider investigates the rise of Sharia fintech in Indonesia.
Malaysian fintech Curlec, which helps businesses manage recurring payments and cash flow, secures investment from 500 Startups.
Sub-Saharan Africa
South African open banking startup – and FinovateAfrica alum – truIDannounces seed funding.
Nigeria’s Chipper Cash secures $13.8 million in Series A funding.
WapiPay, a fintech based in Kenya and Singapore that provides platform-to-platform integration for virtual and global accounts, raises seed funding via accelerator network FutureHub.
Central and Eastern Europe
Estonia’s Planet42 announces $2.4 million seed round led by Change Ventures. The company helps facilitate automobile access for the underbanked in South Africa.
Russia’s Tinkoffteams up with online marketplace goods.ru.
Bokuacquires Estonia-based mobile payments company Fortumo in deal valued at $45 million.
Middle East and Northern Africa
UAE-based Buy Now Pay Later e-commerce company Postpay introduces a trio of new installment payment options.
The Fintech Times takes a look at the state of the fintech and financial services industry in Lebanon.
Tpay Mobile, based in Dubai, acquires Turkish payments company Payguru.
Central and Southern Asia
Cryptocurrency exchange Binance joins the Indian Tech Association.
Kaspi, an e-commerce banking app based in Kazakhstan, to expand to Azerbaijan and other neighboring countries.
India Infoline launches #IIFLDisrupt, an initiative to help early-stage Indian fintechs during the COVID-19 crisis.
India-based Buy Now Pay Later company Tabby raises $7 million in funding to support expansion into Saudi Arabia.
Six companies that have demonstrated their fintech innovations on the Finovate stage have been recognized this year by CNBC as part of their Disruptor 50 roster for 2020.
This year’s list, the eighth in the series, is marked by the high number of billion-dollar companies, or “unicorns.” Fully 36 of the firms in the 2020 CNBC Disruptor 50 have reached or surpassed the $1 billion valuation mark. Combined, the 50 companies have raised more than $74 billion in VC funding and achieved an implied market valuation of almost $277 billion.
The companies making the cut range in industry from cybersecurity and healthcare IT to education and, of course, fintech. In fact, the top-ranked company in the 2020 Disruptor 50 is none other than Stripe, the $36 billion payments platform founded in 2010. Stripe earned a #13 ranking in last year’s Disruptor 50 roster, and likely owes its first place appearance this year to a major $600 million funding raising – the company’s largest to date – and the economic and social consequences of the global health crisis.
“With many people throughout the world under lockdown to prevent the spread of Covid-19,” CNBC’s capsule on the company noted, “the move to shopping online has never been greater. That’s good news for digital payments platform Stripe.”
Stripe was not the only fintech to earn high marks from the 2020 Disruptor 50’s methodology. In addition to the half dozen Finovate alums below, some of the other fintechs on this year’s roster include:
Virtual bank WeLab (Hong Kong)
Digital mortgage company Better.com (New York City)
“Buy now pay later” e-commerce company Affirm (San Francisco, California)
Challenger bank Chime (San Francisco, California)
Banking app Dave (Los Angeles, California)
Microfinancier TALA (Santa Monica, California)
Trading and investing platform Robinhood (Menlo Park, California)
Also earning spots in this year’s list were a pair of insurtech companies, Lemonade and Root Insurance, as well as cybersecurity and biometric authentication firms SentinelOne and CLEAR, respectively.
Here’s a look at the Finovate alums that made this year’s list.
The following is a guest post by Natalie Myshkina, Strategic Business Development, FSI at Adobe.
Like many industries and businesses right now, financial organizations in banking are finalizing and implementing business continuity/contingency plans as well as enabling all employees to work from home. At the same time, they are diligently working to meet changing client needs and building new ways to serve clients. Beyond the operational actions underway, banks and capital markets need to start developing medium- and longer-term plans to address each element of financial, risk, and regulatory compliance, and create new environments to support the business in fully digital settings.
In late 2019, an Arizent survey commissioned by the Credit Union Journal and American Banker reported that only 30 percent of organizations have a digital first, enterprise-wide strategy and readiness. Other organizations are still in the middle or beginning of the digital transformation of their businesses.
While most organizations have business continuity plans, they have been heavily tested over the last few weeks. I’d like to highlight a few operational steps that are essential to consider now for banks:
Transparency and trust Continue to adjust a communication plan to quickly liaise with employees, customers, business partners, regulators, investors, and vendors. Keeping close communications with customers and other stakeholders creates the opportunity to strengthen the relationship.
Operating model Implement a dynamic, scalable, and flexible operating model to ensure business continuity in any scenario. For example, in the case of temporary closures, branches need to quickly train branch employees to provide online help or assist the call center in serving clients.
Remote services and capabilities Many enterprise organizations have an extensive set of workflow tools, document management tools, document collaboration, and electronic signature solutions in place, but they are not fully utilized. For example, one department in the organization may fully embrace digital documents and electronic signatures, while another department keeps receiving and sending snail mail. The solution here would be to review best practices and tools across the organization, understand the full capabilities of available solutions, and offer them to unit managers to utilize as immediate solutions.
Digital project prioritization Conduct project prioritization exercises, and speed up projects related to offering digital products and services (client onboarding, product enrollment, etc.) or operational inefficiencies. If possible, speed up time-to-market or release solutions with limited/partial functionality or limited integration points.
Organizational culture Communicating and fostering the culture that maintains employee morale is becoming extremely important, and it can be done in different forms: through top-down communication and leaders acting as role models, by encouraging grassroots initiatives, by providing platforms for team collaboration, creating virtual watercoolers, etc.
Peer communications Be in close contact with industry groups for information to get best practices and requests to obtain waivers from regulators if required.
The coronavirus pandemic is already leading to major changes in how customers manage their finances and how financial organizations support their customers. Next we would be seeing activities related to meeting changing client needs due to financial stress, supporting client activities in digital channels, rapid digitalization in commercial and corporate banking, and more.
Here are a few notable areas financial organizations should address:
Proactively address new customer needs To operate in the new environment, banks would need to rapidly meet different client needs and serve them in ways outside the norm. Scalable solutions to process and approve requests for forbearance, mortgage holidays, deferred loan repayments, etc. would need to be implemented quickly as well as quickly scale up the Paycheck Protection Program (PPP) via the SBA program.
Branchless banking and self-service options in digital channel Due to the temporary closing of branches and reduced ATM availability and usage, the branchless banking or virtual branches idea is becoming more popular. As many interactions move online, expect to see more and more consumers want to use self-service tools on the web and in their mobile devices.
Rapid digitalization and digital service accessibility across all customer lifecycles stages For many organizations, their digital transformations began with onboarding new clients. But often we see that many other client touchpoints in the customer lifecycle are not fully digitized, and some require manual/paper steps. In the new environment, most of the client-initiated activities would be done on digital platforms. Automation is essential to provide clients with fast service and a consistent experience while keeping cost-effective operating model in place.
Expending successful digitalization of customer touchpoints beyond retail banking Over the last few years, we have seen substantial efforts and budgets spent on elevating customer experiences and moving clients to digital platforms. This has been done for many reasons, one of them was a demand from a digitally native consumer to have a better experience and the competition coming from neobanks (aka digital-only banks).
Commercial and corporate banks were behind this trend partially because the lack of these drivers and the complexity of the processes. In the new reality, we would be seeing a lot of rapid digitalization of customer-facing and internal activities in commercial/corporate banking and capital markets.
Data use, extraction and manipulation Going forward, the ability to extract and process data from multiple documents will be essential to manage risks and to create cost-conscious processes. Immediately, we could see requests for solutions to process documents to feed systems assessing portfolio health in stressed markets, or complete search thought legal documents.
Adaption of cloud solutions As financial services organizations have been behind the curve in the cloud solution adaption, this situation will trigger a revisit of internal policies and expedite further cloud adoption for both client-facing and internal solutions to improve efficiencies, eliminating the need for a larger security and maintenance staff, and creating cost-effective, scalable environments.
During these trying times, banks can best serve their clients by delivering products and services for business continuity today while working on business resilience for the future. Industry experts predict that the current situation will accelerate the digital transformation in the industry over the a short period of time. That time starts now.
In a round led by Santander InnoVentures, Upgrade, the San Francisco, California-based neobank co-launched by LendingClub founder Renaud Laplanche, has raised $40 million in new funding. The Series D round takes the company’s total funding to $202 million, and gives the neobank a valuation of $1 billion.
“We are thrilled to welcome Santander InnoVentures as a new shareholder,” said Laplanche, who is Upgrade’s CEO. “Our strategy of partnering with banks and credit unions of all sizes is delivering tremendous value to our partners and customers, and we are delighted to add one of the world’s largest banks to our partner roster.”
Also participating in the Series D were new investors Ventura Capital and Uncorrelated Ventures, as well as existing investors Union Square Ventures, Ribbit, Vy Capital, and Silicon Valley Bank.
Opening its doors in 2017, Upgrade specializes in providing financing for mainstream consumers via its card and personal loan products. The company, which also provides free credit monitoring and financial education tools, has provided more than $3 billion in consumer credit via its solutions. More than ten million consumers have applied for either the company’s Upgrade card or loan.
“We’re excited to support Upgrade in their next stage of growth,” senior advisor at Santander InnoVentures Chris Gottschalk said. “Upgrade is building a neobank with credit at its heart, which we believe is a smart strategy as credit represents 70% of banking revenue globally and is often the main reason customers seek banking services.”
In addition to helping drive growth at the company, the funding will support the upcoming launch of a new mobile banking product, the Upgrade Account. Named “Best Place to Work in the Bay Area” by the San Francisco Business Times and Silicon Valley Business Journal for three years in a row, Upgrade launched its first contactless-enabled Upgrade Card – as well as a digital form of the card facilitate mobile payments via Apple Pay and Google Pay – in April.
Upgrade’s personal credit lines and personal loans are issued by partner Cross River Bank. The firm’s Upgrade Card is issued by Sutton Bank, via a license from Visa.
With a growing consciousness worldwide on the topic of systemic racism, corporations are doing everything from pro-diversity affirmations (arguably not enough) to mass board resignations (arguably far too much) in order to stay (or get) on the right side of public opinion on a key issue for many of their customers.
We took a look at some of the ways those fighting in favor of a more inclusive financial services and fintech sector can learn from the successes of the women’s movement a few days ago. Here, we offer a few more specific examples of not just what financial institutions can do to help promote ethnic diversity in their companies, but also what financial institutions and fintechs are actually doing.
Celebrate Diversity
With Juneteenth taking place this Friday, some financial institutions have decided to treat the date – which marks the moment African slaves in Texas in 1865 learned of the Emancipation Proclamation – as the official occasion many African Americans have always believed it to be. Fifth Third Bancorp and Truist Financial are among a number of companies that have elected to recognize Juneteenth as a holiday for their employees and customers.
“As we consider the tremendous significance of this day and what it represents, it also reminds us of how far we still must go to have equality and inclusion for all,” Greg D. Carmichael, chairman, president and CEO of Fifth Third Bancorp said earlier this week. “As we observe Juneteeth, each of us should pause, reflect, and contemplate its significance and what it meant 155 years ago, what it means today, and how we might take action to make tomorrow better for everyone.”
Fifth Third will close its offices early on Friday, shutting down at 2pm local time. And while a number of other major financial institutions have made similar commemorations, Fifth Third is believed to be the first FI to offer its employees Juneteenth as a paid holiday.
Show the Money
The $40 million Netflix CEO Reed Hastings and his wife Patty Quillin have announced they will donate to the United Negro College Fund, and a pair of historically black colleges Spelman and Morehouse, is an example of the kind of “put your money where your mouth is” act that many pro-diversity advocates have called for.
Some of the biggest financial services companies and banks in the United States have unveiled similar initiatives. Citi, for example, announced that it will direct $8 million to the NAACP Legal Defense Fund, the Lawyers’ Committee for Civil Rights, the National Urban League, and the National Fair Housing Alliance.
Also pulling out the checkbook in the name of diversity are firms like Bank of America, which announced a $1 billion/four year commitment to help local communities of color at a time when the COVID-19 crisis is making a disproportionate impact on black and brown Americans.
“Underlying economic and social disparities that exist have accelerated and intensified during the global pandemic,” Bank of America CEO Brian Moynihan said earlier this month when the initiative was announced. “The events of the past week have created a sense of true urgency that has arisen across our nation, particularly in view of the racial injustices we have seen in the communities where we work and live. We all need to do more.”
People Who Need People
Honoring the past is important. And putting real resources to work to make opportunities possible for historically excluded groups is a critical component in achieving a more inclusive world. But, without putting too fine a point to it, the best way to promote diversity is to hire more diverse people.
Analysts looking at the barriers to increasing diversity have cited three chief hurdles: (1) finding diverse candidates to interview, (2) retaining diverse employees, and (3) getting diverse candidates past interview stage. And while the second two issues have a lot to do with the culture of a company, something that may not substantially improve until after diversity and inclusivity gains are made, the first challenge – finding good candidates – is one all companies and organizations should pledge to overcome.
For many companies, this may mean looking in typically overlooked places for otherwise untapped talent. Student organizations, including a very active African American collegiate and post-collegiate fraternity and sorority system, can be a an excellent way to reach today many of the people who will be leaders in their communities tomorrow. Diversity-oriented venture capital firms – such as Harlem Capital Partners, the Black Angel Tech Fund, and Base Ventures – are excellent sources for insight into black and brown entrepreneurship in the technology sector.
As Chamath Palihaptiya, venture capitalist and founder of Social Capital, wrote almost five years ago:
We need to recapture our potential and open the doors. Invite more people into the decision making: young people, Blacks, Latinos, females, LGBT and others who aren’t necessarily part of the obvious majority. Surround ourselves with a more diverse set of experiences and maybe we will prioritize a more diverse set of things. Maybe we will find more courage to do the hard things.
Half a decade later, many of us in the technology community in general and the fintech world in specific are still waiting. But it appears increasingly the case that, for now, our communities are ready to act.
Blockchain payment solutions company Rippleannounced this week it has signed Banco Rendimento to RippleNet Cloud. The addition of the Brazil-based bank marks the first bank to leverage Ripple’s cloud-based solution.
This news comes a year-and-a-half after Banco Rendimento joined RippleNet in 2019. “Migrating our payment infrastructure to RippleNet Cloud allows us to provide our customers with a best-in-class experience,” said Banco Rendimento FX Superintendent Jacques Zylbergeld. “Customers can now enjoy more transparency and easier navigation for both submitting payments and trading. RippleNet also allows us access to global partners, offering a standardized solution, and ensuring the integration and onboarding processes are seamless.”
Banco Rendimento considers itself a pioneer in the international payments space and is working to grow the payments ecosystem with high quality, fair cost solutions. With the implementation of RippleNet Cloud, the bank expects it will increase payment volumes by the first quarter of next year.
RippleNet is Ripple’s global payment network that connects 300+ financial institutions worldwide to enable faster, lower-cost payments. Currently, two dozen non-bank financial services companies, including Azimo, MoneyMatch, iRemit, Usend / Pontual, MoneyGram, and Viamericas, are clients of Ripple’s cloud service. And the customer list is increasing. Ripple reported that in the first quarter of this year, 81% of new RippleNet customers opted for cloud deployment and and 30% of all RippleNet payments are now being sent and/or received through RippleNet Cloud.
Earlier this year, Ripple announced that Azimo, in partnership with Thailand’s Siam Commercial bank (SCB), began leveraging RippleNet to launch instant cross-border payments from Europe to Thailand.
Ripple has offices in San Francisco, Washington D.C., New York, London, Mumbai, Singapore, São Paulo, Reykjavik and Dubai, and counts more than 300 customers around the world. The company’s payments network operates in 45+ countries across six continents. Ripple was founded in 2012 and has since amassed $294 million across 13 rounds of funding. Chris Larsen is founder and CEO.
Expense management platform Expensifylaunched its latest solution today. The offering, Concierge Travel, is a virtual travel assistant that makes it easier for travelers to build their itineraries and plan their excursions in the COVID-19 era.
“While most of us are avoiding travel right now, there are still essential workers whose trips can’t be cancelled or postponed,” Expensify CEO and founder David Barrett explained. “We want to help them travel in the safest possible way.”
Concierge Travel is available to Expensify cardholders and can be used to book flights, make hotel reservations, reserve rental cars and more – free of charge. All bookings via Concierge Travel also feature complimentary safety alerts and travel risk advisories from Global Rescue. The free Global Rescue membership offers a range of services for travelers including transportation to the cardholder’s hospital of choice in an emergency, as well as health and security assessments and entry and exit requirements for international travelers.
“With Concierge Travel, your free Global Rescue membership provides world-class safety and medical services,” Barrett added. “On top of that, Concierge lets you know about any COVID-related travel restrictions in advance, including specific stay-at-home orders in place, social distancing measures, and other info on the city you’re visiting.”
A Finovate alum since 2009, Expensify demonstrated the technology behind its expense management platform at our developers conference, FinDEVr Silicon Valley, in 2016. The company introduced its corporate card last fall, offering spending controls and expense management in a single solution that in some ways harkens back to the firm’s origins more than a decade ago.
“Expensify started as a corporate card way back in 2008 before we decided to focus on expense,” Barrett said when the card was launched, “so it’s fun to see the product come full circle with a card that naturally extends our existing platform.”
Founded in 2008 and headquartered in San Francisco, California, Expensify has raised $38.2 million in funding according to Crunchbase. The company includes Redpoint Ventures, OpenView, PJC, and Canadian Imperial Bank of Commerce (CIBC) among its investors.
Some of the biggest disruptions in financial services are coming from some of the least likely places. The challenger bank revolution, for one, is bringing new levels of competition to “old” finance.
The rise of challenger banks will be one of chief topics of our upcoming, all-digital FinovateAsia event next month. Helping drive that conversation will be Araminta Robertson of Mint Studios, a speaker, podcaster, and fintech writer who will moderate our Challenger Bank Power Panel on July 6th.
By way of introduction, we’ve invited Ms. Robertson to address another disruptive elephant in the financial services room: the rise of financial services offerings from popular technology companies with deep pockets and powerful brands.
Everyone working in the financial sector held their breath when Apple announced it was releasing a credit card.
Araminta Robertson
People have been discussing for years when the Big Tech companies will enter the world of financial service. In 2019, it became true. Apple released a credit card in the U.S. that allows you to sign up through your phone, connects with all your Apple devices and offers 2% cashback on transactions. Customers can immediately start using their Apple Card and even use the balance to send money to friends and family members. On top of that, customers can track all their spending on their phone and aren’t charged any late fees, international fees or general accounts fees.
How fintechs can compete with Apple
Fintechs, specifically challenger banks, are going to have to find new ways to up their game. Although some may not need to compete directly with Apple just yet (the Apple Card is only available in the U.S.), fintechs should start looking at strategies that will prepare them for a much more ambitious market. This is because Apple will soon be setting the bar for the industry, and customers will be expecting the same level of privacy, customer experience and quality of features as they get with Big Tech products. Here are a few approaches fintechs can consider in order to stand out.
Take branding seriously
To start with, it’s unlikely people will buy an Apple phone just to use the Apple card. This means that the Apple card will be primarily be used by iPhone and Apple fans. The good news is there is a large segment of the population that does not use Apple products and services or iPhones – and many who don’t want to be associated with the brand or would never trust Apple with their money.
This means that fintechs still have a chance to create their own brand, community, and customer base and should, therefore, take branding seriously.
Not only can fintechs use branding to stand out more, but with the appropriate licenses, they can offer other financial features that a Big Tech cannot. The Apple card does not allow users to invest in the stock market, buy cryptocurrencies, or perform bank-related actions. This is because Apple does not have a banking license, and will likely never hold one: becoming a bank is expensive, cumbersome, and not very profitable for a Big Tech.
Ted Rossman from CreditCards.com says so himself: he thinks people will only sign up to the Apple card because they love Apple. At the moment, they don’t offer any features that you can’t find somewhere else. Although they may offer unique features in the future, fintechs can still use this opportunity to position themselves as a trustworthy banking solution that is 100% devoted to managing people’s money securely. Apple does not have the flexibility to adjust its branding to a more banking-friendly image.
Focus on the underserved
The issue with Apple and the Apple Card is that it excludes a large section of the population. In fact, Apple as a brand does not work well with “financial inclusion”; if their phone costs $500, they can hardly say they are proponents of financial inclusion.
This is an important point because many challenger banks and fintechs have financial inclusion and literacy as a core principle, and are focusing on helping the underserved – it’s what drives them to create accessible products, offer lower fees and build a community around financial education. Those fintechs that are consumer-focused and take financial inclusion seriously can use this as a competitive advantage to build a brand that takes into account the underbanked.
Apple will not become a brand that provides for the underserved anytime soon, so that’s a market that will always be open for fintechs.
Encourage localization
As mentioned above, Apple will raise the bar and set the standard worldwide. However, it also means that their products and features are more generalized and meet a broader spectrum of audiences.
This is where fintechs in different countries can gain a competitive advantage by partnering up with local businesses, offering location-specific services, and building a brand that is more regional. Spanish citizens will likely appreciate a neobank that partners with the local food delivery apps, offers a unique Spanish bank card, and a specific Spanish saving product. In addition, local fintechs may be able to take advantage of country-specific regulations that may favor local companies rather than international conglomerates.
Although Apple will be able to localize the more it grows, it will only be able to do so to a certain extent. In many cases, we may find that locals would rather use a product that serves them extremely well in their own country rather than one that works pretty well in several countries. Having said that, Apple aggregates tons of data every year and there is no telling what kind of features may attract locals as well.
Although Apple is one of the most innovative and forward-thinking Big Tech companies in the world, local fintechs still have a chance to build their own brand and community. If anything, this may propel fintechs to up their game and keep adapting their products to customer demand.
Araminta Robertson is a writer and content strategist at Mint Studios. She helps fintech companies from all around the world use content marketing to create a community, build trust, and acquire quality customers. She has worked with some of the fastest growing fintech startups in SE Asia and London, U.K., and regularly speaks at conferences and events.
Facial recognition may be the hottest form of biometric authentication. But it’s far from the only – or even the most effective – biometric authentication method for all instances. In fact, as far as Redrock Biometrics is concerned, a superior alternative may lie in the palm of your hand.
“The PalmID solution far outperforms competitive touchless technologies, such as facial recognition, in terms of accuracy and reliability,” Redrock Biometrics co-founder Hua Yang said in a statement announcing the company’s latest partnership a few weeks ago. “It is the best available solution for touchless identity management, authentication and security.”
Founded in 2015 and headquartered in San Francisco, California, Redrock Biometrics is the developer of PalmID, a palm-scanning authentication solution that provides accurate, robust, no-additional-hardware-required biometric authentication via camera-bearing devices – ranging from smartphone, tablets, and laptops, to payment terminals (including ATMs), IOT devices, and even cars.
And at a time of social distancing and a preference for as much contact-free activity as possible, authentication technologies like PalmID are likely to be seen as increasingly attractive options. Add to this the challenge of face-based authentication in a world of mask-wearing employees and consumers, and the case for palm-based authentication becomes all the more compelling.
Identity management solution provider Q5id is the latest company to deploy Redrock Biometrics’ technology. Q5id, based in Beaverton, Oregon, announced last month that it would integrate PalmID into its biometric enrollment and authentication solutions. Q5id works with institutions in multiple verticals, including financial services, telecommunications, education, and e-commerce, to provide identity verification services via multi-factor authentication, live video, and active voice authentication. The fact that palm-scanning technologies are particularly hard to fool, according to Q5id chairman and CEO Steve Larson, is one of the reasons why the company partnered with Redrock. The solution’s high accuracy rate – and lack of a hardware requirement (compared to fingerprint scanners, for example) were additional selling points for the technology.
Redrock Biometrics’ PalmID works with both standard RGB and infrared cameras. The company notes that from a distance of approximately six inches, the average smartphone, laptop, or ATM camera can capture a good quality image of the unique skin patterns of the users palm. The captured image then undergoes a two-step process. First, the PalmID Capture Module uses machine learning technology to convert the RGB video input stream into a palm image that is ready for authentication. Second, the PalmID Matching Module, in real-time, matches the captured image against stored references. The technology uses proprietary algorithms to test images against large databases of palm images to prevent false positives.
PalmID has also been deployed recently to help provide an identity verification solution for mass transit and payments. The company partnered with FalconPro Technology in May, adding its PalmID software to a FalconPro camera module to create a simultaneous palm print and palm vein image capture. The goal is to create a large-scale authentication solution; pilot projects using the technology will be conducted in both the payments and public transit industries, according to FalconPro Technology CEO Xun You. FalconPro is a founding member of the Chinese Automatic Fare Collection System Association, and provides QR-code based digital ticketing systems for rail systems throughout China. The company sees its partnership with Redrock as potentially enabling it to “expand (its) product offering beyond barcode technology.”
Also this year, Redrock Biometrics forged a partnership with passwordless authentication solution provider HYPR, which will add the company’s PalmID technology to its platform. Redrock has also waived the license fee for its PalmID software for all essential businesses using the technology during the global public health crisis.
“COVID-19 quarantine made us acutely aware that touching devices represents a threat to our lives,” Redrock co-founder Lenny Kontsevich said. “People become touch-phobic and their faces are covered by masks, which creates a need for a touchless palm solution.”
Credit Sesame made the move to acquire STACK, a Canada-based challenger bank, today. Terms of the deal were not disclosed.
The announcement comes three months after Credit Sesame unveiledSesame Cash, a digital bank account powered by STACK. After a successful pilot in March, Credit Sesame began a widespread rollout of Sesame Cash in mid-May. Since then, the company has onboarded more than 200,000 users to the new service. Now, as Credit Sesame reports, “the demand continues to surge with thousands of new accounts per day…”
Today’s acquisition will also help Credit Sesame expand geographically. The company’s financial management services will be available within STACK’s platform. The move into Canada marks Credit Sesame’s first step toward international expansion.
“Together with STACK, we are combining the power of smart banking and AI-driven credit management to create a new kind of personal finance,” said Credit Sesame CEO and Founder Adrian Nazari. “How much cash you have, and how and when you use your cash, have a big impact on your credit. Adding cash management to our credit platform was a natural next step to better help consumers manage their overall financial health, and it creates a unique benefit for our consumers and financial partners.”
The Sesame Cash account is aimed at underserved users and individuals living paycheck-to-paycheck. Some of the features include free daily credit score refreshes, cash rewards for improving credit, early payday, and real-time transaction notifications. The account comes with a Mastercard debit card that offers Mastercard Zero Liability protection, direct deposit, the ability to freeze or unfreeze the debit card in-app, and more.
Credit Sesame, which most recently demoed at FinovateSpring 2015, plans to launch more features, including a smart billpay service, transaction roundups to save or pay down debt, rewards programs, and credit-building opportunities. The company plans to reveal these offerings “over the next few months.”
Former STACK CEO Miro Pavletic is now Credit Sesame’s General Manager of Canadian and International Business. STACK’s former COO Nicolas Dinh and former CPO Ranjit Sarai have transitioned to serve within Credit Sesame’s banking services. STACK’s Canada-based employees will work out of Toronto, Canada-based STACK offices.
Fintech has always had a digital backbone. Cashless payments. Security tokens. Robo advisors. Invoice financing. Mobile banking. And hundreds of other connectors, all building the path for a digital future, a future where companies are growing and innovating faster than ever.
From a buyer side, companies need technology to digitally do business. From a seller side, companies have to deliver these services and solutions. And all sides need confidence that Finovate’s fall events are going to run successfully to help them achieve their business needs. With all of that in mind, we’re embracing digital.
Now that the events have been moved online, you know FinovateFall Digital and FinovateWest Digital will take place. You can plan with 100% confidence, see more solutions, expand your reach, and access highly curated and produced content. These are all things Finovate is already known for.
Because of Finovate’s quality standards, these won’t be like any other digital events you’ve seen before. Live and on-demand content will put your finger on the pulse of the industry. Live Q&A and polls will ensure you can engage directly with speakers. And 24/7 networking and an app packed with fintech enthusiasts will make it easy to start a conversation with the right person.
Demos will be live streamed throughout the events, plus available on-demand to 1,000+ senior fintech leaders. All demo companies will have virtual booths for Q&A, deeper product dives, and 1-to-1 meetings. Plus, we’ll deliver leads to everyone participating. Visit the event websites above for more information.
The future of fintech is digital, and we hope to see you digitally this fall.
