The definitive source of news and analysis of the global fintech sector | October 2020 www.fintechfutures.com

EDUCATE, ADVOCATE, INVEST It’s not enough for companies to pay lip service

KNOW YOUR PAST, SHAPE YOUR FUTURE Breaking down walls with Keisha Bell at DTCC Produced by

STICKING THEIR NECKS OUT A spotlight on the UK’s first Black-led challenger bank CONTENTS FINTECH FUTURES PODCAST What the IN THIS ISSUE 10 COVER STORY NO MORE LIP SERVICE Fintech? Firms need to invest in internal policies.

Tune-in for: Trending topics

04 The fintech feed 20 Food for thought In-depth insights Top tweets and figures that have caught our eye. The only opportunity COVID gives us, says Leda Glyptis, is to be honest about the opportunities we missed. Banished buzzwords 05 News A round-up of our top news stories of the month.

07 Editor’s choice Sharon Kimathi’s take on some big issues in fintech.

Recent episodes cover: FEATURES In these VC streets 08 Through a Gen Z lens Ruby Hinchliffe collates the experiences of her Black Financial inclusivity in Russia peers within the industry. 22 FOCUS Commerce in the wake of COVID-19 13 Spotlight UK challenger Atmen is filling a gap in the market – it’s Transformers: more than meets the AI Banks must take a flexible approach to digitalisation to the first Black British-led high street or digital bank. ensure newly digital customers aren’t frustrated.

25 Spotlight How collaboration will be key to success for post- pandemic banking services.

26 I’m just saying… Dharmesh Mistry spots an opportunity to learn how to “gamify” banking today through Gen Z.

REGULARS 28 Fintech funding round-up Search for ‘FinTech Futures’ 15 INTERVIEW Lucky recipients of funds in the tech world. to find us on your favourite podcast streaming service. The DTCC’s Keisha Bell talks about the firm’s diversity and inclusivity initiatives that are fostering real change. 31 Appointments Industry movers and shakers.

18 Leadership 32 Fintalk of the town How digital technologies are transforming the banking Our “Gossip Girl” has been a fly on the wall. Who has Listen on and financial services industry. been in her sights this month? SOUNDCLOUD October 2020 | www.fintechfutures.com | 01 WELCOME

IS YOUR BACK OFFICE EDITOR’S NOTE This month’s special Black History Month systems designed without Black people in edition of Banking Technology magazine mind often repeat that same well-meaning but KEEPING UP WITH highlights a topic that’s very dear to my heart. ultimately patronising stance when they go It features interviews with Black women and about structural reform. Symbolic gestures that men in the financial services industry with one do not even scratch the surface of structural THE NEW WORLD OF PAYMENTS? thing in common – the need for change. change are lauded as transformative, as In Toni Morrison’s The Bluest Eye, her self-congratulatory “proof” of an institution’s character, Claudia MacTeer, recalls her anti-racist attitude, without even seriously Many companies using legacy batch systems aren’t able to support childhood experience of Christmas, specifically including diverse voices in the decision- faster and real-time payments. If your organization is one of them, we’d like to introduce you to how she would regularly receive white dolls making process. The Concourse Financial Software Suite® — winner of the “Best Real-Time Payments Solution” at PayTech Awards as presents. The spectacle of whiteness and It is one thing to provide opportunities to 2020. Concourse is a proven modular software suite specifically designed to modernize back office processing for beauty colliding aside, Claudia remembers speak, but we must also listen: if our readers any type of electronic payment transactions. This includes traditional card-based transactions and emerging digital how the adults in the room would spend are to take anything away from this issue, I time fawning over the doll, congratulating would implore them to consider the ways their payment methods such as mobile, eWallet and P2P transactions. Concourse’s continuous processing, rules-based Sharon Kimathi themselves on being such thoughtful gift- organisations can do both. architecture is helping companies meet the demands of the rapidly changing world of payments. Editor, Banking Technology givers, oblivious to the fact that her sole We hope you enjoy this month’s feature childhood wish was to sit at the counter-top with the UK-based Black-led challenger, when her mother was cooking the Christmas Atmen Bank, and discussion with Keisha Bell, CONCOURSE dinner and listen to her father play piano. managing director and head of diverse talent FINANCIAL SOFTWARE SUITE As she grows older, Morrison reflects that management and advancement at DTCC.

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FINTECH FEED NEWS ROUND-UP HMRC reveals £3.5bn furlough payment error Follow us @FinTech_Futures TWEET DECK THE NUMBER GAMES As much as £3.5 billion in Coronavirus Job Retention Scheme (CJRS) payments could have been paid out in error or claimed by fraudsters, the UK government has revealed. HM Revenue & Mike Bird Customs (HMRC) revealed to MPs on the Public Accounts Committee that around 5-10% of money @Birdyword $2 trillion sent to fund the government’s furlough scheme could have been awarded incorrectly. A million dollars isn’t cool. You know what’s cool? Finding a data series on a central bank website that is almost The amount resulting from suspicious deliberately hidden by giving it the most tangential and bank transactions revealed following obscure name possible, after several hours of searching. the leaked FinCEN files FinCEN files show banks allowed $2trn in suspicious transactions

A major leak has revealed a slew of major banks allowed oligarchs, mobsters, and criminals to launder money in transactions worth more James Cook than $2 trillion. Buzzfeed News obtained more than 2,100 suspicious activity reports (SARs) filed by banks and financial institutions. @JamesLiamCook $11.7bn Really big fan of the “Avengers of cybersecurity”-style £3.5 billion Analysis found that between 1999 and 2017 banks flagged transactions worth trillions in SARs submitted to FinCEN. graphic design of this conference. The amount of reaches $11.7 furlough payments in billion valuation the UK that were sent after its $460 in error, according to million Series G HMRC Revolut faces lawsuit in Romania over blocked account funding Digital bank, Revolut, is facing a lawsuit after blocking a customer’s account in Romania. Florin Hrituliac, a Revolut personal account customer in Romania, tried to transfer RON 20,000 ($4,832.68) from his company’s bank account to his Revolut account on 9 September $1bn 21 2020, but was unable to access these funds. Hrituliac tells FinTech Futures that his account was blocked for five days “without any clarifications from their chat agents”. The fintech unblocked the customer’s account on 15 September. The case follows several other similar Citigroup promises The Tokyo incidents of frozen or blocked accounts from Revolut customers around Europe. $1 billion to close Stock US Exchange racial came to a wealth halt during its gap worst outage WeChat transactions ban blocked by US judge for 21 years 1 The US Department of Commerce has been blocked from banning WeChat and its payment Jane Foster transfer services by a San Francisco magistrate. The ban is a response to an executive order from becomes the first President Donald Trump. The Department of Commerce announced last week it would prohibit woman to lead transactions on mobile apps WeChat and TikTok. Brianna a US Wall Street £1 trillion @BriLimitless bank as More than 7,500 UK financial services What’s your grace period before hanging up a zoom call if she becomes CEO jobs and £1 trillion in assets have nobody joins? I say 7 mins. of Citigroup moved to Europe due to Brexit Westpac agrees to record AUD 1.3bn fine for AML failures

Benedict Evans To read more about any of these stories, visit Westpac, one of Australia’s largest banks, has agreed to pay a record AUD 1.3 billion ($911 million) fine for money laundering breaches. @benedictevans www.fintechfutures.com/type/news The bank failed to adequately report more than 19 million international transactions, some of which are linked to child exploitation rings. Another day, another email to write politely explaining that It disclosed details of the breaches in a May 2020 court filing. AUD 11 billion in payments went unreported. The bank also failed to keep living in London means I would rather not do a Zoom call at records related to the origin of the transactions or carry out “appropriate customer due diligence”. 4 pm eastern time. THEY SAID IT… “Real change starts with Chris Albon honest, intentional dialogue @chrisalbon Nasdaq plans cloud migration for all 28 markets by 2030 Tech company: “Bring your whole self to work every day.” about everyday experiences” [employees bring whole self to work] Keisha Bell, managing director and Nasdaq is moving its 28 markets in North America and Europe to the public cloud over the next decade. The exchange operator’s data Tech company: “WHOA, we just meant your whole free time head of diverse talent management and warehouse already sits on Web Services (AWS). Nasdaq’s chief information officer (CIO), Brad Peterson, says the exchange not your politics.” advancement at DTCC repeatedly saw daily peaks of more than 100 billion messages sent and received in the US during 2020. Peterson says the exchange operator didn’t experience any issues due to its use of AWS, hence its decision to “go all-in on cloud”.

04 | www.fintechfutures.com | October 2020 October 2020 | www.fintechfutures.com | 05 EDITOR’S CHOICE

Typing biometrics authentication TRENDING

Spotlight on Black talent The issue of racism in the financial sector has moved up the list of priorities for corporations and regulators. Lloyds, RBC, Softbank, Citigroup, Bank of America and US Bank have all committed funds to tackle the racial wealth gap. The US Federal Reserve recently asked banks it oversees to provide more clarity on what they’re doing to tackle the lack of racial and gender diversity in the financial industry. The UK Financial Conduct Authority (FCA) is also conducting an assessment of diversity and culture in the sector as part of its annual review. These examples show that tackling racism is really on the agenda within the industry, at least at face value. In light of these initiatives aiming to fund Black-led institutions, FinTech Futures is shining a spotlight on fresh Black-led fintechs around the world that are ripe for some investment. Recognize From Atmen Bank in the UK which is featured in this month’s magazine, to Union54 in Zambia.

people when Union54 SoLo Union54, a pan-African challenger, is gearing up for launch SoLo, a peer-to-peer (P2P) lending platform, claims to be in 2021. The start-up, which was founded in January 2020, providing affordable access to loans for those in need. It does is the product of Zazu – a Zambian mobile wallet. Both it by connecting borrowers to lenders through its mobile Union54 and Zazu were founded by Perseus Mlambo, a marketplace. It was founded by former investment advisor, former ethics support staff member for the United Nations Travis Holoway, in 2017. The Los Angeles-based lendtech they type High Commissioner for Refugees (UNHCR). In 2017, Zazu provides microloans of between $50 and $1,000, with terms pivoted into digital banking after helping farmers connect to set by the borrower, with no interest charged for the loans new markets. Its latest venture, Union54, aims to standardise on the platform. Tips are capped at 10%. Borrowers set their payments in Africa and simplify how capital is deployed own terms, select the repayment date, how much they need, across the continent. the reason they need it and what they would like to tip the individual lender. According to Crunchbase, SoLo has raised Try our demo a total of $4.8 million in funding over four rounds. Its latest funding – an undisclosed amount – was raised on 31 August MoCaFi 2020 from a convertible note led by CEAS and -based Mobility Capital Finance (MoCaFi), is a Plug and Play. digital banking platform that aims to “bridge the economic mobility gap by targeting more than 50 million unbanked and underbanked people in the US”, according to its website. MoCaFi was founded in 2015 by Wole Coaxum, who spent Mulberry most of his career as a senior executive at JP Morgan Chase. Mulberry is a personalised customer warranty solution Crunchbase reports that MoCaFi has raised a total of $5.3 based in New York. It was created by Chinedu Eleanya and million in funding over three rounds (the latest one took Lee Johnson. The platform provides a suite of application place in February this year). It recently launched an upgrade programming interfaces (APIs) and plugins to allow retailers of its banking platform for Black and Latino communities in on any e-commerce platform to launch an extended the US who have been disproportionately hurt by the loss of warranty add-on in real-time. It aims to transform the jobs and emergency savings during the COVID-19 pandemic. extended warranty experience for retailers and consumers. MoCaFi officials state that the new mobile banking service Mulberry raised a $10 million Series A round of funding in #KeystrokeDynamics #PSD2 #Compliant will help address some of those specific needs. September this year led by Pace Capital.

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Blank page.indd 2 23/09/2020 11:08 THROUGH A GEN Z LENS THROUGH A GEN Z LENS

“A lot of the major investment banks are our clients. From Young Black lives in banking my experience, the industry is still largely governed by “Capitalism is sustained nepotism. As a result, Black and other ethnic minorities by the oppression of By Ruby Hinchliffe, reporter, FinTech Futures find it difficult to integrate into the culture and usually people. The scary aspect do not get access to the same opportunities. Black of that is it’s systemic. Wall Street chief executives are scrambling still hanging in its building of directors with these long-lasting inequalities, my voice colleagues usually leave before becoming VP [vice How we think, act, where to convince the world that they are tackling slave trade links. isn’t the one you need to hear from on this president] or higher-grade positions. This contributes we go to school, what everyday racism in the workplace, due Whilst banks make up for their shortfalls particular topic. Below is a collection of to the protests following the murders of with one-off million-dollar investments thoughts from my Black peers, relaying their largely to the lack of representation in the high positions kind of jobs we have to George Floyd and Breanna Taylor in the US. from Bank of America and Citigroup, it’s personal experiences within the financial of governance in these banks and firms.” the food that we buy, Yet, the number of senior Black important to really look at why these services industry and their thoughts on the that’s all capitalism. As executives on Wall Street has remained flat institutions are still lacking in people of banking industry’s troubling history with Anonymous at under 3% for the past decade. Only after colour at the top of their ranks, and how this race relations. Some have decided to remain long as we are controlled the global protests this year has the Bank impacts the younger Black generation. fully, or partially, anonymous so as not to by capitalism, racism will of England decided to “review” portraits Although I can pull facts which quantify jeopardise their current employment status. “I was invited for an interview with Morgan Stanley constantly persist. Maybe and the person interviewing me was actually it’s time for us to all to “There’s plenty of diverse talent in finance but take a step back and “I believe the lack of not Pakistani-Asian and he pushed for me to get this job. there’s a deep lack of allyship and relationship truly analyse the systems just Black, but BAME [Black, He believed that when he was in my shoes, he was building at the executive level. Also […] it’s a lot of oppression that Asian and minority ethnic] not offered the same opportunities. Representation is easier to launch a fintech start-up and reach the capitalism embodies and representation in leadership necessary. All it took for me was a person being able same level of success without the racial tension.” to relate to me and giving me the opportunity.” think about the impact roles in the financial sector that capitalism has on us.” (and others) boils down to McKenzie, fintech product lead, Prohaus Labs Leslie, risk and policy manager the lack of opportunities “I find people are more likely to Horizon, recent university graduate enter a field that perhaps has our parents’ generation “Since the 1800s through to the more people that look like them. (and generations before present day, Caribbean and African It certainly made it easier for me them) had. If your role countries were not included in the to pursue a career where people models growing up weren’t global banking system as key capital that looked like me were visible. in leadership positions, it’s allocators. So, today’s diverse talent Representation is important unlikely you would realise it’s is currently working in a totally because it influences not only something you want.” separate banking system.” Malik, ex-banking graduate how others view you, but also Telly Valerie Onu, DFMI lead instructor, Alts School how we view ourselves.” Arnold, legal analyst “The banking institutions’ foundations and roots lie in the exploitation of African people. The British banking system has always been built on criminal acts – that is, slavery, and predating slavery, piracy. The trick is to have people in privileged positions believe that they’re actually there based on merit. When in actual fact the grandsons and grandchildren of former bankers get these jobs. Where is the scope for Black people to come into the banking industry if it’s a closed off industry? You’re not part of the club.” Ziggy, independent subject & behaviour specialist, Moore Education

08 | www.fintechfutures.com | October 2020 October 2020 | www.fintechfutures.com | 09 COMMENT COMMENT

capital investments go to Black-owned businesses, these entrepreneurs often “It’s not enough for lack the funding to get their ideas off the companies to pay lip ground. Here lies a huge opportunity for the sector to embrace fintech to remain service, saying they A sector ready competitive whilst, crucially, investing in Black founders. will change. They need to invest real for change IT TAKES A WHOLE COMMUNITY As a Black woman, a lot of confidence time and real money issues can stem from not having the By Oluchi Ikechi, head of business emotional support early enough, with into education and restructuring & innovation for someone to guide you to embrace your internal policies.” capital markets, Accenture UKI colour and remove any internal barriers for success you may have naturally built Oluchi Ikechi, Accenture UKI up. I like to see this as a journey which highlights the importance of having supportive people around you, forming a community with whom you grow. In It’s about creating equal opportunities that community, it’s for everyone to come for Black talent and encouraging an open together to instil confidence in young dialogue, which is a challenging task in the Black people. White people supporting financial services sector. If we take capital Black people, Black people supporting markets as an example, it was traditionally Black people, and Black people supporting an area of finance derived from a network- themselves. based structure, typically all about who I was fortunate enough growing up to you know and where you came from. It’s be constantly reminded by my parents great to see some improvement here, with that success is possible for a Black person, some top firms now investing in education, but not everyone may have that level training the wider workforce how to be of guidance. In September, Accenture anti-racist and promote inclusivity to drive welcomed over 100 Black students and that innovation. graduates to our virtual “Empowering Black The education piece doesn’t just Futures Consultancy Taster Programme”, stop there. Firms can support their Black where we equipped them with advice, employees further by funding talent storytelling training and the belief that they accelerator programmes, such as the too can succeed in a large corporation. one by the Black British Business Awards. Mindset is everything, and Black talent These particularly benefit senior or middle needs help to grow their self-belief, to be management by empowering them to bold and ready to take their place at the progress to the top and become leading

Photo: Charles Sturge Photo: table. Though let’s not forget how difficult role models. By also engaging all key this is when no one at the table looks like stakeholders of an organisation, it stresses This year has been a year of change in so sector is one of the most traditional This year in particular has been a culture of equality, so giving Black talent you. This is why the community effort is the importance of mentorship, sponsorship many ways, not just by forcing firms and industries out there, from legacy demanding for finance firms to rapidly more of a voice isn’t just the right thing to so important to empower young Black and encourages non-Black employees to financial services to reassess every way of operations introduced in the 70s and 80s, digitise and innovation is needed now do, it makes business sense. people and their futures, creating a better put their hands up as advocates. working, but to reassess the diversity and to intricate old school networks. While more than ever. Often in finance, Black Capital markets is, for me, a particular environment for all. To sum up, it is clear there is still a lot inclusion of the people at its core. some finance firms had begun to embrace people seem less visible in client facing or area in finance crying out for innovation. of work to be done, and while this year The Black community has been fighting digital, COVID-19 turned everything on its leadership roles and may be more likely It’s one of the most traditional areas EDUCATE, ADVOCATE, INVEST has been so tragic for so many reasons, for change for many years, often falling head. The key question for business leaders to take up roles in back-office technology of finance, with a real need for fintech It’s not enough for companies to pay lip I truly believe it has opened the eyes of on deaf ears. The pandemic caused us all as the dust begins to settle on such an or operational areas. Since technology disruption. From my experience, some service, saying they will change. They need many. This is not just a moment in time to pause, go back to basics and reconnect eventful year, is not just how we get back and innovation is ingrained in everything Black people may have had their to invest real time and real money into or a chance to do someone a favour. Let’s with our sense of humanity. This year, the to work- fundamentally revisiting their we do, perhaps this could give Black entrepreneurial spirit dampened as a result education and internal policies. We must not confuse this with “giving someone a Black Lives Matter movement’s call to arms digital transformation journeys to emerge employees the opportunity to become of years of oppression, despite possessing advocate for change and do it loudly. I’m leg-up”. This is a chance to level the playing captured the world’s attention during a stronger from a turbulent year, but how we more visible and potentially supported for the natural creativity and fierce ambition seeing more organisations calling out field, once and for all. It’s time to innovate moment of reflection, and it’s time for the embrace this catastrophic opportunity to more senior positions. Research conducted needed for fintech disruptors. But given their wider ecosystem if their teams are by educating, advocating and investing, industry to respond. re-imagine and re-invent a better and fairer by Accenture last year, shows that statistics from the Harvard Business not diverse or inclusive enough, which is and what better time for financial services It’s no secret that the financial services way for all. innovation is higher in diverse teams with Review show that only 1% of venture promising progress. to embrace this.

10 | www.fintechfutures.com | October 2020 October 2020 | www.fintechfutures.com | 11 Sponsored by SPOTLIGHT: DIGITALISATION

Grasping the opportunities of new digital customers By Rajashekara V. Maiya, vice president and global head of business consulting, Infosys Finacle

As customers migrate to digital alternatives and an opportunity to financial institutions. have emerged across the world. QR codes Channel silos, leading throughout 2020, banks have had to react. Capturing the custom of people who for in China, the proliferation of mobile A flexible approach is needed to ensure the first time are switching form branch to money solutions in Africa, and the rise of newly digital customers aren’t frustrated. mobile app will require a change of tactic. contactless cards in Europe. With companies to disjointed customer “One is that banks irrespective of Maiya uses the example of booking like Tencent trying to make a move into their stature, nature, size or region, are airline tickets in the past. Before, people other regions, banks have an opportunity to experiences? comprehensively moving to an all-digital would have to go to agents multiple take advantage of this crosspollination. environment,” says Rajashekara V. Maiya, times to book their flight, get tickets, and Maiya also believes that a vice president and global head of business receive advice on prices. Now with an crosspollination is occurring between the consulting at Infosys Finacle. app experience being so easy to use and traditional banking sector and the wider Be #TrulyDigital with “Now banks are looking at digitalisation understand, very few people will go back technology sector. An example he gives from an efficiency point of view, and to using a travel agency. is Amazon in India providing an Amazon that point of view is from the customers’ “If you introduce a version of the branch payment and mobile money account Finacle Digital perspective. Whether it’s corporate experience into your digital experience, within its shopping app. The company customers, retail customers, senior citizens very few people will want to go back to the saw customers would be unable to visit Engagement Suite or younger generations, every bank is old branch way of doing things.” branches due to the COVID-19 pandemic looking at how to become relevant to all.” and activated payments between its app PwC data shows that 27% of customers SIMPLICITY users. This goes the other way, too. It in the US said they have logged onto their Maiya adds that while the younger wasn’t too long ago that Apple’s iTunes bank’s website or app as a result of the generations want a social-media style allowed customers to buy singular tracks Onboard, sell, service and engage on COVID-19 pandemic. A quarter also said experience, the elder generation is looking from albums. they had reduced their time in the branch. for simplicity, ease of understanding, and The idea is similar to the ability for users digital and physical channels Meanwhile in the UK money management no training required to complete basic to use buy now, pay later services at banks apps have seen a surge in use as 30% of banking tasks. A customisability will be to issue instant digital credit cards, with Deliver fully personalized, people turn to them to plan their futures. crucial to enable banks to cater to the an instalment already decided. Maiya says Transactions that once happened in the influx of both demographics over the this has changed the game. “The mobile cross-channel customer journeys branch for lots of customer have moved coming months. application is now converted into the role completely online. This offers a challenge Multiple forms of banking and payment of a traditional bank teller.” Deploy with your existing core banking solutions

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Be #TrulyDigital October 2020 | www.fintechfutures.com | 13 INTERVIEW

Breaking down walls By Sharon Kimathi, editor, FinTech Futures

This year has been devastating for Black Wales, to the murders of Breonna Taylor, [her] dual worlds crumbled, and real people across the world. From the Office of Ahmaud Arbery and George Floyd in the US. conversations began” following this year’s National Statistics’ figures regarding Black FinTech Futures took this somber events. Bell dissects how systemic racism people being more than four times more moment to sit with Keisha Bell, managing has affected her workplace experiences likely to die from COVID-19, exposing a director and head of diverse talent and highlights diversity and inclusivity dramatic divergence in the impact of the management and advancement at DTCC, initiatives that have emerged within the coronavirus pandemic in England and who reveals how “the wall between firm to foster real change. >>

October 2020 | www.fintechfutures.com | 15

009 Through a Gen Z July/August.indd 8 28/07/2020 10:23 INTERVIEW INTERVIEW

How did you begin your professional Are there any D&I initiatives you’ve “By overcoming any and providing the skills to achieve it. This journey? seen that are helping and you want to initiative is empowering DTCC’s employee I have been working in the financial services highlight? fear of friction and population to have discussions to become industry for over 20 years, spanning Following George Floyd’s murder, we effective allies, as well as providing guidance broker/dealer operations, technology created our “Perspectives” series to give creating space for on actionable steps they can take to support transformations, programme management voice to concerns, vulnerability, and fear complex, meaningful their Black and Brown colleagues. and business analysis. My first role was a that DTCC’s black and brown employees project manager at a market participant firm, share. The first session featured a cross- conversations, Do you think the reflections made by but the bulk of my career has been spent at section of Black and Brown men from US federal reserve and the UK Financial DTCC, where I have worked for 16 years. all levels of the organisation who have we lay the strong, Conduct Authority that diversity is actually experienced negative interactions with the foundational elements getting worse rings true to you? What obstacles have you faced along the police, sharing those lived experiences with I do not believe it is getting worse – I way based on your gender and race, and their colleagues. There was a moderator but for growing and think people have been awakened to the what advice can you give to young black no Q&A session. The next session followed current state and what’s needed to create women in the industry when faced with the same format, with Black and Brown advancing diverse change. Although I am realistic that change such a situation? women discussing “the talk” they must talent globally.” takes time, patience and commitment, Racism in the workplace can be subtle and have with their children about racism and there is a real opportunity for financial often times focuses on one’s appearance. interacting with law enforcement. Most Keisha Bell, DTCC services to take a leadership role as an Corporate appearance policies that include White colleagues don’t need to fear an industry by facilitating diversity discussions requirements for “professional” hair continue erroneous warrant will lead to an armed that connect worthy D&I goals with the to disproportionately affect black women. the needle on gender parity. A concerted invasion of their home while asleep, at a structural inequality that stands in the way Early in my career, I was told that my natural “Real change effort is underway to close the gap once cost of their lives. commitment to D&I. While political and of achieving them. By overcoming any fear hair was unprofessional, and it was clear starts with honest, and for all, with mentoring and sponsorship We are continuing these conversations societal unrest can bring discomfort, it also of friction and creating space for complex, to me that if I refused to change it, I would programmes abound, and much of the through “BOLD”, DTCC’s employee resource provides growing resources for employers meaningful conversations, we lay the be reprimanded and perhaps fired. It was intentional dialogue industry diversifying their efforts by group centred around Black employees, by to sign onto initiatives and advocacy efforts strong, foundational elements for growing important for me, economically, to keep my supporting science, technology, engineering, facilitating smaller group conversations. It and make public statements, internally and advancing diverse talent globally, in a job, and so, at my own expense, I changed about everyday and mathematics (STEM) education within is undeniable that systemic and structural and externally, for example, around racial systematic and coordinated manner. my hair. I didn’t have the knowledge or tools experiences. It’s an schools, investing in the talent pipeline, racism and violence take a toll on our injustice for people of colour. However, The financial services industry must necessary to address the issue at the time, creating policies and implementing community, and these discussions create these efforts need to be rooted in action. acknowledge and understand how systemic but once I fully recognised and understood important step in programmes to advance diversity. space for employees to talk to each other at Employers must implement a robust inequality and underlying unintentional that incident, I decided that never again While this progress is undoubtedly a work. It’s a small step but also revolutionary, programme to hire, grow, cultivate and bias impacts our workplaces, corporate would I alter my natural hair to conform any diversity and positive development for the industry, given how much effort we have put into support diverse talent while providing cultures and employees’ feelings of with the way White America expected me inclusion journey.” considerable work remains. Yes, there are keeping our professional lives separate from learning opportunities designed to foster belonging. Firms must lead the way in to look. One should be measured based more women in leadership roles, but the the catastrophic impact of racism that is still a supportive and inclusive environment. If facilitating important conversations upon their skills, capabilities and ability to Keisha Bell, DTCC Oliver Wyman 2020 Women in Financial pervasive in our society. your C-suite or board lack racial, ethnic and about privilege and bias across diversity contribute to business success. Services report indicates that despite the We have also implemented an 18-month gender diversity, placing a Black square on paradigms that are necessary to drive increase in representation over the past long “Advancing Women Leaders” your website rings hollow. meaningful change. Are there any specific observations or few years, women make up merely 20% of development programme at DTCC, changes in behaviour you’ve seen in first time, I – alongside many of my Black executive committees and 23% of boards. which targeted a cohort of 16 women How important is allyship from White and financial services since the coronavirus and Brown friends and colleagues – shared The view from the top continues to be male at the director level. The programme non-Black members of staff? pandemic and brutal murders of George emotions with co-workers, voicing anger, dominated, with female chief executive focused on leadership and individual It has been comforting to know that KEISHA BELL: CV Floyd/ Breonna Taylor in the States? grief and terror we’d normally keep out officers (CEOs) and chair representation at skills development and, most importantly, colleagues who don’t look like me share my Nov 2018-present Head of diverse Many Black and Brown people have grown of the workplace. Not only did I need to just 6% and 9%, respectively. In fact, 21% provided clarity on their progression sense of outrage at the injustices we’ve seen talent management & advancement, accustomed to compartmentalising our articulate the pain I was feeling inside, but of financial services companies’ executive opportunities and furnished them with and to hear them commit to supporting me The Depository Trust & Clearing lives, particularly when it comes to matters I had to let my Black and Brown colleagues committees remain entirely made up of men. formal sponsors from DTCC’s senior level and my community, but in order to facilitate Corporation (DTCC) of systemic racism and violence affecting know they were safe to be their full selves, In order to understand why the pace management. This programme saw real change, we need to teach allies how to Feb 2015-Nov 2018 Managing our communities. We have maintained too. As we spoke, the wall between my dual of progress is slow, it is important to immediate results, with four out of the 16 translate that support into action. director – group chief risk office, DTCC a wall between our work lives and the worlds crumbled and real conversations acknowledge that most of the discussion women promoted over the last year. In parallel with facilitating conversations painful emotions we have experienced began. Real change starts with honest, around D&I in financial services remains among our diverse population of Jul 2004-Mar 2015 Vice president – following the deaths of Ahmaud Arbery, intentional dialogue about everyday divorced from the systemic and structural What gestures vs action really means employees, DTCC has launched “ally to wealth management services, DTCC Breonna Taylor, Trayvon Martin, Tamir experiences. It’s an important step in any issues that cause inequality. DTCC operates – from corporations putting the “black upstander” training so that our employees 2000-Jan 2006 Senior business Rice, and countless others. However, diversity and inclusion (D&I) journey. an array of D&I initiatives that aim to square” to vague platitudes – how can of all backgrounds, identities and genders analyst/project manager, Spectra many of us found ourselves unable to address a variety of issues, but increasingly, these hinder or help foster inclusion? can become successful allies at work. It’s Securities Software compartmentalise our pain and fear as What is it like working in financial services our focus is on facilitating the intentional, Outward vocal commitments followed one thing to call yourself an ally, but the 1998-2000 Project manager, Park the now-infamous video of George Floyd’s and does it differ to other sectors? impactful discussions that are necessary for by concrete actions and responses training provides the tools to turn that into Avenue Securities murder spread around the globe. For the The financial services industry is nudging real change. demonstrate to employees an organisation’s action by illustrating the stakes of allyship

16 | www.fintechfutures.com | October 2020 October 2020 | www.fintechfutures.com | 17 Sponsored by LEADERSHIP: FINANCIAL SERVICES

These systems allow leaders to quickly risk of fraud in consumer markets. Periodic WEALTHTECH are able to cut costs and create a new introduce new software solutions and diagnostic risk reviews adhering to the The pandemic exacerbates the brand reputation. There are opportunities maximise their budgets. For instance, defined anti-bribery and corruption (ABC) investment challenges of an already across the value to improve customer The imperatives Coforge addresses cashflow shortage framework. And most importantly, training difficult landscape. In this environment, experience right from new customer through process automation and re- your employees and consumers on basic self-directed brokerages (SDB) are orientation to billing and payments engineering solutions for its American cybersecurity hygiene. experiencing issues with websites that to fees and escrow maintenance. For behind BFS financial, retirement, investment, and aren’t able to handle the trading volume. instance, we provide low-code processing client. REGTECH ON THE RISE With fee compression we can expect to platforms that enable several clients By Gautam Samanta, EVP & global head of BFS at Coforge With the increase in financial crime, see an increase in consolidation. Some to set up client-facing portals for loan CONTACTLESS PAYMENTS, FRAUD regulators around the world are cautioning early trends reported here are: processing and client servicing for retail DETECTION, AND CHANGING the public to stay alert for frauds. Malicious • Digital is the way forward – there is no and institutional users. CONSUMER BEHAVIOUR actors are specifically using the pandemic more ambiguity. Any firm without a digital In this digital era of 2020, the BFSI Digital payments are not new for the to create turmoil and seek profit from advice offering is missing out. sector will need to introspect and modern consumer. But an interesting unsuspecting victims; profiting from the • No more hidden fees – consumers are redefine its operations with a seamless trend noticed is the uptick in contactless market volatility and chaos. During the no longer tolerant toward hidden fees and digital-first approach. Customer-centricity payments during the pandemic. For time of crisis, it would be tempting for unnecessary expenses should be at the core of their digital example, credit card giant Mastercard companies to bypass long regulatory • Hybrid digital investments – investors transformation journey to stay successful. reported a 40% jump in contactless procedures and save on time. But regtech have to be prepared for new investment Coforge continually strives toward payments, including tap-to-play and mobile is important now, more than ever. With risks when it comes to hybrid digital helping its customers get the most out of pay. The rise is driven by the changing teams working remotely and almost the advice platforms and also deal with their digital endeavours. For us, it means consumer behaviour of minimising human entirety of businesses moving to the cloud, technical and capacity issues. collaborating with our clients, employees, interactions, reducing cash transactions, regtech tools and strategies would help and partners to co-create durable value and being able to quickly exit a store after stem the regulatory tide. Modern regtech DIGITAL LENDING for the BFS industry. purchase. While the pandemic has seen a or regulatory technology solutions are Regulators worldwide continue to release Over the years, through the surge in online transactions, at the same offering the possibility to implement new guidance and requirements to assist convergence of emerging technology, time there is an exponential increase systems that automatically monitor, mortgage borrowers facing economic business innovation, and efficient in cybercrime such as payment fraud, analyse, organise, report, and take direct hardships due to the pandemic. With the processes we have taken an engineering- cyberattacks, and credit card fraud. A survey action on non-compliant events and aid of digital solutions, the mortgage or led approach to quality – mitigating risks by TransUnion reported over 100 million prevent fraudulent activities. loan servicing and debt collection sectors while containing costs. suspected fraudulent transactions from 11 March to 28 April. To combat the fraud supply chain, financial players and merchants must Digital technologies have transformed strategy to sustain competitive advantage. adopt a digital trust and safety strategy. traditional ways of doing business and the We look at few emerging trends across the Organisations should consider proactive story is no different for the BFSI sector. BFSI sector. measures to protect themselves and their This has been further accelerated by the consumers from losses. Many banks are current coronavirus pandemic. According THE NEW BFS NORMAL leveraging AI to move from traditional Transform With The Emerging to Zinnov, banking and financial services The current crisis highlights the urgent banking to an insight-driven approach. (BFS) companies are making their digital action required for businesses to upgrade Data is leveraged to analyse, strategise, Offering Winning Technology Strategies in the Modern investments on technologies such as data to digital platforms, new processes, and and develop new products and solutions science, big data analytics, cloud, security, strategies to stabilise their operations based on consumer behaviour. Real-time Digital Economy artificial intelligence (AI)/machine learning and sales. Businesses that paid heed to predictive analytics would help mitigate (ML), and blockchain. While 34% of the the digital transformation buzz were able cyber risks, help make quick decisions, Asset & Wealth Management Banking total digital engineering spend is being to quickly adapt to the social distancing and create self-diagnostic or preventive- allocated towards data science and big data guidelines. Even capital markets looked maintenance solutions. For instance, analytics, cloud comes a close second at to fintech automation to reduce costs Coforge is collaborating with a Fortune Some of Our Customer-Centric and Collaborative Solutions are: 31%. Another IDC report shows that public and drive efficiency. In recent months, 100 company to develop a financial crime Digital Wealth and Banking Payments and Mortgage cloud is playing a critical role in many banks’ cashflow management has been critical. As platform of the future – bringing in our modernisation efforts. Close to 30% of the per a survey by PYMNTS, 76% of surveyed cross-functional team comprising of domain Advisor Productivity Core Platform Services banks that are currently running workloads participants faced a cashflow shortage, with consultants, big data practitioners, quality in the private cloud now plan to move a 18% struggling with cashflow shortages on engineers, API developers, BPM architects Enterprise Data Servcies Financial Crime percentage of these to the public cloud a frequent basis. and visualisation experts. This would Smart Operations Client Onboarding within 24 months. As customers embrace The BFS sector is combatting the include root cause investigation to take more digital channels, the BFSI sector cashflow crunch with innovative solutions timely corrective action. Building a strong will have to look at a digital-first business by adopting low-code or no-code platforms. security architecture that minimises the

18 | www.fintechfutures.com | October 2020 May 2020 | www.fintechfutures.com | 19 www.coforgetech.com | [email protected] | Follow Coforge on FOOD FOR THOUGHT FOOD FOR THOUGHT

“The only new Opportunity opportunity COVID gives us is to be costs for cynics honest about the opportunities we By Leda Glyptis missed.” Leda Glyptis Since COVID hit, I have lost count of how Nothing is new here. many times I have been asked on panels, Even the pressures aren’t new. interviews and webinars, “what is the Just additive. as to the damage we have incurred for not opportunity for banks and fintechs in this COVID has simply made the things that having done things differently already, for new normal?”. If I am getting asked a lot, were urgent, more so. squandering the time and opportunities others are getting asked a lot so can we The things that we knew were we have been having over the last decade please stop this nonsense? obstacles are even more pronounced. But or so. Unless you are in a specific vertical or it didn’t shed light in the dark. It didn’t That’s the conversation. offer a specific set of services, there is no open doors and it most definitely didn’t Don’t talk to me about opportunity. industry-wide, generic opportunity that accelerate adoption, despite the hollow I want to hear about opportunity cost. wasn’t there before. triumphalism of banking panellists. I want to hear about the industry The things banks need help with may Signing a fintech pledge with Tech taking this moment and the pressures have been cast in sharper relief by the Nation is great. But what took you so it brought to realise that we have long pressures of COVID, but they are not new. long? And what are you doing next? known the price of everything and The things that hold banks back from Investing in your digital channels the value of almost nothing. Definitely seizing the day – from procurement and is also great. But what have you been not the human labour that could have compliance to risk averse over-reliance doing all this time? And why are you been channelled to creatively serving on tried and tested business models and still thinking of the world in terms of an afternoon. And that is not great. corporate self-flagellation, individual things that would have made coping with our communities if we had given them from knowing the future will be different channels? It’s not 1999 anymore. Neither is the complacency that comes and organisational self-harming we all COVID easier. Because, had you done the tools to do so. And the time… that but not knowing what that means to Celebrating the success the banks had with “we made it”. Because, if anything, it perversely value. those things, your infrastructure would was instead spent patching 40-year old haziness as to what their differentiating is equally great. shows we are not learning. So, don’t talk to me about opportunity. now empower your teams and customers technology that we had the opportunity value-add may be in ten years… these Actually, it is. It shows that COVID not only fails Talk to me about opportunity cost. to deal with the human tragedy without to change… oh… I don’t know… about things have not changed. Maybe COVID Because anything and everything to create an opportunity, it seems to Talk to me about how you measure needing to work weekends and spend 40 times in the last few years. underlined them and shone another banks delivered during COVID, from not even create urgency around the the opportunity cost of all the things you endless hours waiting for responses to The only new opportunity COVID gives light at them but let’s not pretend we extra features on their apps to changes opportunities we have been missing and didn’t do that would have put you in a queries that would only be truthfully us is to be honest about the opportunities discovered something new here. to loan repayment schedules, was a feat the cost of that inaction. good place when COVID hit. answered with, “we can’t do that but some we missed, the cynicism that led us there The need for start-ups to be profitable of human creativity and hard work. So, And no, your remote working resilience folks are pulling all-nighters to make it and the size of the cost that was carried. businesses and not engines converting they should be proud of and celebrate BETWEEN A ROCK AND A HARD PLACE isn’t what I want to hear. Especially as your happen” – so they are not answered at all. And when we do that, we will realise venture capital to user experience (UX) is their humans who pulled out all the stops. The fact that there is no renewed HR policies and risk matrices mean that, If the COVID crisis presents us with the only true thing about opportunity, now not new. But let’s be honest with ourselves: had opportunity here doesn’t mean that the once the office is open again but teams an opportunity, that is not to do things and always, is that up close, as my old boss The need for value-driven success the banks invested in infrastructure a opportunity cost doesn’t keep rising. Up have to distance and take turns, you either differently but to be honest with ourselves used to say, it always looks like hard work. metrics rather than valuation-based few years ago, what took two months of and up it goes with every day we waste, have to equip everyone’s home office, eulogies is not new. sleepless nights would have been done in knowing what needs fixing but looking the mandate presence or re-write the HR other way hoping the next guy will fix it. policy, so that gets added to the long list of Leda Glyptis is FinTech Futures’ resident thought Dealing with the urgent at the cost of the governance items you need to get round provocateur – she leads, writes on, lives and “Investing in your digital channels is great. important. With the flashy at the expense to fixing to get out of your own way. breathes transformation and digital disruption. She of the impactful. And relying on our people From procurement checklists to testing is a recovering banker, lapsed academic and long- But what have you been doing all this time? to pull rabbits out of hats with inadequate and go-live schedules and everything term resident of the banking ecosystem. tools and shaky corporate support. in-between. All opinions are her own. You can’t have them – And why are you still thinking of the world in The most common feeling among Talk to me about what it cost you as but you are welcome to debate and comment! terms of channels? It’s not 1999 anymore.” bankers is how much we achieve to do an organisation to not have done all the Follow Leda on Twitter (@LedaGlyptis) and within our organisations and despite things that were too hard, before COVID. LinkedIn (Leda Glyptis PhD). Visit our website for Leda Glyptis them. The fight and uphill struggle All the things that you decided were more of her articles. becomes a point of pride, a type of not worth the cost, risk or effort. All the

20 | www.fintechfutures.com| October 2020 October 2020 | www.fintechfutures.com | 21 PROFILE: ATMEN BANK PROFILE: ATMEN BANK

These foreign exchange fees will make “A lot of Black up a big portion of Atmen’s income to businesses struggle, start off with, as the start-up is tapping a community which commonly sends money Sticking their necks out especially start-ups, back home to the Caribbean and Africa. when it comes to The Atmen app will be built on By Ruby Hinchliffe, reporter, FinTech Futures blockchain technology and use software financing.” from an undisclosed Banking-as-a-Service (BaaS) provider. Dele Abibu, Atmen Once the challenger is up and running with its P2P offering, it will look to move into business loans. “A lot of Black These reports point to the clear need earlier this month about how hard it is for businesses for a Black-led bank, founded in the UK, Black tech entrepreneurs to make money. struggle, which can empathise with the racial “I think a lot of folks like myself never even especially discrimination Black consumers and get a chance, because folks don’t answer start-ups, businesses still face. their phones, or listen to their idea, but put when it them in a box they shouldn’t be in,” he said. comes to BUILDING DIVERSITY FROM financing,” THE GROUND UP THE OFFERING says Abibu. For the past 20 years, Smith and his co- Atmen’s offering will start off with a As well as a two- founder, Dele Abibu, have worked across prepaid debit card. This card can be pronged revenue an array of sectors in an interim capacity, used for free in-app peer-to-peer approach, the bank also implementing critical technology and (P2P), multi-currency and has plans to expand across software restructures. foreign currency exchange Europe and the US. Its “My face fitted the transformation transfers. BaaS already carries all the Atmen, a challenger bank based out of the dad said I should just change banks. This accessibility comes paying over the odds scheme for a firm, but outside of that, I licensing the start-up needs UK, was founded when co-creator Marvyn was mid-Black Lives Matter protests, so I in interest and falling into the high-risk found myself handing responsibilities over,” to make this possible. Smith realised there was a gap in the did some research. What I found was that categories.” says Smith. market – there were no Black British-led all the Black-led banks were subsidiaries of Smith is right. A study by Warwick Smith and Abibu want to create an REINVESTING IN EDUCATION high street or digital banks. African banks with offices in London.” Business School found Black entrepreneurs institution built for the Black community But the vision isn’t just to create a He had applied for a loan during the Members of the Windrush generation are charged higher interest rates. from the ground up. “Rather than putting profitable, Black-led bank. It’s to one COVID-19 lockdown, but his application set up the UK’s first credit union back in Other reports argue that the higher something in place now, we’re starting day reinvest in the Black community. was rejected. “The loan amount was 1964. Today, credit unions in the UK boast rates simply reflect lower savings with diversity,” says Smith. He believes “We want to reinvest in the relevant to the money going in and out some two million members. But to date, estimated by neutral credit decisions. But that the 1.9 million Black consumers communities lacking in education of my bank and was no established, Black-owned, UK-founded the algorithms which reach those credit in Britain will choose Atmen over resources. In five years’ time, it around the same bank exists. decisions have been proven to carry their an incumbent or another digital would be great if we could sponsor value as my own biases. challenger for this reason. an education system.” savings account,” MORE THAN JUST AN In 2017, a survey of complaints to Currently in the swings of Smith doesn’t just mean a few Smith tells ACCESSIBILITY ISSUE the ombudsman found Black victims of half a million, Atmen’s talks, or the odd workshop, he means FinTech Futures. Whilst Smith’s loan application fell at fraud are more than twice as likely to be team of two does have a number of an entire education system. “It always “I was a bit the first hurdle, even after a Black customer denied a refund by their bank as a white contributors. They will become full comes back to education,” he explains. baffled, but I’m lands a loan, it’s by no means plain sailing. customer. That’s despite the fact ethnic members of the venture once the “We’ve spoken to people – they’ve said so used to being “Looking back at history, loans have minorities make up around just 10% of the start-up lands its funding. we’re crazy [for founding a bank]. But rejected. My become more accessible, but with population. It only needs to raise £100,000 we want to give the kids at school hope to launch but gathering backing that there can be something different in hasn’t been easy on some of these a society which appears to them to have “Looking back at history, loans have become crowdfund platforms. “They’re barriers.” more accessible [for Black customers], but with all singing the same story, which When Atmen comes up against is: ‘come to us when you have a other challenger banks and brands, accessibility comes paying over the odds in revenue line’. That means we need Smith is confident that having this customers and a product, but it’s moral backdrop which reinvests in the interest and falling into the high-risk categories.” pre-seed,” says Smith. community will encourage more Marvyn Smith, Atmen Zack Smith, founder of Boston- consumers to change banks and based Jobble, spoke to the BBC money transfer providers.

22 | www.fintechfutures.com | October 2020 October 2020 | www.fintechfutures.com | 23 Sponsored by SPOTLIGHT: COLLABORATION

The value of 20/20 hindsight Anders la Cour, co-founder and CEO of financial infrastructure provider Banking Circle, examines the lessons of 2020, and how collaboration will be key to success for post-pandemic banking services.

Like almost every other industry, financial top three challenges, and 53% listed working together to optimise delivery of institutions of all types have been planning the implications of constantly evolving the right propositions to meet customer and implementing increased digitalisation expectations of customers as a top-three need. Financial institutions must take for some years. However, COVID-19 challenge. These are not new challenges; time to understand the future, using and resulting nationwide restrictions in fact, they could have topped any similar the lessons of the past – including undoubtedly accelerated the rate at poll in the past ten years or more. those learned during the pandemic – to which new tech and processes have been To meet these challenges, as well determine longer-term thinking around launched. It also changed the focus of as newer challenges presented by the the infrastructure that enables success. research we commissioned at the start of pandemic, financial institutions must look We still face a rapidly changing the year. outside of their own business. landscape, especially with many regions A study was carried out amongst Collaboration is a key aspect of a now returning to lockdown or increasing financial institutions in Europe to assess futureproof business, even when the future restrictions, but one thing became clear changing trends in the development, is unclear. Payments businesses should very early on: the importance of digital delivery, and support of banking services look for other organisations as potential provision. Through the trials of the current for businesses. However, timing is all partnership opportunities, whether current global crisis, the value of digital has taken and the research was refined to not only competitors, partners, customers, or on new and immediate significance. address its original objectives but also suppliers. The distinction between these 2020 has provided excellent learning provide a unique snapshot of business categories is blurring all the time and it is opportunities and forced innovation that planning and confidence at this critical increasingly clear that businesses are all in was long overdue in many areas, and 20/20 and historic time in the life of so many this together. Working together, providers hindsight will be invaluable to futureproof providers. can deliver new solutions more quickly and businesses. This will help financial provide customers with a better service. institutions of all types to regain clarity and BUSINESS AS USUAL In this fast-paced and highly confidence and see 2020 as a time that lay According to the results, the challenges competitive market it is extremely strong foundations for a bold new future. most urgently focusing the minds of the important for banks, payments businesses best in financial services are aligned to and fintechs to understand the role of A series of white papers based on the a business as usual world: 58% said the financial infrastructure alongside new study is available to download at impact of regulation was one of their applications, services and solutions, www.bankingcircle.com

FINANCIAL INFRASTRUCTURE YOU CAN BANK ON

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bankingcircle.com October 2020 | www.fintechfutures.com | 25

BC-A4-210x297mm-AW.indd 1 11/03/2020 10:44 I’M JUST SAYING… I’M JUST SAYING…

Millennials become the Millennials become the Millennials become the Millennials will no longer be majority of the Peak majority of both Peak and majority of both Legacy the majority of the Legacy Profits in 2022 Legacy Profit groups in 2028 Profit groups in 2048 Profit groups by 2055

60%

50%

40%

30%

20% population combined population 10% % of Peak and Legacy Profits and Legacy Profits % of Peak

0% 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060

Generation ? (Future) Generation Z Millennials Generation X Baby boomers Telstra by Research

them. The earlier you start the better you Fintechs spotted it somewhat later. the account and more about creating a learn and that goes for the customers as GoHenry in the UK, Spriggy in Australia model for next generation adults now, well as the provider. and Greenlight in the US have all been building great beliefs and values around Roughly seven in ten parents give their chipping away at banks’ customers. money and stacking habits. children an allowance who receive on Moroku with its ChoreScout platform Of course, there is a social average $67.80 per month, according to a has gained traction with its enterprise responsibility to educate kids and parents recent survey by the American Institute of platform and has allowed its customers in money management, but banks Kids are Certified Public Accountants. Banks that to launch much faster and with powerful are missing out by not capitalising on acquire customers at a young age, through features for gamification. learning/experimenting with these new pocket money, have a great opportunity Kids aren’t driven by “banking needs” skills, values and beliefs of Gen Z. banking’s to convert and build relationships early. but through a combination of fun, I’m just saying there is an opportunity Banks can instil a sense of trust and value learning and purpose driven goals. to learn how to “gamify” banking today and convert them into being their main They understand digital currencies from through Gen Z, not just provide basic future… financial institute once they get their first game play, they expect to personalise banking for kids. I guess the reason job and have a first mover advantage when their apps, they expect an ecosystem is that there is not a strong enough it comes to loan time. Banks also have an of support through video coaching understanding of technologies like opportunity to pick up mum, dad, the (YouTube), they want to share the gamification platforms or that the link NOW! grandparents, and the rest of the family if achievements on social and often want between Gen Z and next generation they get the value proposition right. to collaborate during their play. Just banking has not been made. Either way, By Dharmesh Mistry Despite the opportunity having existed as the childhood skills of controlling there is a huge opportunity for banks. I for a while, the challengers and the a joystick have created jobs for drone am just surprised that the fintechs haven’t incumbents are now piling in, according operators, intrinsic skills and capabilities fully exploited this sooner, so I’m guessing to a study by Moroku, a digital experience from games/apps they use today will be the issue is a lack of understanding about The first banks are widely recognised as technology, regulation, and wealth from their older brothers and sisters who builder. ING, NatWest, Revolut, Caixa, HSBC expected in banking’s next generation gamification platforms, and I hope to providers of grain loans to farmers and redistribution among the key themes. are internet natives, thanks largely to the and recently Starling are all getting in interfaces. Banking the youth is less about make that clearer next time. traders around 2000 BC in Assyria, India These are driving an increase in the work of Gen X. on the act. The Commonwealth Bank of and Sumeria. It has largely been a game commoditisation of banking but also in The future of banking isn’t denying Australia (CommBank) got into the market of banking the adults since then, with an the things people want and the way they Baby Boomers of their cheque books. It in 1931 with its Dollarmites programme Dharmesh Mistry has been in banking for 30 increasingly more diverse and complex set expect them to be delivered. Research is being relevant to a generation born and now attests that 20% of its savings years and has been at the forefront of banking of products. by Telstra indicates that it won’t be long in a technology ecosystem that makes volume is “youth related” as well as the technology and innovation. From the very first About 20 years ago that process began for the Baby Boomers to be an irrelevant handling vast amounts of information, largest loan book in the country. Analysts internet and mobile banking apps to artificial getting digitised, thanks to the efforts of category for banks and for Generation Z to connecting, interacting, winning and believe that CommBank’s children banking intelligence (AI) and virtual reality (VR). He has companies like Netscape that took the enter the aperture. having fun being primary nature. Winning platform is responsible for 8% of the bank’s been on both sides of the fence and he’s not internet public. These customers are mobile-first, is getting ahead of that notion, building value or around $17,421 per child. 90 years afraid to share his opinions. Since then much has changed, with gamers and digital/social natives as distinct trust and skills by creating experiences for later, others are catching on.

26 | www.fintechfutures.com | October 2020 October 2020 | www.fintechfutures.com | 27 INVESTMENT & FUNDING INVESTMENT & FUNDING

Robinhood has bagged $460 million Atmen, a challenger banking service looking to “bring colour in extended funding just one month - to banking”, is in the swings of crowdfunding £500,000. after it landed a $200 million Series G FINTECH FUNDING ROUND UP Founded by Marvyn Smith in June this year, the Black-led led by D1 Capital Partners. fintech start-up will look to address some of the “unconscious The fresh capital puts Robinhood’s biases” communities of colour face in the financial industry. valuation at $11.7 billion, an increase Atmen in German translates as “To Breathe”. According to of $700 million since last month. Brazilian fintech, Neon Pagamentos, has raised $300 million the challenger’s website, this relates to both the COVID-19 The latest $460 million came from in a Series C funding round led by equity firm General pandemic, and the “systemic institutional biases in society” existing investors. These include Athletic. highlighted by the murder of George Floyd. Andreessen Horowitz, Sequoia, Among the new investors are Vulcan Capital, PayPal You can read about Atmen on page 22. Ribbit Capital, 9Yards Capital, and D1 Ventures, and Endeavor Catalyst. Existing backers Capital Partners. Monashees and Flourish Ventures have also returned for the Series C. Founded in 2016, Neon offer credit cards, personal loans and investment products. The firm has raised $420.3 million Klarna has Amsterdam-based Factris has raised €5 million in a Series A equity in total over five funding rounds. closed $650 funding round led by AB Ventures. million in Existing investors participating in the round include Speedinvest an equity and Optima Investments. funding The start-up provides factoring finance, in which a business sells its round, at a invoices to a third party at a discount. Canadian payments processing firm, Nuvei, has broken post money Factris plans on using its new capital to “help create more CloudMargin, a fintech start-up Toronto Stock Exchange (TSX) records with a $700 valuation opportunities to finance businesses during this challenging economic offering a collateral management million raise on the first day of its of $10.65 climate brought on by COVID-19”. solution, has landed $15 million in a (IPO). billion. Series B funding round. Nuvei announced intentions to float on TSX at the The Sweden-based buy now, pay later Major banks Citi and Deutsche start of the month. The firm said it planned to sell as (BNPL) firm has doubled its value which Bank, as well as exchange Deutsche many as 26 million shares, priced between $20 and $22. was previously set at $5.5 billion just over Hong Kong-based financial infrastructure firm Börse, have all weighed in on the A surge in demand saw the company able to price a year ago. Airwallex has raised $40 million as it closed its start-up’s largest investment. its shares at $26 on 23 September. The shares rose The valuation ranks Klarna as the highest- extended Series D funding round. CloudMargin offers to the sell- again once it opened for institutional investors to $45. valued private fintech in Europe, and the The round was led by Square Peg Capital, side and the buy-side, as well as fourth highest worldwide. with participation from Skip Capital. Other key outsourcers and technology firms, a Silver Lake firm put $500 investors in the company include DST Global, cloud-based workflow for collateral million into the round, according to Wall Salesforce Ventures, and Tencent Holdings. management. MarketFinance has raised £50 million from Street Journal sources. Singapore’s sovereign Founded in Australia and based in an Israeli asset management firm to continue wealth fund GCI and accounts managed by Hong Kong, Airwallex aims to help create lending under the UK government’s Coronavirus BlackRock and HMI Capital, also participated low-cost, high-speed and transparent Business Interruption Loan Scheme (CBILS). in the funding. international available via application Greenlight Viola Credit stumped up the capital as programming interfaces (APIs), as well as its business account and card. Financial MarketFinance launches a new application Technology, a process. The firm offers a combination of children’s debit card business loans, invoice finance and revolving start-up backed by credit facilities. Accounts payable and payments automation UK-based challenger, Allica JP Morgan and Wells MarketFinance says it has secured the funding to help those involved in the “last firm MineralTree has raised $50 million Bank, has secured a £26 million Fargo, has landed a minute dash” to secure the government loans. in Series D funding and acquired a pair of investment and launched a new $215 million Series C funding round. companies. £100 million funding round. The Series C round was led by Canapi Its investment round featured existing The bank kicks off the fresh Ventures and TTV Capital. It also saw backers Great Hill Partners, .406 Ventures, and funding to support “accelerated participation from Bond, DST Global, Cross-border payments firm, Thunes, has raised $60 million in a Series B investment Eight Roads Ventures. lending” to British businesses and Goodwater Capital, Fin VC and Relay round led by Helios Investment Partners. The acquired companies, Inspyrus and prepare for future acquisitions. Ventures. Existing investors GGV Capital and Future Shape participated in the round, Regal Software, are both in the accounts Its £26 million injection comes Greenlight last raised funds in alongside newcomer Checkout.com. payable and payments space. MineralTree has from existing investor and majority September 2019, when major US banks JP The round is Thunes’ second since its foundation in 2016. It snagged $10 million acquired both to expand its positioning to shareholder Warwick Capital Morgan and Wells Fargo bought in. Back in a May 2019 Series A. middle market companies. Partners. then, the fintech had half a million users.

28 | www.fintechfutures.com | October 2020 October 2020 | www.fintechfutures.com | 29 APPOINTMENTS

MOVERS AND SHAKERS

risk. Hershey also worked for Merrill Lynch for 12 years. She held various roles within Merrill Lynch’s compliance, market and credit risk management, and capital market areas.

OakNorth, a UK-based SME lender and lendtech provider, has appointed Raj Cherabuddi as its new vice president of engineering. Cherabuddi joins the firm following a year as a US-based start- up investor and advisor. Prior to that he spent almost eight years at Teradata, ending his time there as vice president of Teradata Labs. At OakNorth, he will provide “operational and strategic leadership” to the engineering organisation. The firm plans to continue building out its credit analysis and monitoring Jane Fraser capabilities. Photo: AP Photo:

Citigroup has become the first major Wall Street bank to US Bank has lost its chief digital officer to Google just over a year appoint a woman as their next chief executive (CEO). Jane after he joined the bank. Fraser will succeed the bank’s current CEO Mike Corbat. Derek White, who carries with him more than two decades Fraser’s appointment is also a moment for the banking of experience across Barclays, BBVA and JPMorgan, has made the industry, which remains male dominated in its top ranks. leap to Big Tech. Fraser, a former partner at McKinsey, is already one of He is leading Google’s global financial services as a vice Wall Street’s most senior women. president. White will oversee Google’s financial services cloud She spent 16 years at Citi and headed its consumer bank efforts, competing with the likes of AWS and Microsoft for bank since last year. Before that, she headed Citi’s Latin American and insurance firm contracts. business. Colleagues praise her leadership skills and strategic Thought Machine, a thinking, as well as her fondness for practical jokes. London-based core banking provider working closely with Lloyds and Standard Revolut’s first head of partnershipsRishi Stocker is leaving the Chartered, has landed start-up after joining the fintech back in September 2016 as one Andy Maguire as its new of its earliest employees. chairman. Stocker’s four-year-long stint marks his longest employment Maguire is former global to date, having spent two years at Unilever and then a further chief operating officer two years at San Francisco-based Square-Trade. of HSBC and joined the “I now plan to set up a business of my own and I’m working technology company earlier on a few ideas in stealth,” says Stocker in a LinkedIn post this month. breaking the news. Details of what this venture will look like are He joins the fintech after yet to be revealed. spending the bulk of his career – 16 years – at Boston Andy Maguire Depository Trust & Clearing Consulting Group (BCG). Corporation (DTCC) has appointed Lisa Hershey as its new One of the UK’s oldest online banks, First Direct, has appointed chief compliance officer. a new CEO, following the previous chief executive’s departure in Hershey, whose appointment May – Joseph Gordon left after a three-year tenure to work for comes into effect on 1 January challenger bank Hayman AI. 2021, will report to DTCC general Chris Pitt, previously head of marketing at HSBC UK, is First counsel Ann Shuman. Direct’s new head honcho. First Direct is fully owned by HSBC. She has spent more than a Pitt has spent a decade at HSBC holding a number of senior decade at DTCC and is currently marketing positions. He also was marketing director at Tesco Lisa Hershey managing director for operational Bank for nearly five years.

October 2020 | www.fintechfutures.com | 31 GOSSIP FINTECH FUTURES FINTALK OF THE TOWN

THE SOUND OF SILENCE As avid readers of this section know, the fly on the wall is often sceptical of those purporting to be specialists: we call them expertise experts. But in a stunning twist to an otherwise generic tale, we found ourselves bemused by an open banking expert. A simple interview request regarding the market participant’s role and specialty subject quickly descended to farce as it became all too clear that the interviewee did not grasp the inextricable link between application programming interfaces (APIs) and open banking itself. The conditions stretched to absurdity, the suggestion to “not stray beyond open banking” resembled a request to talk about music provided we avoided straying into the irrelevant territory of ‘sound’: the interview promptly cancelled, our cynicism ever more justified.

MONEY (THAT’S WHAT I WANT) MAN! I FEEL LIKE A WOMAN It’s been a frustrating time for several customers of two UK-based A famously pink-papered publication managed fintechs who had the temerity to try to use their funds. One user alleges to undermine their feminist credentials with an that the fintech blocked their account from the start of the summer impeccable flourish: it is one thing to publish a story with no official notice and no assistance from chatbots. Another about an internal move within a large investment bank user – who lost their job amid the pandemic – found themselves whilst opting to omit the woman’s name in the headline, unable to pay rent as a direct consequence. Even more surprising for but the cherry on the chauvinistic cake had to be the these platform pioneers is the cold indifference from regulators and decision to include an image of the bank’s male CEO ombudsman services when they chose to escalate matters. How dare instead of the new appointee. As one Twitter user aptly they expect the basic level of service one could expect from a regular put it, “how we tell the story matters; even what picture bank: after all, shouldn’t they have known withdrawing their money we use matters”. The error was swiftly corrected, but gets in the way of fintechs using it to make theirs? screenshots uploaded to LinkedIn are forever.

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