FinTech Magazine - December 2022

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A BizClik Brand

WHAT GOES DOWN MUST COME UP

It’s been a tough year for a lot of fintechs, and the ride isn’t over yet

At our recent Fintech LIVE event in London, I had the pleasure of speaking to many industry experts about the current economic situation. From DeFi and the crypto winter to CBDCs, open banking, new regulations and of course, the global recession, there was no shortage of conversation to be had.

And despite the unanimous assertion from the room (it's a rare thing when everyone agrees on something) that things will probably get worse before they get better, a great sense of optimism prevailed. Because although these industry heads can see the bottom of the hill ahead of them, they can also see the slope upwards on the other side. Essentially, what goes up must come down, and vice versa. After the crazy highs of 2020 and 2021, fallout was inevitable. But that also means we are closer to the golden state of stability than we were a year ago when the party was raging. And that’s a positive note to end the year on.

We wish you a joyful Christmas season – and a peaceful and happy New Year. See you all on the other side in 2023.

JOANNA ENGLAND joanna.england@bizclikmedia.com

to the golden state of stability than we were a year ago when the party was raging”

Let’s digitalize the lending process

Lending industry dynamics and consumer financing habits are changing rapidly and a whole new breed of financial institutions is fundamentally redefining the industry’s modus operandi.

Now more than ever, meeting customers’ needs and speed are crucial factors, and this applies to both lenders and borrowers alike.

A fully digital experience

There are 4 key aspects that should drive any financial institution’s decisions:

1. Client expectations are always more demanding in terms of the overall experience

2. More and more alternative lenders are disrupting the industry

3. Regulatory requirements are increasing

4. Operational challenges have to be faced, both from a technological and operational perspective.

CRIF supports lenders on their journey to a more efficient and productive operating model, traditionally providing information, advanced analytics, and innovative solutions to help their business grow.

Thanks to the continuous search for cutting-edge technological solutions, CRIF launched a new native-cloud Digital Lending Platform built in partnership with Microsoft, which allows lenders to easily activate a digital channel for the entire lending process.

Delivered in an as-a-service model only, reducing IT complexity and effort, the CRIF Digital Lending Platform takes advantage of all CRIF data, analytics, and solutions, providing a fully digital end-to-end customer experience, with customer onboarding, profiling, and instant decisions, complete with all regulatory checks such as KYC/KYB and AML.

With the CRIF platform, lenders can easily activate an online channel both for consumer and business requests, providing them with a fully digital experience and reducing the time taken to evaluate their applications.

CRIF is a global company specializing in credit & business information systems, analytics, outsourcing and processing services, as well as advanced digital solutions for business development and open banking.

Through continuous innovation, the use of state-of-the-art technology and a strong information management culture, CRIF supports 10,500 banks and financial institutions, more than 600 insurance companies, 82,000 business clients and 1,000,000 consumers in more than 50 countries across 4 continents.

For more information: www.crif.com

BIG PICTURE

Economic woes force PM from power

London, United Kingdom

The UK's new Prime Minister, Rishi Sunak, emerging from Downing Street during his first week in the job. In October, Liz Truss became the shortest-serving premier in the country's history when she resigned after just 45 days. Investors had balked at a proposed cut to the top rate of income tax at a time of heavy public spending, causing the pound to crash to a record low. It is expected that Sunak will oversee a new era of austerity, with some commentators believing a recession is now inevitable.

Hurley

THE BRIEF

“WITH GLOBAL ECONOMIC CONDITIONS NOT LOOKING POSITIVE IN THE SHORT TERM, MANY BANKS WILL INTRODUCE MORE MONEY MANAGEMENT TOOLS TO HELP THEIR CUSTOMERS”

Ahmed Karsli Co-Founder and Chairman, Papara 

READ MORE

“AS CASH AND DISPOSABLE INCOME BECOME TIGHTER, WE WILL SEE MORE PEOPLE TURN TO NON BANK LOANS AS A MEANS OF ALTERNATIVE FINANCE”

Melba Montague Senior VP, Banking and Capital Markets, Genpact 

READ MORE

“AS COMPETITION HEATS UP, AN OPTION TO DIFFERENTIATE PROPOSITIONS IS TO PROVIDE REGULATORY UPDATES, NUDGES AND EDUCATIONAL CONTENT TO CUSTOMERS”

Nicolas Vrillaud Head of Partnerships, Mettle 

READ MORE

INDUSTRY PIONEERS RECOGNISED IN FINTECH TOP 100 LEADERS LIST

Some of the fintech sector’s most vocal and influential figures have been recognised in FinTech Magazine’s Top 100 Leaders 2022.

The annual rankings, which include the biggest names in financial technology, cover everything from financial inclusion and embedded finance to crypto and blockchain.

Nubank Co-Founder Cristina Junqueira topped the list, recognising her place in creating one of Latin America’s biggest banking platforms while smashing fintech’s glass ceiling in the process.

Anthony Tan, CEO and Co-Founder of Southeast Asia’s first ever unicorn, Grab, placed second. The app gives users access to services like transport, food delivery and digital payments.

Leaders from the likes of Revolut, Stripe, Coinbase and Ripple made up the rest of the top 10.

Meanwhile, female leaders accounted for nearly a third of those recognised in the list – a sign of fintech’s slow but steady progress towards gender parity in the boardroom.

Click to s ee the fu ll Top 100

BY THE NUMBERS

GOOGLE AND COINBASE EXPAND

WEB3

Google and Coinbase have announced a strategic partnership to launch a pilot programme for crypto payments, expanding the Web3 ecosystem

SERIES E FUNDING ROUND

Australian fintech Airwallex, which provides payments and banking infrastructure, has secured US$100mn in its extended Series E funding round

NUBANK LAUNCHES ITS OWN CRYPTOCURRENCY

Nubank has announced the creation of Nucoin, its own cryptocurrency on the Polygon blockchain network, as part of its digital currency strategy

 NORTHONE

The mobile banking fintech has raised US$67mn towards its ambition of becoming “the digital finance department powering every small business in America”. The company has raised over US$90mn in total funding to date

 REVOLUT

The fintech trailblazer can celebrate being the most searched for online bank in Europe, according to analysis by CMC Markets. Revolut attracts almost 1mn searches per month across the entire continent

 BREX

The business spend management fintech has laid off 11% of its workforce, equating to 136 people. Brex said it could not avoid the redundancies, having already attempted to redeploy some staff

 BANK NORTH

The UK challenger bank startup has announced its closure, having failed to secure adequate funding. The fintech will hand back its banking licence as part of the insolvency process after incurring seven-figure losses

G O O D T I M E S B A D T I M E S

WE ASKED YOU: WHICH FORM OF B2B FRAUD HAS YOU MOST CONCERNED?

TIMELINE The history of in fintech The history of in fintech

The history of in fintech

APIs are transforming the business world as we know it, connecting companies and building the digital ecosystem. Without the invention of application programming interfaces (APIs), the global business and financial space would look very different today

1968

THE TERM API IS INVENTED

The name ‘Application Programming Interface’ was first used in a research study entitled ‘Data structures and techniques for remote computer graphics’. The paper, publicly presented at the AFIPS conference in 1968, described the theoretical ‘interaction of an application’ with a computer system

1990

THE API CONCEPT IS EXPANDED

Although still at the concept level, computer scientists were steadily developing an interest in the potential of APIs. Technologist Carl Malamud defined that potential as "a set of services available to a programmer for performing certain tasks". But, as computer networks began to grow, the demand for connectivity between them increased. This led to programmers exploring Java, the potential of the internet, and how this could be harnessed to create new services

APIs APIs APIs

2 0 12

BANKS EMBRACE APIS

By 2010, 111 financial services companies had adopted APIs for various purposes. But, as regulations improved, demand increased significantly. According to Accenture, 1,675 banks and fintechs had begun using API technology by 2017. The use enabled better B2B functionality as well as the launch of more products and services

December, 2000

EBAY JOINS THE CAUSE

Just months later, eBay dipped its toe into the API space by launching the eBay Application Programming Interface (API), alongside the eBay Developers Programme. This radical move resulted in eBay’s APIs becoming openly available for developers

2022 and beyond...

THE FUTURE OF APIS IN FINANCE

February, 2000

SALESFORCE LAUNCHES

THE FIRST API

According to reports, just nine weeks after experts had panicked about global meltdowns caused by the Millennium Bug, the world’s first web API was introduced by Salesforce.com. The main role of this API was for customers to share data across their different business applications

APIs have given rise to the open banking and embedded finance wave that has gone global since the COVID-19 pandemic. Digital transformation was fast-tracked, forcing legacy institutions to adopt new, faster transactional technologies provided by digital partners. According to recent reports, there are now 1,578 open banking platforms making APIs available, with 5,564 API products available to third parties. This represents an 8% annual growth on 2021 figures

Kjellén

As the CEO of Tink, Europe’s leading open banking platform, Daniel Kjellén and his co-founder Frederik Hegberg have now seen their brainchild connect to more than 3,400 banks - RE ACHING 250 MILLION CUSTOMERS

Hailing from Sweden, the world’s most cashless society, it's hardly surprising that Daniel Kjellén has blazed a trail across Europe’s open banking scene.

But the entreprenurial former investment banker who launched his first company in 2001 is modest about his achievements, and says that the scale and success of Tink has exceeded his expectations.

Speaking to FinTech Magazine, he told us: “I think part of being an entrepreneur is to be slightly naive and over optimistic about speed and impact. While we always felt that ‘it's [Tink] going to be so much bigger, it's going to grow so much more’, looking back 10 years, it's just amazing that we played a part in transforming how people view banking.”

TRANSFORMING THE BANKING SPACE

But Tink hasn’t just changed the perspective of the marketplace. The fintech has also built a layer of infrastructure that has enabled a new generation of financial services, such as PayPal and others to thrive and gain consumer confidence and adoption. It’s been a transformative power within the industry.

Despite this success, being the CEO and co-founder of a world-leading fintech was not at the top of Kjellén’s agenda when he first started out.

He launched his very first startup in 2001. Prodocon AB was a corporate domain name company which he ran for eight years until the company was acquired and absorbed by the NetNames Group.

Describing his time with the startup, one gets the impression that Kjellén is an enthusiatic entreprenuer, who leads with ideas and handles the nuts and bolts later. Speaking about those early years, he says: “My plan was to go to university when I was just 20-something. By accident, I founded a company that was doing corporate domain in management and started to work there, [and] was the CEO for eight years.”

For a while, the dynamism and excitement of running his own company was a heady experience that delayed any plans for further education. But soon, with a workforce of 20 employees, he felt compelled to go to university, selecting finance and business for his degree. “I just felt that if I should ever have a ‘proper job’, I also needed to go to university.

“I think part of being an entrepreneur is to be slightly naive and over optimistic about speed and impact”

A DEGREE IN FINANCE AND BUSINESS

Kjellén worked at Prodocon by day and studied at night. It was a juggling act that he maintained for a further four years. “Nobody in my class even knew that I was studying the course because I did most of the work in the evenings.”

The university course did offer some social perks as it resulted in Kjellén meeting his wife. “I met my wife, there in my class, so I think that's the biggest achievement,” he recalls.

Soon after graduation, Prodocon was bought out, and in 2008, at the height of the financial crash, Kjellén joined the Investment Banking Division at Carnegie – the leading investment bank in the Nordics at that time, where he stayed until 2012.

“It was supposed to have been one of those ‘make motherproud jobs’. It ended up not making mother so proud because it was taken over,” he says of the position.

But the role ended up being a sharp learning curve in the world of finance as Kjellén embraced investment banking from a beginner's perspective. “The bank was going bankrupt as a result of the financial crisis… And I think that for me, those four years were extremely educating, because as a junior investment banker, you work around the clock. You need to be almost a secretary, everything in order, papers in order, Excel sheets in order. And as a small-time entrepreneur, that wasn't a top priority before. It was completely untested waters for me, but also extremely rewarding.”

THE LAUNCHPAD FOR TINK

By now, the financial technology scene in Sweden was making strong headway. Contactless payments were commonplace and the market was ripe for disruption. Kjellén’s entrepreneurial drive led him to a new place of inspiration – and his co-founder, Frederik Hedberg.

He believes timing was crucial in establishing the business because innovation was starting to mature the industry. “I think that timing in entrepreneurship is probably underestimated. Stars were definitely aligned for someone to disrupt payment and banking out of the Nordic countries for a bunch of reasons. Being cashless was one of them – and the fact that mobile bank APIs were just starting to emerge in the Nordics.”

A tech-savvy population, an appetite to innovate and a functioning ecosystem in terms of funding were all aligned. "It was the right time, and a perfect starting point for building the type of business we envisaged,” he says.

“Stars were definitely aligned for someone to disrupt payment and banking out of the Nordic countries for a bunch of reasons”

Both Kjellén and Hedberg had cut their teeth in the investment banking space. Hedberg had also previously built a large technology business and had experience working for a hedge fund in San Francisco.

“We had the edge and keen interest in both technology and finance. We realised personal finance and the payment industry were still very much under the control of large traditional, universal banks. We wanted to be entrepreneurs again, and were looking for a place open to disruption where we could have a meaningful impact,” Kjellén says.

TINK WAS LAUNCHED IN 2012

Since then, the company has transformed in size and offerings. Initially, Tink tackled the missing pieces in retail banking and the unfulfilled needs of consumers. But both co-founders knew the industry was becoming increasingly data-driven, so turned their attention to technology, creating the building blocks of future banking with unified APIs that aggregated data, accessed accounts, and handled payments.

A PARTNERSHIP WITH VISA

There were also many offers of collaboration but until recently, the co-founders held off. However, in 2022, Tink was acquired by Visa for US$1.75bn and has since skyrocketed.

“We've been through ups and downs over these 10 years. We've had a few people come knocking on our doors wanting to make acquisitions or similar.

He continues: “We've always evaluated this through the same lens: 'is this going to increase the likelihood of us winning and bringing open banking globally?' And the answer previously was, no. With the Visa deal, that was different. Why? Because they believed a lot in this company and wanted to keep it independent, but also gave us the muscles and trustworthiness and the network that Visa has globally. I think that's exactly what we got.”

Kjellén adds: “We still operate as a small, nimble company. But we can take a long-term approach. We spend a lot less time trying to explain who we are, that we can be trusted, that we are going to be around 10 years from now. Instead people realise, 'well, you're part of Visa' and we can tick the box. Now, we can focus on what can we do together. I think that it's an amazing opportunity.”

5Vogelpoel

Günther

Günther Vogelpoel is the CEO of c. Offering branded payments from over 750 brands in one marketplace, Recharge.com is the go-to online store for digital prepaid credit for consumers who want to send or buy mobile top-ups, gift entertainment subscription cards to a loved one or themselves, or charge a prepaid credit card

Q. CAN YOU TELL US ABOUT YOUR ROLE AND RESPONSIBILITIES?

» As CEO, my role is to lead the team in our mission: to make Recharge.com the number one destination to find all of your digital prepaid payments options.

It’s my job to make sure our staff are doing their best work, and we do this by creating an employee-focused and caring environment. We embrace diversity and are proud to have employees from 32 nationalities working with us, many of whom are far away from loved ones, making their colleagues like family to them. What we are building together is a great adventure, and I am proud to be on it alongside our fantastic team.

Q. WHAT IS YOUR POINT OF DIFFERENCE AS A BUSINESS?

» Branded payments are a form of alternate payment method, and we aim to make them fast, safe, and simple for everyone around the world – whether they’re gift cards or prepaid payment cards for brands like Xbox, Spotify, Netflix, mobile phone top-ups or more. Branded payments are prepaid cards with a specific limit.

Right now, it can be complex for people to buy them, requiring the customer to physically go to a kiosk or shop to make their purchase. However, we make it extremely simple: we provide a wide variety of card options, and in several very simple steps you can buy any kind of credit, and we send it to you immediately via email.

Q. WHAT TECHNOLOGY ARE YOU MOST LOOKING FORWARD TO USING MORE OF?

» Recently we announced our partnership with Primer to unify and scale our payment stack for our mobile and e-gift cards. Primer offers a completely unified checkout and payment integration system and helps merchants build end-to-end payment flows with a no-code editor. We’ll use this platform to give our users the highest level of frictionless payment experience.

“

Building a solid company culture becomes so much easier when you have the right people on board”

There were several things that attracted us to Primer – their open, agnostic framework for payments means any developer can build a connection. For merchants, connecting payment services becomes an easy point-and-click experience.

Q. WHAT HAS BEEN YOUR CAREER HIGHLIGHT PRIOR TO YOUR CURRENT ROLE?

» I worked at the Swedish telecom company Tele2 from 1999 and became CEO of the Dutch organisation in 2011. I was also a member of the Executive Board of the Tele2 Group as Executive Vice President.

To be honest, in that type of corporate environment, we did many significant things there but it was already an established business and it was hard to see the impact that you as an individual had. In these huge companies, you play a role like everyone else, but it can be challenging to discern what exactly you have achieved for a business that is already so vast. It is quite different at Recharge, where I have helped to build it from the ground up.

We embrace diversity and are proud to have employees from 32 nationalities working with us, many of whom are far away from loved ones”

Q. WHAT HAS BEEN YOUR HIGHLIGHT IN YOUR CURRENT ROLE?

» On a journey as exciting as this, there are too many highlights to count! However, last year we closed a $35mn Series B round, and the doors this has opened have been a massive highlight for sure. The funding has meant that we are in a stronger position than ever to reach our goals as a team, and I’ve said it before, but if we succeed, that certainly would be the best thing I have ever achieved in my career.

“

Q. WHAT IS YOUR LEADERSHIP STYLE

» We’re growing rapidly into new markets, and I know it’s crucial to have the right people on board to scale up the business effectively.

To me, the right people have the right capabilities and knowledge, as well as a specific mindset – they want the company to feel like a safe place for people to work. Building a solid company culture becomes so much easier when you have the right people on board. We put a premium on staff wellbeing and do not tolerate negative or bullying behaviour, talking behind people’s backs, or being judgmental. We know that positive collaboration is core to working effectively together as a team.

Q. WHAT EXCITING PLANS DO YOU HAVE COMING UP AS AN ORGANISATION?

» We’re already executing on our vision for expanding into new countries with new products, and we will keep doing this by investing in the US, Canadian and Mexican markets.

Last year, we expanded into the GCC region, starting with Saudi Arabia and the UAE, and there is plenty of growth potential in these countries. Besides international expansion, we are considering other business initiatives. Since we are a mobile-first company, we are always looking at how our app can deliver even better service for our customers. There is a wide variety of banking and wallet functionalities these days, and we are always interested in keeping up to date with new platform integration opportunities.

Build a Digital Future and Lasting Customer Success

Accelerate growth and create wholistic business value with pioneering technology-fuelled digital solutions tailored to the realities of your enterprise and the financial services industry. Inspire customer loyalty and success.

- Coforge

Gautam Samanta, Coforge EVP and Global Head of Banking and Financial Services, stresses that digital transformation is all about delivering value.

Coforge is a global digital services and solutions provider, and helps its clients embrace emerging and new technologies to achieve real-world business impact.

The company’s proprietary platforms power critical business processes across a select number of sectors, and it has a presence in 21 countries, with 25 delivery centres across nine nations.

One of the sectors in which Coforge is a key player is banking and financial services (BFS), where it is helping its BFS clients on the digital transformation journey by making the road as straight and smooth as possible.

“Digital transformation is an evolutionary process, not a revolutionary one,” says Samanta. “So we do not see it as disruptive.”

He adds that having a clear vision of what digital transformation is - and isn’t - is what shapes the solutions that help Coforge’s clients achieve their goals.

“For us, digital transformation is not just a marketing phrase to wrap around software services. It is not about the technology.

It is about delivering business value for stakeholders, including shareholders, customers and employees.”

Samanta adds that Coforge’s approach is effective because its solutions also “absorb the realities of our customers’ enterprises” - the reality being that “the old and the new often coexist in business processes that can sometimes be decades old”.

“One of the things that differentiates us is that we are pragmatic in our approach to helping clients,” Samanta adds. “Yes, we transform with the new, but not at the expense of the old, which often has value.”

It helps, too, that Coforge has a deep understanding of what value looks like in BFS, because the company has chosen to focus its attention on this sector, as well as a small number of other verticals.

“We focus on very select industries, and have a deep understanding of the underlying processes of those industries, which provide us with a distinct perspective,” says Samanta.

Learn more ›

Tech ‘about evolution, not revolution’

Treasury and liquidity management platform

AD FEATURE

WRITTEN BY: GEORGE HOPKIN PRODUCED BY: JAKE MEGEARY

Sol Zlotchenko, Hazeltree’s

Chief Strategy and Product Officer, explains how technology is transforming treasury and liquidity management initiatives

In recent years, the global financial industry has seen a significant increase in regulatory and market constraints around the management of cash, liquidity, and collateral. And with interest rates rising, the opportunity cost of failing to optimise these factors continues to grow. At the same time, many alternative asset managers have been struggling with handling the increased complexity of operations. The need for robust treasury and liquidity solutions has never been more important, and a new breed of FinTech service providers is developing technology-centric solutions to help businesses adapt and thrive in this new environment.

Headquartered in New York with offices in London, Bournemouth and Hong Kong, Hazeltree is leading the way in treasury and liquidity management technologies for the traditional and alternative asset management industries. The company’s innovative, cloud-based solutions transform how investment firms manage their market and capital activities, empowering them to unlock additional value and improve operational efficiency while strengthening internal controls and managing risk.

Hazeltree: a wealth of technology treasury solutions

SOL ZLOTCHENKO CHIEF STRATEGY AND PRODUCT OFFICER, HAZELTREE

Hazeltree focuses on innovation, optimisation, connectivity, and automation to help clients achieve operational excellence and mitigate risks. These treasury and portfolio finance solutions serve private equity, hedge funds, asset managers, private debt, real-estate investment, venture capital, pensions and endowments, and their service providers.

Chief Strategy and Product Officer Sol Zlotchenko joined Hazeltree in 2016, drawing on more than 20 years of software industry experience and extensive financial technology and hedge fund expertise. Today, Sol Zlotchenko leads all aspects of strategy and product direction, for Hazeltree’s treasury and liquidity solutions.

Zlotchenko’s appointment came at a crucial time. His expertise in building innovative FinTech products and scaling development organisations was an essential part of the company’s plans to take its products to the next level. What’s more,

“New asset classes such as cryptocurrencies require even deeper understanding and investment into technology”

his ongoing leadership is also important in evaluating cutting-edge technologies such as Machine Learning, Algorithmic Optimisation, and Big Data.

FinTech is here to continue leading the charge Zlotchenko, who has previously built and scaled companies from launch to product delivery, received his Bachelor of Science and Master of Science degrees in Electrical Engineering from Columbia University in the United States. Prior to joining Hazeltree, Zlotchenko was Chief Technology Officer of investment management solutions provider Paladyne Systems, which he co-founded in 2005 and was integral to its global growth until it was eventually acquired by Broadridge Financial Solutions in 2011.

Prior to Paladyne, Zlotchenko worked as an investor, executive, and software developer at a number of high-profile financial firms, including Goldman Sachs and Alexandra Investment Management.

“I started out back in the 1990s when the internet was just exploding,” explains Zlotchenko. “I lived through the technological Wild West in those days while being part of the technology and the finance industry, and watched it transform into an advanced and disruptive industry called FinTech, which has been very exciting. It's

SOL ZLOTCHENKO

TITLE: CHIEF STRATEGY AND PRODUCT OFFICER, FINTECH INVESTOR, ENTREPRENEUR AND INNOVATOR

INDUSTRY: FINANCIAL SERVICES

LOCATION: UNITED STATES

Sol Zlotchenko has spent over 20 years starting, running and growing businesses in FinTech. After early career positions as a technologist at Goldman Sachs and CTO of Alexandra Investment Management, he co-founded the investment management solutions provider Paladyne Systems in 2005, acquired by Broadridge Financial Solutions in 2011. He is also the founder of the quantitative hedge fund West End Capital and co-founder of Select Venture Partners, an early-stage VC.

Sol currently serves as CTO and Head of Private Markets Product at Hazeltree, the leading Treasury and Liquidity SaaS platform for alternative asset management firms.

Sol’s deep experience as an executive, operator, investor and entrepreneur provides him with unique perspectives on building business strategies, innovating product development, and operating profitable business models in

$2tn

the approximate collective value of client assets managed by Hazeltree’s community of hedge funds, private equity, private credit, real estate, and asset managers

Sol holds Bachelor and Master Degrees in Electrical Engineering from Columbia University, School of Engineering and Applied Sciences.

part of history now but still evolving and developing. FinTech is definitely here to stay, disrupt and continue leading the charge.”

In the past, many companies would manage large amounts of money on spreadsheets, a practice that still exists in some cases today. But an epiphany came with the continuous influx of large capital and ever-increasing investment complexity, says Zlotchenko, a ‘Eureka!’ moment happened when the industry could not support itself and its growing capital flow relying solely on humans.

“That’s when digital transformation happened in the industry, and Hazeltree found itself in the right place at the right time,” says Zlotchenko. “So we have committed ourselves to financial industry

and have grown along with its needs, building products by partnering with insiders, which really helped our clients along the way. The change and innovation is still happening at fast pace, and we're hoping for a lot more development in the industry especially on the private equity side of the sector.

“We’re seeing transformations,” he explains. “Some of the big hedge funds are expanding into private markets such as private equity, private debt real estate, and there's active cross-pollination going on in many areas where different creative strategies are being employed, and new investment opportunities are being uncovered with aid of advance technologies such as AI/ML and Big Data Analytics. We

are also seeing new asset classes such as cryptocurrencies coming into focus with global asset management community that require even deeper understanding and investment into technology “

The pandemic and geopolitics have introduced a great deal of volatility and

uncertainty, while technology, with the introduction of tools and services – including proliferation of algorithmic trading and quantitative models – has come to dominate the sector. Meanwhile, the private equity sector is growing as it generally attracts more stable investments than those made by hedge funds.

“Technology is a big factor,” says Zlotchenko. “Historically, hedge funds were very hungry for technology and relying on it even before FinTech was FinTech. Between trading, data management, risk management and accounting, everything is driven by technology.”

Trillions of dollars require highest performance levels in data management Hazeltree’s community of private equity,

SOL ZLOTCHENKO CHIEF STRATEGY AND PRODUCT OFFICER, HAZELTREE

“FinTech is definitely here to stay, disrupt, and continue leading the charge”

debt and real-estate funds, hedge funds, and asset managers, collectively manage over US$2tn in client assets, which requires the highest performance levels in data management and insights.

The company’s robust framework allows data management through advance technology, resulting in an added degree of control and flexibility for both long- and shortterm activity, as clients benefit from broader access to a diverse pool of aggregated, global, multi-asset class financial data.

Hazeltree’s services enable fund managers to explore one of the largest alternative investments securities finance data sets on the market with detailed analytics and charting. Users can access and search data across a deep pool of global securities to explore the best execution rates and liquidity

metrics, overlaid with external price and utilisation data points. And fund managers can gain unique market colour and rate transparency across counterparties. Using automated workflows, data repositories in consistent formats, and daily-delivered data, fund managers can efficiently manage rates, re-rates and opportunities to borrow/lend on the short/long side of the portfolio, as well as reduce counterparty risks.

The company’s Public Markets solution is a purpose-built Treasury and Portfolio Finance platform that aggregates cash, collateral, margin, securities finance, and rates data across all counterparties into a central normalised platform, enabling optimal funding, collateral allocation and borrow/lending decisions. Hazeltree’s independent agreement-based internal view reconciles counterparty data, highlighting breaks, while minimising risk exposure and optimising fees. An integrated workflow and execution engine streamline treasury operations functions.

Hazeltree’s Private Markets solutions are adapted for the unique needs of Private Equity firms and other managers of Private Market assets. Not only is the advanced suite of Cash and Payment Management solutions tuned for Private Markets, but other parts of the Hazeltree platform have been developed by industry insiders specifically for Private Markets.

These include Liquidity Management framework that aggregates all liquidity sources such as cash, money markets, credit facilities, and investor commitments, manages liquidity forecasts along with current liquidity, executes liquidity workflows, presents liquidity assets and liabilities, facilitates 'what if'-scenario planning, and suggests actions generated by Hazeltree’s optimiser algorithms.

SOL ZLOTCHENKO CHIEF STRATEGY AND PRODUCT OFFICER, HAZELTREE

“Historically, hedge funds were very hungry for technology and were relying on it even before FinTech was FinTech”

The Private Markets platform also covers Debt Management, enabling clients to manage debt and credit facilities to streamline liquidity usage and serves as a Loan Portfolio Management tool, equipped with loan position management, shadow accounting, transaction execution, and algorithmic operational loan portfolio task management.

Another important need for Private Markets in particular is management of Legal Entities. Funds need a single golden source of all legal entity structures and their relationships. The Hazeltree system has been designed to facilitate critical processes such as cascading cash payments, and the dynamic generation and communication of various types of Investor Notices such as capital calls and distributions to Limited Partners.

Liquidity Management is not a new term in the industry, but it has a different meaning in Public and Private Markets. While Hazeltree Public Markets tools assist in managing portfolio liquidity through data transparency in securities finance - as well as OTC collateral and cleared margin - the platform’s true innovation really shines in Private Markets liquidity management. Private Equity funds in particular have identified Liquidity Management as the goal in the ability to scale, and this cannot be done without advanced technology. Private Market funds need to balance and optimise their liquidity with just-in-time precision while identifying investment opportunities and generating IRR

Public Markets-focused asset managers and hedge funds can access Hazeltree’s diverse pool of aggregated global multi-asset class portfolio finance data, locate securities, compare rates, and select shorting opportunities. Hazeltree helps understand true treasury and portfolio finance P&L by actively manging collateral, providing OTC

SOL ZLOTCHENKO CHIEF STRATEGY AND PRODUCT OFFICER, HAZELTREE

“Some of the big hedge funds are expanding into private markets such as private equity and private debt real estate”

margin analysis, allocating borrowing costs to individual strategies, managing short positions across prime brokers and tracking pre-borrow inventory. Clients also benefit from transparency, automated analytics, reduced risk and exposure, and greater performance opportunities.

Hazeltree’s Private Equity Platform is an industry insiders-built treasury and liquidity management solution which provides cashflow and forecasting management including improved workflow to manage cash, payments, credit facilities, liquidity, legal entities and capital activities. Users benefit from operational efficiencies

and advanced controls, reduced risk and exposure and advanced optimisations to identify greater performance opportunities.

New UK centre helps meet treasury and liquidity management needs

Hazeltree opened a new FinTech engineering centre in the UK’s growing coastal tech hub of Bournemouth in November this year to help meet the increasingly more complex requirements of clients worldwide. The new centre is part of the company’s expansion strategy and designed to support growing demand for its unique cloud-based FinTech solutions.

The centre will be staffed by software developers, product managers and owners, as well as DevOps and client services professionals focused on designing, building, and onboarding new clients onto Hazeltree’s FinTech solutions. The building is located close to The Triangle in the vibrant heart of Bournemouth and is a Grade II listed building and architectural landmark originally built in the 1800s and has undergone extensive renovation. With the capacity to accommodate up to 70 employees, Hazeltree expects the new centre to be well over half full by the end of 2022.

“We are pleased to unveil our new engineering centre, which marks a significant milestone in our growth strategy,” says Tushar Amin, President and Chief Executive Officer of Hazeltree. “The centre will be instrumental as we continue to expand our client base and develop new products to meet the mounting treasury and liquidity management needs of financial institutions across the globe.”

Zlotchenko says the company is very excited about its new facilities, which will help take Hazeltree from strength to strength while further enhancing its best-of-breed treasury and liquidity management FinTech capabilities at a time of increasing complexity in global markets.

“As regulations continue to reshape the financial industry, we continue advancing our products to help our clients manage this disruption, identify unrealised alpha opportunities as well improve operational efficiencies around managing cash and collateral,” says Zlotchenko. “Our mission is to help our clients efficiently manage their counterparties with a comprehensive and transparent view of the market.”

How financial software offers a lifeline to small businesses

As many small businesses struggle to keep on top of regulatory changes, there is an opportunity for B2B financial software providers to bridge the gap

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Complying with legal and regulatory obligations is a significant undertaking for any business – but particularly smaller businesses, who lack resources and often struggle to remain abreast of changes in the rules. Increasingly, financial software solutions aimed at SMEs combine convenient functionality with a finger-on-the-pulse approach to regulatory requirements.

It all begins with understanding what small business owners need, as Simon Kearsley, CEO of accounting software specialist bluQube, explains: “With hybrid and remote working now the norm for many small businesses, multi-device access from anywhere is a key requirement, so much so that it’s a feature that’s often taken for granted in B2B software. Similarly, functionality is expected as standard; the software needs to be intuitive and capable of carrying out the necessary functions and processes.

“However, software developers need to ensure that functionality is accessible and intuitive, enabling time-poor businesses to be able to understand and use the software straight away without having to rely on lengthy instructions or manuals for guidance.”

SIMON KEARSLEY CEO, BLUQUBE

What do small businesses want from financial software?

Nicolas Vrillaud, Head of Partnerships for Mettle, the digital business account from NatWest, adds: “There are a few common challenges small businesses tell us they face, and it’s important to understand them to know what they are looking for in B2B software. Generally, they are time-poor, they worry about getting the financial admin – especially tax – and cash flow right.

“So, when we look at how small businesses pick B2B software, there are a few things we need to take into consideration. For starters, we need to know if it will save them time on a day-to-day basis and if it will be difficult for them to set up or if the software is simply ready to go. Because a lot of small businesses might not have used this software before, having it recommended to them by someone they trust, like their

“We have to tread carefully in the way we support business owners. We cannot fulfil an advisory role for our clients and must be careful to only refer to government guidance”

accountant, means it’s most probably fit for purpose. And, finally, we have to consider if the software is a necessary expense for them, particularly in the current economic environment.”

Vrillaud points out that small businesses have different needs from larger ones, comparing it to bank accounts: “Small business owners have very similar expectations to retail banking customers – they want software that is largely self-serve, quick and easy to use, and increasingly mobile-first.” This explains why a high number of challenger banks, taking advantage of the opportunity to appeal to SMEs, are launching bookkeeping features like invoicing, transaction categorisation and receipt capture, he says.

“Large corporations, on the other hand, will most likely want software that can be made bespoke to their needs, integrated within their existing software stack, and with stringent access control to allow for the various functions within their finance organisation to perform their specific duties.”

Can small businesses be fully reliant on B2B software?

As small businesses increasingly lean on B2B software to keep them informed of regulatory changes, do they risk becoming

NICOLAS VRILLAUD HEAD OF PARTNERSHIPS, METTLE

complacent? Although many platforms are good at informing clients about upcoming changes and how they’re likely to affect their business, it’s no substitute for actually having a thorough understanding of the regulatory environment.

“As competition heats up between incumbents and new entrants, an option to differentiate propositions is to provide regulatory updates, nudges and educational content to customers,” Mettle’s Nicolas Vrillaud says. “This is something that is increasingly happening in the small

NICOLAS VRILLAUD HEAD OF PARTNERSHIPS, METTLE

“As competition heats up, an option to differentiate propositions is to provide regulatory updates, nudges and educational content to customers”

“Small business owners want software that is largely selfserve, quick and easy to use, and increasingly mobile-first”

business market. There’s actually a deep fear of non-compliance that still needs to be addressed. This will lead to the emergence of ‘compliance as a service’ as a broader software category that encompasses, but is not limited to, financial management.”

BluQube’s Simon Kearsley continues: “Naturally, small businesses are more price sensitive when it comes to selecting software, but the main difference between small and large is the supporting role

“Naturally, small businesses are more price sensitive when it comes to selecting software”

SIMON KEARSLEY CEO, BLUQUBE

the financial software plays within the organisation. Small businesses often see financial software as a compliance issue, relying on it to generate accounts and share data in accordance with regulation. Larger organisations with dedicated finance teams and a more comprehensive understanding of the basic systems and processes use it for performance insights and strategic overview, and as more of a decision support mechanism.

“While we develop financial software and have a responsibility to keep track of the underlying legislation changes to make sure they’re reflected accurately in the software, we have to tread carefully in the way we support business owners. With the finance industry being so heavily regulated, we cannot fulfil an advisory role for our clients

and must be careful to only refer to the government guidance issued. Where this becomes challenging is in the timescales between the initial announcement and the changes coming into force, as we need time to build the changes into our software. We work closely with the industry body, the Business Application Software Developers

software

SIMON KEARSLEY CEO, BLUQUBE

“AI can help

become more helpful and proactive to customers”

“Usability and intuitiveness will continue to be a huge focus for B2B financial software”

SIMON KEARSLEY CEO, BLUQUBE

Association (BASDA), to understand changes to regulation ahead of their implementation to ensure we can get the rollout completed in time.”

A prime example, in the UK at least, is Making Tax Digital (MTD) – a government initiative aimed at improving the tax system via the introduction of digital channels. Nicolas Vrillaud says that financial software firms positioned themselves as infrastructure providers during this time, providing the engine for MTD submissions for example, rather than explicitly offering advice on compliance.

What future functionality will we see from B2B software?

Kearsley believes that there are several areas where B2B financial software providers

should be focusing their attention: “Usability and intuitiveness will continue to be a huge focus for B2B financial software. With customer expectations increasing all the time, users have short attention spans and will become frustrated with, or even write off, an application they can’t make sense of almost immediately.

“Alongside interoperability, AI will also start to play more of a role. As software developers, we’re used to the customer demanding what they want from the software, but AI can help software become more helpful and proactive to customers. Although it’ll take time to get there, in future we’re likely to see systems asking users questions, highlighting issues and areas that require attention and suggesting next actions.”

HOW BM TECHNOLOGIES

IS BRINGING BANKING TO BRANDS

WRITTEN BY: ALEX CLERE

It’s an unseasonably warm October day when Jamie Donahue, Chief Technology Officer at BM Technologies (BMTX), talks to us from his office in New Jersey. Donahue has been in the role since 2020 but has a 25-year career in financial services, starting at ADP Brokerage before it spun out in 1998 to create a company called BISYS, which was ADP’s foray into the banking system. He has also enjoyed senior spells at Finastra as well as First Republic Bank before joining BM Technologies.

The company is not a bank itself; instead, it is a banking enabler. It allows companies and organisations to integrate account services – like checking accounts and savings accounts – into their existing digital channels. It was founded in 2015 by Luvleen Sidhu on the principle of “making banking easy”, as Donahue puts it, before going public in 2021.

“BMTX is one of the largest digital banking platforms and banking-as-a-service (BaaS) providers in the country,” Donahue says. “We provide access to savings, checking accounts, personal loans, credit cards, and financial wellness. We are laser-focused on technology, innovation and easy-touse products. We are mission-focused to financially empower millions of Americans by providing a more affordable, transparent, and consumer-friendly banking experience.

“We also have another side of our business, banking as a service, where we go

With its “obsession” for customer service, embedded banking pioneer BM Technologies (BMTX) is helping brands launch new features for their customers.

Example of an image caption

JAMIE DONAHUE CHIEF TECHNOLOGY OFFICER, BM TECHNOLOGIES (BMTX)

to brands and bring full-service banking suites into brands that might not normally otherwise know they need a bank. And one of those that's been in the market for over two years is T-Mobile MONEY, a BaaS offering that BMTX runs for T-Mobile.”

High-profile partnership with T-Mobile

One of BMTX’s most high-profile partnerships involves it providing a unique, turnkey solution to mobile carrier T-Mobile for its T-Mobile MONEY app. A common theme of its client relationships is how BMTX manages to remove the legwork from the services it enables: in the case of T-Mobile MONEY, it deploys the application, owns the end-to-end VPO and owns all the user experience and back-office functions too. This

meant the lead times on the T-Mobile project were longer by BMTX’s standards, because it had to create a purposebuilt app for them, but generally the company can go from introduction to implementation in as little as 90 days.

During this time, BMTX’s team act as a steadying, reassuring presence. It’s just as well, because although they may have a clear picture of what front-end functionality they would like to offer their customers, prospective clients would struggle to roll out banking services without BMTX’s knowhow and support.

“There's a new era upon us where financial services and banking functions will be embedded within your favourite brands”

How BM Technologies is bringing banking to brands

“Banking's hard,” Jamie Donahue explains. “It's a hard industry. If you think about what a brand would do to acquire a bank charter, it's just not natural. In T-Mobile's case, it's a wireless carrier, and we bring a bank to their brand and a bank to their customers. It's really powerful to be able to tie those things together. We do everything from all the regulatory and compliance that goes with that: all the security, all the risk, and all the fraud operations.”

The two firms have enjoyed a fruitful relationship for several years, and this proven track record is helping to establish BMTX as a trusted partner for new clients. The company is preparing to announce a partnership with a new partner, which will be more of a hybrid offering – something it believes is a sign of the way the industry is going.

The company expects to share more details about this mysterious new partner in the first half of 2023. But, for now, it is able to disclose that the business has

global operations and tens of millions of customers in the US. BMTX was awarded the relationship through a competitive RFP process, underscoring the attractiveness of its BaaS offering within the marketplace.

A pedigree in higher education

The largest part of BM Technologies’ business is its higher-education portfolio, where it has built itself considerable esteem. One third of US college-bound students will encounter BMTX’s technology without necessarily realising it. In fact, of the roughly 1,200 universities and colleges in the country, around 750 college and university campuses use the fintech’s technology to offer disbursement to bank account services. “We have a pretty prominent position there,” Donoghue proclaims.

BMTX’s higher-education business actually emerged from its acquisition of Higher One, the universities and collegefocused technology company founded in

TITLE: CHIEF TECHNOLOGY OFFICER

COMPANY: BM TECHNOLOGIES (BMTX)

INDUSTRY: FINTECH

LOCATION: FLORIDA, UNITED STATES

Jamie Donahue is Executive Vice President & Chief Technology Officer (CTO) of BM Technologies. He is accountable for the company's strategy, formulation, development, and cross-functional delivery of BM Technologies Fintech Software, Products and Platforms. Donahue is a key member of the BM Technologies Leadership Team, which is led by President, CEO and Chairman Luvleen Sidhu.

Prior to this role, Jamie has held senior technology roles in financial services including at First Republic Bank, Finastra and Interactive Advisory Software. He has held numerous leadership roles in product management, engineering, and operations – all in the financial services verticals.

Donahue is a proven leader with over 25 years' experience developing and implementing comprehensive business transformation initiatives aligned with strategic plans. He has a bachelor's in Workforce Development from Southern Illinois University and a master's in Information Technology from Central Michigan University.

JAMIE DONAHUE CHIEF TECHNOLOGY

Jamie Donahue

“If you want to go fast, you go alone. If you want to go far, you go together”

OFFICER, BM TECHNOLOGIES (BMTX)

Ubiquity helps digital banks to prioritise customer journeys

While AI is a great customer experience tool, Ubiquity Cofounder Sagar Rajgopal explains that clients must understand customer journeys first

Fintechs that want to deliver superior customer experience (CX) as a business-critical function must balance technology and human intervention.

Understanding the importance, but also the complexity, of different customer journeys and how to optimise operations is Ubiquity

The CX firm is the outsourcing partner for clients looking to incorporate technology solutions into their customer interactions, while maintaining customer-centricity.

“We build processes, workflows, and customer journeys that help our partners deliver exceptional customer experiences,” says Sagar Rajgopal , Cofounder, President, and Chief Customer Officer at Ubiquity.

Know the banking processes that can be digitised Ubiquity is tasked with understanding how customers interact with their financial services provider and determining how best to approach certain enquiries. The team designs customer journeys to establish those that can be managed by technology, including AIbased tools, and which require agent support.

“We also provide clients the expertise to handle the far more complex, hightouch, back-office banking operations. We structure teams to deliver the same level of compliance and performance that would otherwise be achieved inhouse,” says Rajgopal.

The company has several notable success stories

through its seven-year partnership with BankMobile , developing the most efficient self-service and ‘wow-worthy’ customer interactions.

Rajgopal says: “We have partnered with BankMobile extensively to ensure it remains a partner of choice as individuals progress through their own banking journeys.”

During its partnership with the firm, Ubiquity helped boost Net Promoter Scores by more than 46 points by optimising the bank’s technology tools and delivering authentic agent support.

“We’re trying to identify opportunities to evolve the product and the servicing structure to reflect the needs of an evolving customer,” Rajgopal says.

banking philosophies and different banking needs”

JAMIE DONAHUE CHIEF TECHNOLOGY OFFICER, BM TECHNOLOGIES (BMTX)

2000. BMTX was founded with the intention of improving financial literacy for the underbanked, so students on campus was always destined to be a logical fit. Since that acquisition, the company has brought new technology into the onboarding process that college students go through in order to offer a seamless digital experience, with BMTX’s technology placed squarely in the middle between the student and the institution.

For the student, that means one single financial product that covers everything they ever need on campus. They are issued with a single card that grants them access to dorm rooms, serves as their parking pass and their meal card, and allows them to access account services all at the same time. That means they can pay for things like books and course materials, but also receive financial aid such as the support packages announced during the COVID-19 pandemic.

From an institutional perspective, colleges and universities are able to brand all apps and cards with their own branding – including their college colours, fonts and logos – to ensure a consistency and a seamlessness across all their on-campus services. “If an institution is so inclined, we can integrate that technology cleanly and neatly into the overall university ecosystem,” Donahue says. This white-label approach means that BMTX can roll out with a new higher-education partner quickly – even in as little time as it takes for students to return from summer break – while still possessing the tools to deliver more complex, more bespoke solutions if necessary.

“Not every institution is the same,” Donahue explains. “They have different banking philosophies and different banking needs. We can accommodate that in any way through our platform architecture that meets the needs of the university or college.”

“Not every institution is the same, they have different

JAMIE DONAHUE CHIEF TECHNOLOGY OFFICER, BM TECHNOLOGIES (BMTX)

The higher-education business is the backbone of BMTX’s partner ecosystem, and the company believes that it is exceptionally well-placed to serve the student market. “It all stems from our experience in the higher ed business, having approximately 750 college and university campuses that all have different needs and different wants,” Donahue says. “We think we are one of the few in our industry that are uniquely positioned to handle all of the banking needs for our clients.”

An ‘obsession’ for customer service

It’s not just speed-to-implementation that’s important for the brands that BMTX partners. BaaS has made finance accessible for nonbanks for the first time, lowering the cost of entry for brands launching financial services aimed at their customers.

BMTX previously worked with Oliver Wyman to establish the cost benefit to businesses of utilising a BaaS provider. It found that brands and businesses can realise some 95% cost savings, mainly due to the lower barriers to access including regulatory hurdles and not needing to acquire a bank charter. As well as saving their clients years in development time, BM Technologies can help them save millions of dollars in the process, too.

“In this industry, everyone is a banker,”

Jamie Donahue says with a wry smile. “You must have some kind of a banking background. I have my Series 7 from my brokerage days, so I can understand finance but be a technician as well. We bring all that. And so, by partnering with us, it's a significant saving over trying to go it alone.”

Once the initial integration with the partner brand has been implemented and rolled out, the relatively low barriers to launch mean that BMTX can turn its attention to keeping customers engaged. The company is not afraid to admit that it has an “obsession” with the customers who ultimately benefit from its technology – and specifically, in creating long-lasting relationships that lead them to become “customers for life”.

Our customer obsession manifests itself in the features we launch,” Donahue continues. “It manifests itself in the ease of deployment, no-downtime releases, things that I can do as CTO to help bring that vision to life. We do blue-green deployments as an example. We've evolved to that level. Traditional banking systems, when you do an upgrade, you could take them down for the whole weekend. Being customer obsessed, that's my lens that I can apply. And then we're continually looking for partners and features that really bring a frictionless experience for folks managing their money.”

“We can bring BaaS technology to bear without the huge uplift and regulatory burden that would otherwise exist”

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Higher education is the perfect example for that. Donahue recalls his own experiences at college, saying he didn’t have the benefit of a checking account. If you can engage young adults in their financial future from the moment they go off to college, making a meaningful impact on their college experience, then you are likely to retain them as customers when they graduate. That’s one of the things that BMTX is currently focused on, launching a post-student account to bridge the gap between their life on campus and their financial future after graduating. It all stems from the company’s vision of making banking simple and reaching unbanked or underserved populations.

this industry, everyone is a banker. You must have some kind of a banking background”

JAMIE DONAHUE CHIEF TECHNOLOGY OFFICER, BM TECHNOLOGIES (BMTX)

Targeting products to students brings a number of regulatory implications. “The university business in the US is a highly regulated one. The student population's a protected class, as they should be. They haven't formed their opinions financially. So, rightly, the government has some pretty rigorous protections around that population,” Donahue says. It creates a challenging business environment that BMTX is required to navigate. But he’s clear that, if the company can provide students with the right level of service, it has the power to create a relationship that endures long after they leave college. It must be working: BMTX has an industry-leading NPS score of 68 and Trustpilot score of 4.6.

The future looks like super-apps Donahue believes that embedded finance and embedded banking will shape the future of fintech and change our perceptions of

“In

how, and where, banking happens. Brands will capitalise on the audiences they have built and introduce new services, like wallets and cash accounts, to keep their customers within their ecosystem. He says that, at present, many businesses seem to begin with an ideal scenario before downgrading it to suit the technology they have available to them. With the right partner, that isn’t necessary.

“I think everyone starts out with a ‘north star’ of a seamless user experience. But what often happens is they try to solve a problem with technology, and that means it isn’t seamless for the user. Just take a ticket purchase, for example. Ticketmaster and StubHub have come a long way, but they’re still not perfect. They finally realised that you could download the ticket to your device and securely store it on your device. But BMTX has had a virtual card in a wallet for five years! The other industries are just lagging behind.

“If you're at a soccer match or an F1 race or a football game, why couldn't you pre-order and pay for your food and merchandise online? There is an ecosystem there that is untapped. What I really love about my job is getting to talk to folks about that and the power of their brand, and a cohesive ecosystem where banking can be part of that.”

He believes that there is a fundamental shift underway where the industry is moving towards embedded finance as the primary vehicle for BMTX’s integrations with brands and even end-consumers. He expects more businesses to launch ‘super app’ functionality within the next few years, offering more services to existing customers and thereby negating the need for them to leave the brand’s ecosystem.

“We are one of the few in our industry that are uniquely positioned to handle all of the banking needs of our clients”

JAMIE DONAHUE CHIEF TECHNOLOGY OFFICER, BM TECHNOLOGIES (BMTX)

“I think our transformation has afforded us to partake in that shift – to drop in a checking account, a savings account, a peer-to-peer payment in that ecosystem seamlessly and anonymously from a transaction perspective. We can bring that technology to bear without the huge uplift and regulatory burden that would otherwise exist.”

If you want to go far, find the right partner Away from the office, Donahue is a fan of life on the water and a keen fisher, particularly offshore fishing. On the desk behind him, an ornament of two leaping fish – a prize catch, were they not made

from metal – sit glistening in the New Jersey sunshine. Donahue’s experiences away from work inform his belief about where the industry is headed. He compares it to Uber, and what that did for ride hailing. “I remember I used to have a taxi app,” he recalls. “Now I can get taxis through Uber.”

“We think people will go to brands they like to do business with, they're comfortable with, and they trust. And there'll be banking features within that ecosystem.” In order to keep pace with this change, BMTX has undergone considerable technological transformation in recent years – and the partners it chooses are instrumental in that.

The way Donahue summises his approach to partnerships is simple: “if you want to go fast, you go alone, but if you want to go far, you go together,” he says, recounting a popular mantra from his time in military training. BMTX’s call centre partner, Ubiquity,

helps bring to life the company’s passion for good customer service. In many cases, it’s the first point of call; students have a number on the back of their cards for if something goes wrong, and a Ubiquity agent will be on the other end of the line. BMTX has given Ubiquity over 100 scripts

help it understand and mitigate the different security vectors and risk parameters associated with the API code that BMTX is pushing out into the market, which is considerable.

And of course it’s working with Microsoft, a key technology partner, which Donahue

JAMIE DONAHUE CHIEF TECHNOLOGY OFFICER,

TECHNOLOGIES (BMTX)

annually on information security. Even if we reach our most lofty goals, BMTX would never invest that much money. So we feel fortunate to have them by our side. We lean heavily on them for what's coming and how we might apply some of their new technology to bring a frictionless experience to our clients and partners.”

“The cloud never stands still,” says Donahue, who continues to be impressed with all the new features that get released on the cloud quarterly. “I'd like to think that BaaS is here to stay. I know oftentimes in technology, there are fads that come and go, but we believe that there's a new era upon us where financial services and banking functions will be embedded within your favourite brands and be much more ubiquitous than it is today. Where you get your paycheck into an account and then you get money out of the bank and pay bills, we believe that the world is headed towards a much more embedded ecosystem.”

As for BMTX, it has signed a new BaaS partner, which it intends to announce next year, and Donahue says they have an “incredible pipeline” of feature development. The company will continue to announce new partnerships and bring new features into its ecosystem, which can then be applied across the board to other areas of the business, like the white-label higher education offerings. “It’s an exciting time,” Donahue says.

“Banking's hard. It's a hard industry. If you think about what a brand would do to acquire a bank charter, it's just not natural”

BM

EXPLORING THE ALTERNATIVE FINANCE SPACE

BY: JOANNA ENGLAND

The world of fintech has opened up a whole new world for those seeking different forms of finance.

From BNPL and crossborder services to Open Banking and investment platforms, managing money has never been more flexible.

Defining alternative finance

Alternative finance is a blanket term that refers to any type of financial service managed outside the parameters of the traditional banking system. These services are driven by fintech and are part of a swiftly growing network of service providers that are linked into the digital ecosystem.

Fintechs utilise the latest technologies, including AI, ML, blockchain, DL and more to deliver fast, flexible and secure services for both B2B and B2C customers.

Why has alternative finance become so popular?

In a nutshell? Innovation and lower cost services.

Traditional banking services have failed to address demands in the marketplace for better financial service options. Incumbents have often proved to be inflexible, expensive and archaic in terms of their business and consumer offerings.

Jack Trowbridge, Commercial Director at Growth Lending, says alternative finance exists to plug the gap where SMEs have been underserved by traditional financiers. “As the cost-of-living crisis and recent market turbulence continue to impact businesses across the country, this gap is only going to widen. The alternative finance space has a critical role to play on two fronts: accessibility and speed.”

Trowbridge points out that, “as traditional lenders begin to pull the drawbridge up, having access to finance via alternative means is going to be critical”. Moreover, he believes the alternative finance market has the ability to move much faster and with a more streamlined approach than traditional incumbents.

Melba Montague, Senior VP of Banking and Capital Markets for Genpact, agrees, predicting that as the global economic slowdown continues, customers will increasingly choose alternative finance solutions. “With rising inflation and costs of living, the current economic climate is anticipated to worsen over the coming months. As cash and disposable income become tighter, we will see increasingly more people turn to non-bank loans as a means of alternative finance, with BNPL models expected to feature prominently.”

“THE ALTERNATIVE FINANCE SPACE HAS A CRITICAL ROLE TO PLAY ON TWO FRONTS: ACCESSIBILITY AND SPEED”

JACK TROWBRIDGE COMMERCIAL DIRECTOR, GROWTH LENDING

But, she points out, the BNPL industry is unregulated, decentralised, and brings risk to consumers borrowing beyond their means without adequate financial advice.

She continues: “Arguably, BNPL has made it easier to create debt, and it needs to be tackled as more structured regulatory models become developed. As such, it's critical that banks educate the consumer to avoid exacerbating an already fragile cost-of-living crisis.”

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CASH AND DISPOSABLE INCOME

further due to better regulations building more trust in the sector. New technologies such as AI and ML are also driving success. They allow for automation and have improved risk analysis significantly, enabling them to confidently stride forward and scale.

FEATURE PROMINENTLY”

MELBA MONTAGUE SENIOR VP, BANKING AND CAPITAL MARKETS, GENPACT

Other lending services will see an uptick in demand, too.

Mortgages are a prime example because alternative mortgage lenders have different lending criteria than big banks, and could therefore provide a way to approve loans when customers don't meet the requirements for a conventional mortgage. Examples of these lenders include private mortgage lenders, credit unions, monoline and 'B' lenders, and smaller banks.

New alternative finance trends for 2023 and beyond

As the popularity of fintechs like Liberis suggests, alternative finance – and lending especially – is a developing space. It’s a thriving industry that has become an essential part of financing SMEs, particularly in the wake of digital transformation and on the back of the pandemic.

Peer-to-peer lending is also skyrocketing as it extends its services to encompass lending opportunities for businesses as well as consumer loans. This is set to increase.

Alternative lending packages will be ‘a thing’ Market indications also suggest that the alternative financing space is growing so rapidly, that very soon – possibly even in 2023 – a new, secondary market will emerge in terms of alternative lending packages. In short, this will consist of small ticket loans that will be sold in packages with other services and purchased by large-scale lenders as a means to reduce risk.

Investors interested in alternative finance

While the investment market continues to be flat – and much tougher than in recent months – one area analysts believe will thrive is the alternative finance space. This is because cash flow is essential in keeping the lights on across global commerce, and providers that can facilitate such services with speed, efficiency and lower costs will continue to thrive – and, therefore, garner interest in the investment space.

“AS

BECOME TIGHTER, WE WILL SEE INCREASINGLY MORE PEOPLE TURN TO NON-BANK LOANS AS A MEANS OF ALTERNATIVE FINANCE, WITH BNPL MODELS EXPECTED TO

And not just partnerships between fintechs and technology providers, but those between incumbents and innovative startups.

In his recent write up for Forbes, Chad Otar, who is the President at Lending Valley, Inc, explains: “Legacy banks and traditional lenders that aren’t interested in purchasing alternative financing companies outright are still going to want to partner with alternative lenders in 2022.

“A big part of this has to do with the fact that banks cannot transform their business model from top to bottom overnight because of the regulatory environment they are operating in, but they also want to be able to offer the same kind of solutions and services non-traditional lenders provide.”

Alternative currencies in the form of crypto Indeed, when all these aspects combine, they result in an industry that provides significantly more efficient and cost effective loan disbursement, as well as better customer servicing.

According to Jaro Popowic, Chief Brand Lead at Mercuryo – a global payments infrastructure platform, providing businesses from both the fiat and crypto worlds with a wide range of financial services that are accessible through API integration – digital currencies will

JARO POPOWIC CHIEF BRAND LEAD, MERCURYO

He adds: “Banks are going to do everything they can to find ways to fold alternative lending services into their lending menus as much as possible, all while looking for ways to work within their regulatory framework to reinvent and reimagine many of their legacy services.”

We will see more partnerships emerging

“AS PROSAIC AS IT MAY BE, WE ARE CONFIDENT THAT CRYPTOCURRENCIES WILL BE ONE OF THE BENEFICIARIES OF THE CURRENT INSTABILITY DESPITE BEING THE HARDEST HIT BY THIS DOWNTURN”

also play a major role in the future of alternative finance.

“As prosaic as it may be, we are confident that cryptocurrencies will be one of the beneficiaries of the current instability despite being the hardest hit by this downturn,” says Popowic.

Popowic believes that many institutional players and payment networks see crypto as a long-term solution to cross-border transactions, looking at its technological potential rather than seeing it as a way for people to gamble.

“We are already seeing emerging economies such as Vietnam dominate global adoption. There, cryptocurrencies are used to send crossborder transactions and hedge against volatility. In fact, by providing the ability to manage digital money, more people get the opportunity to control, invest and store their funds.”

“Just think about it: 10 years ago, people could hardly invest in the stock market. Today, everyone can invest from their phone –and many do; what the crypto industry is building today will be what helps democratise finance tomorrow.”

A revolution in mobile banking

WRITTEN BY: ALEX CLERE

There’s little doubt that fintechs have prompted a revolution in mobile banking, with incumbents realising that they must keep pace with new features to remain competitive. After all, the days when a bank’s primary interface with a customer was through bricks-andmortar branches are long gone. Mobile banking has overtaken in-person transacting – a trend made more pronounced by the COVID-19 pandemic, when people were told to stay indoors.

According to Insider Intelligence’s UK Mobile Banking Competitive Edge report, 68% of UK adults have used mobile banking in the past year; research from Forbes, meanwhile, shows that over three-quarters (76%) of Americans have used their primary bank’s mobile app over the same period. Mobile is the new battleground in which banks – both new and incumbent – will lose or retain customers, so much so that 40% of people would now consider switching to a digital-only provider with no physical branches, according to research from Forrester.

PAPARA

The rising popularity of mobile banking has prompted a mass rush to release new features – but is the slow march to ‘super-app’ status the right approach?

“The super-app approach can be successful if executed correctly, but getting to that point is incredibly difficult”

AHMED KARSLI, CO-FOUNDER AND CHAIRMAN,

AHMED KARSLI, CO-FOUNDER AND CHAIRMAN, PAPARA

Following a brief slowdown during the pandemic, customers are back to switching current accounts at normal levels, Forrester’s Principal Analyst Aurelie L'Hostis says. Data from the UK’s Financial Conduct Authority (FCA) shows that 8% of the country’s current accounts are currently held with digital challenger banks – up from just 1% five years ago.

Mobile payments trend underscores banking revolution

The popularity of mobile banking is being driven by an increase in mobile payments, with consumers now able to check out using their smartphone or watch. Research from fintech unicorn Rapyd shows that nearly half (43%) of Brits make mobile purchases on a weekly basis, underscoring the rising popularity of e-wallets. What’s more, UK mobile commerce is set to reach £100mn by 2024 as consumer preferences shift.

Sarel Tal, VP EMEA at Rapyd, says: “With consumers having to go cashless at the height of the pandemic, many realised how convenient mobile phone payments are and have since kept this habit up. We expect this trend to accelerate, with UK mobile commerce predicted to grow at more than twice the rate of the overall ecommerce sector.”

Banks must accelerate product development and innovation within their mobile apps in order to satisfy changing consumer habits, and remain competitive with fintech challengers and digital banks. We have seen a new wave of mobile apps that incorporate consumer-friendly features like personal budgeting, financial targets, foreign currency exchange, investing tools and simpler peer-to-peer payments.

Ahmed Karsli, Co-Founder and Chairman of Turkey’s largest neobank, Papara, says that banks must continue to diversify their

“It’s critical not to rely on one part of the business that might be doing well today – as this might not be the case tomorrow”

PAYMENT SOLUTIONS

product offering. “We’ve always felt it’s critical, in good times and bad, not to overindex and rely on one part of the business that might be doing well today – as this might not be the case tomorrow. Having said that, you do always need to ensure that your core business proposition is both scalable and has a route to being profitable in and of itself before you start adding new components.”

With many consumers facing a costof-living crisis this winter, Karsli predicts that money management and budgeting

“With consumers having to go cashless at the height of the pandemic, many realised how convenient mobile phone payments are”

SAREL TAL, VP EMEA, RAPYD

tools – pioneered by the digital challengers and adopted by some forward-thinking incumbents – could become an essential component of any mobile banking app. “With global economic conditions not looking positive in the short term, I believe that many banks will start to introduce more money management tools to help their customers get a better understanding of how to spend more efficiently while also leaving room for saving,” Karsli says, suggesting new features around micro-loans and salary advances as ways that traditional

banks can support their account holders through the current financial uncertainty.

Should we all strive to become a ‘super-app’?

This raises the question of whether banks or fintechs should still be striving to become a super-app, with Elon Musk even hinting that his takeover of Twitter could be a catalyst to creating an ‘everything app’.

Papara’s Ahmed Karsli continues: “The truth is that there’s a lot of debate in the market about whether it’s a good strategy to try and build everything within one

package, or just double-down on what’s working well and keep products and services to a minimum in terms of number, but maximum in terms of impact.

“You only need to look across to China and what’s happened with WeChat and AliPay to see how successful the superapp approach can be if executed correctly, but the reality is that getting to that point is incredibly difficult and also requires a bit of luck.”

AHMED KARSLI, CO-FOUNDER AND CHAIRMAN, PAPARA

He states that, instead of deliberately setting out to become a super-app, it is possible for brands to become one by stealth: “As a business we’ve always been ambitious, but I must admit when we first started, our goal wasn’t to become a super-app – rather it was to focus on a few core products that would really benefit those locally who had been left out of the current financial ecosystem.

“Along the way, as we got user feedback and saw how our customers were using Papara, we started adding additional elements that we thought would be useful to them. Suddenly, we found ourselves with a collection of useful financial features, all in one package, and at that point we almost accidentally became a super-app.

“I’d say that any business that starts out wanting to become a super-app is going to have a very difficult time. Nail your core products first and then you can start thinking about additional benefits. I’ve seen fintechs fail that try to do too much, too quickly without any form of market penetration on their core products. It’s a bad strategy that just never works out.”

“Any business that starts out wanting to become a super-app is going to have a very difficult time. Nail your core products first”

And he says that fintechs still have the edge when it comes to rolling out new features: “The advantage that fintechs have over incumbents with regards to building a super-app proposition is agility. Because the scale is often smaller, new features, products and partnerships can often take less time to get off the ground. However, this doesn’t mean that larger players shouldn’t try and diversify their product offering – it just might take them more time to do so effectively.”

“With global economic conditions not looking positive in the short term, I believe that many banks will start to introduce more money management tools to help their customers”

AHMED KARSLI, CO-FOUNDER AND CHAIRMAN, PAPARA

RESILIENT FINTECHS IN CHALLENGING TIMES

WRITTEN BY: JOANNA ENGLAND

The fintech space is having a difficult time at the moment with the investment environment providing challenges and consumer spending curtailed by the doom-and-gloom of high interest rates and inflation.

Some companies have had to freeze or downsize their workforce. Others have pulled back on that all-important IPO.

Valuations and stock values have also taken a hit, as the global economic climate continues to proffer bad news.

It’s not easy to survive, let alone thrive in such an unstable environment.

AS INVESTMENT OPPORTUNITIES SHRINK AND SCALING STARTUPS PUT THEIR BRAKES ON EXPANSION, WE SPEAK TO INDUSTRY EXPERTS ABOUT HOW STARTUPS CAN INCREASE RESILIENCE

Avoid the Top 5 Most Common Open Source Vulnerabilities Within Financial Organizations

LEARN MORE

Attracting investors in reluctant climate

Proof of clear strategy and sound economics are two essential ways that fintechs can improve their chances of attracting investment – despite the economic downturn.

Angel investor Patrick Kavanagh, who’s also the co-founder of Atlantic Money and one of the first capitalists that backed the investment platform Robinhood, says that the situation is very difficult – but fintechs can help themselves.

“While valuations thrived during the COVID-19 crisis, the era of subsidising unsustainable growth seems to be in the rear-view mirror now. Fintechs are now quite literally paying for their previous stratospheric valuations, rapid expansions and loss of focus. They’ve been forced to tighten their belts, with many withdrawing job offers and laying off staff. Lay-off tracker TrueUp estimates there have been over 100,000 tech layoffs in the past five months.”

He continues: “In this risky environment, fintechs need to refocus and consider what will convince investors to loosen the purse strings. They want to see more proof that core economics make sense and business models that are easy to understand. Crucially, investors want to see a clear path to profitability. Companies that also focus

PATRICK KAVANAGH CO-FOUNDER, ATLANTIC MONEY

on customer segmentation and build targeted products to match will likely be rewarded for their efforts.”

Leadership and resilience in fintech

A change of direction, as advised by Kavanagh, requires executive teams and company leaders to reevaluate their strategies, and change direction. This may

“WHILE VALUATIONS THRIVED DURING THE COVID-19 CRISIS, THE ERA OF SUBSIDISING UNSUSTAINABLE GROWTH SEEMS TO BE IN THE REAR-VIEW MIRROR NOW”

DANIEL HARMAN CEO AND CO-FOUNDER, DARK SQUARE CAPITAL

“WITH ALL STARTUPS, FLEXIBILITY AND PATIENCE ARE KEY”

VIVI FRIEDGUT CEO AND FOUNDER, BLACKBULLION

involve looking at different ecosystem partnerships, putting a new rollout on hold, or even shifting core mechanisms within the company to achieve a stronger business.

Daniel Harman, CEO and Co-Founder of Dark Square Capital, believes flexible thinking is key, as is a lean, agile approach. “With all startups, flexibility and patience are key. Fintechs have the added requirement of needing to be FCA regulated in certain cases, which makes launching your product, promoting/advertising and pivoting more difficult,” he says.

Harman remarks that, in the fintech space, it’s particularly important to make sure leaders have done their research and properly analysed their target market. “You’re asking users to trust you with their finances, so I think customers are less forgiving than they might be in other sectors.”

Vivi Friedgut, CEO and Founder of Blackbullion, agrees with Harman. But she says cohesive teamwork and a strong culture are also key in surviving the storm.

“You need the ability to lead an engaged, committed team. To have created that culture of purpose and inclusion from the outset by bringing your people into your vision,” she says.

“Your talent is your momentum when you’re scaling. It’s not about leading the

hardest working team to achieve your goals or burnout. Rather, it's about being creative with how you make your teams’ work lives great, fostering a culture of flexibility and autonomy so your people truly commit to your business’ values and mission. Leadership is about making your people want to be part of that scaling journey. Because, as we’re seeing, it’s not an easy ride.”

Sector opportunities despite the downturn Despite the difficulties, there are areas that are thriving. Fintech leaders can improve their chances of raising investment capital if they concentrate on these areas.

“YOU NEED THE ABILITY TO LEAD AN ENGAGED, COMMITTED TEAM”

FIVE RESILIENT FINTECHS SCALING IN A DOWNTURN

According to the latest data by CBS Insights, lots of fintech companies are still thriving in the marketplace. Here are the top five fintechs to watch in 2023:

#1 STRIPE

Although this online retail payments giant recently rolled back plans for its IPO, and has consistently refused to confirm its external valuation of US$95bn, it recently offered its internal valuation publicly – which is US$74bn.

#2 CHECKOUT.COM

The international financial technology company that processes payments for other companies, founded as Opus Payments in 2009, is headquartered in London. It recently received a valuation of $40bn.

#3 PLAID

The fintech company that facilitates communication between financial services apps and users' banks and credit card providers has not lost its way in the downturn, having recently received a valuation of $13.5bn.

#4 BREX

With a recent evaluation of $12.3bn, Brex has so far avoided financial issues. The US-based financial service and technology company is headquartered in San Francisco, providing business credit cards and cash management accounts to technology companies.

#5 SUMUP

SumUp is a global financial technology company headquartered in London that supports more than 3.5 million merchants in over 30 markets worldwide. Its most recent valuation in June 2022 placed it at $8.5bn.

“I see an increasing number of investors putting more capital into carbon capture startups that aim at using various technologies for carbon removal,” says Michele Tucci, Chief Strategy Officer & MD Americas at credolab. He goes on to say that it's only a matter of time before companies start using blockchain technology to keep a record of carbon reduction, which also links the regenerative work of land managers to the companies buying carbon credits.

Konstantin Zaripov, Managing Director at MultiPass, part of Dyninno Group, comments on the payments space – citing it as an area that’s still receiving a healthy amount of investment funding. “Payments have recently

grown a lot and have an overall share of one third of the total funding received. Other sectors that have grown tremendously are Digital Lending (which has risen three-fold),

“PAYMENTS

KONSTANTIN ZARIPOV MANAGING DIRECTOR, MULTIPASS

Striking a balance in unstable times

It’s a fine line to walk in terms of leadership, strategy and purpose. But it’s one that is creating much more resiliency – and the market will be stronger for it – once we emerge on the other side, says Dima Kats, CEO of Clear Junction. “Across all markets, the threat of recession is forcing many business leaders to become more efficient regarding their spending and budgets – with the view that adopting a ‘leaner’ operation during these tough times will lead to a more resilient organisation.”

MAKE INVESTMENT DECISIONS”

DIMA KATS CEO, CLEAR JUNCTION

Kats points out that, much like other industries, the recession is a challenge for players in the payments’ landscape. This is because, at its core, a recession impacts real consumption, which is the base layer of payments industry growth.

However, he says: “There is still quite a bit of investment money available and opportunity for growth, but the reality is that, during a recession, investors take fewer risks and take longer to make investment decisions.”

He concludes: “I believe the payments’ industry has a more nuanced outlook than current valuations imply. In my view, there are many aspects of payments that may be more resilient in a recession than many investors expect, creating the potential for enormous investment opportunities.”

“THERE IS STILL QUITE A BIT OF INVESTMENT MONEY AVAILABLE AND OPPORTUNITY FOR GROWTH, BUT THE REALITY IS THAT, DURING A RECESSION, INVESTORS TAKE FEWER RISKS AND TAKE LONGER TO

InsurTech (risen two-fold), WealthTech (three-fold) and Capital Markets (three-fold).”

In challenging times, being aware of market trends, key data and customer preferences becomes ever-more critical. Solid predictions help develop strategy, guide scaling and product development. Global management consultancies, data crunchers and risk assessment organisations are constantly monitoring markets, producing key insights into what the future might hold.

With this in mind, we’ve compiled a list of the Top 10 digital report and white paper providers for the financial industry.

WRITTEN BY: JOANNA ENGLAND

Digital reports to

Knowledge is power, so we’ve rounded up the top 10 financial reporting agencies for finserv leaders to follow

Digital reports

PwC

UK Key Trends 2022 (economic services)

PwC – also known as PricewaterhouseCoopers, the consultancy company that is headquartered in London –formed following a merger in 1998 between Price Waterhouse and Coopers & Lybrand.

PwC has a history dating back to the 1800s, offering clients various professional business services, including accounting, auditing, human resources consulting, and strategy management. PwC also applies its expertise to help educational institutions, governments and non-profits.

Anti-money

09 Kroll Anti-Money Laundering and Countering the Financing of Terrorism Focus

Report 2022

Founded in 1972, Kroll is headquartered in New York and was acquired by Duff & Phelps in 2018. In 2021, Duff & Phelps decided to rebrand itself as Kroll, a process it completed in 2022.

Kroll has a robust market reputation in helping clients manage compliance, navigate litigation and mitigate risk relating to fraud, impropriety and security threats. Its workforce consists of 900 employees that serve a global clientele of law firms, financial institutions, corporations, nonprofit institutions, government agencies and individuals.

07

KPMG Benchmarking Banks' Annual Reporting 08

Helping Countries Adapt to a Changing World

The World Bank

The

World Bank Annual Report

Headquartered in Washington DC, the World Bank was founded in New Jersey in 1944. The World Bank Annual Report details the entity’s measures, findings and applications in a yearly report that provides insights into the developing financial environments of countries with populations primarily of low to middle-income earning power. As such, the report gives a global view on the state of developing economies as well as how industries are scaling and maturing within them.

KPMG was formed in 1987 following the merger of Peat Marwick International (PMI), Klynveld Main Goerdeler (KMG) and their individual member firms. However, the origins of the firm spans three centuries and can be traced through the names of its principal founding members whose initials form the name 'KPMG'.

The organisation’s quarterly and annual reports on the banking sectors document the climaterelated disclosures of 35 major global banks.

Oliver Wyman

06 05

The Tectonic Shifts Between Risk, Data and Technology Experian

Founded in 1984 by former Booz Allen Hamilton partners Alex Oliver and Bill Wyman, Oliver Wyman has more than 60 offices in Europe, North America, the Middle East, and Asia-Pacific, employing over 5,000 professionals. Classified as an American managment consultancy firm, it is headquartered in New York and its parent company is listed as Marsh McLennan.

The Tectonic Shift Between Risk, Data and Technology is an annual report, currently in its 24th edition. It presents a broad perspective of changes in the financial services industry.

How to Guide Customers through the 2022 Cost of Living Squeeze

Headquartered in Dublin, Ireland, Experian collects and analyses data on over one billion people and businesses. These include 235 million individual US consumers and more than 25 million North American businesses. Founded in 1996 and specialising in credit scoring technologies, the capacity for Experian to collate and aggregate big data into bite-sized insights makes it a leading source of razor sharp predictive analytics for businesses across multiple industries.

04

The Top Strategic Technology Trends in Banking and Investment Services for 2022

By

Gartner Top Strategic Technology Trends in Banking and Investment Services for 2022

Headquartered in Stamford, Connecticut, Gartner, Inc is a technological research and consulting firm that carries out research on technology and shares this research both through private consulting as well as executive programmes and conferences.

It was founded in 1979 by Gideon Gartner, an American businessman, entrepreneur, educator and philanthropist. Gartner has a robust industry reputation and is known for its insightful predictions across a spectrum of industries from technology and finance to insurance and consumer trends.

03 Deloitte

2023 banking and capital markets outlook

The 2023 Banking and Capital Markets Outlook

In 2020, Deloitte marked its 175th anniversary in the consulting space. Its far-reaching, long-term presence in the marketplace means it has a wealth of knowledge and experience from which to draw its insights. Offering palatable chunks of predictive insights on the banking and capital markets space, the annual Deloitte 2023 Banking and Capital Markets Outlook provides unique insights and analysis of seven business spaces including retail banking, consumer payments, wealth management, commercial banking, transaction banking, investment banking, and market infrastructure.

Nicole Sturgill, Moutusi Sau

02

Capgemini

The Capgemini World Wealth Report

Like McKinsey, Capgemini is a leading global consultancy that specialises in technology services and digital transformation. The group offers a wide array of integrated services combining technology with deep learning and research.

Originally founded in Grenoble, France in 1967 by Serge Kampf as an IT company, Capgemini was named Sogeti. But, within its first few years and through a series of successful M&As, it soon grew into a group and rebranded as Capgemini in 1973 following the successful acquisition of CAP, a major European IT services company.

Today, it is a global consultancy firm which produces industry-leading insights across the business and financial sectors. The Capgemini World Wealth Report 2022 looks at the new and upcoming trends and changes facing commercial industries. It details ways of managing equities and healthy stock market returns, provides insights into the latest ESG regulations, trends and options.

The report also details new customer segments in terms of diversity. It examines opportunities for millennials, women, LGBTQIA+ and ethnic minorities, and where the wealth growth lies in these areas.

Capgemini Values

0 0 0 0 1 1

A BizClik Brand

to McKinsey Academy

One of the longest-established management consulting firms in the US, McKinsey & Company was founded in 1926 by the University of Chicago professor James O. McKinsey. Today, it is a globally recognised leader in consultancy terms that produces insightful papers involving deep-dive research on the latest trends across a wide range of industries.

In terms of fintech and banking, we’d recommend subscribing and downloading the McKinsey 2022 Global Payments Report. The report is produced annually, presenting “a detailed analysis of the 2021 results and the insights they reveal, including regional and countrylevel nuances”.

The report also provides insights and perspectives on areas where “payments leaders’ actions will help determine market share shifts and the role of payments in the broader financial ecosystem”.

Other key takeaways can be gleaned from the report’s exhaustive industry-wide research – in the 2022 report, it looks at embedded finance and the integration of financial products into broader customer journeys.

Introduction

TO YEAR: LIVE

You’d be forgiven for thinking you’d stumbled into the mansion of an eccentric billionaire walking into Magazine, London on a crisp morning in early November. Entering the huge black fortress next to Canary Wharf for FinTech LIVE London 2022, you'd trust you'd found the right place.

The idea of trust permeates the financial sector, which relies so heavily on the management of risk – from handing out loans and accepting venture capital investments to the socially built and somewhat arbitrary trust of the blockchain system that underpins cryptocurrencies. Without trust, an entire industry crumbles.

Betting on the right horse

The conversation at FinTech LIVE was no different as Stephen Roche, President & Co-Founder of headline sponsor Saphyre, and his twin brother Gabino Roche Jr, CEO & Co-Founder of Saphyre, took to the stage to discuss raising a Series A, referring to the first round of funding fledgling businesses undertake after seed capital, is the earliest introduction many business leaders have to risk. Take a chance on the wrong investor and you gamble on your company.

“We’re going to buy you and you’re going to be millionaires,” recalls Gabino Roche Jr as he speaks on an early offer they received. “...Sounds tempting”. But upon learning that their initial investors would not come out of the deal so well off, Stephen and Gabino chose not to risk their integrity by discarding the investors who helped them get their start. This was not the only lucrative deal the pair walked away from, but with enough confidence in their product, and their saleability as The Saphyre Twins, they knew that they could negotiate better for themselves.

Open Banking, climate crisis and customer centricity in fintech

Trusting your gut when it comes to making a deal is one thing, is one thing, but trusting in yourself as a financial services provider is another. This concept was at the heart of the conversation between Constanza Castro Feijoo, Stakeholder Engagement Manager at OBIE; Rolands Mesters, CEO and Co-Founder at Nordigen; and Nicole Green, VP Product Strategy and Operations for Yapily, as they discussed Open Banking.

GABINO ROCHE JR, CEO & CO-FOUNDER, SAPHYRE

“WE WANT TO GIVE EVERYONE VIRTUAL CARDS IN THE WORK ENVIRONMENT”

AXEL CATELAND HEAD OF BANKING, SPENDESK

In a post-Frances Haugen whistleblowing world, allowing businesses to openly share personal data, even with trusted third parties, can be a scary thought. However, as Adam Rimmer, CEO at FloodFlash, who spoke on how climate change affects the future of insurance said, it is about reframing how we speak to customers. Essentially, customers will accept certain uses of their data if you offer them value in return. As Rolands Mesters puts it, the idea of Open Banking was created to give account holders more

control by creating better services with fewer barriers to accessing their finances. It’s an unfortunate fact of modern life that we often have no option but to trade our privacy, for greater convenience.

Yet, despite the perception created during the 2008 financial crisis, today’s financial institutions really are trying to put the wellbeing of customers at the centre of everything. In fact, during a conversation called 'Unpacking the Futuristic World of Biometric Payments, Virtual Cards & Robot Bankers', Axel Cateland, Head of Banking at Spendesk, revealed that Spendesk has spearheaded a campaign to give virtual cards to "employees so that, while incurring expenses on the job, they never need to be out of pocket. It is a noble cause when emphasis on employee welfare has become such a major component of retaining staff in all sectors.

But that isn’t all. The entire basis of virtual banking, biometric payments and AI is intended to make the experience quicker and more seamless, for the end user. And it’s working. As Will Sorby, Director of Product, Financial Empowerment at N26 states, through use of AI “80% of the time we have an accurate understanding of what a customer is looking for just by what they type into the app for their first question”. As with many financial service providers, the ultimate goal is to help customers navigate their complicated financial lives as easily as possible.

With this new age of social media, companies can no longer hide their intentions towards their customers. Too many wrong moves will get you called out with a low rating and scathing review. The mindset of ‘Us vs Them’ that used to underpin many different retail sectors, most notoriously insurance, is becoming a thing of the past. In the 'Insurance and the Need for Customer Centricity' panel, James Wright, Head of Technology at Beazley, and Adam Powell, COO for Policy Expert, explained that customers simply won’t stay with providers who treat them with disdain.

This harks back to a comment made by Jennifer Bisceglie, CEO & Founder of Interos, at Procurement & Supply Chain

LIVE back in October 2022. She stated that the modern customer isn’t loyal to any particular brand and will go for the most convenient product at the most convenient price. In finance, new service providers spring up daily that are hungry to compete in the market. This saturation heavily penalises companies who are unwilling to adapt with services that put the customer at the centre of operations. Customers want to know that their insurance provider is on their side and will come through if the worst happens.

Fintech, DeFi and economic instability

This has never been truer today. Climate change is making modern living more unstable. Countries anticipating a future fight for resources are acting accordingly, along with two years of disruption created by the pandemic, which has led to unrest and uncertainty across the globe. In finance, the ‘boom and bust’ cycle that most recently caused a significant downturn in the cryptocurrency market has shaken the confidence of many investors. One conversation that brought this into sharp focus was 'The Longevity of Crypto in the Modern Day Economy', where Yorick Naeff, CEO at BUX; Rupert Poland, Vice President – UK Financial Institutions Digital Asset Lead with Marsh & McLennan Companies; and Saphyre’s Gabino Roche Jr discussed whether crypto was still viable.

While Yorick agreed with Rupert’s assertion that there have been a lot of macroeconomic conditions that created volatility in the market, he said it’s also “just part of growing up”. The fact that we have been so spoiled with the growth of the market over the past few years has distorted the optics, making this sudden downturn seem more extreme. “This is

WILL SORBY DIRECTOR OF

a completely new asset class opening up the market to new types of investors... there’s no regulation yet. It’s really the Wild West.”

Gabino also warned that, while the market was still viable, decentralised currencies could be used as a means of control by corrupt governments. The desired financial freedom promised by this market could also be its downfall. We have to look to the future and hope that the risks we take today are going to pan out. It is important to use technology to gain insights into how our world is changing, such as through climate change or civil unrest, to try to find ways to protect our assets and understand how to respond differently to ensure different outcomes.

YORICK NAEFF CEO, BUX

“ CRYPTO IS A COMPLETELY NEW ASSET CLASS OPENING UP THE MARKET TO NEW TYPES OF INVESTORS... THERE’S NO REGULATION YET. IT’S REALLY THE WILD WEST”

REGISTER YOUR INTEREST FOR FINTECH LIVE LONDON 2023

After two days of intense discussion, the event had to come to an end. Though you may have missed FinTech LIVE 2022, there is always another opportunity to rub shoulders with the biggest and brightest in the financial sector. For more great stories and networking opportunities, FinTech LIVE London will return 8-9 November 2023. REGISTER YOUR INTEREST HERE to receive updates on the event and special offers. What you missed: 3,000 top executives across finance, insurance and crypto registered both in person and online, eager to hear from top minds tackling the recovery of crypto after the ‘dark summer’ that sent stock values plummeting, the adoption of Open Banking, virtual finance and the impact of biometric authentications, the new customer centric insurance model, women’s experiences in the financial sector, and how climate change is affecting the future of insurance.