January 2016 The Fintech Times January 2016 1

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Psychology of teenage Call centre STARTUP Blockchain hackers Vulnerability Banking for diamonds

. 2 The Fintech Times January 2016 What is Fintech? The Future.

FINANCE + TECHNOLOGY

Fintech is a new definition, but one expected to become normal. Format Fintech is the future of finance, of financial services, and indeed of money itself. For those already in the know, this is not news. Each month we will be exploring a new fintech sector, interviewing Fintech isn’t a business sector; it’s dozens of sectors. Everything from thought leaders and experts, digging deep into the ideas, people, high street banks, investment companies, money transfer, fintech is and technology. Then taking that experience and presenting it in a re-engineering these sectors into their next generation. And there format that you can read at your leisure. We plan to keep it intelligent, are new kinds of businesses emerging within fintech: crowdfunding, investigative, authentic, but not too serious; informative and useful, peer2peer lending platforms, crypto currencies, the Internet of but not too technical. Enjoyable. Let us know when we get it right or Things, sectors that are digitally native; they didn’t exist before the wrong. internet. And cyber security, this month’s cover story. So...

There’s many ways to look at fintech. It’s about new companies, Keep your copy, start subscribing, become a member, or partner. and new technologies for old companies. It’s about inventors and Watch the changes happen. Be involved if you choose. Fintech is visionaries, and everyday people creating something new. It’s about new. And Fintech is the news. London, by the way, is the World leader your bank, your phone, and your job. It’s about you today. It’s about in fintech, and long may we be so. Not that we don’t welcome the the future. competition.

And it’s definitely about change. Big big change. Finally, to subscribe or become a member, to read and comment online, search thefintechtimes.com A fintech newspaper? Let us know what you think. People like newspapers. They can be a three-minute read between tube stops, or a Sunday morning in bed. So what kind of newspaper [email protected] is this?

There’s so much happening in fintech, it’s so interesting, and sometimes so complicated, and we think it needs its own monthly The Fintech Times Editors: Katia Lang newspaper as an industry report. That’s what The Fintech Times is. Published by Disrupts Media Limited Bird Lovegod Who for? 83-89 Mile End Road London E1 4UJ [email protected] www.thefintechtimes.com 07535 670 581 For company directors, entrepreneurs, and managers, business

minded people. It’s for everyone in finance, banking, and investment. Copyright The Fintech Times 2015 Anyone in tech and anyone interested in startups. Because fintech is Reproduction of the contents in any manner is not permitted without the publisher's prior consent. "The Fintech Times" and "Fintech Times" are registered UK trademarks of Disrupts Media Limited. where the money is. January 2016 The Fintech Times 3

COVER STORY: Cyber Security Expert: Brian Lord OBE

Editor BIRD LOVEGOD Cyber Something: What’s Happening?

Normalising the situation. You lock them. You keep windows closed. But someone can still pick a lock or kick down a Brian Lord OBE Based on a meeting with Brian door. So you look at what is valuable in the Prior to joining PGI, Brian was the Deputy Lord OBE, MD of PGITL. “Let’s treat house, and you keep it out of view. What is Director of GCHQ for 21 years, wherein he really valuable, you keep in a safe. Then you was responsible for Classified Intelligence ‘cybercrime’ look at what is critically valuable or sensitive, and Cyber Operations. During that The first thing Brian draws to our attention and perhaps keep that in a security deposit period, Brian directed the growth and is that technically Cybercrime doesn’t really as normal. box in a bank. mean anything. perpetual evolution of departmental capability against emerging threats. It’s just bad You do what is reasonable to keep thieves He planned and ran both defensive As a word, it’s fresh from the late 1970’s, out. But you acknowledge that thieves might and active Cyber operations, applied cybermen, cyberspace, cybersexcitement. still get in. If they really want to, they will. people doing through unparalleled experience of By definition it is ‘something to do with So you take reasonable precaution, have a cyber threat, risks, opportunity, and computers, information technology, and contingency plan, and maybe an insurance bad stuff, the effective mitigation strategies. He virtual reality.’ That narrows it down to policy. “There’s no point in having an culminated his career at GCHQ as an everything in 2016. intention of ‘make sure we never get hacked’. same bad eminent thought leader on the subject That’s not realistic. This ‘cyber opacity’, in the context of crime, of cyber warfare and on the intent and stuff as has motivations of cyber threat actors. equates to a fog of understanding that It’s not about trying to become an At the time of departure, Brian also makes it difficult to do anything meaningful. impregnable fortress. It’s about being been done for had overall GCHQ Senior Civil Service “We, meaning businesses and organisations, proportionate to the risk. Like any normal responsibility for the development, need to treat ‘cybercrime’ as a normal risk.” business risk.” One of the repeated points Brian makes is thousands of capability building, and requirement setting for the active defense and that cybercrime, (maybe we should call it Back to business: How to normalise offensive Cyber capability and something else) needs normalising. This years.” information security procedures? It comes chaired the relevant joint GCHQ-MoD means stripping away the mystique and down to understanding the specifics: Specific Programme Board. techspeak and understanding it in a rational threats, specific sectors associated with those Additionally, Brian developed and ‘real world’ compatible way. The use threats, then threats and risks specific to your operational coherence across both of jargon, buzzwords, and media hype speed of events happen at the speed of organisation, and the specific departments, foreign intelligence agencies for his obfuscates and disguises what is actually a digital transmission. A problem becomes an the specific IT hardware, and the specific areas of responsibility; his experience number of completely separate issues and unmanageable cascade of bad news data in individuals using it. You really only need to extends to both the design and risks. literally a second. Location of the attackers? know and care about risks that are relevant participation in cross-government Could be anywhere. to your company. Brian takes it back to basics. National Security exercises. At PGI, Brian has designed and “So let’s treat ‘cybercrime’ as normal. It’s just The challenges and complexities of This is so obvious in the real world it’s delivered the PGI Cyber approach bad people doing bad stuff, the same bad information security make it especially normal thinking. And this is what we mean by to organisational transformation and stuff as has been done for thousands of years. important to use a normative approach in normalisation of risk, threat, and response. skill development, whilst growing Breaking and entering. Theft. Vandalism. business. Even calling cybercrime by the Information has value. Some information has and maintaining relationships with Espionage. Blackmail. Ransoms. Crimes as more correct term of information security more value than other. Protect accordingly. government and industry professional old as civilisation. The only new thing is the is helpful. Information is a thing, you know Human error is always going to be the bodies, as well as the relationship with vehicle, the means, by which these nefarious what information your company has, and weakest point in the information protection Academia within the Cyber Academy. activities are actioned.” where; what is important, and what is critical. process. Therefor the first and most Brian currently personally oversees The game changers in cyber crimes are scale, important response is education, training, all capability delivery for foreign speed, location, and traceability in relation Let’s call it information security from now on. and understanding the realities of business governmental clients. Brian is regularly to what the media casually calls attacks. Brian uses real world analogies; how in 2016. It’s no big deal. It’s just another enlisted by the BBC and other national A single bad operator can command an supermarkets protect tins of beans differently normal day. army of ten thousand computers against to bottles of spirits. media outlets as a specialist spokesman a company or organisation. Clearly the Imagine your house. You close the doors. on Cyber matters. 4 The Fintech Times January 2016

COVER STORY Cyber Security CYBER by BIRD LOVEGOD

HYGIENE Threat: Spearphishing The targeting of specific individuals within an organisation at specific points in time, to Sector Specific achieve a single target aim. Either to elicit the individual to directly disclose some Not intended as a complete information, or carry out an act, such as making a false payment or to encourage the ‘how to’ guide, but more a Threats individual to open a folder or go to a website guide to a normative approach. that will automatically download malware for other criminal purposes. Example: a sales contract has just completed. Threat: any individuals or groups? (This is not the information, and which your customers Payment is due. The account manager Malicious attack / Blackmail / Ransom same as doing anything wrong.) If the answer information? Which do you protect more? receives an email from the customer thanking Sectors: is yes, and they are likely to feel justified in How are these filing cabinets labelled? Do him for the excellent service, wonderful Public sector, third sector, corporations, attacking you, if you offend their morals, you have one labelled “Extremely Valuable: delivery of product, we’ll be sure to use controversial sectors, charities, animal ethics, religion, or politics, you may want Do Not Photocopy”? Is that the best label you next time, and one last point, could the related including farming, meat production, to think about this threat in a way a florist for it? Do you have a system admin account balance of payment be made to a different sex / gender related. probably doesn’t need to. The information named “Sysadmin”? Is that the best name to account number. Have a great day. Sony found themselves on the wrong end you hold might not be valuable in the same call it? Think about whether you would leave Sectors: Many, including manufacturing, of what could genuinely be called an attack, way credit card details are, but may be a sign outside your house with an arrow export, but especially non end to end in retaliation for a film parodying the North excruciatingly sensitive. saying “Spare Key under this Plantpot – once digitised companies, as this type of fraud Korean leader. This was an attack, in so much inside follow the arrows to the safe”. involves ‘social engineering’, or more as it was a deliberate and sustained act of Threat: Theft*: All information has some Risk analysis should be undertaken to accurately, individual to individual deception. malicious activity designed to inflict harm. value. All. If someone else had it, how much understand what information you hold and Questions: Does everyone in the company But that’s at the top end of business and would you care? the potential value it has, generically, and know this kind of fraud exists, and are aware global politics, not really relevant to your *Theft used to mean you no longer had perhaps very specifically. You may find the of the variations of it? Are there procedures dating website company, right? something. Now it means you have it, and so process itself rather useful. in place to double check account changes, Ashley Maddision was penetrated in an does someone else. specifically payment transfers, in a non attack designed to collapse the company, Sectors: Most sectors, but some much more Threat: Data Manipulation digital way? Like a phone call? either by the directors closing it according to so than others. From law firms holding IP Sectors: All fintech + others the ransom, or through reputational damage and contract information to anyone holding This may become much more of a problem Threat: Downloading / installing Malware: from the exposure of the users on the public payment info, contact details, even email than data theft. It may already be so. Could be anything, from ransom-ware that web. Coupled with this the exposure of AM’s addresses. The more comprehensive the In 2013 a large bank robbery involved encrypts your computer to spyware that own rather underhand practices of creating data, the more valuable. Email addresses digitally removing the withdrawal limit on facilitates spearphishing. female accounts in bulk in house to balance alone are of small value, add a bank name pre paid debit cards and then cloning them. Sectors: Everyone, including individuals. out the gender gap. The company technically and it becomes much more valuable, a It resulted in a loss of over £20 million in Example: you all get an email. Redundancy survived, its reputation in tatters, CEO gone. home address, more, account numbers, even cash. Cash! Taken from several thousand notices for 2016. See attached list. What Hmmmm. partial, more, and so on. The more specific ATM machines in multiple countries in just percentage of employees open it? You go to the information, the more valuable. Client a few hours. Changing information may be an event. You are given all sorts of goodies, Brian Lord told us of a charity recently fined X is negotiating a merger with Y and will more valuable than ‘stealing’ it. including promotional USB sticks, perhaps quarter of a million pounds for their data accept Z pence per share. Multimillion pound Questions: What information do you have from another visitor who you also give your breach. They operated an invaluable service information in the right / wrong hands. that could be manipulated or changed within business card to? And so on. to support women in their extra-ordinarily your system? Credit limits, for example. Or Questions: Is everyone in the company difficult decision making process regarding Questions: Imagine all your information account balances? Do you have checks and aware of these risks? Without being paranoid, unenviable life choices about childbirth. was in paper form in filing cabinets. Which measures to prevent this? Or a procedure to are they being conscious and careful. If you Ahhhh. of those cabinets would you really not notify admin of sensitive changes? Response don’t know the person, probably better not want photocopying and distributing to the time? to put it in your computer?.. Questions: Could we be severely provoking public? Which contains your organisations

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January 2016 The Fintech Times 5

COVER STORY Cyber Security Don’t blame it on The psychology * of teenage TIM*the IT manager hackers

As with ‘non cyber’ crime, the perps For one generation, this is worrying. For the range from Nation States to organised other, this is normal. There’s a gap, native crime networks to teenage kids. Perhaps and non-native digitals, and it’s wide. The by understanding the mind-sets we can real world checks and balances, the police, begin to understand the problem. A bit. teachers, society, these have had hundreds of years to develop and embed within society Who is responsible One of the ‘problems’ is that people do and have evolved hand in glove with society online what they wouldn’t do in real life. as it changed. The digital mutation that is for information Connected, we are detached from each the Internet has non of the old World legacy, other, our nuanced communications reduced and youngsters can spend most of their security within your to the digital equivalent of shouting abuse at time in groups of other people who have fellow car drivers who swerve into our lane. normalised what technically is cyber crime. Only it’s more than that. Our digital presence Maybe it starts with hacking a school friend’s organisation? can take on an identity all of it’s own, a digital facebook page because they dissed them persona, and that persona can be more on Kik. It’s like tagging a wall. No big deal. The obvious and rather short answer service. They’re interrelated; digital security is influential, more exciting, more alive, than Being initiated into the world of cyber crime is that everyone is responsible. From a clear component of customer satisfaction. the one IRL. (In Real Life) is very easy; the slope unperceivable when the CEO to the Board to the call center Just ask any telecoms company dealing with Here’s how Brian Lord from PGITL describes it starts. Talking through Xbox, playing COD, operatives to the interns to the kids on the fallout from not fully appreciating this. the situation. already they are in a world that excludes their work experience from school, if that still The risk to customer satisfaction levels, if Twenty years ago there were checks and parents, the authorities, the teachers, the happens. your customers account details are stolen by balances growing up, parents tended to police, everyone and everything non virtual. criminals, is absolute. know roughly where the kids were and what It’s now normal to have dual identities, one Some are more accountable than others, they were doing, the school teachers knew online, one offline. Normal is relative to ones some have a clear legal responsibility, and Bottom line, organisations need to train the parents, as did the local police when they peers. everyone should consider themselves to all staff in basic digital security, and have a needed to, and peer groups were small, a be part of a concerted normal practice of system in place for reporting vulnerabilities dozen maybe. Life was goodish, and these Would a fifteen year old walk into a bank digital security. Especially the ‘lower level’ within individual departments and keeping societal checks and balances tended to stop and rob it, just to see if they could get onto employees, the people who are probably everyone informed if and when new threats young people being overly criminal. the league tables of coolest bank hacks? most aware of problems such as weak emerge. Now, in 2016, most teenagers spend more And yet digitally, it’s virtual act. Not real. passwords, lack of encryption, overly time interacting online than offline. So where Truly there are two Worlds now. The real accessible folders of clients information, It’s not difficult, it’s not extra ordinary, it’s are the checks and balances now, and who World is where you spend most time, where and so on. part and parcel of business in 2016. are their peers? you have the most connections, the most friends, hold the most influence, develop the Try MBWA. Managing By Wandering Otherwise, if responsibility is siloed to Ones thing is for sure. The parents can’t most experience, and where you feel most Around. If you want to really find out what a specific individual or department, the answer that. And nor can the teachers. And like yourself. your companies digital vulnerabilities are, defacto consequence is that other people online, there are no local police. Nor is the you could do a lot worse than asking the and other departments are not responsible, peer group restricted by age, or location, it For some of us, the real world is the sky, the people who use the systems every day. and therefore inadvertently make life much can number thousands, and many of them streets, the city. For others, the real world is more difficult for T.I.M, or whoever is to have an un-connected online and offline much bigger, much more exciting, and holds Copy in the same attitude that everyone in blame when it all goes pear. identities. And the places to meet are way more potential. And as a teenager you an organisation is responsible for customer unlimited. can make much more money there too. 6 The Fintech Times January 2016

LAW. PAINFUL BUT NECESSARY Cyber Security Regulation in the UK – an overview

Cyber security is concerned both with Authority (formerly the FSA) is also active final trilogue negotiations stage it is now a also draft, implement and road-test a the security of cyber space (which in the regulation of data security using its case of ‘when’ not ‘if’ it will be passed. One of data breach, crisis and notification policy. can include physical places as well as powers under the Financial Services and the most important issues to be ironed out in purely virtual ones) and the security of Markets Act 2000 to police cyber security in the on-going trilogue negotiations concerns There is significant legislative change entities that use or rely on cyber space. relation to FCA regulated entities. the range of market operators who will be looming for cyber security in the UK and Entities that use cyber space need to However, there is new legislation on the under the duty to be cyber secure. However, across the EU. If you are caught by it, it be cyber secure; not simply because (not very distant) horizon. The Directive critical infrastructures and services in the will have significant legal, commercial and of the obvious business impact and on Network and Information Security, energy, transport, financial services, health operational impact on your organisation. reputational issues arising from security colloquially known as the NIS Directive or and financial services sectors are will very Do not delay - start gearing up to manage breaches, but to ensure they comply with the Cyber Security Directive will create a likely be subject to the new regime. it now. The clock is ticking… their legal duties. legal duty for cyber security for various public administrations and market operators, The impact of the Cyber Security Directive The law governing cyber security is somewhat requiring them to take appropriate technical and the new EU Data Protection Regulation of a complex (and dare I say it unintentional) and organisational measures to manage the on your cyber security obligations is CRAIG RATTRAY amalgam of various pieces of legislation risks posed to the security of the network significant and both are likely to be passed enforced by a number of regulatory bodies and information systems which they use (in the author’s view) in early/mid 2016 and Partner, Gateley Plc who do not necessarily act in concert. and to notify incidents (ie breaches) to be effective two years thereafter. Therefore, Currently, the only legislative obligation for the authorities. New national Regulators cyber security plans must become a priority Craig is a London based commercial partner at law firm Gateley Plc and he cyber security is found in section 105A of the for cyber security will be appointed with for all organisations and in particular is technology, payment services and Communications Act 2003, which regulates significant enforcement powers. And for boards of medium to large sized data protection specialist. He advises telecomms companies and ISPs. However, the infrastructures to coordinate national and EU organisations. Those at the very top need to customer and supplier clients across multiple industry sectors (including security provisions (seventh data protection responses to threats, risks and incidents will recognise the real risks facing their businesses financial services) on complex commercial principle) of the Data Protection Act 1998 be created. (and them personally!) and take steps now transactions including IT and business have been interpreted (and enforced) by the to minimise those risks by preparing more process outsourcing projects. He has specialist payment services expertise and ICO to include cyber space and to contain a The purpose of the Directive is to ensure fully for breaches. What should you do? Start the regulatory compliance environment duty for cyber security ie to protect personal a high common level of network and by implementing a detailed cyber security that governs payment services in the UK, including the payment services data from cyber security vulnerabilities, information security (NIS) within the EU. The plan with adequate systems, safeguards and and e-money regulations and the Data including cybercrime. The Financial Conduct Directive is not yet finalised, but as it is the processes –and test it regularly. You should Protection Act.

TECHNOLOGY Breach response

People expect large organisations, such The reality is that many businesses, not just When it comes to leveraging actionable IT systems and security controls. Applying as telecoms firms, with huge resources telecoms firms, maintain vast amounts of intelligence; information quality and the latest in Automated Threat Verification at their disposal and leading edge personal information, which is highly prized timelines matter. Security teams require technologies to identified threats allows technology, to be amongst the best by cyber criminals and is increasingly difficult integrated security solutions to achieve this. the minimisation of false alarms and rapid equipped to keep cyber criminals at to protect. True cyber resilience means appropriately identification, isolation and remediation of bay. However, the fact that high-profile scaled and competent technologies and systems impacted by an attack. breaches continually come to light, The greatest challenge is that an attack is not processes that meet threat levels and shows that no organisation is immune noticed quickly enough. The time to detect response requirements, rather than just point from attack. It only needs an unwitting an attack can stretch to over 200 days, which solutions that focus on low-level threats or employee opening a suspicious is too long to be exposed to any type of specific vectors that hackers navigate around attachment, plugging in a USB stick or threat. Conversely, in the TalkTalk example, to find a “weakest link”. making a simple error during a routine the breach was detected relatively quickly PETER WOOLLACOTT system admin task and systems can (within only a day or so). TalkTalk reacted Security functions are increasingly identifying instantly be at risk. quickly, which should have put them on a new sources of threat information, all of CEO & Co-Founder, Huntsman Security much stronger footing to deal with the crisis. which needs to be aggregated, digested and Peter Woollacott is the CEO and founder Attacks can come from just about anywhere However, despite the speed of detection investigated to mitigate threats. Increasingly of Tier-3 Huntsman, and the driving force at any time – whether it is a bored teenager there was still uncertainty around the scale the mass of information requires automated behind its success. He is an expert in cyber risk and security solutions for enterprises or an organised criminal targeting data for of the breach and the number of subscribers analytics and decision-making technologies that are serious about preventing, detecting profit. The recent TalkTalk web site breach affected. Hence initial PR announcements to fasten the process, limit the time at risk, and managing cyber threats. He is regularly was a perfect example of the former, where slightly missed the mark and the level of remove false positives and enable analysts to sought for advice on ways to use technology to reduce risk, improve governance and, initial interest (and criticism) reflected this. focus on threats that pose an actual danger. a relatively simple attack was used very ultimately, deliver competitive advantage. successfully, to devastating effect. As with other past breaches like Target, Cyber resilience means fit-for-purpose Sony and OPM; TalkTalk provides valuable monitoring to identify indicators of Targeted attackers are often far more lessons. The first and most important step compromise, behavioural anomalies or Huntsman Security is a cybersecurity specialist focused on real-time security focussed on their intended victim and better to take following the discovery of a breach suspicious activity. The automated collection detection, verification and resolution in resourced. They have a huge asymmetric is to establish which systems and data were and processing of information allows mission-critical security environments, national advantage over the victim, who has no way compromised and determine the nature of security operators to make prompt and intelligence, border protection, banking and infrastructure globally. It proactively of knowing the timing of an attack and has the attack; both rapid detection and early confident diagnoses and decisions, and to detects indicators of compromise and allows multiple potential vectors to defend. understanding are vital. deal with the noise generated by modern companies to quickly resolve issues. January 2016 The Fintech Times 7

COVER STORY by BIRD LOVEGOD Cyber Security “Can I take your card details, please?” A look at call centre vulnerability The vulnerability starts when period of time. If the brand doesn’t have a customer lifetime value, and the true According to customers give details over pre-determined response strategy for this potential impact could be many times more the phone. This includes credit eventuality they will be reactive, and damage severe than initially estimated. Strathclyde Police cards and debit cards, possibly limitation is unlikely to be effective. “approximately bank account details for direct Compliance3 helps the call centre industry debit purposes. If a systematic and professional criminal abuse to deliver compliant customer contact. By 10% of Glasgow has occurred, things can get really tricky. deploying solutions where customers ‘key’ call centres have The customer has at that point lost control of An example could be a rogue telephone their card data into their phone so the agent their information. operative concealing a microphone on their never hears the card details (not even the been infiltrated by It’s a trust-based transaction, and like any person to record every conversation they keypad tones), we can then help companies organised crime”. trust-based relationship, there’s a risk of had for a month. Or a hacker ‘harvesting’ a protect customer payment card data. We can breach. Some of these call centres are database containing card data. also help move any existing call recordings offshore, further complicating the situation This would almost certainly result in high to a secure facility and ‘cleanse’ card data in terms of compliance, law enforcement, profile investigations by law enforcement from recordings if they need to be accessed and so forth. The non-UK call centre agencies, possibly cross boarders, multiple – for regulatory purposes, for example. For employees are earning as little as £200 per regulators, multiple lawsuits, merchant claw one client, we moved over 13 million call month in some instances, and recruitment back, and literally years of customer service recordings off-site, and no card data now practices may not be as thorough as one repair work, litigation, and reputational enters their environment. would hope. In the UK, call centre employees repair. Investigation and remediation costs are paid an average of less than £16,000 per can run into millions – Talk Talk admitted to annum and can be on zero hour contracts. costs of £35m - plus consequential loss of The temptations are huge, and according reduction in new sales, loss of market value – to Strathclyde Police “approximately 10% of Talk Talk’s share price has recovered to ‘only’ Glasgow call centres have been infiltrated by 16% off its pre-data breach price - and loss organised crime”. of senior management expertise if heads are required to roll. Even if the call centre is trusted, and the individual operatives are all honest, hacking But TalkTalk is the tip of the iceberg. The into the actual phone lines, or the database Home Secretary recently said that “90% of of call recordings ‘for security and training large organisations suffered an information purposes’ would give absolute access to the security breach last year” and, according card data. There’s always a weak point. It’s to the UK Government’s Department for about accepting that, and strengthening Business Innovation and Skills “14% of each point in the chain. respondents took more than a month to And whist the message is usually that the detect their worst breach of the year.” customer is not the victim, it’s the card company that loses money, this is only Over to Compliance3 for their theoretical and not always accurate. The commentary on the matter: credit card companies are responsible for Recent consumer research conducted by reimbursement, but not if it’s a debit card, Compliance3 has found that, in the event of and certainly not if it goes unnoticed by the their data being compromised, nearly 40% customer for more than 3 months. In addition, of people would tell everybody they knew, the complete card details can be sold on, and with a further 16% adding that they’d spread can even be used to purchase illegal items the bad news on social media. And 41% of from the dark web, further exposing the people surveyed said that they’d never buy legitimate holder to a completely new area from a compromised brand again. of risk. The potential reputational damage and revenue losses are commercially significant. The risk to the brand: Above and beyond the immediate consumer One incident can damage the public’s backlash, the secondary and related impact relationship with the brand. Even a single could be devastating. Modelling only 1st instance can go viral on social media, it and 2nd generation connectedness and depends on who the individual is, how many making some realistic assumptions on twitter followers they have, their facebook consumer behaviour, Compliance3 estimates connections, and how bad a day they are that for every one person that has their having. The brand loses control once the data compromised, up to 50 connected incident is on social media. people might well change their purchasing If multiple instances occur, it will be picked up behaviour or relationship with a brand as by mainstream media, gathering detractive a result of a breach. Multiply this by ARPU attention in a snowball effect in a very short (average revenue per user) and potential 8 The Fintech Times January 2016

RISK Cyber Crime Risk Management by Marios Kyriacou, Managing Director at MNK Risk Consulting

Cyber crime is just another type of is necessary if a manager wants to track operational risk. In fact it is included in down the root of the problem in a business the operational risk event types defined process; preventing other events with similar by Basel under External Fraud. External cause from occurring in the future. fraud and cyber crime risk can be managed through the implementation of Managers need to prioritise the types of a risk management framework that relies operational risks they should manage and on the following components: mitigate. The ranking of risks would depend on the financial impact, and or other indirect • Risk and Control Self Assessment (RCSA) impacts such as reputational damage. • Capturing and management of historical risk incidents related to cyber crime Incident statistics such as the single most • Scenario Analysis using external data of severe loss event, the total loss amount per similar incidents occurred to peer institutions year, the most frequent cause, and the top- • Setting up a Key Risk Indicator monitoring ten most severe events enable management program to identify any patterns and have a better • Modelling the occurrence and loss severity understanding of the risk profile. In addition of cyber crime risk. it helps the Risk Manager to initiate corrective measures, follow up on their Managing Historical Risk Incidents timely implementation and monitor their earlier. For example, with reference to the ten in the ‘normal’ course of doing business and An incident is broken down into three effectiveness. risks depicted in the heat-map below a Risk as such could be absorbed through P&L elements: cause, event, effect. Recording Manager could assign KRIs for the two risks either by provisioning or (risk based) pricing. historical incidents on cyber crime risk means Potentially disastrous scenarios could be (namely R1, R2) which scored high. VaR looks at unexpected losses, whereas ES understanding the event, which factors have identified using internal incident data as well at catastrophic losses. Unexpected losses, led to that event and its financial or other as external actual loss data; the latter may be Modelling cyber crime risk although unusual, still need to be anticipated impacts. Institutions should maintain internal sourced from either commercially available There are two stochastic processes that drive and covered through Tier 1 and Tier 2 capital incident databases using a preset taxonomy. public loss databases or industry-pooled the measurement of cyber crime risk: the reserves. Catastrophic losses (which are the Recorded cyber crime threats could be consortia (e.g. the Operational Riskdata severity of losses and the frequency of events. largest in size of the unexpected losses) categorized into the following event types, eXchange Association ORX). Compounding these two stochastic processes could be covered by insurance or other risk Human error, Theft/Loss, Insider Misuse, results into the simulated distribution of transfer techniques. Social, Malicious Software, Hacking, Product Key Risk Indicators (KRIs) possible future annual losses from cyber flaws. KRIs are dynamic data indicating the level crime risk. From the simulated annual ©MNK RISK CONSULTING LTD and trend of specific risks. They focus on the loss distribution one can then derive risk Once events have been identified with significant risks which typically emerge from measures such as the annual Expected Loss respect to their type, the analysis of the cause the analysis of RCSA results, historical cyber (EL), the Value-at-Risk (VaR), and Expected and impact follows. The cause of Worryandpeacead.pdf events crime incidents 1 and 27/11/2015 scenario losses 12:29 described Shortfall (ES). EL arises on a continuing basis

Cyber threats

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Authorised and regulated by the Financial Conduct Authority - 609155 January 2016 The Fintech Times 9

INSURANCE DOES FINTECH NEED CYBER INSURANCE?

this will start with an investigation by third parties to establish the extent of the issue. If SUMMARY OF A CYBER INSURANCE POLICY card data is compromised then insurers can indemnify the costs arising from a specialist PCI Forensic Investigator (PFI) investigation. Consultation on how to manage legal and regulatory issues will also be covered as well as a crisis communication strategy. Establishing a call centre to field queries and providing credit monitoring are the last SIMON GILBERT elements of cover. Financial Loss takes into account the increased Managing Director, operational costs and reduction in profits as Elmore Insurance Brokers Limited a result of the attack. This is known as non- physical damage business interruption, and is “There are only two types of companies: typically excluded from property insurance. those that have been hacked and those Should any fines and penalties be issued that will be. Even that is merging into by regulators (Information Commissioner’s Source – Financial Lines Department, Elmore Insurance Brokers Limited one category: those that have been Office) and industry associations (for the hacked and will be again.” Cyber attacks loss of sensitive card payment data), then are coming thick and fast and becoming cyber insurers will cover this with the proviso almost an inevitability for UK business. It that these are insurable by law. Costs in is as FBI Director Robert Mueller foresaw managing a cyber-extortion situation — and when speaking in March 2012. Ignorance the ransom itself — can also be covered. BACKUP FOR YOUR BACKUPS is no longer bliss. It is essential fintech and IP complaints. Surprising to many a firms proactively manage their cyber Liability tends to impact some months later. blogger, I’m sure. risks, which means making a decision Affected individuals or businesses may whether to purchase a cyber insurance bring claims or written demands for failing Fortunately, not only is the UK home to the policy. to protect their information. They may seek second-fastest growing startup ecosystem, compensation for financial losses from it’s also home to the third-largest insurance Ashley Maddison, the US Office of Personal JAMES YORK hacking, or damages from identity theft. In market in the World - well stocked for such Management, Carphone Warehouse, Lloyds cases where customers are claiming from James is the Founder of Worry+Peace, the a need. Our insurers currently underwrite a Bank, TalkTalk, M&S, and most recently multiple jurisdictions, cyber insurers can modern insurance store and concierge. whopping 10% of the global cyber market. Vodafone are just some of the cyber security contribute towards defence costs and any breaches that have occurred during 2015. resulting damages from multi-jurisdictional Plug alert: there’s quite a range of choice UK businesses in the fintech industry will be The rise of relevance for Cyber insurance claims. brewing. My brand, Worry+Peace, soon feeling particularly vulnerable wondering launches a panel accessing (directly/through if they will be next. Recent events serve as It seems you can’t click or flick a page these THE RISK OF GOING wholesale channels) most of it. According to a strong reminder as to the importance days without seeing a nightmare tale about that same government report I cited, there of regularly reviewing cyber security UNINSURED a hack or cyber security breach. According are about 13 major carriers in the UK looking arrangements. The board of directors must Many fintechs are running a great deal of to a recent government report, 81% of large at this class. ensure they understand the most recent c y b e r r i s k o n t h e i r b a l a n c e s h e e t s . B y e f f e c t i n g businesses and 60% of small businesses threats and are suitably prepared in the suitable cyber risk management, such as a suffered a cyber security breach in the last It’s not always expensive, either, prices can event of an attack, or shareholders may hold robust cyber security framework, including year, and the average cost of breaches to be from as little as £150. Be warned, though, them accountable. penetration testing and effective threat business has nearly doubled since 2013. How, because it’s quite a new product range, the detection through multi-layer monitoring, if at all, should you protect your business? applications can take longer than others to many cyber attacks can be stemmed from an fill out. Have a cuppa ready, or a nice broker CYBER INSURANCE early stage. An incident response plan, which Firstly, try and have a policy — explore the to fill them out with you. EXPLAINED considers not just business continuity and guidance of standards like ISO/IEC27001. Typically, the cyber insurance industry disaster recovery, but also easy to implement For most of us, though, Cyber Insurance So, what’s the global worse case scenario? breaks a cyber event into three parts: Event steps and pre-contracted responders, can should become as common a purchase for There’s a way the insurance sector checks Management, Financial Loss and Liability. make the difference between a disastrous UK businesses as property insurance within it has all bases covered — realistic disaster Event Management involves the internal impact to reputation and a positive outcome the next 10 years. Don’t take my word for it, scenarios stress test their ability to cover a and external expenses of managing the for the entity in question. that’s according to the Association of British mega-bad thing. Their estimate for a Cyber response to a cyber event. Cyber insurers Insurers. “RDS” is about £20bn. Currently, the market vary in the extent of cover provided in reckons it can muster circa-£60bn if needed Event Management, but in general they Elmore Insurance Brokers Limited Who should be buying it? If you’re reliant to cover broader RDSs. That’s a pretty recognise that providing access to third advises its fintech clients to actively on cloud services, run a cloud service, keep manage risk to manage down premiums. sizeable context for a little-known class of party cyber security experts can mitigate the hold of Personally Identifiable Information Insurance is a partnership between insurance — Cyber. Makes you think, I hope. consequences of a catastrophic event. businesses and insurers. This for customers, or data from payments - this This is sometimes spearheaded by a partnership can be significantly should already be on your radar. Beyond enhanced by focused engagement to cyber response coach, an industry expert understand and implement information that, these products often cover the very real responsible for advising a business on how to security risk management best practice, risks associated with using social media and Visit Worryandpeace.com/cyber to find out more about Cyber Insurances. handle and manage a cyber event. Typically which includes cyber insurance. content marketing - defamation, copyright 10 Featured content The Fintech Times January 2016

The world’s first mobile DEALFLOW AT YOUR crowdfunding aggregator FINGERTIPS OFF3R displays a brief overview It is a critically acclaimed mobile app that aggregates deals for each campaign, flip the card from over 20 of the leading crowdfunding platforms. The to see more. Digest each deal app uses a swipe user interface to make it simple and card and swipe to sort. enjoyable to browse deals, watch pitch videos and digest It’s free and quick to sign up to investment opportunities about exciting companies. OFF3R. Swipe right if you want to track a deal, left if you want to It’s the best way to discover and track deals across dismiss it or click on the star to platforms. You can also enable alerts and notifications add it to your favourites. to stay up to date with your favorite opportunities. OFF3R does not make any recommendations. It is purely an information service that collates publicly available information into a mobile application.

PERSONALISED DETAILED Tailor notifications to ensure Flip the deal card over to see you don’t miss an opportunity. more information on the deal Set new deal alerts and stay and visit the deal pages on informed when your selected partner platforms. deals are reaching their target Access leading crowdfunding or their closing date. Filter platforms in the palm of your the platforms and the type of hand ensuring you’ll never miss investment opportunities you an opportunity. want to see. Manage your dealflow. January 2016 The Fintech Times Featured content 11 Platforms Crowded space

The platform is an angel-led CrowdLords are directly The rise and rise of Crowdfunding crowdfunding platform where angels connecting investors and and sophisticated investors invest in property professionals so that provides investors with opportunities small to medium sized enterprises. more people can benefit from to buy into companies at an early stage, Angels Den’s approach means that investing in property. They want across a wide spectrum of sectors. once an ‘anchor’ investor is on board, everyone to be able to invest and the funding round is then opened benefit from property investment up to the crowd. This gives the without the traditionally high cost OFF3R is a simple concept, well OFF3R as a company will shortly find crowd the luxury and confidence of barriers to entry. A core concept executed, and actually quite elegantly itself in the interesting position of investing alongside an experienced of the platform is that by pooling designed mobile app that aggregates having detailed historical and real-time angel investor. 94% of funded deals resources more can be achieved. the offers from crowdfunding platforms insights into the Crowdfunding sector on Angels Den are still trading into a tinder style swipe format. There itself, and the multiple sectors that use identifying a niche for investors that are about a dozen UK platforms, and Crowdfunding to raise capital. add value to the startup business. another dozen non UK platforms that Their top performing sectors are can be filtered so you can select exactly Over the next few years this may become Technology, Food & Drink and which platforms you want to see content increasingly significant, P2P and equity Consumer products. from. Crowdfunding are proven challenger Since starting in 2011, Invesdor systems for business funding, and set out to achieve their vision It’s probably the quickest way to gain an having an understanding of success and of becoming the leading equity overview on the Crowdfunding industry the way success is both determined and based crowdfunding platform in terms of companies endeavoring to achieved, is valuable. and offer the best investment raise funds this way, determining which The platform is now one of the opportunities across Finland, tend to be more successful than others, It’s going to take several more years, at biggest in the UK with a constant deal Sweden, Estonia, and Denmark. which platforms are better suited to least, before we start to have sufficient flow of equity and bond investment The Invesdor team specializes which sectors, and a range of other data regarding the live or die rate of opportunities. The founders in equity-based opportunities insights.. crowdfunded companies, and investors wanted to give entrepreneurs the but has also recently introduced should be cautious. B2C business models opportunity to take control of raising bonds on to their platform. For potential investors in these are seemingly more common, building a funding from their own network This leading European platform companies, OFF3R is fundamentally a user base as well as investors, but B2C of friends, family, customers and offers investors the opportunity way of shortlisting possible investments, apps for example can be difficult to make strangers. Crowdcube aims to give to invest in a market outside of monitoring their funding progress, a successful business from, requiring people the chance to become an the UK. engaging with the process, reading hundreds of thousands of users to reach ‘armchair Dragon’. The platform the submitted business plans and viability in some instances. itself has over 225,000 investors documents and so on. signed up and have successfully Where as less familiar but more viable funded 324 companies. Companies What you can’t do is invest through B2B models may find Crowdfunding a using Crowdcube have raised over OFF3R, to actually put money into one of more challenging experience. £115 million since starting and the the companies it requires the user to go Horses for courses. platform operates a direct investment Seedrs has become a leading through the correct procedures on the model where investors invest directly crowdfunding platform in the actual Crowdfunding sites which vary But these are just speculations. The with the company that is fundraising. UK by offering a nominee considerably, platform to platform. power that OFF3R is aiming for is having model to their investors. This the data, the facts, the statisical truth. means that Seedrs acts as legal For this reason, OFF3R is a support service shareholder on behalf of the to the platforms, and the companies on Until then, investors just have to follow investor and that you will have them, rather than a middleman between their interests, insights, intuition, and the same rights however big the investors and the platforms. It’s a sometimes the crowd. or small your investment is. reassuringly symbiotic relationship, with Eureeca was the first global investing Seedrs shows equity and bond OFF3R keen to develop and analyse the market place. The platform is based investment opportunities and valuable information and insight that in the United Arab Emirates and is have been backed by a number of this position allows. focussed on startups that are seeking high profile investors since they funding in this region. The platform launched. In 2014 they funded 110 launched in 2012 and allows investors campaigns from 20,367 individual OFF3R is not a crowdfunding originator. OFF3R is an aggregator of publicly available to invest from as little as $100 investments making them a information, you will need to register on each platform and agree to specific terms to per investment in a wide range of driving force not just in the UK access additional investment information. OFF3R is targeted towards investors who businesses. but Europe as well. are sufficiently sophisticated and/or accredited and understand these risks and make their own investment decisions. Investing in early stage businesses involves risks, including illiquidity, lack of dividends, loss of investment and dilution, and it should be done only as part of a diversified portfolio. 12 The Fintech Times January 2016

REPORT New research explores consumer attitudes to digital finance

Research by Nostrum Group, a lending technology provider based in London and Harrogate, has revealed that consumers increasingly value personalisation, honesty and integrity ahead of speed and monthly cost when choosing a loan provider. CEO Richard Carter gives The Fintech Times readers a preview of Nostrum’s research, unveiled in December.

There were some interesting themes consumers have stopped viewing digital it, retail point of sale finance operators could order to receive a higher degree of customer emerging from Nostrum’s third annual lending as the future, and are increasingly benefit from more spending on the high experience. At the same time, it indicates report into consumer attitudes to digital comfortable accepting it as part of their day street. that if the lender is deemed trustworthy, finance, titled ‘Personalisation in Digital to day lives. providing this data will not be a huge issue. Lending’. Our research, which surveyed 2,000 Personalisation in digital lending So what can we conclude from this research? adults, found transparency (84 per cent) is We see this as an opportunity and a threat It seems the perfect platform for innovation now second only to low interest rates (92 per for existing banks and lenders, as it makes Creating a personal touch and operating in in digital finance to bloom has been set, cent) as the factor consumers consider to be potential market entry by some of the a way that resonates with the consumer’s building on increasing confidence in digital the most important element when sourcing biggest tech and social brands ever more own core values offers an opportunity transactions and demand for credit of all a loan. The third most important factor is plausible and likely to succeed. The strength to differentiate in an increasingly busy varieties. speed (73 per cent). of the current consumer credit industry marketplace. Banks and Fintech innovators lies in experience but the market faces are likely to be pleased to see customers In recent years we’ve seen the lending unprecedented change in the coming years, acknowledging the role social data can industry become ever more influenced by and technology has revolutionised the way play in underwriting. This may represent a the digitally-savvy consumer, and several consumers can be serviced. Whether one recognition that consumers acknowledge factors now point towards an increasing single company can meet these demands their personal data will need to be shared in preference for digital lending. Just 14 per remains to be seen, but to compete the cent of those surveyed could remember their industry needs to take a long hard look at last bank branch visit, while 53 per cent of itself and not be afraid to completely rethink those surveyed now use a mobile banking the way it operates. app. The future certainly looks bright for digital People are now more willing to accept the lenders. There is market share still to be role of social media data in loan decisions. acquired from high street banks and if 49 per cent of those surveyed aged 18-45 consumer affordability continues to be say they are open to the notion of lenders strong for the majority of 2016, if not all of using social media as a means to make credit decisions. This represents a significant increase on the 40 per cent of the same age group who expressed a positive response to the same idea in 2014.

The challenge to banks and other lenders is not just to provide lending facilities digitally. To appeal to existing or potential customers they need to be honest, transparent and able to provide a personal experience, all with a competitively priced product.

Digital finance has arrived

Our survey found general indifference to questions about technology in finance, which in previous years have bought stronger reactions. This in combination with the ubiquitous presence of smartphones and increasing market penetration of tablets and mobile banking apps confirms that January 2016 The Fintech Times 13

REPORT The consequences of the financial crisis of 2007 – 2009 were far reaching. They are still being felt today – the difference in European output in the second quarter of 2015 compared to that predicted by pre crisis levels is equivalent to the size of the German economy. For established banks the complex array of challenges that are confronting the industry, and helping to level the playing field as Fintech Disruptors Report a result, mean that in many ways banking – both old and new – is in ‘startup’ mode. STARTUP Banking The Fintech Disruptors report identifies and discusses seven 2015 inter-dependent themes, outlined below.

By The full report is available from MagnaCarta Communications. Thank you to The Dock, London, for hosting the release event.

S IMPLICITY T RUST A GILITY R EL ATIONSHIP T RANSPARENCY U NBUNDLING P RICING

Easier access to Trust, once a byword Smartphone app use The focus on user The price transparency New fintech entrants The impact of the consumers through for financial services has has radically altered experience by fintech enabled by the first are exploiting the fintech revolution on digital channels, been severely damaged consumer demand for entrants, including internet wave at the advantages of product price-setting and specifically by the financial crisis innovation, with new those in this report, beginning of the single product focus, of products remains smartphones, is driving and waves of scandal in products launched is drawing attention century, in the form following a trend that the most unresolved the trend to the decade following it. more quickly, tested in to the opportunity to of price comparison was set by the launch of area of the ongoing straightforward Loss of trust has opened the open market and redraw the relationship sites such as mono-line credit cards shake-up in the financial products distributed by the doors to new continuously refined. of financial services Moneysupermarket. in the 1990s. The services industry. Price new fintech entrants, in fintech, non-bank Organisations in this providers with their com, has been benefits this strategy is already the primary most cases themselves competitors. While report underline how customers. For banks, complemented by an affords include greater battleground on simple, single product most of these have not banks are adapting to this will mean seizing influx of new entrants emphasis on the which the challenge to companies. While yet been tested by a this cultural change with the potential to leverage with straightforward customer to build existing incumbents this strategy may be downturn, waiting for innovation initiatives deep pools of data pricing and simple loyalty and a simpler is being fought. The impractical for multi- the next crisis to restore that include venture for greater customer business models corporate and revenue research reveals that channel institutions, the trust is not a viable capital investment, insight to understand in the age of the mobile model. With fintech while transparent research highlights the option. The report internal development how to monetise their internet. For banks, valuations riding high, pricing is a central opportunity for banks shows that winning back and acquisitions. Most services transparently often characterised by countering this pillar of the strategy to simplify the user- customer trust critically however, in a way that fosters the complex businesses threat solely through for new entrants, banks experience, rationalise will require an emphasis greater collaboration longerterm relationship. and opaque pricing, a acquisition is probably and complex financial product lines and on re-building the with third parties response will require unrealistic. To compete, services organisations improve returns, which relationship with outside the bank and, a root-and-branch banks will need to are trying to understand now stand on a level consumers through paradoxically after a commitment to develop a how to reconcile comparable to utilities transparent pricing and wrenching financial transparency to help clearer understanding consumer expectations companies. communications, crisis, ‘getting over restore trust and re- of how to leverage for cheaper digital and greater use of the fear of failure’ are build the connection their multiple channel products with an technology to replace increasingly viewed as with customers. structure to create a obligation to maintain human interaction with essential ingredients better experience and multiple delivery automated systems. to an agile innovation deliver greater benefit, channels. strategy for large while exploring the institutions. potential for unbundled product pricing. 14 The Fintech Times January 2016

GLOBAL Israel

Israel: From Startup Nation to Cyber-Security Nation

If you’ve been to Tel Aviv recently, Shwed, who was then a 25-year old graduate These military units pre-screen and train rogue or suspicious users (employees) in a you’ve most likely heard local of the 8200 Elite Technology Unit of the young high school graduates to become company. Considering that 82% of cyber- entrepreneurs refer to Israel as “Start- Intelligence, recruited his army “buddies” to tech leaders. At 18, these guys and girls attacks involve stolen user credentials, these Up Nation.” This name was coined become the first employees of the company. confront complex technological tasks that startups have grown incredibly fast. by two American journalists who, in have real-life implications, to say the least. their 2010 book, explained how Israel CheckPoint’s success as the inventor of The structure of these units is unique to the Israel only is 3.5 hours away from Europe, turned so hi-tech-heavy (hint: skilled “Stateful Inspection” or the “Firewall” extent that they are often non-hierarchical and the wealth of security innovation found immigrants & mandatory military created a domino whereby the CheckPoint and welcome the critique of younger in a few square kilometers in the country is service). founding team spun off to create their own members. In effect, these units operate simply unparalleled. As global connectivity companies (Imperva & Palo Alto Networks). almost exactly like startup incubators. rises, Israel will continue to produce some of But what you may have missed is Israel’s These successful security entrepreneurs the world’s most innovative and protective rapid transition from “Startup Nation” to became active angel investors, thus creating One of Israel’s most fascinating contributions state-of-the-art cyber-security solutions. “Cyber-Security Nation,” a transition that has a “virtuous circle” in the Israeli security to cyber-security innovation is in industrial produced a wealth of opportunities for angel ecosystem. cyber-security. investors, venture capitalists, and global The domain of OT (Operational Technology), corporations such as McAfee, Microsoft, Fast forward twenty years, and the as opposed to IT (Information Technology), IBM & PayPal, who have begun seeking CheckPoint Domino Effect has given birth has seen the rise of a few very successful acquisitions in the country. to over 300 security startups in various Israeli startups in the last couple of years. cyber-security domains, including industrial These startups’ uniqueness is their ability In the last two years alone, CyberArk IPOed at cyber-security, web application security, user to connect to industrial networks in a non- USD 500 million (it is traded today at USD 1.2 behavior analytics, biometric authentication intrusive manner and detect anomalies in SHIRA KAPLAN billion); IBM acquired Israeli security startup and even car cyber-security. the network. In light of the rise of industrial Trusteer for USD 800 million, and Microsoft connectivity both in the US and Europe, CEO & Founder, Cyverse acquired Aorato for USD 220 million and Israel’s booming cyber-security ecosystem, these Israeli startups have attracted a lot of Secure Islands for USD 150 million. To name which attracted as much as 11% of global investor and customer attention. Shira Kaplan is the Founder & CEO of Cyverse, a business development & just a few exits (there were many, many funding and produced over USD 6 billion in investment firm based out of Zurich and Tel more). sales in 2014, has been driven largely by an Another Israeli forte has been in User Behavior Aviv that focuses on Israeli cyber-security unusual supply of talent that comes out of its Analytics, an emerging field in the cyber- startups. She is a graduate of the 8200 Unit and Harvard University. She is available at Israel’s journey to the forefront of cyber- top military units. Shwed’s 8200 unit is just security space. Israeli startups have learned [email protected]. security innovation dates back to the one of those units; others include the Cyber- to correlate log data with active directory founding of CheckPoint by Gil Shwed in 1993. Security Unit and the Software Unit. data in a way that automatically points to January 2016 The Fintech Times 15

GLOBAL France-UK French on British Soil: It’s not about the money.

in London for a French corporation, and one youngsters. “They are now taking bigger risk, and 13 percent in Silicon Valley. During the of the top global energy players. for the first time in 10 years. Partly due to the same period, the value of Fintech investment high unemployment rate of 10.5%, France is increased nearly eightfold, to US$265 million I asked Crémieux her thoughts on what seeing an increase in small businesses. Last in 2013 – a rate of 51 percent a year, nearly she later titled “The French Talent Exodus”. year a quarter of recent graduates of HEC, twice the global average (26%), and more MIRA MUDHIR Passionately she explained how the initial an elite business school, have started their than twice that of Silicon Valley (23%). incentives lure you in, “just for the laws and own company. That is a significant change as London is one of the world’s regulations to choke you.” She continues, opposed to one in ten, just a decade ago.” This time I was determined to find British “Talented entrepreneurs leave France, to the Consequently, the French startup ecosystem expertise on the subject. Thus, meeting largest centres for financial point where some of the country’s young – La French Tech - is growing rapidly. Startup Geoff Graham, Fitzgerald and Law (F&L), a institutions, being home to business-leaders have started a campaign to weekends, investment fairs, and international global exponential advisory firm that works something like 251 banks, 588 woo them and their international expertise campaigns are emerging everywhere to with US and EU tech firms who are looking financial services companies, and back. It’s called ‘#ReviensLéon’ named after bring enthusiasm among spirited young self- to expand to the UK. F&L specialises in the hundreds, possibly thousands, of an 80’s TV ad enticing youngsters to eat at starters. Crémieux, “The rise of digital sectors taxation and accounting aspects of corporate emerging fintech. The financial home. The target for this year’s campaign is often seen as an opportunity to grow a expansions. The firm sees a large number of is the same: youngsters – now all grown up, company without capital expenditure: no French Fintech startups, coming in search services sector in the UK accounts living away from the homeland.” risk needs to be taken by timorous French of funding. Graham, “Many French tech for approximately 9.4% of the entrepreneurs, all it takes is a computer startups come to the UK when they are ready country’s total GDP making it one This point was later reinforced by Sylvain and time. Finally this trend towards for their first round of funding, they see the of the largest globally, and more Girard, a French entrepreneur and founder entrepreneurship is enhanced by success UK as having greater access to funding. From active than any European peers. of Angus.ai. stories that show risk-free possibilities.” conversations with them I gathered, rightly or wrongly, that London’s Fintech sector is far However, within the past few years Girard had been an expat for many years, To quote Marc Simoncini, one more developed than the rest of the EU.” technological progress has forced all and has recently returned to France to of France’s most successful governments to turn towards entrepreneurs start his business. When asked about the web-entrepreneurs: “Seen from Surely, funding is not reason with a view to attracting or retaining them: benefits of starting a business in France, abroad, France is the last country enough for so many foreign clever branding, helpful legislation or Girard responded, “It all depends on what an entrepreneur wants to go to.” entrepreneurs to pack their increasing propaganda budgets, everyone stage your business is at. In the early stages Pourquoi? bags and leave their home, wants more startups in their town / city / of a tech company, France is an excellent friends, and family behind. What country. incubator. We have many engineers who Crémieux, “Because France has kept its other reasons are there forcing are, after all, the producers of tech products. reputation of being an expensive country. entrepreneurs to migrate to This brought me to La Résidence de France They are affordable and highly trained. And Where tax rates are discouraging, labour laws Britain? in London. I was attending La French Tech, because the government aims to support are complicated, bureaucracy procedures an event that the Minister of State for Digital French engineers, you get a tax exemptions are full of obstacles, banks are reluctant to Graham, “The availability of VC investment Affairs Axelle Lemaire announced to be in your first year of business. So when the offer credits and venture capitalists do not is of primary importance. As reported “the world premier of many more to come.” company wants to scale up, or start their exist. And this is despite the country’s drastic by London and Partners earlier this year, During the conference we heard many French search for investment, they tend to move to efforts to become SME attractive. The main London attracted 50% of all European entrepreneurs proclaim jokingly that they places like London or Silicon Valley.” reason for French companies to collapse Venture Capital investments. had not chosen to move to the UK for “tax remains the lack of funding.” Access to mentorships: 36 out of 57 of purposes”, emphasis on the NOT. During the French youngsters today Girard, “I think this is a bit more of a European accelerators and incubators are Q&A session, the same young entrepreneurs take risks, think big, break cliché than the reality. You have different based in London, such as Level39 which is spoke about the difficulty of getting funding conventions instruments to employ people in France. You renown and very well regarded on a global in France. This peaked my interest. have many consultant contract laws, which scale. English language makes it so much “France has never had an entrepreneurship are the same as that of the UK. You have easier and cheaper to go global with your Later I asked Lemaire in person: “Why do oriented culture”. Crémieux and Girard, many developers, and PHD’s that you can company. Which is especially useful when you think there is a leakage of French talent whom I interviewed individually, answered employ at very affordable prices.” trying to attract American investors. Also to the UK? Are there any legislations that harmoniously. “The French population is with UK laws it is very easy to set up or fold will help the advancement of technology rather reluctant to take any kind of risk. Surely, what’s drawing French startups to a company.” in France?” Unfortunately, the answer was France has always been culturally far from London is not just dire trade conditions in unclear. Lemaire’s only comment was: “I’m the ‘self-made man’ ideology. French people their homeland... Foreign corporations have The UK’s leading financial infrastructure, truly baffled that French entrepreneurs have historically had a predisposition toward been controlling 39% of UK patents since supportive regulations, accelerators and are leaving home! It’s a lot easier to start a salaried jobs. Social protection of employees 2012. This is far more than the EU as a whole, mentorship programs for startups coupled business in France than it is in London. How tend to encourage job stability. Hence the at just 13.7%. This exceeds the foreign-owned with large availability of capital and English do we aim to change this? Well… Through “Contrats à durée indéterminée” - the golden patents in the U.S. (perched at just 11.8%) by as the main business language - these are you! The media!” Unsatisfied, off I went, to legislation that prohibit companies from 27.2%. Of course, it is no surprise that the all major factors that attract disruptors on a sate my curiosity. firing their employees.” UK is the fastest growing region for Fintech global scale; and not only the French. investment (Accenture). The UK deal volumes Shortly after, I met Laure Crémieux, a 24 year Crémieux refers to the recent transformation have been growing at 74 percent a year since old Parisian contractor, currently freelancing of this convention brought about by French 2008, compared with 27 percent globally, 16 The Fintech Times January 2016

LEVEL39 Introducing

Level39 194 really interesting stories to tell

“Level39 provides curated content every week. That means a ‘curriculum’ offered to all our members, where they can sit down with investors, mentors and advisors for one-on-one sessions which we organise.” Asif Faruque

Asif Faruque, Head of Content of Level39, Where better to sculpt the very future of different feel, a different vibe, reflective of meets, greets, and leads us to the finance, banking, and change. their members. members’ club restaurant. Level39 was formed in 2013, it is of course Google campus is a chaotic cauldron, a Soft jazz soothes the space, and a choice Level39 of One Canada Square, Canary reaction vessel, you can walk in with an idea selection of art softens the walls. I recognise Wharf. Its Head, Eric Van der Kleij, was the and walk out with a team. But you’ll never scale a piece from Kurt Beers’ gallery, a mandala, former CEO of Tech City UK, the Government in such a place, too volatile, too distracted, upon closer inspection, one realises the backed organisation designed to bring tech too much. Central Working spaces, each one complex geometry is entirely constructed to London. Seems to have worked. Story goes, a different energy, from calm to creative, from electrical components, transistors, after he finished at Tech City UK, he went to more like an art school, here’s the painters, capacitors, transformers. an event and met Sir George Iacobescu, the the sculptors are in another space, each to chairman of Canary Wharf Group, who said their own. Other artworks are similarly digitised. A let’s bring tech to Canary Wharf, and Eric said framed print of a girl, in the style of 19th sure. Level39 feels… strategic. Poised. Enabled. century portraiture. Her eyes open and move Serious. as I approach. Sculptures, a glass sphere, From the windows of our viewing platform For the space reflects the people, and the within a triangle, within a cube. The three lit we look over at the other skyscrapers, units people are the companies, 1600 apply, 194 by LEDs, which change colour as I view from with units, vast machines for translating are here. Fintech is finance as technology. another side. I wonder if Kandinsky’s colour human activity into 0s and 1s, then back shape theory has been applied, or if the again. Extraordinary conceptualism, when And here, in the calm, above the city, much artists here are leaving the past in the past, one steps outside to contemplate. change is afoot. and are rebuilding from a new foundation, to leave legacy, not behind, but in the future. In our role as journalists we find ourselves A contemplative, innovative, high technology in many a co working environment, from space, with the meditative energy of a dojo. the subterranean level of London Campus Canary Wharf Group’s art curator is Keith in Shoreditch, known as google campus to Watson, a former gallery owner, and now everyone in the scene, to Central Working procurer/curator of digital and kinetic art next door, to the WeWorks popping up like from all over the world to display at Level39. so many hives. Each of these spaces have a January 2016 The Fintech Times 17

LEVEL39 Startups

REVOLUTE

What it is: Sufficiently convinced were Balderton Physically, it’s a card, a Mastercard. With Capital, they seeded it with £3.5M. Investable a corresponding app. When activated it then. There’s now 15 employees, including becomes a local bank card, where ever you Veronique, employee number 4, another ex- are. You can use it to withdraw funds from banking professional, she met Revolute at a ATMs and to buy from shops, and online meetup, pitched for a job, took it. retailers. In ‘any’ country. Technology Accelerator I asked Nikolay how much he himself put into How does it work? the company to get it to that stage. £300,000. You open an account in the app. You can It’s a different game these ex-banking then charge the card via the app. You then founders are playing. They themselves are treat it like a debit card. Which it is. You can capable of funding their own businesses way have multiple accounts within your account. above SEIS level angel rounds. I asked the A dollar account, a euro account, up to 90 current value of Revolute. Around £26M. currencies. How does it make money? “Not from the What’s the user benefit? users. It’s from the shops, a merchant charge, Convenience, security, and importantly, same as shops always pay every time they fractionally the price for overseas use. Users accept a debit or credit card. Not close to send, spend, and transfer at the interbank break even yet. Our plan it to make it free rate. Currently 23 currencies to send in. forever but to find other sources of revenue, Founders: change bitcoins, buy travel insurance, hybrid Single founders are the exception to the rule services, end to end solutions. A Global in startups. There are almost no successful Money app that allows you to do everything ones at all, anywhere. Paul Graham, the with your money.” mastermind behind Y Combinator, considers YIELDERS single founders to be basically un investable. I’ll say one last thing about Revolute. They is the property might depreciate, which is But there’s exceptions to every rule. know to make things beautiful. Nikolay possible, but in any event, the rental is fixed, Nikolay may be one. With a background gave us one of the cards. The mechanism What it is: A very interesting company and there’s no ‘mortgage’ to pay. The rental in trading, not even in payments, in June by which you slide open the holder is so that’s what. It’s an equity property agreements are with housing associations, 2014, he hired a consultant, one of the top satisfying, I must have done it a dozen times, crowdfunding platform. which means tier one level reliability, with a ten in the World apparently, to work out the for the pleasure, before even removing the How does it work? Properties are placed probably achievable target of zero voids, ie solution that would become Revolute. The card from the wallet. It’s like the elegance on the platform. These aren’t ‘opportunities’ un-rented down time. The rental returns are consultant said it wasn’t possible, and for of a new iPhone box. It demonstrates an or speculative high risk crowdfunding anticipated to be around 6%. that reason wouldn’t charge for his expertise, understanding that user satisfaction is not startups. These are bricks and mortar Another interesting fact about Yielders is that and visited Nikolay in Level39 to explain the a neutral state, it’s a positive one. And the properties that already exist and crucially, it’s based on Islamic banking principles, it’s process, initially for a day, which became design mind to see it applied, end to end. are already generating, or contracted to Sharia compliant, which means it’s not based several weeks, as between his experience Revolute. They re-engineer an entire banking generate, rental income. on interest charged for lending money. and Nikolay’s, a solution that ‘might work’ process, and I’m still enamoured with the Each property has its own SPV. That’s a It’s a financial return for a commercial service, came out of the process. packaging of the card. Special Purpose Vehicle. Which is in practice in this instance, rented housing. a Limited Company. And it’s the shares in theses limited company SPV’s that investors However, it’s not an Islamic opportunity, it’s buy. They then own a percentage of that open to anyone with £5000 or more to invest, property, as an equity shareholding in it, an amount they plan to lower to £1000 in and receive a share of the rental income time. These Islamic banking practices are accordingly. interesting. It opens up a whole new way of looking at investment, some models of which The tech is not necessarily groundbreaking, will be more efficient, better returning, than but what is very interesting about this conventional interest based ones. Forget business model is the structure of the the religious consideration, from a purely investment. It’s designed to be end to end commercial perspective, there’s opportunity transacted across the platform, from investing here, a whole range of investment products in the property, through to contractual are waiting to be interpreted into digitised completion, shareholders agreements, platforms. shareholders voting, and so on. The platform is the process entire. The implications of this Irfan and Zeeshan are well aware of this. The are profound, it simplifies what would be Yielders platform, with a little white label re otherwise prohibitively complicated, and in branding, could be used to crowd invest in doing so, opens up a new type of investment all manner of sectors. Wine. Vintage cars. to the mass market. Art. It’s all about the end to end integration From an investment perspective, on the up of the mechanics of the process, the digital side there’s the appreciation of the property, paperwork. Compliance. Definitely one to and the revenue from the rental. The risk side watch. But then in Level39, aren’t they all. 18 The Fintech Times January 2016

BLOCKCHAIN Diamonds

diamonds, its paper-based approach is RarePink. not as rigorous as that of the technology underpinning Everledger when you consider New technology the power of smart contracts and the blockchain. Chain of disruption meets jewellery We hope to be able to proudly say that our As an online company, trust and transparency ethical sourcing and unique design policies Blockchain wins the war is critical to building a respected brand. We are promises that we can now proudly back- are fortunate enough to work with customers up with technologies that are of the highest for clean diamonds at a time where a simple question translates security and transparency. into a life long commitment and promise. As Another example involves diamonds. most of our items are bespoke engagement Whilst the diamond industry has been While the new kid on the financial Although many diamond-fuelled wars have rings, our customers really care that their focused on ethical sourcing, the success of technology block, bitcoin, is ended in Africa, conflict diamonds remain ring design is one-of-a-kind and that it will these efforts are often blind to the consumer. having a tough time gaining a serious problem. Everledger supports a remain this way. It becomes a part of the Enabling the blockchain, and exploring the acceptance on the financial system of warranties that enable mining unique bond which has formed, somewhat use of Everledger, enabled another level of playground, its underlying companies to verify that their rough stones of an emotional fabric of the relationship. It transparency to our ethical sourcing policy. technology, blockchain, is not. are not conflict diamonds and comply with is for this reason we assure them that each Moving beyond the source of the stone, Blockchain has been the star the ‘Kimberley Process’. The provenance design is made from the mapping of their and now we can also protect the designs attraction at the recent Money (ownership history) of these diamonds from thoughts and ideas into a truly unique piece. of our customers and give them a view into 20/20 event in Las Vegas and legitimate sources can be easily accessed Just as the promise is a one in a life time, so this protection through the digital vault continues to demand the by governments, jewellery retailers and too is their ring and so too is the commitment technology attention of those who influence consumers, providing full transparency, from Rare Pink. both international business and instant verification of the value and A massive additional benefit to our customers governments. authenticity of the diamonds. With emerging technology surging through is that their design is also protected and thus industry, Rare Pink is at the forefront of available for future use should their first ring In an interview for The Fintech Disruptors’ In the six months since its inception, embracing these platforms to enable a be lost, stolen or damaged. We look forward Report, Everledger CEO Leanne Kemp talks Everledger has already stored the records of better customer experience and to protect to assist out customers in getting their ring about the blockchain potential and how over 850,000 diamonds and has impressed the promise for the customer. Our existing insured and increasing the speed through Everledger is using the technology to thwart its peers by winning the Meffys Award for ethical policy already uses the Kimberley which we can re-make it should we need diamond thieves. Fintech Innovation organised by the Mobile Process, and while this process has proven to to where the customer trusts Rare Pink to 16841 Fintech Times Advert1_Layout 1 07/09/2015 13:37 Page 1 Ecosystem Forum – the first blockchain drastically reduce the occurrence of conflict deliver again on its promise. “The blockchain represents an opportunity company to be chosen. to re-think legacy systems that for the most part have been taken for granted as the way For Leanne this is just the start for the KEYNOTE CONFERENCE SESSIONS • INTERACTIVE things must be done, rather than what could technology. “As with others breakthroughs WORKSHOPS • PRODUCT be done,” explains Leanne. “Arguably, the that affect regulations, business systems LONDON’S DEMOS • MICRO- MENTORING CLINICS future potential is limitless, particularly in the and human behaviour, adoption will take DISCUSSION SESSIONS ON: areas we are focusing on at Everledger: using time,” she says. “We’re seeing global leaders FINTECH • Payments a global, distributed ledger that cannot be in technology, like IBM and MIT, turn their • Crypto tampered with as a compliment to traditional focus to developing platform initiatives – • Crowd Funding START UP • Peer to Peer Lending methods of recording information, all of even as an open source environment. In • Insurance which have been shown to be vulnerable.” finance, 25 banks are now part of the R3 • Trading Technologies blockchain consortium working to determine EXPO • Big Data • Social Scoring and Digital contracts, says Leanne, is one a framework for using blockchain technology much more… DECEMBER 8TH-9TH // WEMBLEY STADIUM, LONDON example where transactions passing through in markets.” multiple intermediaries and countries today are adding unnecessary time and cost to She concludes: “This is progress, but there 2000+ 100+ SPECIAL EXHIBITOR RATES FOR START UPS the process. Through the blockchain, it is are challenges such as the legacy of ‘bitcoin ATTENDEES START UP C O N N E C T EXHIBITORS AND VISITOR PASSES designed to be self-executing and self- anxiety’ and the need to increase the number FROM JUST £39.00 START UPS • SCALE UPS • ANGELS • PRIVATE EQUITY • ESTABLISHED TECH Get in touch now to find out more! enforcing because the interaction is solely of non-tech people who understand and PROVIDERS • FINANCIAL INSTITUTIONS • PROFESSIONAL SERVICES ftcl@fintechconnect.com between the parties involved. embrace its potential for their business.” WWW.FINTECHCONNECT.COM/FTCL January 2016 The Fintech Times 19

BLOGS

16.11. 2 015 ukbondnetwork.com

Being disrupted isn’t just a challenge for the banks David von Dadelszen UK Bond Network

In the ever-evolving world of The uptake of incumbents or otherwise larger companies. So the Shareholders would need to agree to finance, disruption is a challenge knowledge, and desire, to develop these giving aware a share of new ideas to the for fintech itself. One of the major threats facing the industry technologies was there – it just wasn’t on the individual who came up with the idea and is the switching on of incumbent financial radar of the people at the top. the individual who came up with the idea would need to accept having a lesser stake Financial Technology is a big, growing organisations to the opportunities presented Leaders of large organisations face an intrinsic than if they started the company themselves. sector. At the end of last year, Ernst & Young by leveraging technology to deliver services. challenge when it comes to developing their But consequently shareholders would own estimated the UK Fintech market to be worth The Santander ‘InnoVentures’ scheme business. Few are visionaries, instead having a share of something, which they wouldn’t £20 billion in annual revenue, with 18% of provides funding to fintech startups in proven themselves within the company’s otherwise, and the individual would be able this revenue coming from ‘emergent’ fintech. exchange for the ‘disruptive’ technology existing business model, and excelling at it. to quickly scale and develop their idea. Whilst financial technology seems to often needed to streamline bank processes and Because of this they are experts at what they While this approach would contribute to be perceived as a new phenomenon it seems ensure its continued relevance. do, but aren’t necessarily naturally inclined an on-going culture of innovation within a that, in reality, it is simply a continuation of to start doing what they do differently. business, it would also help to manage the the natural evolution of the financial services Goldman Sachs is actively hiring from the risk of new ideas, which have the potential to sector. fintech sector, and is planning to launch its own online lending platform in 2016. Embracing change take market share away from the business in future. At some point, as the financial services Financial technology – the use of software Hargreaves Lansdown, the UK online Flux doesn’t just come in the form of the sector continues its ever-evolving cycle we, to deliver financial services – is continuing financial behemoth, has similar plans in the technology that we use; it comes in the form as disruptive businesses, will ultimately be to evolve as rapidly as the technology we UK. How the pure marketplace platforms of management styles and organisational disrupted too. If, however, we can foster this possess is. Indeed, new technologies are will be affected is yet to be seen. The best culture too. Leaders run the risk of becoming disruption within our own organisations, put consistently being developed to improve on outcome is likely to be a significant additional legacy systems themselves – like the greed to one side and give fair ownership to traditional delivery mechanisms. challenge for upstarts to overcome, with a technological infrastructure widely noted as the owners of disruptive ideas then perhaps Nothing in this world is static. We are in a reduced potential ultimate market share. hampering change in the banks. Listening we can continue to be the drivers of change constant state of flux. Stock exchanges, with It is the capital that the incumbents have to to voices from across the organisation – in this world, rather than falling prey to their origins in City of London coffee houses deploy that makes them such a threat. Yes, which might be the most junior employees ourselves. at the start of the 17th century, are now they are being stretched by capital adequacy – to nurture both talent and new ideas is almost wholly digital. Complex investment requirements, but directing a fraction of incredibly important. What if once a quarter, and trading strategies can be deployed at their turnover to developing digital arms is the CEO sat down with the brightest young the click of mouse, and we can build equity still entirely possible if the desire to do so is talent from each division of its organisation portfolios with commissions lower than £10 there. If what we are experiencing is however to discuss their ideas? What if when they per trade. a natural evolution of financial services, the heard a good idea, they let them run with One of the most recent, and most talked question is, with all the resources available to it within that organisation, giving them about developments in financial technology, them, how did the incumbents even let the ownership (both in terms of an equity share Peer-to-Peer Lending, now often referred to alternative finance market develop? of the siloed business, and in terms of direct under the moniker of Marketplace Lending, management) and let them leverage the is gaining huge traction. Whilst the sector Intrinsic challenges organisation’s existing expertise to deliver seems that it is now undeniably here to stay, their vision? it is not without its threats. Many leaders of alternative finance platforms used to work in traditional FS organisations, 20 The Fintech Times January 2016

BIG PICTURE Azimo

This changes businesses now trying to hold on to their outdated everything.

For Marta it’s a personal quest, I can feel it everything and hear it in the language she uses. “...they have the courage to leave their homes, to All big ideas come from either big problems or big travel to another country, to work hard and opportunities, or at best, a response to both. get paid to be able to send enough of that money home to support a family… The most In the simplest terms, Azimo is a platform to send money online hard working, lowest paid, most exploited… from one place to another. Money transfer. Money transfer isn’t a luxury to these Specifically catering for the market sector of migrant workers. 250million people; it’s a regular, frequent, As a company, and a sector, it’s literally World changing. necessity.”

Marta gives me the stats: There are almost that up to 4% of turnover from some of The modern poor are those who don’t have Name: Marta Krupinska 250 million migrants, living in ‘foreign’ these companies goes on (non) compliance access to remittances. The equalisation of Occupation: countries, and from these, $600 billion is fines. Again, passed back to the end users wealth doesn’t mean the equalisation of General Manager and Co-founder, Azimo transmitted annually in remittances. A total in charges and fees. Non digital transfer of wages. It’s the equalisation of access to Born: Krakow, Poland of 700million people globally send or receive money across the World is clumsy, multi remittance that’s the key to global equality. Education: Masters in Organisational Psychology money from abroad. processed, risky, and accordingly expensive. And the smartphone is the key to all of it. from Jagiellonian University in Poland and a Management degree from Columbia Business She quotes Bill Gates who in 2011 said, Creating true disruption in any sector The number of smartphones is currently on School. “If remittance costs were halved from the frequently comes down to drawing the par with the number of bank accounts. By current average of 10% of the transfer value straightest line between two points. 2020 the ratio will be 3:1. This is going to CAREER to 5%, it would unlock $15Billion in poor Straightness in process and attitude. This define the next generation of people, and countries.” It’s a big ‘if’, and a big amount of approach, with elegant and robust tech, their understanding of money, what it is, and 2008 – 2011 money, Marta puts it in context. consistently out competes the ‘hidden where it comes from. From airtime credit, MD & Founder, Travelnity.com charges apply’ of the past. Azimo is all about digital wallets, to cash from hundreds of thousands of retail points. None of it needing 2012 “£15B could feed half of Ethiopia for a year, transparency and value, disintermediation, bank accounts. Somerset House and London 2012 Olympics or provide a mosquito net for every man, removing the middle processes and starting woman and child in Africa and Asia.” The at the consumers’ need. It’s an ethical 2012 – Present fee’s Azimo charge equate to 2% on average, quest, moral business, modern business. Global poverty could end through the General Manager and Co-founder, Azimo taking into account the fixed charge per It’s also more effective, more efficient, more globalisation of remittance ability. Certainly, it can’t end without it. FAVORITE transaction plus the exchange rate. straightforward, easier to market. When we step back and consider the norm used to be Even in 2012, Marta explains, people were far fundamentally predatory in attitude, it’s little Smartphones might just be the single most Books: Lean In by Sheryl Sandberg from confident in putting their debit cards wonder times are changing, and difficult important development in humanitarian Films: ”There Will be Blood” a great example of into a website, and transferring digitally. We to feel any sympathy for the exploitative terms since… almost anything. The the emotional price of success have a face to face instinct when it comes smartphone will enable it, and the money Restaurant: Anything Thai to transferring money, it’s to do with trust “Global poverty transfer companies, Azimo, Revolut, Hobbies: Travelling and listening to Jazz music ultimately. We want to see it happen. TransferGo, World Remit and many more, will could end through Politics: John Oliver for Prime Minister! facilitate it. Even now, over 90% of remittance happens Business philosophy: Success doesn’t come the globalisation of offline. Branches, shops, tellers, call centers, It’s another level of the Internet of money. from playing it safe. You’ll either achieve remittance ability. these all need paying for, ultimately by the The understanding of finance as a technology. something great or make a mistake. Mistakes can customers. I heard a statistic a few days later, Certainly, it can’t end And realising its unlimited availability as a be key to success, as long as you’re ready to act from another challenger fintech, they claimed without it”. consequence. fast on them, learn and next time do better. the startup scene. delivered monthly from £35 / year

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