China Versus the West Want Immediate by Henry Vilar Gratification”

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“Customers China versus the West want immediate By Henry Vilar gratification”

The fintech battle between China and the West China’s underserved market has 432 million could be won by the one that profits from the citizens currently unbanked, and Chinese middle class market. unicorns, unlike European ones, tend to focus on “The rise of fintech can, quite accurately, large scale, B2C models. be traced back to the 2008 crisis,” said Bonnie With high smartphone and social media Buchanan, PhD, Howard J. Bosanko Professor penetration, Baibu, Alibaba and Tencent (the in International Economics and Finance, at BAT) have found vectors of penetration in Seattle University. the rising millennial middle class. This was “In fact, many do consider fintech a reaction particularly relevant after 2012, when China’s to the crisis. As a result of the loss of trust in central bank granted a series of licences financial institutions, fintech came in to provide enabling mobile payments. Currently, 83% of consumers with products and services that challenged the status quo in financial services,” she adds. “The rise of fintech can, During a day two presentation “Quo Vadis? IN THIS Fintech in China versus the West,” Buchanan quite accurately, be traced explained the peculiarities that make China a ISSUE whole different beast in comparison with other back to the 2008 crisis.” Western countries. China has a very different legal and cultural 8 Shift framework, which is reflected in the way fintech mobile and online payments across China are 11 Big four floored? is developed. done through mobile. Back in 2012, this number China has always had a massive underserved was only 4%. 17 Alpha-bets: M-R market, however, the large growth of the middle In China, a 2017 survey showed how 14% of 21 A rum tale class has helped the investment, development people carried no cash in their pockets. And for 28 Photos and subsequent adoption of fintech. 74%, RMB 100 in cash was enough to survive at Buchanan’s research focuses on three main least a month. Mobile payments are big. Published by areas: P2P lending, mobile payments, and AI. And it looks like China is winning. When it However, she highlights that China’s fintech comes to AI, Baidu, Didi and Tencent – they reign transactional value of $1.56 trillion this year is in the East, with over six times the number of AI- well ahead of the US, at $1.26 trillion. related patent publications compared to the US. FINTECH FUTURES @DailyNewsSibos NEWS | DAILY NEWS AT SIBOS

Discover EDITOR more at Antony Peyton [email protected] stand H20. +44 (0) 207 551 9010 CGI, National Bank of Canada and Skuchain REPORTERS Alpha-bets:in blockchain-based trade finance A-F pilot Henry Vilar Alpha-bets: A-F [email protected] +44 (0) 207 017 5709 By Tanya Andreasyan National Bank of Canada, tech that is “enormously effective” in the Richard Buckle In our new feature, we have a quick look at fintech firms that are worth Exchange Lisa Creffield heavyweight CGI and blockchain tech standby LC and guarantee process, Alexandra Cain firmkeeping Skuchain have an collaborated eye on. on This first article focuses on fourCGI names says. within the A-F a pilotletter programme range. to improve Tanya and Andreasyan, editor-in-chief of FinTech“This pilot Futures project is, aexplains great SALES MANAGER streamline the process for negotiating opportunity to leverage blockchain Jon Robson her choices. [email protected] standby letters of credit (LCs) and technology to simplify the process +44 (0) 203 377 3327 guarantees. for negotiating standby LCs and Services. LCs and guarantees – used guarantees while making it more MARKETING MANAGER APPIANacross many industries to secure transparent and secure. This Irena Andrisevic Thiscontracts US-based – are providercurrently of conducted low-code applications makes 30% of will enable us to offer a simple, [email protected] itsvia money email, inmaking the financial them prone services to space (other industries it serves fast and efficient experience to +44 (0) 207 017 5379 include life sciences, healthcare and the public sector). errors and delays in a process that our commercial clients which Among its broad international client base are Bank of the West DESIGN & lacks transparency for beneficiaries facilitates managing their business,” and First Republic Bank in the US, Vontobel Bank in Switzerland, PRODUCTION regarding terms and approval comments Patrice Roy, VP of Kosh Naran Santander in Spain, and Bendigo and Adelaide Bank in Australia. status,It offers CGI businessesexplains. potential to automate faster and make the payments, cash management and ONLINE mostFor of National the legacy Bank systems of Canada, most ofCGI large, established businesses have international solutions at National www.bankingtech.com/sibos got.integrated the CGI Trade360 trade Bank of Canada.

@DailyNewsSibos financeJohn Rymer,platform principal with Skuchain’s analyst at Forrester, says the adoption of “This standby letter of credit Listing. Trading. low-code development platforms is “on fire”. Contract Builder, an application to initiate, conduct and conclude contract builder is the first live The Daily News at Sibos builtFor on example, the blockchain a large start- business would havenegotiations thousands of standby of processes letters implementation of the emerging is an independent of which “most are not automated”, according to Rymer. In his view, publication, wholly up’s Brackets platform for smart of credit and guarantees entirely DLPC standard,” adds Srinivasan owned by KNect365, “lowcontracts code onis quick a blockchain. delivery”. on smart contracts that can Sriram, CEO of Skuchain. “This Post-Trading. an Informa business. The integration enables the bank intelligently construct agreements standard is the result of more than

© Daily News at Sibos 2018 to provide trade finance services and securely communicate any two years of work by the Distributed changes in terms to relevant Ledger Payment Commitment All rights reserved; Daily digitally to customers conducting News at Sibos material may business on a blockchain business- parties. (DLPC) Working Group at the not be reproduced in any A form without the written to-business (B2B) solution. In The result is a blockchain- Bankers Association for Finance and permission of the publisher. particular, customers will be able based contract negotiation tool Trade (BAFT).”

PRODUCED & PUBLISHED BY BBVA Fintech Futures Spain’s banking heavyweight BBVA hardly needs any introductions these days – Knect365 iGTB and R3 join forces for blockchain- Maple House start-ups want to get investment from it and other banks want to be it. 149 Tottenham Court Rd BBVA’s influence in the fintech and paytech space stretches from the London W1T 7AD based fintechUS –platform the acquisition of Simple, backing of the “world’s first” global bank UK account Denizen; to Europe – the acquisition of SME bank Holvi in Finland, ISSN 0266-0865 By Tanya Andreasyan a 39% stake in Atom Bank in the UK, a major investment in Banking-as-a- Intellect Global Transaction Service (BaaS) platform solarisBank in Germany;says the to two Asia parties – a $50 will million look to PRINTED BY investment into Sinovation Fund IV, a Chinese venture capital fund. Masterprint, Sydney Banking (iGTB), the transaction explore how Corda, combined BBVA is big on open banking (BBVA API Market was launched last banking division of India-based with the iGTB tech, “can remove year), blockchain experimentation (multiple projects with Ripple, Indra tech firm Intellect Design Arena, trade/supply-chain bottlenecks and Wave), paytech (e.g. bringing Alipay to Spain), chatbots and AI (voice has joined enterprise software assistant MIA at BBVA’s subsidiary in Turkey,in corporateGaranti Bank; sales mobile enablement, banking by firm R3’s collaborative initiative chatbot in Spain); data and analytics (checkhelping out its companiesBBVA Valora, increase Bconomy their to develop blockchain-based and Baby Planner functionalities of its mobilesales banking as well app). as market share in offerings for banks and financial It is also putting in practice the ideas of hugelycollaboration competitive without domestic borders: and organisations on its flagship Corda earlier this year it launched the first mobileoffshore banking markets”. platform developed Published by platform. globally by means of a coordinated effort involvingDavid multidisciplinary E. Rutter, CEO of teams R3, iGTB says it “is exploring fromtrade Spain, finance/supply the US and Mexico.chain finance, believes “iGTB is ideally placed the development of scalable, paymentsAnd not to and forget cash the management bank’s Open Talent initiativeto develop – which solutions it claims across to becash commercially viable solutions on “world’s(PCM) biggest and central fintech banking.” competition” – as it management,hunts out ideas payments, from anywhere trade and across the globe, with a €150,000 prize fund for the overall winners. Corda in three mainstream areas: Manish Maakan, CEO of iGTB, supply chain finance on Corda”. Swiss-made. World-class.

2 | Wednesday 24 October 2018 | www.bankingtech.com/sibos www.bankingtech.com/siboswww.bankingtech.com/sibos | Wednesday | Monday 2422 October 2018 | 3 SIX-Add_Daily-News-Wednesday_Post-Trading_ES_210x297mm-CMYK_U_181010.inddSIX-Add_Daily-News_Monday_Both Worlds_210x297mm_CMYK_U_181010.indd 1 1 10.10.18 16:5716:56 B NEWS | DAILY NEWS AT SIBOS

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Death of the cheque in RBA’s sights – finally By Alexandra Cain

A Reserve Bank of Australia (RBA) executive Having been launched in February 2018, been very interested in using the NPP from has predicted the end for cheques, as it’s still early days for the NPP and panel the start”. He said it makes 2,000 emergency Australia’s New Payments Platform (NPP) members explored its future uses. payments each day, for instance to people helps consoidate the payments system. Karen Webb, from the Australian suffering domestic violence, and it’s looking Addressing the audience at the day Securities Exchange, said the NPP has to migrate this service to the NPP. The two Sibos session on the future of real- application for real-time payments for the Australian Taxation Office is also exploring time payments in Australia, RBA assistant exchange for securities lending, non-listed the NPP’s use for requests for payment. governor Lindsay Boulton said there “has to managed funds known as MFunds, funds Panel members said they would approach be rationalisation [and it] doesn’t make sense distribution and corporate actions. some NPP aspects differently if they had their to use multiple clearing streams – some Banks are also doing substantial work time again. clearing streams may be absorbed into NPP”. understanding the NPP’s application for their “At Westpac, we try to do everything Boulton cited research that found less customers. perfect on day one but sometimes it’s more than a quarter of a percent of payments “I keep saying the fast part [of the NPP] important to develop a minimum viable are presently done with cheques and that is not that interesting – but it is becoming product … we should have delivered a number is shrinking. He said the Australian interesting to some clients,” said Rachel modular project rather than tried to boil the Payments Council is looking into the future Slade, National Australia Bank (NAB). ocean,” she said. for cheques. Slade said the bank is exploring the Panellists were positive about its future “We could actually set a date for closing NPP’s application for making payments on and potential to prompt efficiencies in the down the cheque system – we’re not at that weekends and after 4.30pm and is running a payments system. Boulton adds: “it’s living up point yet … but we’re probably not too far pilot with Swift. to its purpose – we’ve only just started on the away,” he said. Boulton confirmed the “government has journey but so far the signs are good.” Banks must have superpowers to solve financial crime By Alexandra Cain

Dispelling the myth technologies will combat financial crime. The overwhelming Panellists agreed one of the replace people when it comes to solving response was lack of expertise, with 65% most difficult areas when it comes People are important to us problems like money laundering and of attendees indicating this was their to combatting financial crime is terrorism financing was a central debate major concern. complying with different nations’ often Since 2000, our business has been steadily growing. Our approach to technology at the day two Sibos session on financial To resolve this, during the session Miles contradictory data privacy regulatory crime compliance. Ward, Google Cloud’s solutions director, regimes. has succeeded because we understand the financial industry. We always listen “Technology doesn’t take jobs,” stated said technology will help to “give people “I’m being forced to choose which law to it. Listening is part of our DNA. panel member Hiroshi Ozaki, director of superpowers” to solve financial crime. To I’m violating,” said panellist Michelle Technology is the life force of our business. But we also know that while AI and the AML/CFT Planning Office for Japan’s this end, Google has developed a machine Neufeld, head of risk and control for robots are pretty exciting – well, we find them pretty exciting – human beings Financial Services Agency. learning crash course to help educate people the financial institutions group and are even more important. When it comes to understanding the challenges But there’s an urgent need to reassure about the potential of this technology. international at Wells Fargo. financial institutions face, and to deciding how technology can best serve people about this. “Banks need to Ward balked at the term AI. “Google She also acknowledged banks are those organisations, we realise that people are paramount. communicate to staff that technology eschews AI – it’s about machine learning experiencing inertia when it comes to is not about replacing them, it’s about (ML); we’re decades away from AI. ML is a adopting new technology to prevent We want to know where you need to get to and how we can help you get there. empowering them,” said panellist Adrien step forward from statistics and it is very financial crime. “We’re slow to adopt That is why talking to you face-to-face is important to us, and why getting to Delle-Case, policy adviser for digital confusing machine learning is not more new approaches … but disruption is a know you at Sibos is our top priority. finance regulation and policy at the broadly applied,” he said. fact and transformation is a choice.” Institute of International Finance. Delle-Case agreed: “We’re far away With cyber criminals becoming This is critical, given banks require from AI, but we are moving towards a increasingly dexterous, the Come along and join us on Stand I31, people with the right expertise to use new higher level of robotics to reproduce overwhelming message of the session technologies to help solve financial crime. human decisions – but automating was that banks’ choices may become it will be the best coffee you taste at Sibos. A poll taken during the session asked the the entire decision-making process is progressively narrow unless they act smartstream-stp.com/sibos audience about the major barriers to using a long way off. It’s all about analysing now to adopt new tools to put up a artificial intelligence (AI) and robotics to information.” satisfactory defence.

Can a centralised virtual ledger help banks join the API race? By Henry Vilar

In the panel held at Sibos called see the introduction of alerts and bots “Cross-border payments over a virtual that could keep both customer and centralised ledger – future or utopia?”, bank about significant events during the speakers discussed the potential of a payment journey. virtual ledger that could host not only Peter Maddison, executive director at all payments processes centrally, but Commonwealth Bank of Australia (CBA), also incorporate a whole ecosystem of says a solution like this would make applications that could benefit both payments faster, more flexible, and more consumers and banks in how they importantly, more consistent, as they manage these payments before, during do not go through several banks, which and after they are instructed. each have different banking schedules Sulabh Agarwal, MD in financial according to the time zone. services at Accenture, cited Expedia, financial products on e-commerce sites at This route may just be the way Easy Buy and Shell as examples of point of sales. However, when it comes to banks can fight off fintechs in the area of companies that have completely rethought commercial payments, things are much payments, and their series of workarounds their business models as a result of going greener. that have proved to be quite a success in stale – for lack of a better word. Niall Cameron, global head of corporate the retail area of financial services. More importantly, the way they have and institutional digital at HSBC, highlights With the ability to implement APIs, done this is via the implementation of the importance of tracking payments things would look up for banks. The third-party APIs. through Swift’s global payments initiative whole panel seemed to agree on the In the realm of financial services, retail (gpi), remarking that a virtual ledger would need to experiment – it is clear that payments is an area where you see some only increase the ability to track the payment implementation of APIs in this area is Would you like one API to reach incumbency, and some already-established in each step of the process. a conundrum, so testing and trialling use cases for APIs, however limited. Particularly with the potential possible solutions is a much needed 500 million potential customers? An example is how BBVA offers implementation of APIs, which would also priority.

Deutsche Bank and Data Labs in big data project The Pelican OpenBanking Hub provides pan-European access to thousands of By Tanya Andreasyan banks and millions of potential customers via a single Pelican API, as well as via Deutsche Bank says it has “stepped up its big “The platform represents a key step towards into the banking space but this move sees popular APIs like UK’s OBWG, French STET and Berlin Group APIs. Visit Stand data efforts” with the launch of new analytics unlocking the value of Deutsche Bank’s us flex our own muscles when it comes to an capability for its securities services business. huge repository of transaction data, which area traditionally in the technology domain. M03 to discover how our AI-powered payments and compliance solutions can give The enterprise analytics capability, “which details the holdings and movements of cash, “We have the data, we have the your organisation a competitive edge in the API economy. collates and analyses millions of lines of data securities and other instruments in and out of technological and analytical capabilities via daily to identify opportunities for efficiencies client accounts,” the bank says. our data labs and of course, we have the in the bank’s and its clients’ securities For example, one initial use case identified banking expertise – putting us in a strong Payments Compliance Innovation settlements”, has been developed together includes analysing clients’ intraday cash position to dig into client data in a way that’s • Integrated Real-time • Sanctions Screening with • Digital Transformation with with Dublin-based Data Labs. liquidity utilisation, providing valuable yet to be fully explored in securities services,” Payments and Compliance Self Learning Pelican Innovation Hub The launch is “the fruit of agile delivery insights that enable them to optimise their she states. and close collaboration” between the two available liquidity, reduce their funding costs “Next on the agenda for data analytics • OpenBanking Hub • Fraud Detection with • OpenBanking Platform parties, and “includes consolidating data and maximise their returns on cash. is ensuring we can identify and understand • API Interoperability Biometrics • API Hub from a complex landscape of systems and “This is a ground-breaking launch for the drivers behind settlement fails – a key • AI Powered STP and • Transaction Risk Analysis • Proven AI pioneers for databases onto a new scalable platform and Deutsche Bank and the wider banking part of achieving settlement efficiency. then integrating it with business analytics industry,” says Fiona Gallagher, Deutsche This is increasingly important following the Payment Hub • Trade Finance Compliance payments and compliance capabilities”. Bank’s head of GTB Securities Services. introduction of the penalty regime under The offering will be live in November “There has been a lot of media attention Central Securities Depositary Regulation 2018, starting with the German market. surrounding technology companies moving (CSDR).” pelican.ai | stand m03 6 | Wednesday 24 October 2018 | www.bankingtech.com/sibos www.bankingtech.com/sibos | Wednesday 24 October 2018 | 7

SDN-Sibos-WEDNESDAY-Pelican-v5.indd 1 22/10/2018 22:43 OPINION | DAILY NEWS AT SIBOS OPINION | DAILY NEWS AT SIBOS

Faster time to revenue means there are fewer instances where data changes will flag to the bank that more revenue. As customers are entered manually and therefore it must re-request information. For onboard faster, the banks can Shift fewer opportunities for mistakes example, if the bank asked for a generate revenue faster from those when entering the data. And when valid address and then the address customers. Urs Bolt, ambassador for Swiss firm Pikcio, explains how a customer wants a new product changes, the hash will change and The most prolific customers at a different bank branch (or a that can create an automated flag become more satisfied. A great blockchain-based know your customer (KYC) and onboarding different bank), the customer simply to the bank to request an updated consequence of improved KYC is fundamentally shift the bank/customer relationship. re-shares the validated data again address from the customer. that it increases satisfaction most – reusing the existing validations among the banks’ most important Banks and customers both suffer again, even if the customer wants instead of requesting them again Satisfaction customers. Consider what the when KYC processes are slow, error- a product from the same bank in a from third parties. As described above, blockchain- banks want most: highly profitable prone, and repetitive. Banks would different country. Blockchain-based hashes based identity brings multiple customers which buy new products prefer to get customers onboarded Blockchain allows immutability automatically become invalidated cost-saving and revenue-generating and services often or long-duration quickly because it improves the of data, timestamping, and when data change – so any important benefits. high margin financial solutions. banks’ time to revenue and other auditability. While such solutions, Those clients will be less frustrated success metrics. Customers want like all decentralised environments, if they don’t have to do manual immediate gratification and want to are more expensive to run than KYC and product suitability reduce the amount of time required to centralised systems, they bring checks every time they want a get access to the products they want improvements to the KYC process new product. Higher customer from the bank. that centralised systems can’t. satisfaction leading to more First, the bank asks the customer business. for the information needed. In most An end to tradition Reduced costs for cases, this requires the customer The basis of KYC is identity validation. administration of KYC processes. to provide paper documents for Here, blockchain provides capabilities As the process becomes basic information such as address that traditional systems don’t. At automated, there is less need for and identity data. Depending the foundation layer, consumers (or many manual steps and for rework on the banking product and risk enterprise bank customers) either to fix errors. This allows banks involved, the customer could also upload their data to a secured, to cut the administrative costs be asked for information that must encrypted blockchain or allow hashes associated with KYC, particularly be validated by a third party such of their validated off-chain data. The data entry. as an employer or government validated data then are available Finally, there is improved agency. The first type of information and under the control of the user, but compliance reporting. With requires the customer to physically accessible to anyone to whom the user the immutability of data and appear at the bank branch because grants access. timestamping, banks can prove of the hard-copy and the face In the case of the bank asking for more easily that they’ve completed recognition required. The second identity data, this brings speed and the process to regulatory standards. type of information requires paper- accuracy: the customer can validate Also, the banks will spend less time based signed approval from the basic information like an address searching for proof among different customer for the bank to request electronically and no longer needs systems because the validations information from the third party. to physically be onsite to request a and times of the bank’s request of Then it requires days or weeks bank product. Also, the customer the validations will all be in one of waiting while the third party no longer needs to simply ask a place. This makes it faster and more completes the request. third party for validation – it has efficient to report to the appropriate If any of the information doesn’t the validation already attested on regulatory body. DNS match or gets entered incorrectly a blockchain app, so the bank can (for example, transposing two accept the attestation immediately numbers on a customer’s annual instead of requesting from the salary,) then the process must third party and waiting weeks for a get redone. After the process response. The KYC cycle time can be is completed to satisfaction, cut from weeks to minutes. the customer becomes a true Also, consider that the likelihood ABOUT THE AUTHOR customer of the bank with access of data entry errors and other data “Customers want Urs Bolt is an advisor for tech start-ups, publications and knowledge platforms. He is a speaker, panellist, to whichever products he wanted. quality problems will largely be immediate gratification” moderator, interviewee, microblogger and author. If the customer wants a new removed. Since blockchain-based A current focus is, in collaboration with Pikcio, on digital identity, KYC, client onboarding, and the product, the entire cycle starts over identity validation is automated, verification/validation and secure exchange of personal data.

Big four floored?

With several new entrants trying to muscle into the Australian banking sector and upset the big four, Daily News at Sibos editor Antony Peyton has created a comprehensive list of the known challengers to date and the technology they are using.

86 400 Judo Capital Launched in June 2018, the bank is Melbourne-based Judo Capital led by former ANZ Japan CEO, Robert officially unveiled its banking plans Bell, and ex-Cuscal Payments CIO in March 2018 as it targets the Brian Parker. Joining as incoming nation’s SME sector. chairman is Anthony Thomson, co- Judo says it has started founder and former chairman of Atom Archa the process of applying for a Bank and Metro Bank. Melbourne-based mobile-only banking licence from APRA – the It is fully funded and backed challenger Archa is not currently a culmination of a “strategic build- by Cuscal, Australia’s largest bank, but is working with a licensed up of the company” over the past independent provider of end-to-end bank partner to open for business. three years. Its model is based on payments solutions. The plan for In due course, it will obtain its own UK challengers such as Aldermore, 86 400 requires in excess of $250 ADI (authorised deposit-taking Shawbrook, and OakNorth. million of capital over the first three institution) licence. For its tech, it uses a variety of years of operation, with “additional It positions itself as a financial different vendors. Unifii’s Business shareholders expected over that platform for users to save, spend, Transformation Platform is used for its period”. travel, send and receive money via technical infrastructure. For its small 86 400 will launch in beta mobile phone. Funds can be stored business lending platform, it will use towards the end of 2018 and in a fee-free global account, hold one from Realtime Computing, based intends to launch to the public in multiple currencies at once, and in Perth, Australia. the first quarter of 2019, complete move between them at flat rates. To deliver both the platform with a transaction and savings For its technology, Archa is and application, Judo turned to account from day one. It has exploring how it can use blockchain Microsoft and BankSight. The latter been working with the Australian technology and cryptocurrency provides a banking CRM and deal Prudential Regulation Authority networks. builder solution for use both by Judo (APRA) and is “well progressed” Archa was founded in 2016 lenders and partner brokers. into the process of obtaining a full by Oliver Kidd (CEO), who is also Also involved in the AWS-based banking licence. a company secretary for Benitec lending platform is Brisbane- 86 400 will be available as Biopharma. based Itoc. Judo states that it was both an iOS and Android app from The average age in Archa’s designed and built from the ground launch. management team is 28. up in six months.

Pelikin QPay Digital banking start-up Pelikin QPay, based in Canberra, offers aims to reshape the way people a banking platform targeting the save, send and spend their money student sector in Australia (and also in Australia and while travelling the UK). abroad. The company’s slogan is It alerts users about their “spend like a local”. The founder is expenses with a mobile notification Sam Brown. with an emoji for whatever its users It will be targeting “digital spent their money on – e.g. it will Tyro natives” with its app and debit card. show you a pizza slice emoji if you This Sydney-based bank has been It is beta testing features such as buy pizza. around since 2001 and says it is immediate currency conversion, QPay was founded in 2013 Australia’s “largest independent foreign bill splitting and group by Andrew Clapham and Zaki Eftpos provider”. It is focused on holiday saving goals. Bouguettaya. Andrew Chick, former SMEs and has a licence to provide Pelikin says it is doing away with Royal Bank of Scotland’s (RBS) banking products by APRA. At complicated account numbers and Australian head, is on QPay’s board present, Tyro has around 400 staff instead encourages users to set of directors. members. a unique Pelikin handle, just like The platform has also been In March, it unveiled Tap & Save, Twitter. launched in the UK, with 24,000 to enable merchants to process “Setting up a Pelikin account will students from Cambridge, Oxford, debit tap-and-go payments through take as little as three minutes and Edinburgh and Durham now using the Eftpos network. it will travel with you wherever you QPay Swipe, a pre-paid card. Tyro provides integrated go,” Brown says. “Gone are the days The app sends targeted and payment, deposit and unsecured of notifying your bank that you’re relevant deals to users, based on working capital solutions for travelling overseas or waiting over previous purchase behaviour, “ranging more than 20,000 SMEs, and 24 hours for a bank transfer from a from discounted Netflix and Spotify to collaborates with more than 200 friend to come through.” reduced co-op books and burritos”. POS providers and cloud accounting The aim of the card is to help platforms. students save money on products In its fiscal year 2017, it states and services, with future aims to that it processed more than $10 become a challenger bank in both billion in payment transactions, Australia and the UK. generating $121 million in revenue.

UBank Up Volt Bank Unveiled in 2008 and developed The bank (or, to be more precise, Sydney-based Volt Bank was given Knowing your customer: and supported by National Australia banking service) was founded by Australia’s first new restricted Bank (NAB). It operates under NAB’s Dom Pym and Grant Thomas, a banking licence and is now working banking licence, and offers home former AFL coach. towards becoming a fully licensed blockchain’s ultimate killer app? loans, online savings accounts, and The tech company behind it is bank. term deposit accounts. UBank has Melbourne-based Ferocia. The bank says it is “mobile first” more than 400,000 customers. Up’s technology is fully cloud- and is in the early stages of its life. The concept of identification has always banks extending services throughout the The transactions in the trial were It has launched Free2Spend – an based. The financial services are being For example, it is recruiting staff been at the heart of financial services. For world, particularly to the poorest and conducted in 19 countries across eight in-app tool for personal finance provided by Bendigo Bank, so Up and calling for investors. banks to manage customers’ money safely, most difficult-to-analyse regions. timezones. Banks were able to request management (PFM); and RoboChat, doesn’t need its own banking licence. In October 2018, PayPal and Volt they know exactly who they are dealing However, recent technological access to customer KYC test data, whilst a virtual assistant for online home The challenger has been kept partnered to allow customers to log with – a simple premise on the surface, but innovation in blockchain-based systems customers could approve requests and loan applications. The latter was on the low until now. It has been in using their PayPal credentials. a complex and costly task in reality. promises improvement in KYC compliance revoke access. Customers were also able built with IBM Watson. trialling its services with 1,500 For its core banking system, Volt While numerous technology solutions without the need for extensive networks to update their test data which was then For its core banking tech, UBank customers, which have sent a total has selected Temenos’ T24. exist to help streamline know-your- with central administrators. Data on a automatically updated for all banks with uses Oracle Banking Platform (OBP) of $2.2 million in transactions. The bank was founded by Steve customer (KYC) processes for banks, a blockchain platform’s distributed ledger permission to access it. from Oracle FSS (and so does its It already has Apple Pay, Google Weston (CEO) and Luke Bunbury recent study by Thomson Reuters shows is verifiable and immutable, providing Corda’s unique technology addresses parent, NAB). Play, Garmin Pay and Fitbit Pay (deputy CEO), who have both that some financial institutions are still increased transparency to relevant any concerns around data privacy and implemented. worked in banking and financial spending up to $500 million annually on participants. security that may arise when sharing Up says it is bringing products to services. ensuring KYC compliance. This has driven Regulators impose fines and identity data. In direct contrast to the market that Australia has never many banks to de-risk, terminating their penalties on banks that don’t conduct traditional permission-less blockchain seen before. relationships with particular institutions, appropriate due diligence on the entities platforms, Corda only shares data with countries and regions. and individuals they directly deal with; those with a need to see it. This is critical The emergence of blockchain therefore, banks use intermediaries for its application in the KYC space, where technology has provided an opportunity and shift some of the risk to the middle sensitive data must be kept confidential. for banks to re-engage with customers and men or reject processing the transaction Having KYC information readily correspondent banks excluded as result of altogether. The more readily a bank in available allows banks to spend more de-risking. But design matters. Technology a well-developed country can access time analysing information rather than must be coupled with regional KYC and information on the end user and the collecting and verifying the data received anti-money laundering (AML) standards in end user’s bank in an unbanked region, – a key issue in onboarding delays. In order to improve transaction traceability the more comfortable it will be with addition, all data is fully standardised, and identify potential suspicious activity, facilitating the transaction. significantly reducing the time, cost and and highly sensitive data must be handled resources required to manage it. appropriately. KYC registry on the blockchain Xinja The shared nature of blockchain A united step forward The neobank emerged from the shadows to unveil its Risk fines or de-risk? technology lends itself naturally to The current de-risking problem has pushed plans for a mobile-only digital bank in 2017. It will have To understand how blockchain can improve providing a single, unified registry of KYC millions of individuals and entities out of the no bricks and mortar branches. KYC, it is important to first understand the information for banks. A KYC application traditional banking system and caused them Eric Wilson is Xinja’s chief executive and a former scale and scope of the challenge. built on R3’s Corda blockchain platform to explore non-traditional payment methods National Australia Bank (NAB) executive. Xinja might Since 2010, 28 major banks have been recently facilitated over 300 transactions that have little or no government oversight. be new, but it will have some handy experience on tap. fined for breaching US sanctions, with during a collaborative four-day trial with The right blockchain technology design Jason Bates, a co-founder of UK digital challenger bank seven banks receiving fines exceeding 39 financial services firms, as well as coupled with KYC and AML standards Monzo, has joined the Xinja board. $500 million, of which the highest was various central banks and regulators. consistent across regions will significantly In March 2018 it unveiled its prepaid travel and $8.9 billion. In one particularly pertinent In stark contrast to the typically increase traceability to support financial spending card and app. Xinja says it plans to launch example, the UK’s Financial Conduct complex and duplicative KYC processes inclusion for the countries and regions deposit accounts, and mortgages and credit cards. Authority and the New York Department banks are forced to endure today, Corda’s whose development hinges upon access to Its home loans were released in April 2018 as a beta of Financial Services issued KYC/AML self-sovereign model allows customers to the global banking network. product. Once it gets its bank licence, Xinja says it will fines for an institution that formed a create and manage their own identities Following the success of the recent immediately launch current accounts. cumulative $628 million. including relevant documentation 39-member global trial, R3 is focused For its tech, it uses SAP Cloud for Banking. This In response, banks have moved and then grant permission to multiple on developing the solution, scheduled to provides open banking capabilities, and integration to reduce their risk by shedding participants to access this data. This go live in 2019. If you’d like to learn more to payment systems and business networks. Xinja can correspondent banking relationships in reduces duplication and costs by or are interested in participating, please also offer APIs to use and has a mortgage origination developing countries. The high and rising eliminating the need for each institution contact [email protected]. DNS platform. The latter is supplied by Australian fintech risk of fines and the costs of increased to individually attest and update KYC Abbas Ali, specialist Iress. DNS scrutiny have destroyed the tradition of records. Associate Director, R3

14 | Wednesday 24 October 2018 | www.bankingtech.com/sibos www.bankingtech.com/sibos | Wednesday 24 October 2018 | 15 Separating the myth and reality Alpha-bets: M-R of AI in financial services In the third part of our new feature, we have a look at fintech firms that Matthew Davey, Head of Business Solutions are worth watching. This article focuses on four names within the M-R Societe Generale Securities Services letter range. Tanya Andreasyan, editor-in-chief of FinTech Futures, makes her selection. There is no doubt that artificial intelligence (AI) is set to fundamentally alter the financial services world. Customer experiences will be enhanced, fraud detected and opportunities unearthed. However, at the moment the hype MONEYTHOR is overwhelming the potential and firms first Moneythor was set up by Olivier Berthier in 2013, following his need to have a better understanding of where departure from Misys (now Finastra) after six years with the firm. the technology can have the greatest impact. Its HQ is in Singapore and it has an office in Paris, developing “One of the biggest challenges is that software components to provide digital banking and marketing and people are looking for solutions without analytics for banks. identifying the problems,” according to Its toolkit and personalisation engine has proved attractive to banks Matt Davey, head of business solutions at and financial institutions in Europe and Asia Pacific – with takers Societe Generale Securities Services. In including Crédit Mutuel Arkéa and Orange Bank in France, and Raiz other words, they should not just employ Invest in Australia (formerly Acorns Australia). the technology for the sake of it but have Among the biggest names on the client list are APAC heavyweights a vision of their objectives and then a plan DBS, Citi, CIMB and Standard Chartered. The latter signed with of the most expedient way of achieving Moneythor last year to supplement its client-facing transaction insights these goals. “Firms can lose sight of their (as part of the bank’s new chatbot roll-out), initially in Hong Kong. business requirements and how best to risks or investment opportunities. Looking use cases in trade processing, reconciliation use the technology,” he says. “The result is farther down the line, NLP and generation will and client controls. “For example, RPA that expectations may not be met but there make it increasingly difficult for customers can also be used in setting up funds where NORDEA M certainly has been a lot of interest created. to determine whether they are talking to a people have to key in a lot of different A Nordic banking group busy on many fronts – from moving its HQ This is the case with any new technology.” human or an AI interface. Voice and facial details. The technology can define the to Finland from Sweden; to being among the first large incumbent The difference with AI is that it is not recognition will also be further developed process, automate it and then automatically players in Europe to embracing open banking; to joining forces with four an amorphous technology but a collection to improve the customer experience and for make the updates.” other regional banks to create a regional know your customer (KYC) infrastructure; and to investing over €1 billion in an enterprise-wide of tools that are quite distinct and tackle cybersecurity. Not surprisingly, there could be a technology overhaul. different business issues. They are currently RPA is also attracting a great deal of host of regulatory issues surrounding The latter has been under way since 2015, with Temenos as its main tech at various stages of development but to date attention because it aims to replace the these new technologies but legislators supplier (Temenos’ largest deal to date) and Accenture as integrator. FIS’s chatbots, or virtual assistants, better known manual handling of repetitive and high- are treading carefully for now. For (formerly Clear2Pay’s) Open Payment Framework (OPF) is to be the bank’s to many as Siri and Ok Google are among volume tasks. It differs from traditional instance, in the UK, the Financial Conduct new payments hub. On the way out is a host of legacy tech, including from the most advanced. However, machine automation software in that it does not Authority (FCA), is looking to roll out its Finastra and Tieto. learning (ML), natural learning processing have to be fundamentally redesigned and so-called “sandbox” which it launched in In spring 2018, Nordea started the roll-out of a “completely new” mobile (NLP) and robotics processing automation transformed. “While there has been a lot of 2016 on the global stage. The initiative banking app, with Finland as the first country. (RPA) are also gathering momentum. focus on how AI can enhance the investment allows financial service firms to formulate On the blockchain front, Nordea joined the we.trade consortium as Together, they can generate huge efficiency decision making process, RPA is more about new ideas and develop products in a founding partner. Together with IBM, we.trade is building a platform based and quality gains through validation of the improving the operational processes,” says “safe” environment plus offers support on distributed ledger technology (DLT) for domestic and cross-border commerce. data, providing proactive notification and Davey. “It is gaining traction in financial in identifying appropriate consumer And finally, in summer this year, Nordea bought a digital bank in realisation of patterns, identifying errors and services because its scalability and efficiency protection safeguards that may be built Norway, Gjensidige, for €578 million, adding 176,000 customers, €4.8 producing trade and transaction reports for makes it a compelling business case. Banks into new products and services. billion in assets and 170 staff, and reinforcing its position as Norway’s compliance purposes. have spent time and money on integrating “People are aware of the risks,” says second largest bank. Gjensidige will be gradually incorporated into Nordea Natural language generation and legacy and new systems but you still need a Davey. “Transparency is one of the most and its operations migrated onto Temenos’ T24, from legacy platform understanding are also being added to human to rekey information. RPA enables you important things and firms need to ensure supplied by local banking tech vendor Evry. the mix to absorb raw information in large to parameterise the process and run it 24/7.” that when the technology is deployed, the On top of that, in September it brought its open banking to Sweden. datasets, understand and detect trends and Aside from the benefits in integration, decision-making process and how it works is correlations as well as identify inferences, Davey points to several other viable business well understood.” DNS 16 | Wednesday 24 October 2018 | www.bankingtech.com/sibos Nwww.bankingtech.com/sibos | Wednesday 24 October 2018 | 17 STAND OUT AT SIBOS 2019 RESERVE BANK OF AUSTRALIA Digital media and print No banking event is complete without the country’s central bank on the scene. Enter Reserve Bank of Australia (RBA). commercial opprtunities RBA assumed its duties in January 1960, when the Reserve Bank Act 1959 removed the central banking functions from Commonwealth Bank of › Interviews Australia (CBA). › Thought leadership It specialises in services to government agencies, other central banks and state organisations, and manages the country’s gold and FX reserves. It › Videos processes over 320 million payment and 25 million collection transactions › Company announcements per year. It also oversaw the introduction of the country’s real-time New Payments › Advertising Platform (NPP). The implementation project started in 2014, with Swift as › And more! the tech and services supplier; and the first go-live took place in early 2018. In spring 2017, RBA embarked on a major tech overhaul with TCS For advertising and Financial Solutions. The Indian vendor won the AU$13.6 million ($10 million) contract to supply its core banking system, TCS Bancs, to RBA. The deal sponsorship opportunities, followed a two-year system selection process. please contact Jon Robson The initiative – one of the largest tech modernisation projects at the bank – is scheduled for completion in 2019. TCS Bancs will replace legacy e: [email protected], software and will be hosted on RBA’s existing infrastructure and interfaced t: +44 (0)203 377 3327 to the bank’s PeopleSoft general ledger. R

RIPPLE Blockchain alert! Ripple is known for being one of the most active players on the DLT scene. Its abundant proof of concepts (PoCs) and pilots in the cross- border payments space are well publicised. In mid-2016, Canada’s ATB Financial sent €666.67 to ReiseBank in Germany using Ripple tech, with the transaction completing in eight seconds. The participants said this was the world’s first bank transfer using blockchain. The following year, the Bank of England’s accelerator teamed with Ripple for a PoC. In the Middle East, National Bank of Abu Dhabi became the first bank in the region to introduce real-time international payments on Ripple’s network. Meanwhile, Axis Bank became the first bank in India to do the same. In spring 2017, BBVA completed “the first real-life implementation of an international money transfer using Ripple’s new DLT”. The transaction, which ran on BBVA infrastructures with real money, resulted in money moved between Spain and Mexico “in a matter of seconds”. Earlier this year, Santander launched an international payments service for retail clients in Spain, Brazil, Poland and the UK – Santander One Pay FX – using Ripple’s tech, XCurrent. By the way, InnoVentures, Santander’s $200 million venture capital fund, is an investor in Ripple. At last year’s Sibos, Ripple attracted attention on the opening day with its cars outside the Metro Toronto Convention Centre (MTCC) ferrying people back and forth to its own rival “Swell” event downtown. And to finish on a double blockchain note: R3 and Ripple sued each other over an options contract to purchase the latter’s digital currency XRP. But kissed and made up in September when they reached a secret settlement of all outstanding litigation.

Tanya Andreasyan, @TanyaBankTech 18 | Wednesday 24 October 2018 | www.bankingtech.com/sibosR CRYPTOCURRENCY | DAILY NEWS AT SIBOS

Pole position A rum tale Nordea is actively positioning itself for a digital and real-time future. Erik Zingmark, head of Richard Buckle, founder and CEO of Pyalla Technologies, looks at Sibos and Sydney’s transaction banking, explains the bank’s active engagement to ensure its future success. ongoing pursuit of the ideal currency. Central to the bank’s efforts is the replacement of its full legacy stack. This With Sibos in Sydney there isn’t a hospital – which begs the question: of the globe cash in whatever project extends to include accounts, better time than now to talk about For how many years did the rum local currency they might have in payments and the data warehouse of the digital currencies. After all, in corps water down the rum thereby exchange for homes and condos bank replacing different stacks with a Sydney’s past there was put in place orchestrating one of the world’s first that have real value. At a time when single integrated platform. “We decided to a forerunner to digital currencies, currency devaluation? currencies are fluctuating as wildly do this all in one go because it will reduce Rum! That’s right, rum. For quite Rum may not have been the ideal as they are doing of late, it simply integration to legacy while implementing some time that first Australian currency for the colony but when makes sense to convert to bricks and the new platform,” explains Zingmark. colony was known as the rum colony banknotes finally appeared, twenty mortar in areas coveted by everyone. “Because the business is now lying on a after a cargo ship pulled into Port or so years later, they carried the Against a backdrop of such a new technology platform we will be able to Jackson with 7,500 gallons of rum most surprising assurance. With history, it’s not surprising then to add to it and future proof ourselves,” on board. Surprise, surprise! The a touch of poetry, each banknote read that Australia is looking into he says. military forces of the day bought included the words, “When we cease embracing digital currencies. Not The new platform should be fully all 7,500 gallons of that rum and to render strict and impartial Justice a cryptocurrency like Bitcoin, but operational by 2020 and the banks sees it as the nineteenth century began, in the Administration of the Affairs rather, an Australian token yet to be as part of a bigger journey of simplification “We also want to support the growth of this rum had become the colony’s of the Bank, as it regards the Public defined or created. – of process and of operations. Being leading currency. Indeed, the only on the one hand, and the Proprietors Last year, the Reserve Bank architectured on a single platform means the Nordic economies and make us an currency given that the “trust” that on the other, be our Names and of Australia (RBA) was also we can add in capabilities on top of it quite was backing this currency was yes, Characters branded with perpetual investigating the ‘pros and cons’ easily. Examples are the API platform, PSP attractive region for entrepreneurs.” the “rum corps”. Construction of Infamy”. of establishing a digital currency. and mobile payment capabilities as well the colony’s first church along with Today, arguably the currency of Governor Philip Lowe said in a Erik Zingmark, Nordea as blockchain – all of which are aimed at the first hospital was paid for with Sydney is water front real estate as speech last month that while going improving the customer experience and rum – 60,000 gallons of rum for the wealthy individuals from all corners into direct competition with retail income generation. To ramp up its digital capabilities the bank acquired Gjensidige Bank in July this year. The acquisition was partly driven by an attractive region for entrepreneurs, the customers the battle is theirs to Gjensidige’s digital capabilities and also start-ups and developers to come and lose. by the opportunity to consolidate Nordea’s test out real-time payments capabilities “Banks know that they cannot own presence in Norway and create scale. within a fully regulated and approved survive just by processing transactions “It was an intelligent acquisition that environment.” and this is why we are hearing so much provides digital capabilities and scale for He says that the banking community about eco systems and the platform us – we hope things will be finalised soon,” as a whole; banks, regulators and central economy,” says Zingmark. says Zingmark. banks are all fully on board and enthusiastic The question will be, he says, about this project, inherently complex as it whether the fintechs will opt to Real-time railway is. “We all know that it’s just not viable to collaborate with the banks or take them The bank is also playing an active role in a continue to operate in a fragmented and on entirely. “Only a minority will be truly payment infrastructure project within the piecemeal way and it’s so encouraging to disruptive and the rest will partner with Nordic region. It is in a partnership of seven see the current levels of cooperation and banks,” he says. banks all looking to create the ‘railway’ for collaboration. This is something to be really As of the bigtechs, he thinks that a real-time payments infrastructure within excited about,” he says. they are well aware of the difficulties the Nordic region as whole. “By creating Going forward Zingmark thinks that of operating in a cross-border banking this real-time cross-border infrastructure the question will be how banks, fintechs environment and may opt instead to we can create scale and that allows for and bigtechs will approach the need to capture value thorough collaborative attractive unit pricing,” says Zingmark. retain the customer interface. Banks have means. “They can get a lot of what they “We also want to support the growth already moved to do this by providing API want without actually being a bank and the of the Nordic economies and make us platforms and as the current ‘owners’ of intelligent players know this,” he says. DNS

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CONTROLLING RISKS TO PROTECT ASSETS AND CREATE VALUE banks is not something they’re it would be at the top of any list of planning to do; the RBA is working currencies being traded. to see if a system to issue Australian In a country that produced dollars in the form of electronic files polymer banknotes – paper notes or tokens for specialised situations is degraded too quickly when left a good idea. What was taking hold on a bar countertop awash with within the RBA was the thought that beer, or so it was reported – the Benefi t from the security perhaps the underlying distributed transition from rum, to paper (with ledger technology (DLT) may prove disclaimers) to polymer to digital of a leading depositary bank, invaluable to the central bank long doesn’t seem all that far-fetched. with strict processes and term. Furthermore, in a country where Central banks are a close reinforced protection “The tokens could be exchanged almost any mineral of value can community and today, there really for its investors. among members of a private, be unearthed at any time – you are only about five or six global permissioned distributed ledger, drill for oil and come up with pink currencies worth watching – the separate from the RBA’s real-time diamonds; what a country – there US Dollar, the Yen and the Euro securities-services.societegenerale.com gross settlement (RTGS) system, would never be any issue about and yes, naturally, the Canadian but with mechanisms for the tokens trust or about what ultimately and Aussie dollars. China may to be exchanged for central bank backs the currency if that is huff and bluster, but with what deposits when required,” said even a concern of anyone these has been happening of late, as a Governor Lowe. “This seems to be days. Backed by gold? Back by result of the ongoing trade disputes the general model that some people Lithium? Backed by the mythical with the US, doesn’t do a lot for have in mind when they talk about Unobtainium found on the moon, confidence mid- to long-term as far ‘putting AUD on the blockchain’, Pandora? It really doesn’t matter. If as the Renminbi is concerned and although other technologies the RBA says the country is going as for Switzerland? Well it too has might be able to achieve similar tokens, the country will go that way “requested a report on the risks and outcomes”. Imagine it; the a-dollar if only to ensure it stays ahead of opportunities of introducing its own that on the one hand could assure the Canadians. state-backed digital currency, or so Societe Generale Securities Services is a marketing name for the securities services businesses of Societe Generale and its affi liates worldwide. Societe Generale is regulated and authorised by the French Autorité de Contrôle Prudentiel and Autorité des Marchés Financiers. This document is for informational purposes only. Under no circumstance should it, in whole or in part, be considered as an offer to enter into a transaction. This document is not intended to have an advisory character or intended to represent an investment recommendation or a recommendation regarding a certain strategy, product or service. As such, it should not be used as a substitute for consultation with professional legal advisers. Specialist advice should be sought about your specifi c circumstances. Not all products and services offered by Societe Generale are available in all jurisdictions. 22 | Wednesday 24 October 2018 | www.bankingtech.com/sibos Please contact your local offi ce for any further information. 2018 Societe Generale Group and its affi liates. www.bankingtech.com/sibos© GettyImages - FRED & FARID Paris | Wednesday 24 October 2018 | 23

719901A_235558 Annonce A4_SERENITY_.indd 1 08/10/2018 14:43 CRYPTOCURRENCY | DAILY NEWS AT SIBOS

called ‘e-franc’”, according to a May 2018 attendees look around this report in Reuters. Which leads us to magnificent harbour city and yes, SWIFT gpi: How global the next question to be asked: What look past the eye-popping real of the UN, the World Bank and the estate harbor-side even as they IMF? Surely, this is all small talk pull out their plastic cards and and chit chat by nations all thinking cash, then maybe, just maybe, payments are going digital about their local markets. Surely attention being paid to national there should be a global digital digital currencies will look even Thierry Chilosi, Head of gpi Customer Success Team, explains how currency targeting legal transactions further afield. There are only a half where trust is assured not by rum dozen currencies worth watching SWIFT is reacting to this year’s ‘Going Digital’ Sibos theme. or threats of perpetual infamy but so shouldn’t that be all the digital rather, by mutual transnational currencies we need? Shouldn’t How can we interpret drivers for ‘Going on board and in about four weeks’ time cooperation by everyone. In reality, every citizen on the planet be given Digital’ within the payments industry? every single payment within our system the path to digital currencies will be a choice? And wouldn’t it be great I think there are two key drivers within will have a tracking number. That will then a difficult one but we will get there. if currencies no longer projected payments – the customer experience, be consolidated next year with a function It’s inevitable and as far as I am sovereignty or were associated which demands a digital experience enabling the receiver to post to indicate concerned, it cannot happen soon with regimes or personalities? Life and the technology that enables that to that a payment has arrived – at this point, enough. would be so much simpler and our happen. we consider universal adoption to have As they say in Australia, fair smartphone would be our ATM. On Customers live in a hyper connected been made. enough! Won’t happen; so it’s back the other hand, I hear my colleagues world and they want better experiences We’re also aiming to provide value to a-dollars and e-francs. The road becoming restless as we head for around all elements of that. This translates added services. This is not just about to all digital currencies will not be the bar; I guess I have to pull out into the financial world, too, and the providing connectivity, it also includes straightforward nor will it proceed more polymer to buy the next round financial industry needs to become more things like pre-validating a payment so without the occasional complete of rum. It’s Sydney after all, and as real time, transparent and efficient in its that the sender knows in advance both meltdown of public trust. As Sibos they say, it’s my turn to shout! DNS dealing with customers. when and how much is coming. Technology, meanwhile, delivers the ability to meet customer expectations. What are the hurdles to be overcome? APIs are one key enabler. They deliver to us Thierry Chilosi, SWIFT One of the biggest hurdles is that the means to assemble processes into an everything seems to be happening at once. ecosystem and expose that to customers One of the things we have also found So, we need to make sure that we can help over a real-time and easy-to-use interface. with our system is that it allows not just for people adopt new things at their own pace. It’s all about making something previously the cross-border payment itself but also for We need to be modular and allow for well- complex both easy and cost efficient. AI its tracking within the domestic system. In timed onboarding that suits the customer. and data, meanwhile, allow for access to trials, we linked the two within 18 seconds. We also want to see a new digital knowledge via richer data. This means we Previously, this process could take a day or so experience exposed to the end-customers. can see customer behaviour as well as our under the old ‘fire and forget’ system where This is already being done in China where own processes and find where the gaps are the payment would be made but there was mobile use is already very high. It’s all in meeting the demand of the customer hardly any tracking to know if it had arrived. about creating a unique and high value with our processes – our processes can be user experience and understanding made smarter. What are the next steps with this? that the payment is part of the overall We are now looking for universal adoption. transaction. Without ease of payment, the How does your real-time cross-border proof We already have 280 financial institutions whole transaction might fail. DNS of concept, using SWIFT gpi, fit into all this? SWIFT gpi is the new standard in global payments. The service is already live YOU CAN CHECK OUT SWIFT GPI DISCUSSIONS AT SIBOS TODAY: with coverage of 700 corridors and daily ■ 09:45-10:45: Conference L3, Conference Room 6, “Lessons learned volumes of one million transactions. The implementing gpi – Next, going global” proof-of-concept relates to reusing this ■ same new digital payment rail to connect 10:00-10:45: SWIFT Hub L2, SWIFT Hub 1, “SWIFT gpi – Delivering value to multi-banked corporations” with domestic real-time payment systems. We’ve trialled in it China, Singapore, ■ 12.30-13:15: SWIFT Hub L2, SWIFT Hub 1, “SWIFT gpi – An opportunity Thailand and Australia and it confirms to make cross-border payments real-time” that banks can now send and receive ■ 17:00 to 17:15: SWIFT Hub L2, SWIFT Hub Theatre, “SWIFT gpi case funds in seconds and securely across study – Grasping gpi benefits as a multi-bank corporate” domestic systems.

24 | Wednesday 24 October 2018 | www.bankingtech.com/sibos www.bankingtech.com/sibos | Wednesday 24 October 2018 | 25

NEWS | DAILY NEWS AT SIBOS

13 December 2018 | London Marriott Hotel Grosvenor Square Polls and Souls

Welcome to our new feature that captures the best Twitter polls and tweets from the show.

Who would be the most likely group behind a massive cyber 9/11 attack? “Being big doesn’t make you Nation states 45% important, being connected Organised crime 33% makes you important.” Parag Khanna, Managing Partner of FutureMap Cyber terrorists 16%

Hacktivists 4%

Malicious or unwritting insiders 2% JOIN US FOR THE INDUSTRY’S MOST Which is the most important way for technology to help banks to address the challenges of GLAMOROUS EVENT OF THE YEAR geopolitical uncertainty and trade wars?

By improving access to data that allows banks to Now in their 19th year, Banking Technology Awards recognise excellence in the use make quicker and more informed decisions 42%

of IT in banking and financial services, strive for innovation, and “Attracting people with soft All of the options 37% professional contribution to the industry’s betterment. and engagement skills is key By improving the assessment of to overcoming the counterparty or country risks 11% Book a table for you, your colleagues, partners and clients, and join us for a By reducing the cost of compliance, 5% cybersecurity challenge” particularly in complex supply chains fabulous black-tie event at London Marriott Hotel Grosvenor Square, Jacqueline McNamara, Head of Cyber Security, Telstra By speeding up transactions 5% a top-star venue in the heart of the UK capital. By tightening AML/KYC compliance 0% Be a part of the celebrations!

What is the most promising solution for the futureQuestion cross-border XXXXXXXX payments XXXXXX model? XXXXXX www.bankingtech.com/awards XXXXXX XXXXXX XXXXXX XXXXXX Centralised: e.g. centralised virtual ledger 73% “Progress is Darwinian – only Get in touch to find out more and book your seat: Answer 1 the banks that adapt nimbly to Decentralised: e.g. distributed trust will prosper in Jon Robson Answer 2 distributed legder base 27% a changing ecosystem.” e: [email protected], t: +44 (0)203 377 3327 Ghela Boskovich, founder of FemTech Global

Is a cyber 9/11 event inevitable? Sberbank’s cybersecurity subsidiary Bi.Zone provides the answers.

Back in July, FinTech Futures attended the things. For an in-depth explanation of how us, we can’t even consider it.” These International Cybersecurity Congress in organised cyberattacks operate, read our words resonate, as Samarstev’s calls Moscow, where Dmitry Samarstev, CEO reports from Moscow’s ICC on the FinTech for collaboration often meet deaf ears, of Sberbank’s cybersecurity subsidiary Futures website. as collaboration among the many and Bi.Zone, told us that its work with A “cyber 9/11 event”, however, would disparate law-enforcement agencies across international organisations like the World largely disrupt organised crime’s business the world is sometimes thwarted by Economic Forum or Interpol would set model – they thrive when these gangs political obstacles. standards on the future of the fight against can steal money from running functional This is not something that happens in cybersecurity. networks. So, as the audience poll revealed, the cybercrime community. As Jacqueline As the biggest bank in Russia, Sberbank nation states would be the most likely threat McNamara, head of cybersecurity at Telstra, A minute ago they had been and its subsidiaries are in a privileged in perpetrating an attack of this kind. Australia’s largest telecom, explains, climbing those trees position to monitor, analyse and share cybercriminals are not short of incentives to information from the Russian-speaking share information and communicate about cybercrime community, the largest and how regulations, technology, tools and most sophisticated one. other information that might aid them in A few months later, at Swift’s Sibos “Corporate launching an attack successfully. conference in Sydney, his message Increasingly, the lack of communication The world’s largest toffee resonates in a theatre with a much more players need to and collaboration channels prevents apple has gone missing international audience. He calls for criminals from being caught. “Many communication, information sharing, and share information companies can easily identify the criminals collaboration to fight the growing threat, and make cyber themselves, but we can’t catch them which nearly triples in capacity, from ourselves. We need law-enforcement darkweb-organised cybercrime. criminals’ lives more agencies to do that for us,” says Samarstev. “Is a cyber 9/11 event inevitable?” the Samarstev concludes: “The industry, in panellists are asked. Troy Hunt, Aussie difficult and more terms of cybersecurity, is clearly not doing independent cybersecurity consultant, expensive.” enough about it. We can get all the best paints the horrifying picture of a mass loss tech, but we won’t be able to fight off all of service that could affect business and these attacks if the whole industry doesn’t daily life worldwide in a large scale. learn how to behave towards them. It’s like Hunt reminisces, like a veteran dealing But the threat of these is overstated, buying a Ferrari and not knowing how to with PTSD, of last year’s WannaCry’s Samarstev said in a follow-up interview with drive.” attack, which left some services within the Daily News at Sibos. “Spies will spy, and they Sibos is a great place to kick off the UK’s National Health Service inoperative will find ways to do so. How governments necessary collaboration. Swift’s network for a few days. Patients couldn’t schedule can access your data through back doors is connected to many banks, and it can be appointments, surgeries were postponed is mostly all hype. Yes, it may happen, but the igniting factor to roll out a process of Whatever... just take me to a … what is even worse for many, two years it is nothing in comparison to the threat communication and collaboration among bar where alcohol is served ago, Petnet’s internet of things (IoT) organised cybercrime entails. We need to do financial institutions. devices malfunctioned, which had some something about it before the damage they “There’s not much I can do at a pets not being fed for over ten hours. do gets out of hand.” governmental level, other than keep putting Samarstev explains the worst likely “Even the idea that the NotPetya attack pressure so law-enforcement agencies start attack scenario for a company is becoming was Russia-sponsored doesn’t make to talk to each other,” states Samarstev victims of several types of attacks sense – the largest target was Russia’s with a sigh. “I just hope that, when it comes simultaneously such as DDoS and social biggest oil company,” he points out. “Surely to it, they talk to tech companies to get media manipulation. This may prompt government-sponsored attacks could do a the practical expertise to apply in anti- Young lady desperately seeks many customers to withdraw their money, better job than that?” cybercrime efforts.” DNS table tennis partner which would create myriad problems Nevertheless, in Samarstev’s words, Henry Vilar with cash flow and liquidity, among other “even if nation states are attacking @henrynotborja

Stocks ran out once we hit the place

The best way to get through Sibos is to be virtually someplace else

We know how you feel

Duh! Those are books, not concrete and brick