The definitive source of news and analysis of the global fintech sector | June 2019 www.bankingtech.com

BEYOND HUMAN Dreaming of a fintech tomorrow INTERVIEW: DAN MAKOSKI, LLOYDS BANKING GROUP What makes a chief design officer CHALLENGER IN GERMANY

Who’s who and what’s their tech FINTECH FUTURES IN THIS ISSUE

Challenger banks worldwide who’s who and what’s their tech FinTech Futures’ editorial team is keeping its finger on the fintech Contents pulse with a series of comprehensive and free guides on the challenger banks and banking services and their technology in various countries. NEWS 04 The latest fi ntech news from around the globe: Visit www.bankingtech.com to read the guides. the good, the bad and the ugly. FEATURES 16 Focus Cloud adoption – the future for the back offi ce?

UK 18 Conference report US FinovateSpring: focusing on the digital future of fi ntech.

22 Exclusive interview Dan Makoski, chief design offi cer, Lloyds Banking Group. 26 Spotlight BrightLife – clean energy and fi nancial inclusion coming together in a social enterprise.

29 Focus Digital platforms – transforming the loan experience. 30 Challenger banks in Germany GERMANY Who’s who and what’s their tech?

34 Comment Rise women – you can do it, you really can!

37 Industry insights Infosys Finacle – core modernisation is essential for truly digital banking.

38 Food for thought A banker goes a-banking chapter 2.

40 Ask the expert – practical and free advice on how to grow your business.

REGULARS 44 Appointments – the movers and the shakers. We’ll be revisiting and updating these guides on a regular basis, as well as adding more countries. 44 Industry events – mark your calendars! If you have any additions and/or suggestions, please get in touch with Tanya AndreasyanVCP[CCPFTGCU[CP"ƂPVGEJHWVWTGUEQO www.bankingtech.com June 2019 | www.bankingtech.com | 01 @FinTech_Futures Managing Director & Editor-in-Chief Tanya Andreasyan +44 207 551 9010 tanya.andreasyan@fintechfutures.com

Align your brand with excellence and innovation Editor Sharon Kimathi +44 207 551 9010 EXPLORE SPONSORSHIP OPPORTUNITIES sharon.kimathi@fintechfutures.com Reporter Henry Vilar +44 207 017 5709 WITH PAYTECH AWARDS 2019 henry.vilar@fintechfutures.com

Contributing Reporters Jane Connolly Martin Whybrow Editor’s note

Head of Sales Jon Robson +44 203 377 3327 jon.robson@fintechfutures.com

Business Development Manager This month brings cautionary tales from Eric They discovered hackers had found all the David Wurie Michaud, CEO and founder of security firm executives’ phone numbers on social media +44 207 017 5593 Rift Recon, who shared fascinating facts at and enough information on the names of david.wurie@fintechfutures.com the recent Verint Engage user conference. their kids, pets and so on from password Marketing Manager For instance, since 2014, an international breaches from LinkedIn and other services, David Taylor cybercriminal group has been targeting where the password reset was probably +44 207 017 5379 david.taylor@fintechfutures.com banks around the world and has made going to be the one for the execs’ phones. off with well over $300 million – by “They were using SMS as the two- Marketing Executive compromising the banks’ systems with factor authentication. So, for password Kiran Sandhu +44 207 017 7377 malware and using the information they recovery for your email, your phone is your kiran.sandhu@fintechfutures.com have mined. The gang – called Carbanak identity, because that’s where everything by the researchers – targets financial goes,” Michaud explained. “It turned out Design & Production Simon Turner @ West Hill Media institutions in Russia, Japan, US and the CEO was storing his private keys for [email protected] Europe. They start their attacks with spear- his cryptocurrency in his phone with phishing emails to employees, who passwords. And then the hackers went This is your chance to make headlines and position your brand in front of are instructed to open an attachment that to the CFO who did similar, and then the top-level executives, decision makers, stakeholders and infl uencers. contains malware, which the hackers use comptroller got nailed. Then basically, they to infiltrate the bank’s networks and do wired all of the money out into the network, extensive reconnaissance about the inner and all of a sudden they pulled in all their Q Network with an engaged audience of senior executives in the payments industry workings of the bank. email systems and everything went down. Q!DMDƥSEQNLNTQDWSDMRHUDL@QJDSHMFOQNFQ@LLD Armed with that knowledge, they then All that money lost just because someone is © Banking Technology 2019 Q Increase your brand awareness All rights reserved; Banking Technology material masquerade as employees, and steal able to change your phone number.” b Q Entertain your clients, prospects and team at the spectacular awards event may not be reproduced in any form without money in ways that they hope will not How good is your cybersecurity? t the written permission of the publisher. raise an alarm. Q Highlight your brand as a leader in the global paytech sector Banking Technology is published ten times a year. Another effective way to extract money, according to Michaud, is to instruct ATMs to Address dispense cash to an associate of the gang Maple House 149 Tottenham Court Road at a predetermined time. Apparently, one WWW.BANKINGTECH.COM/PAYTECHAWARDS W1T 7AD Kaspersky client lost $7.3 million through UK ATM withdrawals alone. Printer However, no bank has come forward and Get in touch to fi nd out how you can benefi t from this summer’s premier industry event! Hobbs the Printers Ltd publicly acknowledged a breach. Hampshire, UK One more anecdote: a cryptocurrency Tanya Andreasyan Jon Robson ISSN 0266-0865 exchange had its currency holdings wiped Editor-in-Chief e: jon.robson@fi ntechfutures.com, t: +44 203 377 3327 www.bankingtech.com out in an hour, and Rift Recon was called in. Banking Technology

@FinTech_Futures June 2019 | www.bankingtech.com | 03 #PayTechAwards NEWS NEWS

Australian Business card management platform BNP Paribas makes a Magic Leap to teleportation meetings BG@KKDMFDQ /KDNQ@HRDRʙLHM2DQHDR!ƥM@MBHMF BNP Paribas is embracing immersive conducted via a lightweight, wearable world first. It allows each participant to technologies to offer employees and spatial computer called Magic Leap One. manipulate and alter the common plan, seeks more funds Fintech Pleo, the business spending as it integrates directly with customers teleportation meetings in Using augmented reality technology, modelled in a 3D projection, whether it platform based around smart company software providers. Hong Kong, Dubai, London, Frankfurt the headset allows meeting participants is a model of a real estate venture or a cards, has raised $56 million in a Series B “Managing work-related spending and Paris. to interact with virtual objects, while neighbourhood mapping.” financing round led by Stripes, a New York- has traditionally caused headaches for In collaboration with spatial computing lowering environmental impact through Cardona adds: “Together with Magic based growth fund. employees and their employers alike. firm Magic Leap and French/Belgian reduced travel. Leap and Mimesys, we are inventing a The round has seen participation from Pleo is making the whole process simpler, start-up Mimesys, which develops spatial “For two years, BNP Paribas Real Estate new workplace that is more agile and existing investors Kinnevik, Creandum quicker and more transparent,” comments co-presence platforms, BNP Paribas Real has integrated immersive technologies collaborative, and that places people and and Founders. This latest round brings Jeppe Rindom, co-founder and CEO at Estate will use the tech to offer investment into the development of its innovation expertise at the forefront of customer the total amount raised by the company Pleo. “We are building a solution to fit opportunities to clients – particularly projects,” says Kevin Cardona, BNP Paribas experience.” to $79 million. the needs of today’s modern workforce those of Corporate and Institutional Real Estate’s head of innovation. “Already The solution was tested over a one- Founded in 2015 with the aim of – reshaping how businesses manage Banking and Wealth Management. tested on two real estate projects in year period before being implemented. transforming the laborious business company spending, and how they operate, The teleportation meetings will be London and Paris, this innovation is a Jane Connolly expense process, Pleo achieved a $16 enabling staff to feel more empowered and million Series A funding round last year. It ultimately more productive.” was Denmark’s largest Series A in a decade Pleo has on average quadrupled the Image source: 86 400 Image source: and today’s fundraise is Denmark’s largest number of cards within a company, making 2N%HBNMƥQLRʙLHMUDRSLDMSKDCAX0@S@Q Australian challenger bank 86 400 is Series B. it one of the biggest corporate card In a round led by Qatar Investment refinancing and mortgages offerings, as looking for more funding to support the The firm says that more than 3,500 providers in the Nordics. Authority (QIA), personal finance solution well as newer products like SoFi Invest and next phase of its growth beyond launch, companies of all sizes and verticals have Pleo will use the funding round to provider SoFi has raised more than $500 SofiMoney. appointing Morgan Stanley Australia switched to Pleo across the UK, Denmark, more than triple its headcount, from 120 million in equity funding. SoFi Invest, launched at the beginning Limited to assist with this process. Germany and Sweden. to 400 employees by the end of 2020 and The new capital gives the San Francisco, of the year, is a stock and ETF trading To date, the aspiring bank has Pleo provides smart company cards to accelerate product development as it California-based company a valuation and investing platform that also allows been supported and fully funded by paired with software and mobile apps to aims to service the entire purchase process of $4.3 billion, and will drive investment, for automated investing. SoFi Money Limited, Australia’s independent automatically match receipts and track for SMEs across the whole of Europe. This the company says in its press release, in combines the best of checking and savings payments provider. While Cuscal will all company spending in real-time with includes adding , invoices, mobile continued innovation and growth. SoFi’s Anthony Noto, SoFi accounts into a single account with a continue to support 86 400, the company detailed analytics. Pleo eliminates expense payments, a vendor marketplace, VAT total capital now stands at $2.3 billion. 2.25% APY and an app to facilitate mobile is seeking to add new shareholders reports and automates tasks reclaim and more. QIA CEO Mansoor Al-Mahmoud transformation. “Over the last year, we’ve spending, saving and payment. towards the end of 2019. highlights SoFi’s long-term vision, which worked aggressively to grow SoFi from In May, SoFi announced that it was The capital-raising is in line with its has enabled the company to evolve into a a desktop lending business to a broad- introducing an exchange-traded fund based business plan, which requires more than Founders Bank anticipating EU licence major personal finance platform for both based, mobile-first financial platform on the gig economy, GIGE. The actively $250 million of capital over the first three A new challenger bank is about to enter Its current expansion plan is to obtain lending and wealth management. enabling members to borrow, save, spend, managed fund – run by Toroso Investments years of operation to fund its growing the crypto market as Malta and London- operating licences in all the main financial “We strongly believe in SoFi’s approach invest and protect their money,” Noto says. – enables investors to participate in the balance sheet. based Founders Bank is receiving EU jurisdictions, including the US, Singapore and its dedication to build a transformational With more than 700,000 members and stock market gains of companies like Anthony Thomson, chairman of 86 banking licence authorisation in the fourth and the UK in the first instance. financial platform that is rapidly disrupting 7.5-plus million registered users, SoFi offers eBay, Lyft, Square and Twitter. In April, the 400, said: “We look forward to introducing quarter of this year. Paula Pandolfino is the bank’s co- consumer finance,” he says. a variety of personal finance solutions in company teamed up with Lemonade and new, like-minded shareholders to the Founders’ Bank, which is backed by founder and chief strategy officer. Kenan In his statement, SoFi CEO Anthony lending and wealth management. These Root to add to its offerings. business towards the end of this year, as crypto exchange Binance and venture Altunis, who has 20 years’ experience in Noto underscores the company’s include the company’s student loan David Penn, Finovate we deliver the easiest version of banking capitalists, has been awaiting a banking finance at , is CEO. Lana to Australian customers. licence since 12 June 2018, according to Burdei, formerly of HSBC and , “Our mission is to help Australians take the Maltese government. is COO. control of their money, placing them at Once it is authorised, the disrupter will On the technology side, Dearg 3Q@MREDQ6HRDCNTAKDRHSRU@KT@SHNMSNʙ AM the very centre of what we do – every be offering corporate banking services OBartuin is CTO, having been CTO at UK-based international payments fintech TransferWise’s strategy of providing phenomenal growth and this investment second, of every minute, of every day. All focused on tech companies including Challenger.Money, the London Block TransferWise has doubled its value to cheap exchange rates by using two local is testament to that,” says Kristo Käärman, eighty-six four hundred of them.” accounts, payments, escrow and credit. Exchange and BitPesa. And Ludwig Mallia $3.5 billion after raising $292 million in transfers for each transaction, instead chief executive and co-founder. “We The bank is currently piloting and will “Founders Bank will have its own has recently joined as head of IT. He secondary funding. of more expensive single international don’t need to raise funds on this trajectory, launch with a transactions and savings proprietary banking platform with moves from Bank of Valetta, where he The round was led by investors including payments, has attracted more than five but we’re humbled by the persistent level account later this year. It continues to instant, multi-currency settlement,” says was programme manager for one year. Lead Edge Capital, Lone Pine Capital and million customers since the fintech was of interest.” progress its application for a full banking a spokesperson at the bank. Prior to that, he spent nearly eight years at Vitruvian Partners. The Sir Richard Branson- founded in 2011. TransferWise handles a transaction licence from the Australian Prudential It is working with several industry MeDirect Malta, most recently as head of backed firm also received investment from TransferWise will use the funds to take volume of $5.1 billion across its 12 global Regulation Authority (APRA). leaders in blockchain including exchanges core banking platforms. BlackRock and existing investors Andressen on 750 more staff over the next year. offices every month. Henry Vilar and other infrastructure providers. Sharon Kimathi Horowitz and Baillie Gifford. “TransferWise is experiencing Jane Connolly

04 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 05 NEWS NEWS

0TCNR!@MJDRB@K@SDRKDF@KA@SSKDVHSG(MENRXR 1@OG@DKRƥMDCa LAX%" @MC/1  Hong Kong grants Australia-based is pursuing The court has asked Infosys to produce for outsourcing mismanagement ENTQLNQDUHQST@K legal action against Infosys relating to documents to support its claim that it has alleged copyright infringement, breach not breached the terms of its agreement The Financial Conduct Authority (FCA) significant aggravating factor in this case, bank licences of contract and misuse of confidential with Qudos Bank. and Prudential Regulation Authority (PRA) leading to an uplift in the penalty.”

information by the Indian tech giant. Qudos Bank commenced preliminary Bookmarc Image source: have fined R. Raphael & Sons (Raphaels) Raphaels is a retail bank providing The Hong Kong Monetary Authority The allegations are centred on software discovery proceedings against Infosys for failing to manage its outsourcing banking and related . (HKMA) has granted virtual bank licences written by Infosys for another Australian in November 2018. Leithhead said: arrangements properly between April 2014 Its payment services rely on outsourced to Ant Financial, Xiaomi and AMTD Group, client, Australian Military Bank (AMB). “Following Qudos Bank’s Federal Court and December 2016. service providers to perform certain, PING AN’s OneConnect and Tencent. Qudos Bank is seeking documents from application, Infosys produced some This resolution was decided nearly post- including the authorisation and processing Xiaomi and AMTD’s bank is a joint Infosys related to the user experience and documents and computer code, but mortem, as the bank only announced a of card transactions. project called Insight Fintech. user interface (UX/UI) of the mobile and resisted producing other documents couple of months ago it was closing down. The bank failed to have adequate According to the firms’ business plans, solution that the supplier we believe are important in us making a Raphaels has received separate fines processes to enable it to understand and they aim to launch their banks in six to built for AMB. decision on whether to commence further of £775,100 from the FCA and £1,112,152 assess the business continuity and disaster nine months. Infosys was initially engaged by Qudos legal action against Infosys. from the PRA in respect of these breaches. recovery arrangements of its outsourced The HKMA is now working closely Bank ( Credit Union, as was) in “Earlier this week, the Federal Court The firm agreed to resolve this matter and service providers, particularly how they with a total of eight virtual bank licensees 2015. The project spanned core banking found that Qudos Bank had reasonable qualified for a 30% reduction in the fines would support the continued operation of to help them prepare for launch, says (Infosys’ Finacle), customer relationship grounds to believe that its rights had been imposed by both regulators. its card programmes during a disruptive Norman Chan, chief exec at the HKMA. management, online banking, mobile violated and ordered Infosys to provide “Raphaels systems and controls event. The absence of such processes Chan adds that the launch of these The Qudos breakout room application and other systems. Infosys the additional documentation. The Board supporting the oversight and governance posed a risk to Raphaels’ operational banks and granting these licences aims to subsequently started work on the project and Management of Qudos Bank view this of its outsourcing arrangements were resilience and exposed its customers to a champion Smart Banking Initiatives in the at AMB, with this bank’s mobile and matter very seriously, and are committed not disclose any information pertaining inadequate and exposed customers to serious risk of harm, say the regulators. city, and that the HKMA will monitor how online banking solution launched in to protecting Qudos Bank’s intellectual to the Qudos contract in adherence to our unnecessary and avoidable harm and On 24 December 2015, an incident these banks are doing after launch. February 2018. property against any potential misuse.” confidentiality.” inconvenience,” says Mark Steward, FCA caused the complete failure of the There is a total of 160 banks licensed in Qudos Bank chairman, Andrew Infosys has responded with its own Qudos Bank has 95,000-plus members executive director of enforcement and authorisation and processing services it Hong Kong. Leithhead, in a statement, says: “During statement: “Infosys adheres to well- and offers a full range of market oversight. “There is no lower provided to Raphaels and lasted over eight The city estate has been granting the period Infosys was working on the established processes in delivering products including home and investment standard for outsourced systems and hours, with 3,367 customers unable to use these types of licences to increasingly Qudos Bank contract, we became aware of services and has successfully designed and loans, credit cards, personal loans, deposit controls and firms are accountable for their prepaid cards and charge cards. more banks. Just recently, FinTech Futures striking similarities between the software deployed many business-critical banking accounts, superannuation, financial failures by outsourcing providers.” Raphaels’ specific failings in relation to reported on a joint venture between Bank developed for our project and the AMB solutions globally including Australia. planning and a range of Qantas Points Sam Woods, deputy governor for the incident resulted from deeper flaws in of China (BOC) Hong Kong, JD New Orbit project. This made us very concerned that The company denies any allegations of Banking products. Branches and ATMs are prudential regulation and CEO of the its overall management and oversight of Technology and JSH Virtual Ventures our intellectual property may have been wrongdoing and will vigorously defend located in states across Australia. PRA, adds: “The firm’s ability to manage outsourcing risk from board level down. Holdings (JSHVV), which acquired the misused and our confidence violated.” itself in any litigation. The company will Martin Whybrow outsourcing of any critical activities is The joint FCA and PRA investigation same licence for a new virtual bank. a vital part of maintaining their safety identified “a lack of adequate consideration Just before then, ZhongAn and soundness. Such outsourcing is an of outsourcing within its board and Technologies International was also !@MJ+DTLH "(!"@MC- !K@TMBGNMKHMDONQS@KENQƥMSDBGR important part of its operational resilience, departmental risk appetites, the absence granted a virtual banking licence by Bank Leumi of Israel, Canadian Imperial comes to seeding international efforts to Davey believes that the platform will and particularly so in the case of Raphaels, of processes for identifying critical the Hong Kong Monetary Authority, as Bank of Commerce (CIBC) and National spur better value propositions,” says Tamar provide a simple and easy process for given the level of reliance on outsourcing outsourced services and flaws in its initial was a joint venture between Standard Australia Bank (NAB) have introduced Yassur, chief digital officer at Bank Leumi. fintechs to help connect them into the in its business model. In addition, this was and on-going due diligence of outsourced Chartered, HKT, PCCW and Ctrip Finance. their Global Alliance Fintech Link as part “We’re confident this new platform will bank, and to the right people who may be a repeat failing that demonstrates a lack of service providers”. Henry Vilar of an international banking alliance. This help spark international innovation and interested in what they have to offer. adequate and timely remediation. This is a Henry Vilar is a global online portal developed to creativity to enhance customer services in Bank Leumi, CIBC and NAB’s strategic help drive client-focused innovation by banking across the globe.” alliance formed in September 2016. The facilitating collaboration between the Global Alliance Fintech Link offers start- initiative is not only designed to simplify Amaiz launches banking app for entrepreneurs banks and fintechs. ups around the world easy access to the global cooperation, but to offer fintechs Amaiz, a UK-based fintech, has launched activities, mixing personal and business Dobrovolskiy, founder of Amaiz. Fintech firms will be able to submit global banking marketplace by enabling access to potential partners that could its first business banking app for UK expenses often means investing more Amaiz aims to release customers from creative solutions in response to a wide direct collaboration with three financial help scale their business. It also offers the entrepreneurs. time and effort into managing their time-consuming admin and paperwork range of opportunities identified by the institutions on three continents. opportunity to bring these world-class The business current account for sole cashflow and keeping records for tax by bringing together fast, convenient banks through the digital platform. Upon “In big and complex banks like companies into a global technology and traders will be accessible via Amaiz’s sleek compliance checks. banking service with smart back-office receiving the proposals, the banks will NAB, CIBC and Bank Leumi, it can be a banking ecosystem. mobile app, which also includes financial “Having all business-related operations and accounting tools. consult directly with the technology firms. challenge for fintechs with good ideas to The platform has been initially launched health overviews, 24/7 in-app customer together in one place will help you run The fintech currently operates in the “This shows that Bank find the right path to the right people,” as a pilot and will evolve as additional support and accountancy assistance. your finances easily and focus on what UK market only, with free trials beginning Leumi, NAB and CIBC are leaders not says Jonathan Davey, executive general challenges are added to the site. Although sole traders can use their really matters – development and growth. this month until early September. just in thought but also in action when it manager for digital innovation at NAB. Sharon Kimathi personal bank account for their trading This is what Amaiz is about,” says Sergey Sharon Kimathi

06 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 07 NEWS NEWS

IBM chosen to support Canada’s RTGS platform (MCNMDRH@K@TMBGDR01BNCDRS@MC@QCR Payments Canada has selected IBM as including the move to Lynx from the He adds: “This is a key partner to join Bank Indonesia (BI), the country’s central standardised code,” said BI governor the lead technology partner for next- country’s current large value transfer system. us along the modernisation journey as bank, has launched its Quick Response Perry Warjiyo during the launch ceremony generation real-time gross settlement Along with daily operations, IBM we establish a foundation for payments Indonesia Standard (QRIS) code system, in Jakarta. (RTGS) system Lynx. Canada will also oversee SIA, which won that will strengthen Canada’s competitive a new type of QR code standards, aiming The has been developing IBM Canada will provide combined the build contract earlier this year. advantage on the global stage.” to homogenise cashless payments QRIS since early last year. hosting and system integration services for “The onboarding of IBM Canada as lead Lynx is a core part of Payment nationwide. Since then, it has sought end-to-end delivery and system operations technology partner will help to ensure we Canada’s major modernisation initiative, QRIS is, overall, a more complex QR with financial institutions, banks, interbank for the new high-value payment system, deliver the highest international security, created in response to international pattern and it allows users from one network providers and e-wallet T-cash Finextra reports. resilience and operating standards for high- risk standards and the new ISO 20022 payment service to transfer funds to any (now LinkAja). BI based the QRIS pattern The role will include offering security value payments in Canada,” says Gerry Gaetz, messaging type. rival service under BI’s umbrella. on the Europay, Mastercard and Visa (EMV) Sugeng, Bank Indonesia expertise and support for the launch, president and CEO of Payments Canada. Jane Connolly The Jakarta Post reports that international standard. customers using e-wallet services such as The central bank’s deputy governor “We believe that such a modern LinkAja, for example, could transfer funds Sugeng says the standard’s deployment fast payment system is vital to support %HUDA@MJRƥMDCŵAMENQQHFFHMFENQDHFMDWBG@MFDL@QJDS to a shopkeeper using OVO, a different cost was lower than, for instance, chip economic activity in Indonesia, where e-wallet service. cards and RFID tags, which would have economic growth is still at around 5%. We Five banks – Barclays, RBS, Citigroup, JP again, along with MUFG, €285 million in all RBS and Barclays both say they All it needs is that at least one party has been a standardisation alternative. believe that if the digital economy players Morgan and MUFG – have been fined for the “Essex Express” cartel. have made provision to cover the fines. a QRIS code. QR code deployment could be as cheap leverage this new payment system, growth a total of €1.07 billion by the European The Commission’s investigation, which However, the investigation could open the “QRIS allows QR-code-facilitated as printing the code and downloading may be above 5% in the years to come,” Commission for currency rigging. began in September 2013, revealed that door for those affected by the cartels to payments to be interconnected a smartphone app, not requiring the adds Sugeng. According to the BBC, individual most of the traders knew each other sue the banks. and interoperable through a single expense of buying an EMV reader. Henry Vilar foreign exchange traders had used online personally, with some having met on a train. Lambros Kilaniotis, a partner at law chatrooms to exchange trading plans and The BBC reports that the traders firm RPC, tells the BBC: “If they haven’t occasionally co-ordinate their trading exchanged information that could already, any party involved in forex strategies between 2007 and 2013. enable them to make informed market trading, such as institutional investors, 9DMTR!@MJK@TMBGDR@HLHMFSNRDQUDFKNA@KBKHDMSR UBS was excused from penalties decisions about buying and selling pension funds and large corporates, Zenus Bank is a new bank in the US and tier banks have in accepting foreign clients, will offer services for retail, businesses because it revealed the existence of the currencies in their portfolios. This should now be reviewing what losses Puerto Rico that, according to its page, is as it has an international banking licence. and institutions. the cartels. information related to outstanding they have incurred.” designed for global clients. “We accept individuals and businesses Zenus expects that it will initially Four banks – Barclays, RBS, Citigroup customer orders, open risk positions in UBS states that it is a legacy matter and According to the new institution, to apply remotely for a multi-currency bank be offering bank accounts and a multi- and JP Morgan – were fined a total of €811 different currencies, prices applicable to the bank has made “significant investments” Zenus enables financial inclusion, not account and using our advanced currency debit card before expanding million for being in the “Banana Split” specific transactions and other details to strengthen its control framework. only at a global level but “also across all digital banking technologies”, it says. to other services such as merchant cartel. Barclays and RBS were penalised about current or planned trading. Jane Connolly levels of society”. Headquartered in San Juan, Puerto Rico, processing, investment accounts and This means that it aims to resolve the the bank is led by Jose A Diaz-Ortiz as CEO. correspondent banking. local residency requirements that all top- The bank has opened a waiting list, and Henry Vilar 3HMJRDBTQDRRSQ@SDFHBHMUDRSLDMSEQNL/@X/@K Swedish open banking solution provider technology – it can be implemented to Tink’s enthusiasm for the transformative Mizuho said to be rolling out Flexcube core banking tech Tink has unveiled PayPal as its latest improve a range of use cases for businesses potential of open banking. “Tink has investor and customer. Tink describes big and small,” Tink states. developed the infrastructure and data One of Japan’s largest banks, Mizuho Bank in its international operations, including the development as a “major vote of Offering account aggregation and services for this new financial world – and (Mizuho Financial Services), is understood Finastra’s old MidasPlus workhorse in confidence in our tech and an indicator payment initiation services via a single, API we’re excited to work together to continue to be implementing Oracle FSS’s Flexcube Europe (the bank has operations in of the strength of the open banking integration – as well as data enrichment to democratise financial services,” says to modernise its corporate and commercial London, Frankfurt, Paris, Amsterdam, movement in Europe”. and categorisation and personal financial Marriner. banking business. and Madrid) and Asia. The funding will help drive Tink’s management (PFM) services – Tink helps The funding will help drive Tink’s The bank is believed to be embarking Mizuho provides a wide range of continued expansion across Europe. The fintechs to maximise the opportunities of continued expansion across Europe. In on a multi-year project to replacing services including syndicated loans, investment from PayPal adds $11.2 million open banking. More than 1,400 developers recent months, the fintech has partnered multiple systems across its international acquisition financing, finance, to Tink’s capital, boosting the fintech’s are using Tink’s API platform to access with NatWest in the UK, Mash in Finland, operations, leading to standardisation risk management, working capital and funding total to more than $105 million. financial data from hundreds of banks and and Lunar Way in Denmark. The company on Flexcube, linked to a number of other structured finance plus treasury operations

As Tink’s newest partner, the payments financial institutions in markets across began the year with both a big funding Oracle FSS applications. Bloomberg Image source: covering deposit taking and foreign giant plans to leverage Tink’s account Europe. This access is paving the way – picking up €56 million ($63 million) in a The project was hinted at in Oracle exchange, current account and cash aggregation technology to enable its for what the company called “the next round led by Insight Venture Partners – and FSS’s latest financial results, which stated: and Collateral Management, Corporate management services. European customers to connect their bank generation of financial services”. a significant expansion, going live in five “A leading Japanese bank has extended Lending, and Analytical Application No one from Oracle FSS was willing to accounts to their PayPal accounts. VP of global markets and partnerships new European markets. its relationship with Oracle by signing Software solutions.” comment. “It’s a testament to the versatility of our for PayPal, Jennifer Marriner, echoes David Penn, Finovate a deal for Oracle’s Core banking, Limits The bank uses a range of platforms Martin Whybrow

08 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 09 NEWS NEWS

Eurobank plans .Q@BKD%22F@HMRSVNMDVBNQDA@MJHMF %@BDANNJDXDRO@XLDMSRL@QJDSVHSGMDV2VHRRƥMSDBG front-to-back tech clients in Eastern Europe Facebook has set up a new fintech attention over allegations of misuse of company in Switzerland with a focus on consumers’ personal data. transformation KDB Bank Europe in Hungary and DXC Technology (formerly CSC), it is payments, blockchain and more. In May this year, a concerned US Senate Všeobecná úverová banka (VUB) in understood. VUB is one of a dwindling The social network – currently used by wrote an open letter to Facebook’s CEO VHSG3DLDMNR Slovakia have opted for the Oracle FSS number of Hogan’s remaining sites more than two billion people worldwide – Mark Zuckerberg, following news that the core banking software, Flexcube, Banking across the world. registered Libra Networks in , with business was developing a cryptocurrency- Eurobank Group is to overhaul its core Technology understands. Banking Technology understands that Facebook Global Holdings as stakeholder. based payments system. and digital banking with Temenos’ T24 No comment was provided by the Temenos and Infosys were also bidding for The register reportedly reveals that The letter stated that privacy experts Transact and T24 Infinity. vendor on these deals. this deal. the company will provide financial had asked “whether any of the data The project will cover the group’s KDB is a subsidiary of Korea VUB is Slovakia’s second largest bank, and technology services and develop data, blockchain and other technologies”, collected by Facebook is being used international operations. It will start Development Bank, operating in Hungary and is owned by Italian financial services related hardware and software, focusing according to a Reuters report. for purposes that do or should subject in Cyprus, with the intention of swiftly since the early 1990s. It provides retail and group . It has over 230 on “investing, payments, financing, Facebook, which also owns WhatsApp, Facebook to the Fair Credit Reporting Act”. moving on to Eurobank Private Bank commercial banking services. locations across the country (plus one identity management, analytics, big Messenger and Instagram, has received Jane Connolly Luxemburg, with Eurobank Bulgaria AD In its recent financial results, Oracle branch in the Czech Republic) and employs (Postbank) and Eurobank AD Beograd FSS mentions “an established banking nearly 4,000 people. It is the only universal (Serbia) also on the roadmap. player in the Hungarian financial sector bank in Slovakia licensed to provide the .Q@MFDINHMR1@HRHMŗRŵL2DQHDR#HMUDRSLDMSQNTMC The project comprises a full IT which provides universal banking services”, full range of banking services to the public, renovation programme. The bank has which signed for Oracle Banking Payments corporate and institutional clients. It offers Orange Digital Ventures has joined the other’s technological assets, while aiming record, as both a successful international also taken Temenos’ WealthSuite for and Flexcube. mortgages and consumer loans, deposit €100 million Series D investment round for to change the banking market. mobile operator and an accomplished Cyprus and Luxembourg, with the aim It is understood Flexcube will replace and payment products and services, pan-European savings marketplace Raisin. “Orange Digital Ventures has been financial technology provider. In addition of reducing time-to-market for new the legacy KoreBank system from Korean corporate banking, financing of foreign Existing investors Index Ventures, impressed by Raisin’s team, vision and to the investment, we do see potential products and services and improving technology vendor Hyundai Information trade activities and factoring. PayPal, Ribbit Capital and Thrive Capital achievements and is now pleased to synergies and concrete partnership automation of its Technology. As exclusively reported earlier by also participated in the round. The funds participate in Raisin’s quest to become opportunities with Orange Bank.” operations. At VUB, Oracle’s software will replace Banking Technology, Municipal Bank in will enable Raison to expand its core the leading global financial marketplace With over 75 partner banks, Raisin offers Also in the mix is Temenos Analytics the legacy Hogan core banking system, Bulgaria has also opted for Flexcube. service in at least two European markets for savings and investment products,” says at least 250 savings products to more than to support Eurobank’s marketing provided by US tech heavyweight Tanya Andreasyan this year and extend its line of Marc Rennard, chairman of Orange Digital 175,000 users in 31 countries. The platform campaigns. Development tools, which investment products. Ventures. “ODV will bring all its support to provides banks with access to markets, will use the T24 APIs, are intended Orange’s strategic objectives for Raisin’s expansion into new markets and liquidity across Europe and the opportunity to speed up building and deploying -DV,DCHBH!@MJSNG@QMDRRSDBGMNKNFX mobile financial services include two key product development.” to offer a one-stop-shop savings and applications around the core. SNřQD@V@JDMŚHMMNU@SHUDROHQHS initiatives with Orange Bank in Europe Raisin CEO and co-founder Dr Tamaz investments portfolio directly integrated in In terms of the initial project in and Orange Money in Africa. The two Georgadze says: “It’s particularly exciting their web and mobile interface. Cyprus, Stavros Ioannou, deputy CEO A descendant of the original Medici that creates seamless, digital customer companies plan to benefit from each for us because Orange has a proven track Jane Connolly and group COO, Eurobank, comments: banking family has launched a digital experiences and expands financial “We look forward to this co-operation, bank, Medici Bank, in Puerto Rico. opportunity across global markets.” as this is the first stage in the wider The co-founders are Prince Lorenzo de’ De’ Medici will lead business implementation of Temenos banking Medici and Ed Boyle, former Fidor Bank development and strategic partnerships; 2S@QKHMFO@QSMDQRVHSGO@XSDBGR3QHAD@MC/DKHB@M/@X software across the group.” Americas managing director. The fully- Boyle will be CEO. Boyle has also worked at Starling Bank has partnered with PelicanPay Starling has also teamed up with new with the news that Tribe will be among Ioannou describes the project as licensed, US chartered bank will target American Express and Blade Payments. and newly launched paytech, Tribe, to modular issuer and acquirer processor, Tribe the first issuer processors in Europe to be supporting the bank’s “vital digital international businesses and family offices. Among the technologies the new provide more businesses with the latest Payments. Utilising Starling’s secure and the certified to allow banks to issue UnionPay transformation journey”, which Medici Bank is promising “convenient, Medici bank is hoping to harness is payment services. second payment services directive (PSD2) cards, which have the world’s largest is intended to shape “advanced transparent and easy-to-use services for blockchain. The deals were announced at compliant APIs, Tribe can offer its customers cardholder base. relationships” and provide customers customers that need a fast, secure banking Boyle says: “We prioritise the needs of Money2020 Europe. Starling will work real-time access to faster payments, direct Tribe is Europe’s only issuer processor with “high-quality service and a vast option”. It was “born out of frustration with digitally native businesses and address the with PelicanPay, the payments and access to Bacs (direct debits and ) working with Mastercard, Visa and UnionPay variety of innovative and tailor-made the current financial services landscape”. friction and inefficiencies that exist with financial crime compliance platform, to and full bank grade accounts with a unique International. products”. It will use a modern technology base – as established banking options. deliver complete pan-European invoice to virtual account offering. Vaghjiani says: “Our team of renowned The bank currently uses a range of yet unspecified – and will seek to be faster, “We are building Medici Bank from payables automation for small businesses, Founded by Suresh Vaghjiani, who has payment experts, combined with our legacy international and Greek packages, lower-cost and more transparent than the ground up, not reliant on aged along with online e-commerce merchant worked with fintechs such as Starling, modular platform, means that innovative including Oracle FSS’s Flexcube in Serbia incumbent banks. infrastructures nor as an overlay on payment services. PelicanPay will use Curve, Monzo and Revolut, Tribe aims payment providers no longer need to and CSoft’s VCSBank++ in Bulgaria, De’ Medici hopes the new bank will be traditional banks. This is uncommon, Starling’s payment processing platform to rebuild back-end payments using compromise between speed and scale.” Banking Technology understands. The a “reawakening” of the innovative spirit of especially in the US where licensed to offer a PSD2-compliant open banking its modular, containerised technology Tribe aims to avoid the restrictions of holding group is Greece-based EFG his 14th century Florentine predecessors. challenger bank options are few and hub, which integrates with accounting platform ISAAC. legacy systems, slashing the delivery time Eurobank Ergasias. He says: “We are reimagining modern- far between.” packages to automate payments and The paytech’s launch was also for new products. Martin Whybrow day banking by leveraging technology Martin Whybrow account reconciliations. announced at Money2020 Europe, along Jane Connolly

10 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 11 NEWS NEWS

-HFDQH@MA@MJHMFRS@QS TOE@UNTQR.Q@BKD%22 &KNA@K/@XLDMSR@MC3282@FQDDLDF@ LDQFDQ Nigeria-based Titan Trust Bank has selected The Nigerian banking sector has seen media sources say the new licences stem Merchant acquirer Global Payments has investors own 48%. TSYS CEO Troy Woods merchants and more than 1,300 financial Oracle FSS for its core and digital banking a great deal of upheaval over the years, from the Central Bank’s desire to attract agreed to buy issuer processor firm Total will become the chairman. institutions worldwide. technology, it is understood. The start-up with many mergers, start-ups and closures. new investments into the sector and System Services (TSYS) in a $21.5 billion Jeff Sloan, Global Payments’ CEO, will It is expected that the deal, anticipated bank recently obtained its licence by the Flexcube is a well respected name since better serve the country’s 50 million-plus deal. The two companies confirmed lead the combined company. He says: “The to close in the fourth quarter, will generate Central Bank of Nigeria. the late 1990s (the pioneer was Access unbanked and under-banked citizens. the deal on 28 May in what will be the pace of change in the industry driven by about $8.6 billion in adjusted net revenue It is understood that Temenos and Bank, now one of the country’s top five Titan Bank is said to be headed by a payment industry’s third “mega-merger” innovation in technology, coupled with the annually plus network fees and make cost Infosys also competed for the deal. The banks) and has been a commonly selected former executive director of of 2019. The all-stock deal values TSYS need to have additional scale, had made savings of $300 million. shortlist came down to the two most platform since then. (which is a Finacle user). at $119.86 per share, a rise of 20% since this deal a function of a matter of time.” The deal follows Fiserv’s $22 billion widely installed international core The new bank is believed to be one of Oracle FSS did not respond to request before news of the talks started to emerge. The combined entity will provide takeover of First Data and FIS’s acquisition systems in Nigeria, Infosys’ Finacle and five to have gained regulatory approval for comment. Global Payments shareholders will own payment technology and software to more of Worldpay for $34 billion earlier this year. Oracle FSS’s Flexcube. of late (Globus Bank is another). Local Martin Whybrow 52% of the combined company, while TSYS than 3.5 million small to medium-sized Jane Connolly 2S@MC@QC"G@QSDQDCO@QSMDQRVHSG(!, TransferMate 4*HRƥMSDBGVNQKCKD@CDQVHSGa AM to launch Trade AI Engine 3QTD+@XDQKNNJR lands major deal HMUDRSLDMSHMSGQDDXD@QR SNDWO@MCVHSG Standard Chartered and IBM aim to to further improve accuracy. Standard The UK is now leading the world in fintech, to understand how we can best engage VHSG6DKKR%@QFN transform the largely paper-based Trade Chartered processes more than 36 million with high-growth businesses receiving with global collaborators, investors and ʙLHMUDRSLDMS Documentary System with the launch pages of trade documents every year, over £4.5 billion investment between 2015 partners,” says Eileen Burbridge, chair of Payments company TransferMate has won of a pioneering augmented intelligence capturing 200 million data elements. and 2018. Tech Nation. “The UK is a shining light UK-based open banking fintech, TrueLayer, a major deal to handle global payments (AI) engine. Lisa Robins, global head, transaction News that the UK is the top global hub and a nation punching well above its has gained $35 million in investment for US banking giant Wells Fargo. By significantly automating the time- banking at Standard Chartered, says: “The for fintech came in the Tech Nation Report weight in the world, so we need to keep funding. This will be used in part to The Kilkenny-based fintech will see consuming and high-risk traditional Trade AI engine significantly reduces the 2019, which also revealed that the UK is these connections close to mind on the expand the three year-old company’s its platform exclusively handle all Wells process, the Trade AI Engine will reduce amount of time and effort in this review fourth in the world for overall scale-up scaling journey of our ambitious, high- presence in continental Europe. Fargo’s inbound payments into the US manual back office tasks to improve process while raising the bar on our investment, behind the US, China and India. growth companies.” Initial investors were Connect, from overseas. operational efficiency and control. controls environment, further enhancing Fintech scale-ups received almost The report mentioned that deal size Northzone Ventures and Anthemis Group. TransferMate will add a team of 25 Trade AI Engine can convert non- our ability to play the connector role for double the investment of the next most disparity is growing. The top tech deal Leading the latest round of investment staff in New York and North Carolina and a digital shipping documents into our clients by facilitating transactions at popular UK tech sectors: e-commerce, to occur in the UK during that three-year are Chinese tech giant, Tencent Holdings, further 25 staff in Kilkenny to manage the machine-readable format using Optical pace with the growth of their businesses.” gaming and Software-as-a-Service (SaaS). period was the acquisition of London and Singapore government-owned fund, Wells Fargo partnership. Character Recognition (OCR) and identify Trade AI Engine is currently live in key “As global connections become ever online payments company Skrill by Paysafe Temasek. Northzone and Anthemis are The paytech’s co-founder and chief different types of document from a pre- markets across Asia, Africa, the Middle more important for the health of our tech Group for £785 million in 2015. also participating in the latest funding. executive Terry Clune says that the Wells defined database. East and the UK. economy, there is a responsibility for us Jane Connolly This makes the total funding raised by Fargo deal was a step in TransferMate’s The engine also utilises Natural Additional markets – including Japan, TrueLayer to date as roughly $41 million. efforts to replace the Swift system used by Language Processing (NLP) to read Hong Kong, Singapore, China and the US TrueLayer is one of a number of most banks. and capture context, while continuous – will follow. ,@RSDQB@QCANNRSR!HKK/@X$WBG@MFD fintechs seeking to provide solutions to “We went through a two-year due machine learning will enable the system Jane Connolly Mastercard has agreed to acquire bill The acquisition of Transactis will enable enable open banking, by connecting diligence process with Wells Fargo and payment platform Transactis, which will Mastercard to address bill payment needs and consolidating data from multiple we are the only fintech company they enhance the imminent Mastercard Bill Pay in online bank applications, as well as in providers. It has an API to access data have chosen to administer their inward Student digital current account Loot Exchange solution. billers’ websites. from users’ bank accounts and cards. It payments globally,” says Clune. “For other enters administration Due for full launch later this year, Colleen Taylor, executive vice president also has a payments API to allow users banks, that vetting and compliance that Mastercard Bill Pay Exchange is a digital of new payment platforms, North America to initiate payment transactions directly we have gone through makes us a much Digital banking start-up Loot has entered money from its 175,000 customers via a solution that aims to make bill payment for Mastercard, says: “Transactis’ technical from their bank accounts and receive easier choice.” administration after a sale to investor Royal crowdfunding campaign, but it was forced simpler for consumers, by allowing them to and commercial know-how, combined money instantly by an API call. The TransferMate has agreed major Bank of Scotland (RBS) collapsed. to go into administration before the round manage a variety of bills on one platform. with our reach and comprehensive fintech claims connectivity for the UK, investment deals with AIB and Dutch giant The fintech, which was founded in could begin. Transactis’ technology makes digital payment options, will greatly simplify the with Germany in beta, and France, ING, which last year valued the company 2014 to provide a digital current account Loot – not to be confused with online payment services available even to small entire process. We’ll be able to deliver a and Spain to follow. at €350 million. for students, has called in Smith and marketplace loot.com – did not have a businesses, to remove the inefficiencies that better real-time consumer experience, TrueLayer is expected to use the The firm is also heavily focused on Williamson to oversee the administration. full banking licence. It operated under can be caused by paper bills and cheques. from sign-up to viewing and paying bills, funding to expand across Europe. Among Asian expansion and has regulatory RBS owned a 25% stake in Loot through an electronic money licence through Bill Pay Exchange is offered to banks leveraging the investments that have been its existing customers are Monzo, peer-to- approval to operate in Singapore. NatWest’s developing digital bank Bo and a partnership with Wirecard, which is and credit unions through a core set of made in the core infrastructure.” peer lender, Zopa, and Experian-owned Regulatory approval is pending in had already invested £5 million before the regulated through the Financial Conduct APIs, providing the choice of all payment The transaction is expected to close in Clearscore, which gives UK customers free Hong Kong. potential sale fell through. Authority (FCA). types through the consumer’s online or Q2 of this year. access to their credit scores and reports. Henry Vilar The fintech had hoped to raise Jane Connolly mobile banking app. Jane Connolly Martin Whybrow

12 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 13 NEWS NEWS

&Q@RRGNOODQ!@MJNODMRENQATRHMDRRVHSGCHFHS@KENBTR "QDCHS FQHBNKDOK@MRŵAMSDBGHMUDRSLDMSHMENTQXD@QR US start-up, Grasshopper Bank, has opened Minerva Tantoco, who has held senior Credit Agricole, the French bank for the “new IT university”. This is part of the plan it faces low interest rates and a potential for business, having completed a private positions at UBS, Merrill Lynch and Fannie agricultural sector, has allocated €15 to retrain its staff to be able to handle the deterioration in its loan portfolio. placement off ering and gained all fi nal Mae, and served as the fi rst CTO of the City billion for technological transformation for new technologies that the fi nancial group In its previous plan, Credit Agricole had regulatory approvals. A key diff erentiator of New York. “greater effi ciency”. aims to test and implement throughout its targeted a 10% increase in net profi t from is intended to be its digital platform. For its Erwin was founding EVP of venture This capital will be invested over the business lines. 2016 until this year but managed to deliver technology, the bank opted for Temenos’ capital services at Square 1 Bank, from its next four years, aiming to achieve a data- According to a document issued by the that a year ahead of schedule. The bank T24 Transact core banking system. launch in 2005 to its IPO in 2014 and its centric architecture in 90% of the group by bank, “100% of emerging technologies” will reported a 25% profi t increase over the

Grasshopper Bank will serve innovation Ranking Fintech Image source: ultimate sale in 2015 to Pacifi c Western 2022, as well as €300 million “in increased be tested for new services. That’s right, all two years to 2018. economy companies and capital Bancorp. She has previously worked at IT effi ciency”. of them. The bank expects an annual net profi t of communities in New York and in other position them to provide products and Comerica, Imperial Bank and Plaza Bank The group aims to have the totality of its The bank forecasted a very slow level roughly €5 billion in 2022. major US innovation economy centres. services for today’s digital entrepreneur at of Commerce. Overall, the bank claims its IT staff trained in new technologies at the of profi t growth for the next four years, as Henry Vilar It opened for business on 13 May for a aff ordable prices, or to take advantage of senior management team has more than select group of entrepreneurs and venture new technologies around data, security 200 years of experience in commercial investors, with a broader rollout of its and user-friendly access. banking and fi nancial services. 6NQKC1DLHSCQHUDRFQNVSGVHSGʙLETMCHMF services planned in the coming months. “In contrast, Grasshopper Bank will The Grasshopper private placement Grasshopper Bank CEO, Judith act as a partner with entrepreneurial raised approximately $116.2 million, which London-founded mobile payments TCV general partner, John Doran, says: Erwin, says: “Traditional banks, limited companies, delivering digitally-driven, followed an earlier seed round off ering company, WorldRemit, is targeting further “In 2018, mobile and online payments to by antiquated and burdensome legacy streamlined services that give management that raised $15 million. Combined, this is global growth and product diversifi cation emerging markets reached a record high systems, are less equipped to meet the teams more effi cient command of day-to- believed to be the largest capital raise for a following a $175 million Series D funding of $528 billion and we expect this number needs of early stage companies. Their day fi nancial operations.” start-up bank in the US. round. The round was led by returning to increase.” He adds that he looks forward business models and infrastructure do not The bank’s CTO and co-founder is Martin Whybrow investors, TCV, Accel and Leapfrog WorldRemit Image source: to the fi rm continuing their work with Investments. The transaction is subject to WorldRemit to scale its digital platform customary closing conditions, including and expand its services to reach many new !KNBJBG@HMHMHSH@SHUD%M@KHSX(MSDQM@SHNM@KFDSRaLB@OHS@K regulatory approval from the Financial Breon Corcoran, WorldRemit customers across the globe. Conduct Authority (FCA). Having already become one of the fi rst A new London-based company, Fnality payments. Fourteen banks have Since its launch in 2010, WorldRemit has communities,” says WorldRemit CEO, Breon UK fi nancial service fi rms to secure licences International, has received a total of contributed to Fnality, with ING being the attracted nearly four million customers, Corcoran. “Our mission is to help them in all 50 US states, WorldRemit is aiming £50 million in capital to lead the utility latest to join. transferring money from 50 ‘send’ countries transfer money as securely and speedily for further global growth. The company settlement coin (USC) project, which aims “We see that tokenisation of assets and to 150 ‘receive’ countries. as possible while reducing the cost to also plans to launch a new money transfer to develop a more effi cient blockchain- the use of distributed ledger technology “Our core purpose has been and our customers. We will grow our business product for SMEs who trade internationally, based payment mechanism. off er huge potential for our industry,” says continues to be to help migrants send through diff erentiation on speed, service, particularly in emerging markets. The USC initiative was set up by UBS Annerie Vreugdenhil, head of wholesale money to their families, friends and security and value.” Jane Connolly in 2015 – the project focuses on cutting banking innovation at ING. the costs, time and risk involved for “With Fnality we are setting the international transfers. standard in the fi nancial market The bitcoin-like token, which can infrastructure of tomorrow. Our collective Initially, the USC system will work with (BBQD@BGNNRDR OOH@MSNRDQUD L(S@KH@MBTRSNLDQR be used for payments and to transmit goal is to make settlement processes as US dollars, Canadian dollars, pounds, euros Iccrea Banking Group – recently created Iccrea and the BCCs in the group exceptional customer experiences across all transaction data, will refl ect foreign easy as possible and we are very excited to and yen. from a merger of 142 small Italian serve 4.2 million customers, with around any platform. exchange rates and enable immediate be part of this industry-wide eff ort.” Jane Connolly Cooperative Credit Banks (BCCs) – has 2,650 branches across 1,700 Italian Iccrea has set up a new continuous chosen Appian’s low-code platform to municipalities – making it the country’s improvement and innovation team, which automate key processes. fourth largest banking group by assets utilises lean six sigma methodologies and To enhance customer support and under management. intelligent automation technologies to 2DSSKD&NRHFMRENQ"KD@Q!@MJŗRO@XLDMS@BBDRRRDQUHBDR service delivery, while reducing complexity “Our vision consists of creating an accelerate the development of applications. ClearBank has gained SettleGo as a ClearBank off ers banks, fi nancial The main reason for the selection, cited and manual tasks associated with architectural layer for modernising and Jane Connolly customer for its Banking-as-a-Service institutions and fi ntechs access to UK by SettleGo, is to expand its payments regulatory compliance, Iccrea will roll out a automating our core banking processes,” off ering. SettleGo is an international payment systems and core banking capabilities. Its strapline is: “Faster Access number of applications on Appian. says Iccrea’s head of organisation and e-money institution and will use ClearBank technology to support current account To Your Revenues. Collect. Convert. Settle.” These will include accounts payable projects, Cristiano Pietrosanti. “Appian’s to access real-time payments services capabilities. ClearBank was set up in 2015 and approval, fraud management, IT low-code platform allows us to measure key across the UK’s Chaps and Faster Payments. SettleGo targets small and medium sized opened for business in autumn 2017, support, new product introduction and processes for performance and effi ciency, The service will also facilitate real-time businesses with international payment headed by Nick Ogden, founder and management of banking, fi nancial and which enables continuous improvement.” account creation and addressable UK services spanning low-cost foreign former CEO of payments processing retail insurance products in compliance The group’s partnership with Appian IBANs associated with each account for exchange facilities, multi-currency IBANs heavyweight WorldPay. with the European Product Oversight aims to enhance service quality, gain Image source: Appian Image source: SettleGo’s customers. and international and domestic transfers. Martin Whybrow Governance (POG) regulation. greater speed in operations and to deliver

14 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 15 FOCUS: CLOUD ADOPTION Sponsored by

total cost of ownership. Overheads are SECURITY AND DATA PROTECTION minimised as no hardware is required, nor Intensifying regulatory oversight and Cloud adoption: the future are software licences needed. Software ever-expanding reporting obligations and hardware upgrades are performed are driving cloud adoption. Security is by the vendor, while support and user an important issue – a vendor’s platform ENQSGDA@BJNƧBD training costs are brought down, too. hosting environment should comply with Where such services are off ered on the highest standards of information An increasing number of banks are moving back offi ce applications to the cloud. a transaction volume-based model, security management. Peter Hainz of SmartStream investigates this trend. improved budgetary control can be achieved. The cost structure can be SMARTER USE OF RESOURCES, treated as part of the operational UP-TO-DATE APPLICATIONS AND Faced with rising data volumes, greater Responding to industry feedback, overheads, some fi rms move beyond budget, which fi nancial institutions BEST PRACTICES regulation and burdensome legacy SmartStream off ers cloud-based support pure cloud services to a third level – full prefer to up front capital expenditure. Financial institutions spend a great infrastructure, as well as increased and management for its applications. It business process outsourcing. The model may also be scaled up and deal of time on manually intensive, competition and demands for improved provides a tiered, three-stage process. How can cloud adoption help fi nancial down to suit business requirements and on-premise tasks, such as manual customer service, banks are under huge The fi rst stage sees SmartStream institutions manage their back offi ces budgetary pressures. matching. If a Software-as-a-Service pressure. With growing acceptance of maintain a client’s applications from more cost-eff ectively and effi ciently? (SaaS) platform solution is managed cloud strategies across the industry, and an IT perspective. If required, clients A RAPID, COST-EFFECTIVE ROUTE by the vendor, valuable in-house greater reassurance as to the cloud’s can progress to a second step, with REDUCING OVERHEADS TO ADOPTING NEW TECHNOLOGY resources are freed up to concentrate security, banks are becoming interested in SmartStream taking on IT change Moving back offi ce applications to Financial institutions want to upgrade on strategic projects. moving back offi ce applications there. management. To further drive down the cloud enables fi rms to reduce the their technology but are keen to avoid “Taking care of Taking care of upgrades binds lengthy, expensive implementations. in-house resources. Putting applications The cloud provides a quick, cost-eff ective upgrades binds in- into the cloud, where they can be adoption route. Clients are live within house resources. managed by the vendor, alleviates weeks, while dependence on in-house staff this. The vendor will also ensure that for hardware set-up, software installation, Putting applications applications are running on the latest confi guration, training and maintenance is version and are kept up to date with reduced, or even eliminated. into the cloud, where security and other patches. Additionally, they can be managed software providers often guarantee HARNESSING THE POWER OF industry best practices in relation to DATA: AI ANALYTICS AND MI by the vendor, monitoring back-up, archives and other DASHBOARDS housekeeping tasks. The scalability and fl exible storage alleviates this.” Blockchain in the cloud – fi nancial capacity of the cloud make it an excellent Peter Hainz, SmartStream institutions are building consortiums to platform from which to analyse data. develop blockchain applications. Thanks Artifi cial intelligence (AI) analytics can to its scalability, the cloud is a great place be run on large amounts of information to establish blockchain services. to provide business insights and Business continuity – the cloud often increase competitiveness. In the case provides superior business continuity of transactions management, AI may and disaster recovery technologies to potentially support fi rms to achieve faster on-premise solutions. One reason for this data loading and exception management. is that cloud computing relies heavily Financial institutions want to trade on hardware independent virtualisation more effi ciently and are interested in REGULATORY APPROVAL OF technology; another is that cloud services measurable outcomes that can be tracked CLOUD-BASED SERVICES (for example, AWS) are redundant in via management dashboards. Building the Regulators’ changing attitudes are diff erent availability zones. tools to gather such business intelligence also playing a role in encouraging In conclusion, fi nancial institutions is time consuming and hard to achieve cloud adoption by the fi nancial sector. are under greater pressure than ever to in house. SmartStream has developed De Nederlandsche Bank (DNB), the control costs and streamline back offi ce message interface (MI) dashboards as Netherlands’ national banking regulator, operations. They are on the hunt for part of its cloud off ering. These can be was one of the driving forces in Europe innovative, scalable solutions that allow used to analyse ; for example, that enacted legislation permitting them to update their legacy infrastructure, to monitor manual rates, automated fi nancial institutions to use cloud-based reduce the total cost of ownership and matching rates and straight-through services. FINMA has allowed the use of introduce other effi ciencies – increasingly, processing (STP) rates. cloud-based services in Switzerland, too. they are fi nding these in the cloud. bt

16 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 17 CONFERENCE RECAP CONFERENCE RECAP

FinovateSpring 2019: focusing NMSGDCHFHS@KETSTQDNEƥMSDBG

By Greg Palmer, VP, Finovate FinovateSpring returned to San Francisco add value to banks’ everyday operations. last month, and it was a great week full of Previously, Finovate demos that focused innovation, networking and strategising on AI were sometimes heavy on amazing about the long-term future of fintech. technological capabilities and light on real- With so many innovative companies and world applications. That trend has turned seasoned thought-leaders on stage, there around in a big way. are no shortage of takeaways from the Of the 60 companies that were on stage event, but here are three that are especially at FinovateSpring, 25 incorporated AI and worth mentioning. machine learning (ML) in some way. That’s notable in and of itself, but what’s more AI IS OFFICIALLY HERE (AND IT’S interesting to see is the variety of areas in LIVING UP TO THE HYPE) which that technology is being applied. We Artificial intelligence (AI) has been a hot saw AI applications being applied to areas topic in fintech for a few years now, but it such as alternative credit scoring, customer

has finally reached the point where it can care, marketing/sales, financial advising, Conferences (all images): Finovate Image source >>

18 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 19 CONFERENCE RECAP CONFERENCE RECAP

FINOVATESPRING BEST OF SHOW NOTES

financial inclusion, stock-trading and call- my answers to those questions would be centre, among others. “yes” and “probably not”, respectively. The initial promise that AI offered when we first started hearing about it is being IS THERE A REAL-WORLD USE FOR realised, and fintech entrepreneurs are BLOCKCHAIN? using the technology intelligently and The first time I remember seeing a creatively. Most importantly, though, the blockchain application on stage was in way we’re talking about AI has shifted. 2015, when Blockstack.io (since acquired The technology itself is no longer the focal by Digital Asset) showcased how it could point; what matters now is what you can build a custom blockchain for anyone who get it to do. Or to put it another way, the wanted one. In talking to the team during conversation has progressed beyond “How their pre-event coaching calls, it was clear does it work?” and moved on to the more that they had amazing technological important question: “Why does it matter know-how, but they weren’t quite sure that it works?” We saw a host of possible who should be interested in their tech or ■ Best of Show winner Voca.ai has now participated in three Finovate events and answers to that question offered by our what their core value proposition should won a trophy each time. Making that more impressive is the fact that these events FinovateSpring presenters, and we’re still be. Now, four years on, it feels like the were on three different continents. It has now won at FinovateAsia in Hong Kong, only just starting to scratch the surface of industry is still struggling with those FinovateEurope in London and FinovateSpring in San Francisco. The company’s what’s possible. fundamental questions. demo clearly resonates with audiences all over the world, and if you haven’t heard At FinovateSpring, just five companies of Voca.ai yet, now’s the time to do some research on it. WHEN IT COMES TO DATA BREACHES, used “blockchain” as one of their self- EVERYONE IS VULNERABLE selected keywords, and only three of those ■ Glia (formerly SaleMove) won its sixth Best of Show at FinovateSpring, If AI is establishing itself as the engine that (ALTR, Cone and Finhaven) had blockchain taking it into a tie for second place on the all-time leaderboard. MX (formerly will drive fintech forward, data is its fuel. technology at the core of their value prop. MoneyDesktop) and eToro also sit on six total wins, while Dynamics remains the After all, a self-learning algorithm can only By contrast, AI first showed up on stage at all-time Best of Show leader with eight wins to its name. be as strong as the data that feeds it. Data, Finovate in 2016, and now it has worked its though, continues to represent a massive way into nearly half of all the solutions that vulnerability for banks and fintechs alike. we saw on stage. This raises a fundamental During their demo, Best of Show question about how useful blockchain winner Arkose Labs showed the audience technology really is for banks and other FIs. just how easy it is for malicious actors to I want to be really clear that I acquire compromised data and use it to enjoyed the demos from ALTR, Cone commit fraud (needless to say, they also and Finhaven, and I would encourage have a solution to help protect against anyone to take a look at their demos for that problem). In a different 15-minute themselves (available at fionvate.com/ keynote, Alissa Knight of Aite took the videos). That said, there has always been stage to release some troubling findings an idea that blockchain was a solution around how possible it is to use APIs to looking for a problem, and based on the gain access to customer data and exploit number of companies we saw using it at vulnerabilities in mobile banking apps. FinovateSpring, it looks like the anticipated BreachRx, another demoing company, adoption of the technology by the industry went so far as to suggest that data is still a long way off. ■ Have you heard of The Venture Center in Little Rock Arkansas? You’re certainly breaches are essentially inevitable, which Will blockchain become something not alone if you don’t immediately think fintech when you think Arkansas, but is why it focuses its technology on how to that banks have to engage with similarly maybe you should. FinovateSpring Best of Show winners Neener Analytics turn the response to a data breach into a to the way they engage with AI? I (second win) and Invest Sou Sou (pictured, first win) both have ties to The Venture routine business process. certainly hope so. But the more time that Center, joining previous Best of Show winners Bond.ai (FinovateFall 2018) and Are data breaches becoming “routine?” passes before blockchain makes it into Alpharank (FinovateSpring 2017 and FinovateSpring 2018), who have also passed Is any organisation immune? Based on mainstream finance, the less likely it is that through one of The Venture Center’s accelerator programmes. bt what we saw and heard at FinovateSpring, it will happen. bt

20 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 21 INTERVIEW: DAN MAKOSKI, LLOYDS BANKING GROUP

designers to engineers might be one-to-six or one-to-eight and there will not be this ratio within financial services but a team, already made up of a couple of hundred, is Grand designs coming together at the bank. The majority are new recruits, including apprentices, but some have moved from other parts of the bank, including branches and group IT, where they have shown a (M@VHCD Q@MFHMFHMSDQUHDV +KNXCR!@MJHMF&QNTOŗRBGHDECDRHFMNƧBDQ Dan passion for design. The most important Makoski, talks to Martin Whybrow about his role, the need to listen to customers quality, says Makoski, is empathy – “a real Q@SGDQSG@MENKKNVSGDƥMSDBGR VG@SGTL@M BDMSQDCCDRHFMLD@MRHMƥM@MBH@K desire to meet people’s needs”. These RDQUHBDR@MCVGXGHRřATKKRGHSŚLDSDQVDMSNƤVGDMGDƥQRSRONJDSNSGDA@MJ are “not just visual UX [user experience] designers” but have a range of social science backgrounds, including sociology, psychology and anthropology. There are also writers in the team, focused on how best to communicate with customers. Will one day every bank have an executive- Makoski’s initial discussions with the That need for empathy stems from the level chief design officer (CDO)? One of UK bank started about three years earlier. essential role of listening to the customer, this currently rare breed is Lloyds Banking In the end, what tempted him across was inviting them in not merely to look at what Group’s Dan Makoski, who has been in the bank’s vision. He admits that when he is under development but to provide input position since July 2018. He was previously first heard Lloyds Bank’s ‘Helping Britain from the outset. There is no point talking at Walmart (vice-president of design) and, Prosper’ strategy, on the one hand he was open banking or PSD2 with customers, prior to this, at Google (head of design/ excited about the potential social impact Makoski points out, it is more about advanced technology and projects) and but, on the other, “my bullshit meter went issues such as how they want to view and Motorola Mobility (global head of design off”. Unveiled in 2014, that strategy states: manage their finances in one place. research), among others. “We believe we have a responsibility to help In these pioneer CDO days – in financial address some of the social, economic and REIMAGINING A DIGITAL FUTURE services, at least – it seems pertinent to environmental challenges that the UK faces”. As an early example of the types of work start by asking, why the switch to financial After discussions with the bank, being undertaken, the bank is integrating services and, at an even more basic level, including with CEO, António Horta Osório, the Google Maps API with account what does a CDO do? and transformation group director, Zak statements, so that customers can click on In Silicon Valley, it is now usual to Mian, he was convinced that this wasn’t a transaction and see where it was made. find this role at a vice-president or other a glossy sheen for business as usual and Apple Card is doing something similar. executive level but, says Makoski, “in that the new CDO role was a key one for “We need to reimagine our digital future the world of finance, there are not a lot putting it into practice. from the perspective of customers,” says of examples”. Often, where there is a “Design, like technology, is a strategic Makoski. He points to Walmart, arguably specific design function, it is at a middle superpower that can be used to do the world’s largest company based on management level and is about “tactical incredibly bold things,” says Makoski. As many dynamics, with 2.6 million associates, delivery”, making things look “shiny”. Where a reflection of the challenge, he cites the which “completely redesigned every pixel there are currently such senior level CDOs Google autocomplete suggestions when associated with walmart.com”. It focused or equivalents, these tend to be in fintechs. you type in “My finances are…”. Its top on people, not competitors, and this is one That looks set to change. responses include “a disaster”, “a mess”, “out of Makoski’s key messages. of control” and “making me depressed”. The bank is less focused on fintechs “That Google search is why I’m here,” he says. and its competitors than on its customers. Tangibly, the response means finding With fintechs, “there is a lot to admire “Design, like technology, is a strategic ways to help the most challenging and it’s great that they build a higher bar households and people because, “if we can for everybody” and it is not that Lloyds superpower that can be used to do incredibly help them, then we know we can deal with Bank is “blasé, lazy or doesn’t care” about all of the less complicated scenarios”. them, challengers or its fellow big banks, bold things.” At present, it is a relatively small design but there’s a danger of following the Dan Makoski, Lloyds Banking Group team within Lloyds’ 75,000 staff but there competition rather than your own strategy. are “some bold intentions to build the “We take more inspiration from the lives capability”. In Silicon Valley, the ratio of and experiences of ordinary UK citizens >>

22 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 23 INTERVIEW: DAN MAKOSKI, LLOYDS BANKING GROUP WELCOME TO THE

Makoski is based at the bank’s 48 Chiswell “I expected [the bank’s large IT infrastructure] to Street office in London, which has a long- be pretty antiquated and, while we do still have standing reputation within the group for trying to be more agile and interactive, a mainframe somewhere, I was really impressed as reflected in the fact that it has long LIBRARY been nicknamed internally as the ‘Google with our digital estate. In many respects, it is building’. “There are no free lunches, no pretty darn good.” Sergey [Brin, co-founder of Google] or Larry [Page, Google CEO] going around Dan Makoski, Lloyds Banking Group the building, no nappods”, but it does have more of the feel of a start-up. That culture change, applicable to the banking sector as a whole, in part than the competitors, about the way Makoski can see banking products similarly revolves around a tendency to still view they think about money,” he says. As linked to individual customers’ attributes digital as something separate rather than Microsoft, Google and Walmart have where they are willing to share relevant as inherent to the whole business. “When shown, “when you focus on customers, information. you say ‘digital’ something, then you don’t amazing things happen”. In terms of the technology to support quite get design,” says Makoski. There is no He believes the leap forwards could this, artificial intelligence (AI) and robotics ‘digital group’ at Google, for instance. be comparable with some of the big will have a role, so too virtual assistants tech milestones of the past, such as (“providing a more conversational CHIEF GOO UNBLOCKER when command line interfaces replaced connection with their finances”) and, On the reverse of Makoski’s business card punchcards. Or when, in the first half of the “further out” mixed reality, providing (which he redid on joining as he didn’t like 1970s, a Xerox Park researcher envisaged financial information in context, such as the design) it reads “Chief Goo Unblocker”. how people might want to use computers, when out shopping. The technology will There will always be the need to be creating a simple schematic that paved free up staff to work on the more “high- secure, comply with regulations, manage the way for the world’s first GUI-based touch, complicated customer interactions” risk but there’s also the mentality of “that’s computer, Xerox’s alto, from which Apple and Makoski foresees employees and just the way we’ve always done it” to was born. virtual assistants having “a harmonious move away from. In the financial sector, he sees a likely relationship”. On the up-side, he was pleasantly transformation of the ledger. Although The bank’s aim is to be “the most surprised by the bank’s large IT digitalised, it still reflects its 400-year-old advanced human company, powered infrastructure: “I expected it to be pretty heritage, now being little more than a by technology” and he emphasises antiquated and, while we do still have spreadsheet and only informing about again that it will be “driven by AI but, a mainframe somewhere, I was really the past. “Numbers alone don’t help more importantly, by empathy and impressed with our digital estate.” It was ordinary people to prosper,” he says. He design principles”. Everyone will have AI, more advanced than he expected and “in anticipates a new design language that will blockchain and so on but the differentiator many respects, it is pretty darn good”. fundamentally rethink how financials are will be how they are used. This new future And some of the bank’s partners are presented, constituting a single snapshot will also need to be backed up by deep aligned with the design approach too. of a person’s overall financial health, data ethics, he adds, with the bank actively For instance, he says Phil Gilbert, general including aspects such as their spendable engaging with the different potential manager of IBM Design, is “a great partner cash, debt and expenses. models for this, such as data trusts. for us”. IBM Design is described as focused The challenge shouldn’t be under- on “recruiting and retaining top designers, Introducing a brand new section on our website, GETTING SMART estimated, not least due to the size of scaling the consistent practice of great Makoski also feels that smart contracts the Lloyds Banking Group and its many design across IBM, and simplifying access where you can findfi nd a compilation of books from the world of business, financefi nance and technology. will have a role to play. This concept touchpoints. That design language will to IBM’s broad portfolio of capabilities”. We’ll be adding new books regularly that we feel are relevant, underpins the design of Thought Machine’s be needed for every point of a matrix that That new design language that Makoski emerging Vault platform (Lloyds invested spans the main brands of Lloyds Bank, referred to won’t necessarily be something useful and of interest to you, our readers. £11 million in this UK company, taking a Halifax and Bank of Scotland, the product that you’ll see written down but rather, he Happy reading! 10% stake, in November 2018). He believes set of current accounts, savings, personal says, something that you will feel. And it’s smart contracts are “really interesting” and loans, credit cards, mortgages and others, clear that he’s enjoying the challenge. “I will allow for adaptive, flexible financial and every channel, including branch and am in an incredible place of learning,” he products, rather than the current “one- telephone, for its 30 million+ customers. says. While he is a scarce pioneer at present www.bankingtech.com/library size-fits-all based on classes of risk”. As is How receptive was the rest of the bank in financial services, there is every chance happening in car insurance, with premiums to the new function? that, as happened with the CTO position, linked to customers’ driving behaviour, so There is a need for a cultural change but one day all banks will have a CDO. bt Do you know of a book that should be on our virtual library’s shelf? Contact: Tanya Andreasyan 24 | www.bankingtech.com | June 2019 e: tanya.andreasyan@fi ntechfutures.com and we’ll be happy to consider it. If our team deems the book suitable, it will be included in our library for free. FOCUS: FINANCIAL INCLUSION FOCUS: FINANCIAL INCLUSION

Uganda hoping to Prosper with clean energy initiative

In Uganda, clean energy A project is underway in Uganda that claims to have reached more than 100,000 solar lantern can provide 72 hours of high- The devices are sourced from two US @MCƥM@MBH@KHMBKTRHNM@QD brings together both financial inclusion people in that time. power light after a single day of charge. One companies that manufacture in China and clean energy products. Repayments Washington DC-based FINCA model includes two USB ports for charging and are supported by FINCA Ventures, an BNLHMFSNFDSGDQVHSGHM@M for the latter over 12 months can be used International was established in the mid- mobile phones. There are also solar homes impact investment initiative that provides HMMNU@SHUDLNCDKGD@CDC to build credit history, which then leads 1980s, offering small loans to transform offers, which include solar lighting, power capital and technical assistance to early- AX%(-" CDQHUDCRNBH@K to the offer of a savings account. That lives across the world. It is the founder and systems and appliances, including TVs stage social enterprises. FINCA Ventures DMSDQOQHRD !QHFGS+HED  offer is seamless and is provided through majority-owner of 20 community-based and radios. BrightLife also offers firewood supports innovative solutions in energy, long-standing financial inclusion specialist, microfinance institutions (MFIs) and banks and charcoal cooking stoves that cut toxic water/sanitation/hygiene, education, 3GDRD@QDD@QKXC@XRATS FINCA International. across Africa, Eurasia, Latin America, the emissions by up to 90% and reduce fuel use health, agriculture and fintech. SGDHMHSH@KHMCHB@SHNMR@QD The solar products are offered by Middle East and South Asia. by at least 50%. One of these clean stoves The solar homes offerings in particular ONRHSHUD Martin Whybrow BrightLife, a social enterprise set up by At the low-end of BrightLife’s offerings uses the heat from cooking to generate were often too expensive for one-off QDONQSR FINCA. Since 2015, BrightLife has offered are standalone solar lights. These can be enough energy to charge a mobile phone purchase so there was a loan option a range of solar solutions in Uganda and hand-held, hung or placed on a table-top. A or power an LED light. from the outset. FINCA loan officers accompanied BrightLife sales agents into the field; FINCA clients could finance the solutions via top-up loans. “That worked pretty well for a time,” says Stefan Grundmann, BrightLife’s president and CEO. “But over time, a few lessons came up.” FINCA was not particularly geared up for financing consumer goods “We realised that if and the incorporation of Uganda’s pay-as- you-go PayGo technology by BrightLife there was too much proved more convenient. While purchases could still be financed friction then no one via FINCA, the greater flexibility of PayGo would accept it. So was an attraction, allowing customers to repay via mobile money and without we spent a long time the need for set times and days for those repayments. BrightLife was effectively figuring out how to providing the financing itself, via its do that.” balance sheet, using the physical products as collateral. It is able to turn off those Stefan Grundmann, BrightLife products from a central system if there is a default on repayments. “So we started separating from FINCA Uganda,” says Grundmann. Nearly all consumers came to choose the PayGo route.

PROSPER – COMBINING FINANCIAL INCLUSION AND CLEAN ENERGY The latest initiative is really “flipping our original business model on its head”, says Grundmann. Where FINCA was at the outset the perceived sales channel, it is now brought into the loop again from a financial inclusion perspective, addressing >>

26 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 27 FOCUS: FINANCIAL INCLUSION FOCUS: DIGITAL PLATFORMS Sponsored by

is the only off er now being made, with an excess charge built into the off er price to accommodate the rebate. Transforming The uptake of the savings account at the end of the payback period is currently unknown but Grundmann says the option the loan has been well-received, particularly among women customers, who might not have access to land titles or collateral for experience fi nancial inclusion. Why is all of this important? In Uganda, nearly 67% of adults lack a fi nancial Simple and fl exible digital platforms could be institution account. There is similarly deep the key to improved customer repayment rates. energy exclusion, with 73% of Ugandans Image source: GoCardless Image source: unserved by on-grid electricity. BrightLife’s solar off erings are targeted at Ugandans earning less than $4 a day. The clean energy

FINCA International/Alison Wright FINCA International/Alison products create healthier and safer homes, Recent survey data shows us that the addressing them at a systems level could 87% saying they should be able to make increase productivity, reduce household risk of missed loan repayments, for a be transformative for both lender and repayments online. Managing repayments expenses and provide additional income- signifi cant percentage of borrowers, boils borrower. And, while lenders have little online seems like a no-brainer in today’s In Uganda, nearly 67% of adults lack a fi nancial generating opportunities. down to customer experience. While lack control over borrowers’ lack of funds, by market, but barriers such as paper Direct Off -grid living stifl es productivity, of funds is a major issue – and always will paying closer attention to the customer Debit mandates may put people off . institution account. There is similarly deep reduces earning potential and increases be – other barriers such as technology experience and addressing these issues, Reminders ahead of repayment dates household energy expenditures. Children troubles and lack of clear information they could make a big dent in loan are also important – 87% of respondents energy exclusion, with 73% of Ugandans cannot study after sunset, leaving them on when and how much to pay are also delinquency. would like this. And 85% said they would unserved by on-grid electricity. academically disadvantaged, while signifi cant. This presents lenders with like to ‘set and forget’ all upcoming businesses must close at sundown, reducing an exciting impetus to transform the KEEPING UP TO DATE repayments in one go. the available working hours. And poorer repayment experience; if customers are So what does a better repayment Flexibility of payment method is also households that are reliant on traditional off ered a clear and easy-to-use digital experience look like for the borrower? desired. Lenders who off er multiple fuels spend a relatively larger share of their repayment system, the chances are they’ll Survey data tells us that customers want payment methods may be more likely to total expenditure on energy. All of which miss fewer repayments. What’s more, a better visibility, ease of use and control. In attract customers. As would lenders who perpetuate a vicious cycle of poverty. loan product proposition with a simpler terms of visibility, 91% of those surveyed allowed borrowers to change the due customers who are usually beyond its Grundmann. “We realised that if there For the future, says Grundmann, repayment system and better options agreed that being able to see the status of dates of each repayment. Direct Debit has reach, typically because they do not have was too much friction then no one would BrightLife is looking to add appliances to becomes more attractive compared with all their repayments is important. Online a huge potential to improve the customer collateral or credit histories. accept it. So we spent a long time fi guring its off erings, particularly for agriculture and others on the market. repayments are hugely desired, with experience, too: 92% of those surveyed Called Prosper, the scheme leverages out how to do that.” The off er is made and probably starting with solar water pumps. When asked about their borrowing would be happy to pay by Direct Debit if a the 12-month credit history built up via can be accepted by text, is mobile-only A plan for a pilot is being drawn up and, experience, 84% of the 400 loan lender off ered it and 75% would be more PayGo. That is valuable data to a bank, and has no need for the client to enter once more, there will be an off er of a FINCA customers surveyed* said payment likely to use a lender that off ered Direct says Grundmann, and the initial plan was a branch. This is enabled by BrightLife loan product linked to this. experience is important to their overall Debit as a payment option. This means to hand it over and allow the fi nancial collecting all of the data required for know Uganda itself still has a huge unfi lled borrowing experience. A large proportion that incorporating Direct Debit with a institution to make use of it. However, you customer (KYC) at the outset, within its need but it is also the intention to take (50%) of all those surveyed said they clear, fl exible and easy-to-use digital Prosper is much more integrated than that. sign-up process. the model to one or more countries, says had missed a repayment or had made platform could greatly improve customer At the end of the 12 months, customers Also involved in the planning was Grundmann, probably in the next 18 a repayment after the due date. Yet numbers and repayment reliability. who repay their loans in full and on time Financial Inclusion on Business Runways months, once it is proven in Uganda. interestingly, while 50% missed their “Transforming the Transforming the customer receive a 20% rebate and are eligible (FIBR), an initiative of consulting fi rm BFA These are early days but the theory, at repayment because they did not have the experience of loan repayments could be to become FINCA Uganda clients. With and the Mastercard Foundation, that seeks least, looks sound and, while Grundmann funds, signifi cant numbers of respondents customer experience a win-win for businesses and borrowers. the customer’s agreement, the rebate is to connect fi nancial services to low-income admits there might be a few glitches, the highlighted experiential reasons as well. of loan repayments Automated payment collection platforms deposited into a FINCA Uganda savings populations in Africa through digital aim has been to make take-up as simple Technology troubles led to 34% of such as GoCardless off er to do exactly account, as opposed to being repaid via innovation. as possible. The true test will come as the borrowers missing a repayment, while could be a win-win that – providing the clarity, fl exibility PayGo as mobile money. In addition, based Prosper was launched in early March loans start to mature in large numbers 31% said they didn’t know which date and ease of use that could lead to better on the credit history, the customer is 2019 and, in the fi rst couple of months, but there are already customers who have their repayment was due and 21% for businesses and repayment rates. bt pre-approved for a loan with no collateral within pilots in the Masindi and Mityana paid them back early and have accessed didn’t know how much to pay. These borrowers.” needed beyond the savings deposit. The regions, it had gained about 300 the loan off er as a result. All in all, Prosper sorts of fi gures can have a big impact Get paid on time, every time loan off er is based on a multiplier of at customers, says Grundmann, at which looks to be a neat dovetailing of two on business and personal credit ratings; www.gocardless.com least four times the deposit. point between 200 and 250 people were important requirements – clean energy It is a totally digital product, says signing per month. In these regions, this and fi nancial inclusion. bt * GoCardless survey of 400 borrowers who have taken out at least one personal loan within the last two years and had missed at least one repayment.

28 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 29 SPOTLIGHT: CHALLENGER BANKS SPOTLIGHT: CHALLENGER BANKS

German challenger banks: HOLVI Helsinki-based Holvi, established in 2011, offers a business current account and a debit card, Holvi Business Mastercard. It launched in Germany in 2016. The same year it partnered with SumUp for the German market – combining who’s who and what’s their tech SumUp’s mPOS offering with Holvi’s online business account – to serve SMEs and the self-employed in the country. Also in 2016, Holvi was acquired by BBVA. The Holvi platform is a bespoke build, and is essentially a core banking system with integration built into the various payments ecosystems around Europe. The technology stack comprises a proprietary Javascript UI framework, along with Backbone.js, CSS and HTML at the front-end and Python, Django and PostgreSQL at the back. Dynamic Deutschland! With several new entrants looking to prosper in the German The entire infrastructure is hosted in the cloud with Amazon Web Services (AWS) from a data centre in Ireland. banking sector and be part of the Zeitgeist, Banking Technology has created a list of the known challengers to date and the technology they are using.

HUFSY Hufsy, a Denmark-based fintech start-up focused on SMEs, expanded into Germany in 2017. Its banking partner in the country is solarisBank. Its banking offering is tailored for start-ups. “It is a one-point entry and therefore an easy and time-saving way for small businesses to handle finances,” Hufsy explained. It also uses CONSORSBANK artificial intelligence (AI) tools. The bank is the name in Germany for Hello bank! – a digital – which in turn is part of BNP Paribas. It In 2017, the company said it will focus on Berlin, as its research found that 30% of German was launched in Germany in 2013 and offers online products, such as credit cards, loans, savings and insurance. start-ups are in the country’s capital and the region has 177,000 SMEs. The roots of the bank in Germany is Cortal Consors, a European broker in consumer investing and online Hufsy’s founders are software engineer Rafal Lipinski and entrepreneur Maria Flyvbjerg Bo. trading, owned by BNP Paribas. In 2013-2014 it was rebranded and joined different parts of BNP Paribas’ businesses in Europe. In Germany, it was merged into Consorsbank. In 2016, Consorsbank also absorbed DAB Bank, a German bank that BNP Paribas bought in 2014. In 2017, German fintech firm figo’s technology became the backbone for the launch of Consorsbank’s MultiBanking service. Customers can now use accounts and deposits they have with other banks after logging KONTIST into their online banking. Berlin-based banking app provider Kontist was founded in early 2016 by Christopher Plantener (CEO), Alexander Baatz, Sebastian Galonska and Madison Bell. It offers a German IBAN, Mastercard, FIDOR integrations with accounting systems Digital-only Fidor was founded in 2009 and is based in Munich. (FastBill and Debitdoor) and deposit The bank holds a full banking licence and uses its own in- insurance. It is a partner of solarisBank, house developed technology, which it also licenses to other which holds a full banking licence. financial institutions (such as Penta Bank) via its technology In October 2018, Haufe Group provided arm, Fidor Solutions. an undisclosed amount of Series A funding In 2016, Fidor was acquired by BPCE, France’s second and acquired a stake in Kontist. The two largest banking group, but remained as an independent partners’ first task together was a technical business. However, the relationship did not prove successful integration of the online accounting and BPCE set out to sell Fidor in H2 2018. Fidor’s founder and software Lexoffice and the Kontist bank CEO, Matthias Kröener, left the company in spring 2019. account. Users get automated accounting, In 2017, it partnered with Eight Inc to launch Fidor a real-time estimate of tax payments FinanceBay, its digital marketplace. The two firms said they due, and an integrated Mastercard for are jointly designing Fidor’s customer experience for the expenditure management. community-based marketplace for financial services. The The bank has got the backing of project was initially launched to Fidor’s customers in Germany Founders, a company builder and VC as a beta test, followed by a global roll-out. Fidor FinanceBay in Copenhagen that develops software is a standalone market infrastructure and white-label solution solutions for the self-employed and SMEs. for distribution partners. Founders provides financial, development, marketing and administrative support.

>>

30 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 31 SPOTLIGHT: CHALLENGER BANKS SPOTLIGHT: CHALLENGER BANKS

REVOLUT SOLARISBANK London-headquartered Revolut was founded in 2015 and sees itself as a digital Berlin-based solarisBank was MONEYOU banking alternative designed for a global lifestyle. It off ers fee-free spending, founded in spring 2016. With Moneyou, ABN Amro’s digital banking subsidiary, launched its Tikkie mobile payment interbank exchange rates, free international money transfers and diff erent support from local fi ntech incubator app in the German market in 2018. currencies in-app. FinLeap it launched the “fi rst” global The app and its underlying software were jointly developed with Munich-based It applied for a European banking licence in 2017 and launched in Germany banking platform, called Solaris FinTecSystems. the same year. The licence was secured the following year. – a Banking-as-a-Platform (BaaS) Tikkie can be used by anyone, regardless of who they bank with, and only the In April 2018, it raised an additional $250 million in Series C funding, which service. The service is used by other person receiving the money needs to have the app. Once they enter their name, saw the fi ntech valued at $1.7 billion – a fi ve-fold increase in less than a year. challengers and start-ups today, mobile phone number and the IBAN number, they are ready to start sending payment Earlier in 2018, it fully launched its open API – allowing users to integrate including Penta (see left). requests via WhatsApp, Facebook Messenger, Telegram, QR-Code or text (SMS). Revolut for Business accounts with third-party software and in-house systems. FinLeap brought the team of Payments are executed as direct transfers from accounts at any bank in Germany. It also built its own in-house processor, following a string of outages caused entrepreneurs together, provided In September last year, it launched Moneyou Go, a new payment and savings app, by its then third-party provider, Global Processing Services (GPS); and brought seed funding and support during the developed together with Bankable. It is free for German customers. the card issuing function in-house, ousting its external supplier Wirecard. development phase for solarisBank. In early 2019, it signed an agreement with regtech start-up ClauseMatch to The bank off ers a B2B2C adopt its technology to streamline management of internal policies, controls (business-to-business-to-consumer) and regulatory compliance, following a two-month trial period. product. It is a modular-based toolkit Not long after, Revolut was rocked by compliance and culture criticisms, and off ering account and transaction saw its CFO resign. services, compliance and trust N26 solutions, working capital fi nancing Berlin-based mobile banking challenger N26 is one of the more active banks. It and online loans. In addition, it off ers has taken its business fully across 17 European countries, including Spain, Italy, payment and escrow services – all Greece, Ireland and Slovakia. accessible via APIs. It was founded in 2013 by Maximilian Tayenthal and Valentin Stalf. In 2016, it It holds a full banking licence and received a full banking licence from the German regulator, BaFin, and changed its SILICON VALLEY BANK has passporting rights across all EU name from Number 26 to N26. Silicon Valley Bank (SVB) arrived in Germany in May 2018. states. As of mid-2018, it is active N26 provides a free basic current account and a debit Mastercard card for its It was granted a lending licence by Germany’s banking regulator, in seven countries and has more customers. Additionally, customers can request overdraft protection, investment BaFin, and is based in Frankfurt. It is a subsidiary of California-based SVB; than 60 corporate clients using its products and premium current accounts. PENTA and is the bank’s second European location (the fi rst one was the UK). It banking platform. N26 works with TransferWise on cross-border money transfers. It also Berlin-based Penta is a digital bank is also in China and Israel. In spring 2018, it completed a partnered with Raisin – to enable N26 customers to save money and choose account for “high-tech” start-ups and SVB already has several German tech fi rms on its client list, including Series B funding sound, raising €56.6 interest rates from banks across Europe – as well as integrated Vaamo into the SMEs in Germany, founded in spring HelloFresh, Lilium and Babbel. million for further international N26 app to enable customers to invest their money and manage a customised 2016. In early 2018, it raised a €2.2 million It will off er lending to growth stage technology and life science expansion (it has raised more than investment portfolio. seed round. The investment was led by businesses in Germany, as well as fi nancing acquisitions and €92 million since its launch). Among For its back-offi ce processing, N26 uses Mambu’s core banking system, Inception Capital, a fi ntech-focused VC working capital. the investors are ABN Amro, Visa, supplied on a hosted basis. based in the UK. For its tech, SVB is a long-standing Oracle customer, including the BBVA and Japan’s SBI. In March 2018, the bank closed a €110 million Series C funding round as it Penta was acquired by European Flexcube core banking system, business process management (BPM), In June 2018, solarisBank sought to consolidate its presence in Europe and expand to the US. This was fi ntech ecosystem Finleap in April 2019. As content management and ERP software and middleware products. It teamed with Poland’s Alior Bank, followed by a $300 million Series D funding round in early 2019. a result, the bank started a collaboration also uses ACI Worldwide’s software for online banking. Germany-based online marketplace Earlier this year, N26 has come under scrutiny by German regulator BaFin, with Beesy, another Finleap portfolio for savings products Raisin, and which found several defi ciencies in its processes. It ordered N26 to address company that provides digital business Mastercard to unleash a pan- staffi ng, outsourcing and engineering issues. banking for freelancers in Italy. European digital bank. bt Its technology is provided by another German bank, Fidor, and it also uses the Banking-as-a-Platform service from yet another local start-up, solarisBank, which holds a full banking licence. All deposits are held at solarisBank. Penta says it diff erentiates from its competitors by off ering third-party products only. These include automated accounting, international transfers and cash fl ow management. We are updating this list on a regular basis. If you have any amendments and/or additions, please get in touch with our editorial team (see p3).

32 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 33 COMMENT COMMENT

Looking back at a career in banking “If I can help inspire Rise up women – and fintech that spans over 30 years, I sometimes stop and wonder where I would just one person to have been had it not been for key mentors who believed in me – and spurred me on be bold and ‘rise up’ you can do it, you to be the best version of myself. So when I had an opportunity to become a mentor above what could myself through Money20/20 Europe’s Rise otherwise be a less really can! Up Academy 2019, and to share my story, I jumped at the chance and applied – and than ideal path in life, am proud I have been chosen to represent then I will be a proud By Jackie Barwell, director of fraud and risk the Academy in Amsterdam in June. My personal story is not quite the woman.” product management, ACI Worldwide conventional, but if by telling it I can help inspire just Jackie Barwell, ACI Worldwide one person to be bold and “rise up” above what could otherwise academic school. I also took the initiative be a less than ideal path in life, then I will of enrolling into a night school to learn be a proud woman. My start in life wasn’t the art of touch-typing – a skill that has the kind that could be viewed as a firm stood me in good stead ever since. That foundation for a successful and purposeful skill enabled me to be promoted to future. I was born, a middle child of three, telesales within the newspaper where, into a house whose parents were totally after a year, I typed up a situations-vacant unequipped to raise a family. After a short advertisement over the phone from life together filled with financial pressures someone at Clydesdale Bank. They were and evictions due to unpaid rent, my father looking for an audio secretary for a post at Money20/20 Europe, the region’s left when I was five, quickly followed by their St James’s Street Branch in London. AHFFDRSO@XLDMSR@MCƥMSDBG my mother deciding that abandoning us I cheekily asked that they interview me event (held in Amsterdam on 3-5 at a local police station was the best thing for the role and if I turned out to be June 2019), featured Rise Up for all of us. After some difficult years in unsuitable, they were still in time for this multiple foster and children homes, my week’s newspaper. Well, they interviewed Money20/20, a global programme father retrieved us after remarrying and me and I got the job! That was the start of designed to address the gender securing a council house to accommodate a 30-year career within the banking and imbalance in leadership positions us all, including a new stepmother who, for fintech world. VHSGHMSGDƥM@MBH@KRDQUHBDR@MC reasons of her own, resented the three of I stayed with Clydesdale Bank in a us enormously. variety of roles, moved on to Bank of ƥMSDBGHMCTRSQX Despite my less than ideal start in life, I America and then went on to spend showed signs of academic potential. I was ten years at Citigroup – specialising Among 30 female professionals encouraged by my junior school teachers and focusing on the prevention side of that took part is Jackie Barwell, to take the 11+ exams, which I passed, thus managing fraud risk across all businesses. I allowing me to attend a grammar school. eventually became SVP and global head of director of fraud and risk product I gained eight “O” levels, left school at 16, fraud prevention at Citibank, and created a management at global payments and pretty much grabbed the first job I network of almost 300 business unit fraud RNESV@QDOQNUHCDQ "(6NQKCVHCD  could find! managers, whose task was to understand Here she talks about why she is I worked at a local newspaper, where fraud and take their new knowledge back I was an office junior and I would order into the business. excited to be part of Rise Up and stationery, deliver mail and operate the I now work as director for global VGXHSRVNQJHRRNHLONQS@MS switchboard at lunch time; this was all a payments software powerhouse ACI good starter-for-ten for someone who Worldwide, as director of the company’s had come out straight of a straight-laced fraud and risk products, to make sure our >>

34 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 35 Sponsored by COMMENT INDUSTRY INSIGHTS

highly sophisticated fraud-prevention of the day and other elements of fraud solution performs at a competitively high prevention, away from the very “closed” level and our merchants are sufficiently fraud communication forums, which Core modernisation is essential protected against exposure to fraud risk. unfortunately at the time, typically viewed I also represent ACI at industry events women as misplaced in their midst. around the world and I am often asked the This started with just two of us, quickly for truly digital banking question: how do you promote your career growing to double figures – and soon the as a woman in the still male dominated Fraud Women’s Network was born. I was a Banks have only to look at how innovators have transformed retailing and music to recognise this truth, says Sanat Rao, fintech and payments industry? This is an founding member (and their first treasurer, Chief Business Officer and Global Head, Infosys Finacle. interesting question, as I never thought and membership secretary). This network that my gender has been holding me back has now been going for 12 years, and has a at any stage of my career. However, when strong membership running into the 100s. I think about some of the things I used Women supporting and encouraging In recent years, UK high street banks have collaboration with ecosystems – to drive to do (and to a degree still do) and when each other, talking to each other about been under siege as newer, seemingly business value, enhance profitability, I put those in the context of gender, I do their experiences on their own career more adept competitors have entered the compete with agile digital banks and believe there are some interesting lessons “Unconscious bias paths, is probably the most valuable market. However, recent developments be sufficiently scalable to meet the to be learnt. thing women can do for themselves. It’s indicate that the newer rivals are volumes that digital banking demands. exists, not necessarily surprising how many individuals have had experiencing problems of their own and Their customers still want the traditional BE BOLDER AND TAKE RISKS just in regard to similar experiences where their gender has the incumbents have an opportunity to services that they have always availed, According to many studies, women been almost a hindrance or an invisible hold back the invaders. but in addition seek expert guidance on tend to only apply for roles for which gender, but also age, barrier to progress, or have experienced Metro Bank made waves with its bricks- managing their finances better. they can evidence all the requested unconscious bias of some kind – but have and-mortar presence nearly a decade ago New technology is an enabler for experience. Women often over-analyse personal situation and taken steps to overcome the negative and has steadily extended its network innovation, opening up a market where the written job description and either even education. Be effects of those experiences. since then. However, the revelation early existing off-the-shelf products and services dismiss roles where all the “boxes” are I also think that it is inspiring to hear this year of a massive accounting error and can be supplemented by more tailor-made not ticked in terms of evidenced aware of unconscious the stories of individuals who have almost consequent investor rebellion has clouded “To survive and thrive, offerings designed around customers’ experience or – almost worse – over-talk stumbled into the successful career path its future, and may have deterred many specific lifestyle, circumstances and about the missing ticks in the interview bias and challenge it!” for little more reason than being mentored potential new customers. banks must simplify individual needs. itself! This is something that many (if not Jackie Barwell, ACI Worldwide at key points in their careers by individuals More recently, Tesco Bank’s decision to their operating models Some banks have begun their most) men do not do. They trust that who “saw something” in them, guided pull out of the mortgage market points journey of transformation by placing they can smash the role regardless of the them and encouraged them to believe in towards the downward profitability trend through APIs and new digital channels on top of their core missing ticks in those boxes. themselves, and step through that door to of the mortgage business for challenger systems. However, many progressive others Being aware of the fact that the inner- grab a suggested opportunity and run with banks. Nimble digital upstarts are known automation.” have been quick to realise that creating need to prove our capability upfront it. And sometimes that’s all that is needed to pick and choose parts of the banking Sanat Rao, Infosys Finacle a truly digital bank of the future requires remains with us women is a first step to give you the push you need to soar! value chain or the business of banking a more radical approach than the rather to being bolder and taking risks. Also, My final message, linked to my and create disruptive propositions. Tesco’s short-term approach of adding another I believe that job descriptions need to experience, is that I had little to no move underscores this strategic intent of digital channel. be written in a way that allows for this such biases, as we debate these issues encouragement in my early years that focusing on attractive business instead of In the future, customer-centric behaviour trait – making small adjustments more honestly and openly, these bias told me “you can do it – you really can”. offering the full range of services, which mobile wallet app in 2014, it predicted that innovation and collaboration with will result in more women applying for barriers will shift and hopefully cease If anything, I was standing out for all the has been the norm in banking, traditionally. half of all banking transactions would move ecosystems will be the norm. To survive and these roles. to exist. wrong reasons – such as being a child in If the recent developments portend to distribution channels from Google, Apple thrive, banks must simplify their operating Be aware of unconscious bias and care, or always in the “free school dinners” even a slight decline in threat from new and others by 2022. Five years on, with models through application programming challenge it! FEMALE NETWORKING IS CRUCIAL queue, or the fact I was sent off on my market entrants, it is a no brainer that Open Banking and other transformational interfaces (APIs) and automation to Yes, I absolutely do. Unconscious bias There was a time in my career where first day at a posh grammar school in my incumbents would like to take advantage regulations coming into effect, the introduce new propositions quickly and exists, not necessarily just in regard to being a woman in the world of fraud junior school uniform. I could so easily of this to reaffirm their relevance. prediction is likely to be a reality even create new revenue streams profitably. gender, but also age, personal situation investigation was seen to be a rarity. have decided to hide away in the shadows However, to be able to do that, updating sooner. Driving this wave of change further Not surprisingly, winning in the digital and even education. Despite open debates Back then, at most financial institutions or take the wrong path in life. But there core legacy systems has to be their top are emerging technologies. An example future will require investment, but the in the UK about gender pay gaps and the investigative workforce was almost were those key individuals, starting with priority. It’s equally important for both is blockchain which is now seeing wide gains from reduced costs, improved creating equal opportunities for men and exclusively made up of ex-law enforcement my junior school teacher who said I could retail and corporate banks, as the twin adoption in areas such as trade finance. security and ability to innovate make that women in the workplace, the fact remains officers on second careers and typically, achieve more, and then two successive forces of regulation and distribution have investment worthwhile. And looking at that men are still miles ahead when it they were men. managers who pushed me through overturned the established order across all PROACTIVE, NOT REACTIVE how e-retail has been transformed by comes to senior and leadership positions in As I progressed through my career I that door of opportunity. I trusted their quarters in banking. Banks must be proactive rather than Amazon, or the music sector by Apple, the the technology and fintech industry. came, slowly but surely, into contact with judgement and took the courage to give it Less than 20 years ago, the bank branch reactive if they intend to ride the digital longer-established players in the banking Unconscious bias is often the point other women in similar roles to mine, and a go. Recognise those situations because housed more than half of all banking wave. It is imperative for them to sector must realise that they can either where challenges start, but as society we created an informal regular meeting they will be there one day – anything is transactions. Today, that figure has fallen to revitalise legacy systems, move workloads place themselves at the forefront of change changes and is becoming more aware of of the minds (in person) to discuss issues possible if you want it enough. bt less than 10%. When Apple launched its first to the cloud and open their core for or become its quickly-forgotten victims. bt

36 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 37 FOOD FOR THOUGHT FOOD FOR THOUGHT

There were a bunch of questions on my card and returned the card. There is how the cashiers performed. Were they “Thank God for the another way. There is a better way. Why A banker goes a-banking courteous? Yes. Were they helpful? Were free-form box where don’t you give them this better way? they taking care of my needs? Why don’t you make your employees’ All I have to say to this is thank God I could actually say lives better, and through theirs, mine? chapter 2: the party is for the free-form box where I could what needed to So, yes, I got the task done. actually say what needed to be said. And But not in the way I should have, what needed to be said is this: no matter be said. And what given the year, the maturity of certain how polite your staff, if they don’t know technologies and the size of your only just beginning why they are doing what they are doing, needed to be said is innovation spend. they can never be truly helpful. No matter how hard they smile, how this: no matter how GO AHEAD AND ASK ME FOR obliging their small courtesies, how polite your staff, if they MY NAME By Leda Glyptis winning their manner. I don’t name the bank in my blogs. I never A few weeks ago, I had a rather comical They are following a process blindly. don’t know why they do. I occasionally refer to them as the experience at my local bank and of course, Scrap that. They are following a bad Giant in Red (pick one, your options are being me, I wrote about it. You may have and outdated process blindly. are doing what they limited) for a few reasons. read it (you can find it in the May 2019 They never asked and were never told are doing, they can First, it’s not just them. edition of the magazine and also online). why each step is how it is. Why options are Second, it’s not about shaming them, We talked with thoughtful and well- not available for some things that seem never be truly helpful.” it’s about bettering the industry. informed consideration about the failures so obvious (I am here, I have ID; you are Leda Glyptis Plus, it seems a little petty. It’s not of high street banking, the purpose of here you have access to the system, you about venting. It’s about reflecting and branches, the failings of our analogue asked me a question last asked in 1997, collectively moving forward. past and how they still haunt us… the the answer has changed, let’s update this So I filled out the feedback form. options for the future. thing together, you and me baby. But no. And I gave the free-form feedback And we were done and moved on to “Computer says no”, and they don’t even because, hey, it’s an opportunity. If the next topic… or so we thought. know why. Teach them why.) someone genuinely reads this stuff and Well, almost. That’s it. Teach them why. they don’t just feed it to a calculator I knew I wasn’t entirely done as I To know the cause of things. It’s a for the NPS score (they totally do but needed to repeat the cash withdrawal wonderful thing. hey, here’s to having faith in humanity) exercise a couple of times after the blog And your people don’t know why they they will get real feedback. Actionable incident and of course, as expected, it do what they do and why they don’t do feedback. So that is what I gave: genuine was equally arcane but – keeping things what they don’t do and it’s your fault, not And it was hard because your folks feedback. With adjectives, adverbs and interesting – in different ways each time. theirs. And no amount of courtesy will didn’t have the right tools. punctuation and everything. What I wasn’t expecting was an algorithm make up for that. And it’s a terrible thing Because you spent none of your And then the last question came: are with a sense of humour. But that is exactly to be put in a position where you cannot innovation budget or your venture you happy to disclose your name and what I got. Because a day or two ago I got improve your own performance. Don’t do investment budget on making your for someone to call you to discuss your an email. From my bank. “Dear Customer,” that to your people. Teach them. colleagues’ lives easier. On skilling them up. answers? it said. “We read your blog.” On tooling them up. On equipping them to You betcha. So here we are. You asked. No, it didn’t. DON’T ASK ME ABOUT MY TASK, meet my need and get the task done. I answered. You challenged and I said It said, did you visit our Old Broad ASK ME ABOUT YOUR CAPABILITIES They used pen and paper. bring it. Street branch on such and such a day Did you do what you came here for? They filled out forms. It was bad enough before you asked. and such and such a time? Why, yes, I Sure. They copied the information off the But now if nobody calls me, we are did. Would you complete a customer Eventually. form to the screen and stamped the form beyond hope. satisfaction survey? But it was hard. and then copied the information off Your move, Giant in Red. bt Boy oh boy, would I? Now, things get interesting. This was merely a statistical exercise in calculating NPS. A play in numbers. A play Leda Glyptis is FinTech Futures’ resident thought provocateur – she leads, writes on, lives for numbers. and breathes transformation and digital disruption as chief of staff at 11:FS and CEO of But I am big on eating my own dog 11:FS Foundry. She is a recovering banker, lapsed academic and long-term resident of the food. So I answered the questions. And banking ecosystem. this is what I told them: All opinions are her own. You can’t have them – but you are welcome to debate and comment! DON’T ASK ME ABOUT YOUR Follow Leda on Twitter @LedaGlyptis and visit our website for more of her articles. PEOPLE, ASK ME ABOUT YOURSELF

38 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 39 ASK THE EXPERT ASK THE EXPERT

Ask the expert One of the most common – and priorities, targets, challenges and areas effective. Do your research and take a QUESTION 1 frustrating – challenges for fintechs is in which they need support and help? personalised approach. securing meetings with target clients. And crucially, how can you help them I’M STRUGGLING TO Many believe that simply sending a address their challenges and/or meet 3. You haven’t leveraged your LinkedIn mail or emailing the prospect their objectives? network – or your team members’ Introducing a new regular column designed to provide SECURE A MEETING is enough to secure a meeting. However, Building a detailed view of your target networks – to secure an introduction WITH A PROSPECT – in the majority of cases, that message client or prospect – in other words, a An introduction from a mutual readers with practical advice on how to grow their will be ignored or, more likely, deleted. buyer persona – will help you understand connection is more likely to result in a businesses. Our resident expert is Greg Watts, the HOW CAN I SHARPEN Here are some reasons for a lack of them and tailor your approach. positive response. Yet this approach is founder of Demand Creation Partners, a London-based MY APPROACH? cut-through, and some suggestions to often overlooked. Here’s how to do it: FQNVSGBNMRTKS@MBXSG@SGDKORƥMSDBGR@MCO@XLDMS sharpen your approach: 2. Your approach is too generic. 1. List targets on an Excel spreadsheet. Cultivating relationships takes time; 2. Under each company, add job ƥQLRSNRB@KD 'DV@ROQDUHNTRKXGD@CNEL@QJDS 1. You don’t know enough about employing a long-term approach yields descriptions based on buyer personas, acceleration at Visa Europe. your target the best results. plus names of individuals if you have Do you really know your prospect? Do your homework. Know what your them. If you don’t, leave gaps. You might know their name, title and prospect’s interests are, what events 3. Go through the list and make a note where they work, but what about their they attend, and what social channels of the people in your organisation who they engage with. Most importantly, have connections with them. consider why they should invest time in 4. Print everything out and stick it on meeting you – what’s in it for them? your wall so everyone can see who Once you better understand you’re targeting, and who knows their behaviours, translate that into who. This is likely to spark additional QUESTION 2 targeted outreach – for example, connections you weren’t aware of. rather than crafting a generic LinkedIn 5. Ask your team members if they’re HOW CAN I CONVINCE mail, consider a 1:1 approach: a happy to introduce their connections, handwritten note from your CEO; an and to initiate an approach. A PROSPECT’S CFO TO invitation to participate in a relevant PR PARTNER WITH US? opportunity; or an offer to be quoted BRINGING IT ALL TOGETHER in a thought leadership piece. The By taking a focused, researched approach possibilities are endless but the point to securing prospect meetings, you’re far You’ve had a successful first is: don’t expect generic outreach to be more likely to get a positive outcome. meeting with a retail prospect: they understand your product and can see how it could help them improve their customer experience. Now you need to prove how it can enhance better to be candid about integration is their margin; how is their cost base their business and bottom line. upfront and build it into the business case constructed? You’ve been asked to meet with and development plan.) These inputs can then be validated their finance team to develop a Once you’ve identified the retailer’s by the prospect at the meeting, and business case. The challenge is: how commercial opportunities and challenges you can even conduct modelling do you persuade their CFO to buy – for example, acquiring new customers, together. If approached correctly, the into a partnership? increasing the value of existing CFO and finance team will relish the First, you need to demonstrate an customers or attaining higher operational opportunity to co-create with you at understanding of their business and efficiencies – create an Excel value model an early stage. how your offering adds value – as to validate your assumptions and use it as opposed to weighing them down a tool to secure the CFO’s buy-in. BRINGING IT ALL TOGETHER with additional costs or resource Gather inputs by reviewing annual By conducting a robust assessment of complexities. (Many fintechs claim reports, financial statements and other the prospect’s business and validating they have simple or no integrations, sources that provide deep, factual your assumptions with them, you’ll but that’s not always the case – insights into the prospect’s business. For have a strong basis for a commercial frustrating retailers when they need example: what are their strategic goals; case and a foundation on which to to allocate technical resources. It’s what was last year’s performance; what launch a partnership. >>

40 | www.bankingtech.com | June 2019 June 2019 | www.bankingtech.com | 41 ASK THE EXPERT

1. Your website isn’t attracting visitors 5. You’re not retaining customers or QUESTION 3 People need to know about your product eff ectively upselling or service before they purchase it, so a An eff ective demand generation WHAT IS DEMAND demand generation strategy should programme should incorporate retention start with brand awareness. If prospects and cross or upselling opportunities as GENERATION; HOW aren’t reaching your website, there part of the client lifecycle after the initial FinTech BankingTech PayTech RegTech WealthTech LendTech InsurTech DOES IT DIFFER FROM might be an issue with your brand sale has been achieved. Client marketing identity, blogging strategy, SEO strategy, provides the opportunity to enhance LEAD GENERATION; AND social media strategy or buyer persona your product roadmap, create compelling WHY IS IT IMPORTANT development. case studies and cultivate advocacy. FOR MY BUSINESS? However, if you’re marketing to current 2. You don’t understand your audience clients and it isn’t paying off , you might Because a demand generation strategy have an issue with your buyer personas. The terms ‘demand generation’, ‘lead considers every touch point along a generation’ and ‘inbound marketing’ are buyer’s journey, you need a thorough 6. You have diffi cultly tracking and often confused. Here are the defi nitions: understanding of those buyers: who they measuring results K Demand generation uses targeted are; what their organisational challenges The best demand generation strategies marketing to drive awareness and are; what solutions they’re looking for; are driven by data and powered by interest in a company’s products and/ what content they engage with; and, technology. If you don’t know which or services. most importantly, how your product or of your tactics are working and which 900,000+ 42,000+ 50,000+ K Lead generation is a sub-category of service can help them. are falling short, you won’t be able to demand generation. It’s the practice Improve your eff ectiveness by optimise them in the future. Defi ne the AVG. MONTHLY PAGE VIEWS NEWSLETTER SUBSCRIBERS CONTACTS IN CUSTOMER DATABASE of collecting information on targeted creating buyer personas with your critical metrics for your business and individuals that can then be used to marketing and sales teams. track them using analytics software such qualify and nurture prospects into sales- as Hubspot or Pardot. ready leads, pipeline opportunities and 3. Your website doesn’t have – eventually – customers. conversion opportunities BRINGING IT ALL TOGETHER 39,000+ 3,400+ 2,200+ K Inbound marketing is a technique Too often, marketers make the mistake Creating a demand generation for drawing customers to products of thinking that accurate buyer personas, programme that has the needs target and services via content marketing, great content and lots of web traffi c are buyers at its heart – and which is adopted Interested in placing your brand in front of FinTech Futures’ extensive global audience? social media marketing, search engine enough. To generate leads, you need to fully by your marketing and sales teams – optimisation and branding. motivate site visitors to share personal will more likely result in increased revenue Think of demand generation as the information in exchange for valuable for your business. bt We can help you raise your company’s awareness through: umbrella term for lead generation and content you’ve created. In other words, inbound marketing, and something you need conversion opportunities Q Exclusive interviews and thought-leadership features that gets customers excited about your spread strategically across your website. company’s products and services. Demand If you have a question for Greg and would Q Product reviews generation programs can help your 4. Your leads aren’t becoming like a practical, no-nonsense answer/ Q Webinars organisation reach new markets, promote customers advice, please get in touch! We’ll be product features, create buzz, generate PR One of the most frustrating things a answering your questions in the Ask Q Videos and re-engage existing customers. demand generation marketer can hear is the Expert column in this magazine and Demand generation bridges the gap that the leads they’re bringing in aren’t online (fortnightly) – free and open to Q Industry surveys and white papers between your sales and marketing teams, converting into customers. This could everyone. and it should result in inbound growth. indicate issues such as: You can email Greg Watts at greg. Q Advertising But co-ordinating sales and marketing K '/:3A/<2;/@93B7<5;7A/:75<;3

Scale Movers and shakers EVENTS CALENDAR operations June Troy Bradley has joined NCR Corporation Kate Frankish has been appointed as 12: The Mayor of London’s TechInvest: and increase as VP, chief information and technology director of strategy and standards at officer (CITO). Pay.UK, the UK’s retail payments authority. Gov Tech, London Bradley had a lengthy career spanning She is also IT director, payments and open http://techinvest.london two decades at a US-based banking banking at Barclays. revenues technology vendor, Metavante, as VP and Frankish joined Barclays last year. Prior 24-27: FundForum International, CTO. Following the company’s acquisition to that, she spent more than seven years at Copenhagen by FIS, he spent nearly eight years there in Tesco Bank, most recently as head of PSD2 finance.knect365.com/fundforum- a similar role. and open banking delivery. Before that, she international He left FIS in 2017 to work as an worked for a nearly a decade at RBS. independent consultant. 25-26: MoneyLIVE: Digital Banking, B2B payment solutions provider Bento for London German challenger bank Penta has got Business has appointed Paula Bachman marketforcelive.com/money-live a new CEO – Marko Wenthin. Wenthin as CFO and Tracy Hansen as CMO. co-founded solarisBank, a banking-as- The two will be the first to serve in these 28: Customer Intelligence Banking a-service platform with banking licence, capacities, as both roles have been newly Summit, Amsterdam which Penta also uses as a banking created (the company itself was founded cibankingsummit.com provider. in 2014). He also spent 16 years in various Prior to Bento, Bachman worked at July Networked Insights, a data analytics management positions at Deutsche 4-10: London Fintech Week 2019, SaaS firm; while Hansen worked at B2B Bank, with ten of those years residing in London companies including Tealium, NetApp, Argentina and Poland. In Poland, at 30, www.fintechweek.com he was the youngest member of a bank’s and CA Technologies, and was most recently CMO of Learning, an management board and responsible for IT, 5: PayTech Awards 2019, London education software company. operations, back and middle office. www.bankingtech.com/paytechawards After his time at Deutsche Bank, Chicago-based Bento offers an all-in- one platform to help small businesses Wenthin founded several SaaS firms and 23–24: Hong Kong BFSI Innovation manage their spending. helped Asseco, one of Poland’s largest Summit 2019, Hong Kong IT software companies, to expand into www.hongkongbfsi.com Western Europe. Jeremy Hubbard has left his CIO position at UBank (a digital banking subsidiary of Paysafe Group also has a new CEO – ) to join Rest, a August Our customers tell us that they need to use transformative digital strategies to Philip McHugh. He replaces Joel Leonoff, Sydney-based fund management firm, 5-8: Intelligent Automation Week, remain relevant in today’s challenging financial landscape. Strategies that will who is taking up a new position as as group executive, innovation and Chicago allow them to improve operational control, reduce costs, build new revenue vice-chairman of the company’s board transformation. www.aiia.net/events- streams, mitigate risk and comply accurately with regulation. of directors. Leonoff founded Paysafe Hubbard spend over a decade at intelligentautomation-chicago To help you make the journey towards digital transformation, we provide a (originally Optimal Payments) in 1997 and UBank/NAB in various tech roles. range of solutions for the transaction lifecycle. AI and Blockchain technologies held the position of CEO and president are now embedded in all of our solutions, which are also available in a variety since 2008. BNY Mellon has appointed Subhankar Banking Technology is a prominent of deployment models. McHugh joins Paysafe from another Sinha as head of blockchain, based in media partner of many financial services, Digital transformation. Reaching the summit just got a little easier. paytech firm, TSYS, where he was New York. He moves from Nabartham LLC, insurance and payments technology responsible for heading up their merchant which he founded to advise other start- events worldwide. If you are interested in a [email protected] solutions division (TSYS is in the process ups on strategic partnerships, ecosystem media partnership with us and marketing of being acquired by Global Payments, governance and product-market fit for opportunities, please contact: smartstream-stp.com see p13). blockchain products. Prior to TSYS, McHugh worked for Prior to that, Sinha was a director at David Taylor, Marketing Manager Barclays in London, where he was global PwC where he co-founded and co-led Tel: +44 (0) 207 017 5379 CFO of Barclaycard and CEO of Barclaycard the firm’s blockchain consulting practice Email: [email protected] Business Solutions. in the US. bt

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