FinTech Magazine - January 2021 by FinTech Magazine

fintechmagazine.com

JANUARY 2021

HOW COVID-19 WILL SHAPE 2021

FINTECH UNICORNS

House of Insurtech Switzerland (HITS):

MAKING INNOVATION REALLY HAPPEN Pietro Carnevale and Stefano Bison discuss bringing innovation, ecosystems and scale to insurtech C2FO

ORANGE CAMEROON

Avoid the Top 5 Most Common Open Source Vulnerabilities Within Financial Organizations Learn what open source vulnerabilities are commonly found in financial services organizations.

LEARN MORE

FOREWORD

new year promises new begin-

of industry leaders - including Finastra,

nings, and while the events of 2020

TransferGo, and Paysafe Group -

will have left an indelible mark on digital

detailed what 2021 might have in store

strategies heading into 2021, the features

for finance. Elsewhere, we find out how

in our premier edition prove that the drive

banks can differentiate their solutions,

for innovation remains undiminished.

track the evolution of mobile banking,

No more so than our cover story this month: House of Insurtech Switzerland. Speaking with Pietro Carnevale, CEO, and Stefano Bison, Group Head of Business

and debate the merits of full versus partial risk management automation for Venture Capital firms. Make sure you don’t miss our Top 10

Development and Partnerships at Generali,

unicorn list; with the latest information

we learn the circumstances from which it

on fintech giants like Stripe, Chime,

was founded and explore its mission to

Nubank and others, these are the names

bring scale and robust ecosystems to

everyone needs to follow!

global insurtech. “Fundamentally, we firmly believe that partnerships between corporates and

Happy New Year to you all!

startups creates value for both parties,” says Carnevale. “In order to make innovation even more valuable and sustainable, {insurance has] to open up and start col-

Will Girling william.girling@bizclikmedia.com

laborating with new varieties of partners.” We were keen to learn the ways COVID-19 has impacted companies’ digital journeys, and a fantastic rostrum

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PUBLISHED BY

PRODUCTION DIRECTORS

Georgia Allen Daniela Kianickovรก

Jordan Hubbard Michael Banyard MANAGING DIRECTOR

EDITOR-IN-CHIEF

Will Girling DEPUTY EDITOR

Rhys Thomas EDITORAL DIRECTOR

Scott Birch CREATIVE TEAM

Oscar Hathaway Sophia Forte Sophie-Ann Pinnell Hector Penrose Sam Hubbard Mimi Gunn

PRODUCTION MANAGER

Owen Martin Philline Vicente

Lewis Vaughan MEDIA SALES DIRECTOR

James White

VIDEO PRODUCTION MANAGER

Kieran Waite DIGITAL VIDEO PRODUCERS

Sam Kemp Evelyn Huang DIGITAL MARKETING EXECUTIVE

Evelyn Howat

DIGITAL MEDIA DIRECTOR

Jason Westgate CHIEF OPERATIONS OFFICER

Stacy Norman PRESIDENT & CEO

Glen White

PROJECT DIRECTORS

Jake Megeary fintechmagazine.com

CONTENTS

BRINGING INNOVATION, ECOSYSTEMS AND SCALE TO INSURTECH

10 How the pandemic changed fintech strategy for 2021

BAL AN C IN G AUTOM ATED & RISK M H ANAGE UMAN MENT

46 2021 TRENDS TO DIFFERENTIATE YOUR BANKING SOLUTIONS

Have digital banks turned the corner?

50 Fintech Unicorns

Building an ecosystem? Connect the dots. â&#x20AC;&#x153;Your journey to cloud must navigate pitfalls and opportunities that are unique to your business. We support you in imagining and delivering your cloud journey and making it runâ&#x20AC;?. Eric Meistermann, Deloitte Partner in charge of AXA Group

76 Orange Cameroon

92 C2FO

BRINGING INNOVATION, ECOSYSTEMS AND SCALE TO INSURTECH WRITTEN BY

WILL GIRLING PRODUCED BY

JAKE MEGEARY

JANUARY 2021

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HOUSE OF INSURTECH SWITZERLAND (HITS)

JANUARY 2021

Pietro Carnevale and Stefano Bison detail the founding of House of Insurtech Switzerland and its mission to drive innovation in global insurtech

fficially founded in December 2019 as an independent subsidiary of Generali Switzerland, the origin story of House of

Insurtech Switzerland (HITS) actually reaches back further to 2017. “At that time Generali Switzerland created an innovation function,” explains Pietro Carnevale, CEO of HITS. “As Head of Strategy and Innovation, I had the opportunity to introduce new working methods. The insurance industry also realised that, in order to make innovation even more valuable and sustainable, it had to open up and start collaborating with new varieties of partners.” What followed was a partnership with the fintech incubator and accelerator F10, which not only gave Generali Switzerland access to startup ecosystems but also enabled it to create a space for collaboration, networking and valuable information sharing. “We called the result ‘Corp Up’, and its success led the company to research the potential for improving its ecosystem, capacity for innovation and scaling capabilities ten-fold. HITS was the answer,” states Carnevale. This was the birth of HITS as an independent entity.

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HOUSE OF INSURTECH SWITZERLAND (HITS)

“ FUNDAMENTALLY, WE FIRMLY BELIEVE THAT PARTNERSHIPS BETWEEN CORPORATES AND STARTUPS CREATES VALUE FOR BOTH PARTIES” — Pietro Carnevale, CEO, HITS

HITS operates on three pillars: ‘opening’, ‘connecting’ and ‘doing’. In effect, the hub creates a customercentric framework for the future of insurance by providing opportunities for startups to flourish and scale-up through innovation. Summarising HITS’ approach in this regard, Carnevale says, “Fundamentally, we firmly believe that

E X E C U T I V E P R O FILE :

Pietro Carnevale Title: CEO of HITS Industry: Insurance

Location: Switzerland

CEO of House of Insurtech Switzerland (HITS), a Swiss based insurtech hub which focuses on building partnerships with startups to co-create and scale-up innovative solutions. Joined Generali Group in 2014 and Generali Switzerland in 2016 as Director of Strategy and Innovation leading the set-up of the local innovation platform and The Innovation Garage in 2018. Board Member of F10, the leading swiss Fintech Accelerator in Zurich. Passionate of Digital, Innovation, Strategy and Transformation within Financial Services. Equipped with a master degree in Engineering from Milan Politecnico and post-graduation training in Digital at IMD. JANUARY 2021

partnerships between corporates and startups creates value for both parties.” Corporations gain a three-fold advantage in speed (time to market), flexibility (costs and investment) and new talent. Startups, on the other hand, are granted market access that would otherwise be near-impossible for new organisations to penetrate quickly, while also gaining industry expertise, capital resources and rich long-term scaling opportunities. It could be argued that the overall

necessitated the creation of HITS’ three pillar strategy, with a central focus on

benefit presented by HITS for start-

digital transformation and innovation,

ups is obvious. However, what is the

and significant investment of both

gain for Generali itself? “The Generali

money (over €1bn) and time, including

Group is one of the most significant

projects such as those supporting 360°

participants in the global insurance and

Advisory, its pan-European mobility

financial services market. In Europe

platform, and

we are the leading insurer and we are

the development of B2B2C ecosystems.

present in over 50 countries around

“The Group and its companies are

the globe,” states Stefano Bison, Group

pushing themselves beyond the bounda-

Head of Business Development and

ries of traditional insurance and offering

Partnerships at Generali Head Office.

services and products that, often, it is

“In 2018 we’ve launched our new strategy

not necessary to develop in-house for

aiming to become ‘lifetime partners’ to

a number of different reasons,” Bison

our customers, offering them innovative,

continues. “This is why we actively seek

personalised and integrated solu-

partnerships in adjacent industries like

tions. These aren’t ‘just’ products; we’re

those dominated by big techs or other

bundling various value-added services

incumbents, as well as with digital native

together.” Delivering this strategy

startups – often, the most intriguing f i nt e c hma ga z in e. com

HOUSE OF INSURTECH SWITZERLAND (HITS)

16 ones.” Generali is a firm believer in ‘open

state-of-the-art ‘fast-track’ procure-

innovation’ and seeks out collabora-

ment processes and innovation funds

tors who champion it in a similar way. In

mitigate the historical difficulties of

practice this takes on both external

partnering with startups.

and internal dimensions: externally,

Although Generali is meticulous in its

the company leverages wide net-

planning, this is not to say that the pro-

works of partnerships with incubators,

cess is without risk on both sides of the

accelerators and open innovation

equation, as Bison explains: “We tend to

platforms to gain valuable insights

prefer evaluating startups operating in

into insurance trends, build a syner-

at least one of our major markets across

gistic cultural perspective with smaller

Europe, Asia and Latin America, and that

companies, and source solutions for

already have minimum market traction

specific projects. Internally, mean-

(few corporate clients and some access

while, bespoke support structures

to revenue). In this way we partially

are created to serve the dual needs

reduce the risks that are, in any case,

of Generali and its partners, while

inevitable when working with early stage

JANUARY 2021

companies.” Carnevale adds, “At HITS

to anticipate customer pain points and

we follow a rigorously messy innovation

address them in the overall design.

approach going from ideation, proof of

HITS tailors its value proposition to

concept (POC), minimum viable product

startups based on the candidate’s level

(MVP), and finally iteration with custom-

of development, with a primary focus on

ers until we get to an MVP that we can

pre-Seed to post-Series A companies.

try to scale.” With POC taking between

“For the ones in pre-Seed or Seed, we

30 and 60 days, and MVP between

help lower their burn rate by provid-

three and six months, local or interna-

ing free office space in our 600m2

tional scaling can commence once the

‘Innovation Garage’ in Zurich and get

value hypothesis of the project has been

their first paying customers. This is

validated. Then, analysing trends and

particularly relevant for B2B startups

gauging strategic priorities, HITS is able

where lack of credentials and track 17

E X E C U T I V E P R O FILE :

Stefano Bison Title: Group Head of Business Development & Partnerships Company: Generali

Location: Italy

Stefano Bison is in charge of the Unit responsible for sourcing, originating and launching, at Group / global level, new business initiatives and new (strategic) partnerships with startups or other leading companies, triggering business innovation / transformation in the Generali Group. As an ex-management consultant (Senior Manager at The Boston Consulting Group) and, previously, investment banker (at Lehman Brothers – FIG M&A, then Nomura after LB bail-out). In his spare time he also acts as an angel investor and entrepreneur mentor to various startups. f i nt e c hma ga z in e. com

Where innovation meets industry F10 is where innovation meets industry, helping todayâ&#x20AC;&#x2122;s talent create tomorrowâ&#x20AC;&#x2122;s technology. It is an ecosystem of startups, corporates, industry experts, and investors, with local hubs in Switzerland, Singapore, and Spain. Its mission is to stimulate worldwide collaboration to further innovation across industries. Visit our website and watch the movie to find out more about F10.

Visit our website

“ GENERALI IS PUSHING ITSELF BEYOND THE BOUNDARIES OF TRADITIONAL INSURANCE AND OFFERING SERVICES AND PRODUCTS THAT DON’T NECESSARILY HAVE TO BE DEVELOPED IN-HOUSE” — Stefano Bison, Group Head of Business Development and Partnerships, Generali Switzerland

record can be a killer,” says Carnevale. “For pre-Series A or beyond, we instead provide references to investors, help their business development within Generali, and provide access to our network. Finally, because of Generali’s global presence, HITS provides the perfect launch base for scaling up and internationalisation, should the startup be ready for it.” He reports that initial indicators point to smoother financing, higher valuation and better longevity for startups who opt to partner with HITS, as opposed to not.

EFMA Innovation Award CLICK TO WATCH

4:12

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HOUSE OF INSURTECH SWITZERLAND (HITS)

2019

Year founded

Number of employees

JANUARY 2021

One prominent example put forward by Carnevale is LINGS, a communitybased on-demand insurance company, an enterprise not dissimilar from American insurtech Trōv. Founded in November 2017 as Generali Switzerland’s first corporate startup venture, LINGS has proven popular with its targeted community (“bikers and photographers”), has gone on to successfully scale internationally and has already built a presence in two European markets. In addition to Generali, numerous other partners contribute to the value of HITS’ ecosystem, either by filling skill gaps, providing valuable ‘cultural links’ or technology. “Partners like Google and Salesforce are fundamental not only for the tech expertise, know-how and solutions they bring to us, but also to give speed, future-proof sustainability, weight and credibility in the market,” says Carnevale. It should also be noted that companies who got their start as a direct result of HITS can also become valuable collaborators too, as was the case with insurtechs ‘vlot’, Billte and Imburse. “Thanks to vlot’s technology, Generali can quickly test innovative f i nt e c hma ga z in e. com

HOUSE OF INSURTECH SWITZERLAND (HITS)

“ ...BECAUSE OF GENERALI’S GLOBAL PRESENCE, HITS PROVIDES THE PERFECT LAUNCH BASE FOR SCALING UP AND INTERNATIONALISATION, SHOULD THE STARTUP BE READY FOR IT” — Pietro Carnevale, CEO, HITS

of our work is our investment in under-

standing how using artificial intelligence will provide value-added services and smooth interactions to our customers in

solutions in the area of risk protection.

the future.”

While together with Billte and Imburse

When considering what success in

we are developing a product to make

the mid- to long-term would look like for

saving money easier and more acces-

HITS, Carnevale is emphatic that realis-

sible for young people. Another cool part

ing the initiative’s joint value for both

JANUARY 2021

corporates and startups is essential.

that this doesn’t indicate we’re not

“We’ve not yet figured out all the ‘right’

innovating enough.” HITS and Carnevale

ingredients,” he caveats, “but, despite

are palpably hungry for success and

being in the early days of our journey,

with such a thorough grasp on develop-

most KPIs that we measure compared

ing insurance companies to their full

to previous year are giving positive

potential, it’s difficult to imagine that they

signals: speed is increasing (six-times

won’t achieve it. As the project grows in

better from first talk to first day of work-

maturity, increases cost effectiveness,

ing, and two-times faster average time

improves accessibility and enhances

from prototype to MVP); our startup

scalability, the standing of HITS in the

ecosystem has expanded six-fold and

insurance market as an innovation

our delivery capacity four-fold. Lastly

leader is likely to grow simultaneously.

we’re experiencing a low failure rate (<30%). However, we need to be careful f i nt e c hma ga z in e. com

FINTECH

JANUARY 2021

How the pandemic changed fintech strategy for 2021 WRITTEN BY

WILL GIRLING

With insights from Finastra, TransferGo, Paysafe Group and others, we explore how digital strategies are developing for the start of a new year 2020: REWRITING DIGITAL STRATEGY At the beginning of 2020, it seemed that ‘digital transformation’ was going to be the dominant industry trend for fintech throughout the year. However, at the onset of Spring, this changed unprecedentedly for most of the world as the COVID-19 pandemic took hold. From that point onwards it seemed that long-standing industry pain points could no longer be ignored: digital strategies had to reflect the new normal, fast. “Simply put, the events of 2020 brought the future forward,” says Eli Rosner, Chief Product

f in t e c hm a g a z in e . c o m

From Inspiration

to Innovation

To know more, visit us at www.capgemini.com.au/insurance or email us at capgemini.marketing.au@capgemini.com

and Technology Officer, at Finastra.

value in the race to provide better

“Our capabilities and software plat-

products and services. Companies in

forms allowed us to act very quickly

the finance space were forced to rely

in March 2020, from accommodating

on technology in an incredibly com-

remote working to supporting our

pressed amount of time, and, in some

customers with their own transition.

cases, start approaching fundamental

Finastra delivered working solutions to

aspects of their business from totally

the market in a matter of days, such as

new perspectives. Firat Koc, Chief

the Paycheck Protection Programme

Marketing Officer at challenger bank

(PPP) in the US.”

Papara, states that remaining fast

Indeed, there is a general consensus

and agile during the transition period

that the lockdown period has driven

and accommodating customers’

a wholesale reappraisal of digital’s

changing needs paid off significantly f in t e c hm a g a z in e . c o m

FINTECH

for his company. Offering cash back

technologies had driven companies’

incentives and relief from financial pres-

revised digital strategies, we received a

sures, “Papara managed to reach its

diverse range of examples:

end-of-year user and card holder targets

Big Data and data analytics: “The

three months earlier than expected.

introduction of big data analytics and

Papara now has 5.5 million users and

machine learning algorithms into our

adds over 300,000 more every month.”

development cycle has improved customer segmentation and fraud

TECHNOLOGY: DRIVING THE CHANGE

detection and prevention,” says Koc.

When FinTech Magazine asked

“Artificial intelligence (AI) for KYC

for perspectives on which key

(know your customer) purposes is

JANUARY 2021

“ Simply put, the events of 2020 brought the future forward” lending process to a matter of minutes

— Eli Rosner, Chief Product and Technology Officer, Finastra

from application to approval. Currently,

another technology that has been

and 56 seconds.”

used by centralised cryptocurrency

Funding Option’s record for ‘application to approval’ is just two minutes Cloud: “Finastra has a strategic,

markets for some time. However, it

multi-year cloud agreement in place

has not yet become widespread in

with Microsoft to help accelerate the

the finance sector, yet.”

digital transformation of financial

Microservices: Edgardo Savoy, Chief

services. Cloud is a key enabler in

Technology Officer at TransferGo, told

this regard and has helped our ability

us, “At the heart of each operation is

to deliver remotely too. Cloud tech-

the customer experience. Every ser-

nologies are also helping to drive our

vice or microservice that we design has

initiatives to deliver better outcomes

the customer at its starting point and is

for everyone, including the financially

anchored to the experience we want to

excluded, small businesses, and entire

deliver. This not only gives us flexibility

communities,” says Rosner.

but also allows us to develop new services and offerings at speed and in line

HAS FINTECH MATURED IN 2020?

with client needs.”

The endurance and continued success

Open banking and automation:

of fintech despite the overwhelming

“Open Banking has offered an immedi-

number of challenges, restrictions

ate remedy while preserving the level

and pressures is highly encouraging.

of due diligence required to process

However, it could be argued that the

loans responsibly,” comments Simon

‘divide’ between startups and incum-

Cureton, CEO of finance marketplace

bents has never been more apparent

Funding Options. “Automated deci-

than how each has reacted to the

sion-making has also accelerated the

pandemic’s paradigm-shifting effect. f in t e c hm a g a z in e . c o m

FINTECH

M E E T OU R CO M MEN TAT O RS

Eli Rosner, Chief Product and Technology Officer, Finastra

Firat Koc, Chief Marketing Officer, Papara

Edgardo Savoy, Chief Technology Officer, TransferGo

Simon Cureton, CEO, Funding Options

Danny Chazonoff, Chief Operating Officer Paysafe Group

JANUARY 2021

“Rapid changes in user behavior cannot be met fast enough by incumbents,” posits Koc. “Existing companies’ slow acceptance of financial ‘experiments’ like cryptocurrencies are reflective of their lack of agility.” The fragmentation of the finance sector has been exposed. Mending this rift will require intense collaboration from both sides in order to support customer needs in an increasingly digital industry. Danny Chazonoff, Chief Operating Officer at Paysafe Group, is optimistic that enhanced coordination

“ Can you imagine going back to the same manual processes, like queuing in banks to send money abroad, when the technology exists to do all of that without leaving your home?” — Edgardo Savoy, Chief Technology Officer, TransferGo

will take place, with companies eventually recognising the superior value that

targeted ecosystems could soon

ecosystems, instead of siloed efforts,

become the world’s unassailable gen-

can offer. “Businesses have had to rev-

erators of revenue. In fact, McKinsey

olutionise the consumer experience in

& Co predicts that, by 2025, 30% of

order to stay afloat. The latest report

global revenues (US$60trn) will be

in our ‘Lost in Transaction’ research

generated by 12 distinct groups.

series suggested that 36% of online

Rosner, while still opining that

UK businesses consider COVID-19 to

finance has yet to fully capitalise

have increased their ability to innovate,

on the lessons of 2020, concedes

with around 84% of organisations

that COVID-19’s effect of refram-

subsequently altering their opera-

ing common operational issues has

tions. Companies will need to depend

led to some impressive results in

on one another, collaborate and work

accelerated development. Its legacy

closely with regulators.” This advice

in banking, for example, has been

is all the more pertinent because

a higher level of cloud enablement f in t e c hm a g a z in e . c o m

FINTECH

and agility that will make subsequent

easy access to innovation, and reduces

innovation faster, easier and better.

the total cost of ownership.”

“Our experience shows that banks which

had already adopted cloud were bet-

PREPARING FOR 2021

ter able to meet the challenges posed

In many ways, the digital strategies for

by COVID-19. Banks still on their digital

2021 outlined by our commentators

transformation journey must continue

could be summarised as ‘fulfilling the

to steer their operations toward a new

promise’ that the previous year has

operating model, one that delivers highly

demonstrated as possible. Digital

relevant customer experiences, provides

transformation filtered through

“ Businesses have had to revolutionise the consumer experience in order to stay afloat” — Danny Chazonoff, Chief Operating Officer, Paysafe Group

JANUARY 2021

the lens of the pandemic has laid the

of thought, planning and hard work to

foundations for a brand new work-

pay off. “Customers have also acceler-

place culture, a revolutionary way of

ated their adoption of digital technology,

approaching customer service, and a

and the pace of this transformation will

dynamically more engaging user experi-

continue long after COVID-19. Can you

ence. The events of 2020 have left an

imagine going back to the same manual

indelible mark on corporate strategy

processes, like queuing in banks to

in fintech that will have an enduring

send money abroad, when the tech-

legacy. For Savoy, 2021 represents an

nology exists to do all of that without

exciting opportunity for a year’s worth

leaving your home?”

w w w.f in t e c hm a g a z in e . c o m

V E N T U R E C A P I TA L

BALAN CING AUTOM ATED & RISK M H U ANAGE M A N MENT 34

WRITTEN BY

JANUARY 2021

DOMINIC ELLIS

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V E N T U R E C A P I TA L

SHOULD RISK MANAGEMENT BE FULLY AUTOMATED TO DRIVE EFFICIENCIES UP AND COSTS DOWN, OR INCLUDE HUMAN ELEMENTS TO ENSURE OPTIMI SATION AND BEST PRACTICE? ASSESSING VC RISK Technology’s ever-encroaching reach knows no boundaries and in the realm of risk management, automation is not only being used 36

for repetitive, mundane tasks but also narrative reporting and broadening data contexts. Data analytics can form a single and authoritative ‘point of truth’, as opposed to hundreds of differing perspectives, and be used to more accurately predict risk in-situ, as well as give full-spectrum applications throughout an organisation. AI, in particular, looks set to transform corporate accounting and could account for 30% of audits by 2025. By then, half of global midmarket and large enterprises will depend on risk management solutions to aggregate digital risks in their business ecosystems, up from 10% in 2018, according to advisory and accounting firm Richey May.

JANUARY 2021

f i nte c hma ga z i n e. com

UNIFY

Identity Verification and eKYC

Introducing the Jumio KYX Platform

Customers, users, patients, employees … whoever the “X” is in your business, Jumio helps you know, then trust.

jumio.com/kyx

According to research conducted by Dorian Proksch, et al, in ‘Risk management in the venture capital industry’, venture capital (VC) firms are exposed to five variants of risk: 1. Agency - arising from conflicts of interest between the investor and the company or individual being invested in. 2. Financial - these are standard business risks associated with bankruptcy, poor liquidity or a 39

lack of available ‘exits’. 3. Market - competitivity, customer receptivity and the availability of marketing opportunities. 4. Human - not just failure to per-

data analytics and automation technology to remove and redeploy the

form essential tasks correctly,

human workforce, or is a more nuanced

but also financial planning, mana-

approach preferable?

gerial experience of the company being invested in, and a guidance

AUTOMATED OR SEMI-AUTOMATED RISK?

of a larger vision from the VC firm.

Automation negates slower, less effi-

5. Failure - a combination of the pre-

cient and often more costly manual

ceding four categories and their

processes, cuts back on staff training

overall impact on direction.

costs and potentially frees up staff’s time to pursue more creative, value-

Given the abundance of risk factors

added tasks. KPMG says robotic pro-

in modern VC activities, a question

cess automation can reduce costs for

arises: is it better to utilise cutting-edge

financial services firms by up to 75%. f i nte c hma ga z i n e. com

V E N T U R E C A P I TA L

EU PUBLISHES DORA IT RISKS

In October, the European Union (EU) published draft legislation to codify how financial firms manage digital risk. Announced as part of the EU’s new Digital Finance Strategy, the proposed Digital Operational

Resilience Act (DORA) is designed to “consolidate and upgrade IC T risk requirements” across the financial entities to ensure all firms are “subject to a common set of standards to mitigate ICT risks.”

Moreover, given the “drumbeat of regulations”, the global nature of business and investors’ growing emphasis on transparency – not to mention the COVID-19 pandemic, which dramatically highlighted the nature of unforeseen risks – the possibilities for improving risk management abound, according to Oracle. This year saw digital efficiencies soar as the world worked from home though risks amplified too; a recent Deloitte poll found respondents expect their top internal controls program challenges to include staffing changes and the virtual work environment (26.9%) and third-party risks (22.2%) in the next six months. Only 5.8% of respondents reported a decrease in the size and frequency of risks that their organisations’ internal controls programs faced during the past year, and only 22.1% said their organisations leveraged advanced technologies, according to the same poll, suggesting traditional risk assessments remain in place. “As organisations sprint to digitally transform nearly all aspects of their businesses to manage disruption,

JANUARY 2021

41 internal controls programs should not

Remote or onsite, organisations

be left out of modernization efforts,”

depend on people to oversee optimi-

said Stuart Rubin, a Deloitte Risk &

sation, drive best practice, develop

Financial Advisory managing director

collaborations and spark innovations.

and controls advisory leader, Deloitte

It’s been a year when we’ve all been

& Touche LLP.

reminded of the convenient power

“Advanced technologies can help

of technology, though it isn’t without

shift internal controls programs

its challenges, as the concerns over

away from a lookback-focus to a

cybersecurity illustrate.

near real-time dashboarding and visualization approach that’s both

STRIKING A BALANCE

packed with insights and sustain

As with much of the corporate COVID

able, thanks to automation-based

world, it is clear we have reached a

design and cutting-edge capabilities

crossroads, reports Deloitte in The

like AI and advanced analytics.”

future of risk in financial services. f i nte c hma ga z i n e. com

V E N T U R E C A P I TA L

Financial institutions need to decide if they will continue with business as usual or instead fundamentally rethink their approach to risk management, it states. “Institutions should examine how they can employ digital technologies – such as robotics process automation, cognitive analytics, advanced analytics, and big data – to automate repetitive manual tasks, provide decision support, and improve the ability to proactively identify and manage risks,” it notes. McKinsey identified six trends shap42

ing the risk function, in a paper entitled The future of bank risk management, two of which focused on humanmachine interactions. Highlighting the importance of refreshing the talent pool, it states: “Data scientists with advanced mathematical and statistical knowledge are needed to collaborate across the bank in the conversion of data insights into business actions.” It also advises building a strong risk-management culture where the detection, assessment and mitigation of risk must become part of the daily job of all bank employees and not only those in risk functions. JANUARY 2021

“Institutions should examine how they can employ digital technologies – such as robotics process automation, cognitive analytics, advanced analytics, and big data – to automate repetitive manual tasks, provide decision support, and improve the ability to proactively identify and manage risks” — Deloitte

f i nte c hma ga z i n e. com

V E N T U R E C A P I TA L

“ As organisations sprint to digitally transform nearly all aspects of their businesses to manage disruption, internal controls programs should not be left out of modernization efforts” — Deloitte

Deloitte agrees firms need an active program to infuse a risk aware culture in the organisation, encourage ethical behaviour by their employees, and monitor and manage conduct risk. Institutions should ensure they have sufficient specialists with subject matter expertise on high-risk and complex activities and provide adequate training to continually upgrade skills, it adds. PwC highlights five key ways organisations are embracing automation

JANUARY 2021

SIX TRENDS SHAPING RISK FUNCTION

• Regulation will continue to broaden and deepen • Customer expectations are rising in line with changing technology • Technology and advanced analytics are evolving • New risks are emerging (model, cybersecurity and contagion) • The risk function can help banks remove biases • The pressure for cost savings will continue Source: McKinsey

– and ‘risk and compliance analytics’

“We worked with a large invest-

is among them. It believes organisa-

ment bank that recently spent over

tions need to evaluate their situation

$100m to implement work flow tools

and available automation capabilities

allowing it to reengineer processes,”

to find the right mix of applications

it stated. “That’s a huge investment

and automation that fits their needs.

in technology and it can be a difficult

KPMG suspects we may have

pill for senior management or share-

reached a tipping point, thanks to enhanced AI, cognitive automation

holders to swallow.” It seems firms will need to strike a bal-

and better-designed ‘bots – though

ance between automation and human

if you think staff payrolls can be costly,

relations for some time to come.

consider the sums of redesigning entire corporate processes. f i nte c hma ga z i n e. com

BANKING

2021 TRENDS TO DIFFERENTIATE YOUR BANKING SOLUTIONS WRITTEN BY

GEORGIA WIL SON

AS WE ENTER INTO 2021, DISCOVER THE EMERGING TRENDS THAT BANKS SHOULD ADOPT IN ORDER TO DIFFERENTIATE THEIR SOLUTIONS IN THE WAKE OF COVID-19 PERSONALISATION While it is no secret that for many years personalisation has been earmarked as a growing trend for organisations to attract customers and maintain loyalty, as we enter into 2021 such a trend only stands to gain traction as more and more consumers enter the virtual financial world. In a recent Forbes article by Personetics, the company reflects on being better prepared for the future, stating that forward-thinking organisations are looking to capitalise on customer data, in order to better JANUARY 2021

understand their clients and improve

provide alternative onboarding meth-

their personalised experiences. With

ods. In addition to alternative onboard-

data-driven personalisation rapidly

ing methods, there has also been a rise

increasing in its adoption among cus-

in customer demand for alternative

tomers to view finances, spending

financing and installment methods.

habits and saving opportunities in real-

With many around the world facing

time, banks that fail to adopt these

financial challenges due to the impact

trends could face limiting their cus-

of COVID-19, organisations such as

tomer base and stunting their growth.

Klarna, who provide flexible ‘buy now,

Other personalisation trends emerg-

pay later’ models, stand to thrive in the

ing in the industry include smart con-

current climate alongside those also

tracts that eliminate many of the

offering mortgage, investment and

inconveniences associated with

credit advice online. 47

traditional contracts. By harnessing computer

DIGITALISATION

coding and cryp-

2020 – the year that ‘digital transforma-

tographic keys as

tion’ took industries by storm. With mil-

digital signatures,

lions of organisations transitioning their

smart contracts

operations to 100% remote working

increase the

overnight, COVID-19 has forced many

speed of fintech

to increase their digitalisation speed.

transactions, and

However, with 74% of organisations

" 2021 WILL USHER BANKS AND BANKING INTO A NEW ERA OF TRANSFORMED OPERATIONS" — Elias Ghanem, Global Head of Market Intelligence, Financial Services at Capgemini f i nte c hma ga z i n e. com

BANKING

“ BANKS WILL FOCUS ON SUSTAINABLE OPERATIONS, REDUCING THEIR CARBON FOOTPRINT, AND PRODUCT STEWARDSHIP MINIMISING IMPACT OF BANKING PRODUCTS ON THE ENVIRONMENT” — Elias Ghanem, Global Head of Market Intelligence, Financial Services at Capgemini

With increasing reluctance to touch cash as a result of the pandemic, contactless payments is another area which has seen significant growth since the

seeking to maintain the increased levels

outbreak – it is predicted to have a value

of home working post-COVID-19, organi-

of over US$100bn by 2026. As the

sations must ensure they are being

amount of customers realising that

smart and efficient.

contactless payments are safe, easy

Ways in which the fintech industry is

and efficient continues to increase, it is

driving digitalisation include the use of

unlikely that this trend will reverse in

blockchain and artificial intelligence (AI).

the future. As a result, traditional and

Such technologies are expected to inno-

new entrant organisations should look

vate the entire global finance ecosystem,

to provide these kinds of services in

eliminate centralised processes,

order to maintain a competitive edge

enhance cryptocurrency, and allow for

going forward.

faster and move convenient transactions for customers.

MITIGATING THREATS While trends such as digitalisation and personalisation are certainly positive evolutions for the industry, with all innovation comes challenges and potential threats to mitigate. With this in mind, two considerations that those looking to accelerate their

JANUARY 2021

level focus on cybersecurity and the protection of customer data. Being able to demonstrate this to customers, ensuring that they feel safe and that their finance is secure, will be vital for retaining customers. Fraud prediction, similar to digitalisation strategy should also

cybersecurity, as more and more finan-

bear in mind include cybersecurity

cial processes are conducted online,

and fraud protection.

those that try to commit fraud will also

With Google reporting that, in one

look to evolve, increasing digital fraud

week, it saw 18 million daily malware

challenges. New technology such as

and phishing emails related to COVID-19,

Visaâ&#x20AC;&#x2122;s latest AI credit application fraud

now more than ever â&#x20AC;&#x201C; as organisations

prevention tool, will be vital to mitigat-

increase their digitalisation â&#x20AC;&#x201C; it is

ing those potential threats and provid-

important to ensure that there is a high

ing security for customers. f i nte c hma ga z i n e. com

MOBILE BANKING

HAVE DIGITAL BANKS TURNED THE CORNER? WRITTEN BY

RHYS THOMAS

MOBILE BANKING HAS COME INTO ITS OWN UNDER COVID-19, BUT FINTECHS MUST ADAPT TO COMPETE WITH THE STRENGTHS OF INCUMBENT BANKS

ast November, Starling Bank hit headlines with

the announcement it would break even for the first time. What would be a commonplace piece

of financial reporting in other sectors is a rare and

in some respects unique milestone in the mobile banking sphere. Starling posted £800k in profit on revenue of £9m for October 2020, making it “the first of the new breed of digital banks to become profitable,” according to its founder, Anne Boden. Industry commentators pointed to Tinkoff, the Russian digital bank founded by Oleg Tinkov, or China’s WeBank, as the actual first wave of neobanks to turn a profit. But Starling’s achievement remains noteworthy as an indicator of the sector at large: finally a big European mobile bank has entered the black, and in a year when incumbents were feeling the pinch. JANUARY 2021

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In the same month, ING announced

COVID-19 is the proximate cause,

1,000 job cuts and the closure of

forcing consumers to rely more heav-

consumer banks in several overseas

ily on digital interactions and ditch

markets. Simultaneously the Dutch

physical cash in favour of contactless

banking giant boasted more than

payments. In its April 2020 study

213,000 new primary customers who

â&#x20AC;&#x2DC;Remaking banking customer experi-

were attracted by its digital offering,

ence in response to coronavirusâ&#x20AC;&#x2122;.

and a steady increase of 5% year-on-

McKinsey found that while only a

year in mobile interactions.

third of US banking customers used

These contrasting examples are

a mobile app more than once a month,

emblematic of the biggest shifts in

those that did had a higher customer

consumer banking. The outbreak of

satisfaction rate, and average deposit. 53

f i nte c hma ga z i n e. com

MOBILE BANKING

“ [MILLENIALS] HAVE EXTENSIVE FIRST-HAND EXPERIENCE OF WHAT WORKS WELL AND WHAT DOES NOT IN THEIR EXISTING BANKING SET UP” — Aman Behzad, Managing Partner, Royal Park Partners

they offer poor customer service and clunky processes. In the third quarter of 2020, an influx

But in truth, the tide was already beginning to turn.

of new account openings on mobile banking platforms hit some incumbents hard. “The reason for switching?

DIGITAL MIGRATION

Improved online banking facilities (47%),

Where incumbent banks benefit from

preferable mobile banking systems

perceptions of stability and trust, excel

(39%) and better customer service

at offering broad services, access to

(37%),” says Teodor Blidarus, Founder,

deep wells of credit and regulator-

Fintech OS. “These are all customer

approved lending, they also suffer

experience reasons – nothing to do

from a systemic image problem: that

with products or financial terms.” The trend shows customers are placing a premium on convenience. They consider digital banks as intuitive and user-friendly portals for handling payments, deposits and withdrawals, and other quotidian personal finance tasks. Neobanks segue neatly into our ever more digital day-to-day lives, but they are still playing catch up when it comes to mortgages and other major finance functions. This is most evident in millenials, the former catch-all for young ‘digital

JANUARY 2021

natives’ who are now raising families,

their existing banking set up” and oper-

purchasing property, and heading

ate in both worlds, tapping through

towards the upper brackets of their

their daily outgoings on apps, while

earnings potential. While these cus-

turning to trusted, traditional financial

tomers, aged 25 to 40, were among

institutions for their mortgages or other

the first adopters of mobile banking,

large lending.

they grew up in a world of bricks-

Gen-Z customers (those born in

and-mortar retail and branch-based,

the mid-90s to early 2010s) are yet to

physical banking. In short, Aman

truly enter financial independence en

Behzad, Managing Partner at Royal

masse. Early indicators, however, show

Park Partners, argues they “have

they are more firmly digitally oriented

extensive first-hand experience of

than older generations, placing great

what works well and what does not in

value on “speed, convenience and cost f i nte c hma ga z i n e. com

MOBILE BANKING

“ THE REASON FOR SWITCHING? […] ALL CUSTOMER EXPERIENCE REASONS – NOTHING TO DO WITH PRODUCTS OR FINANCIAL TERMS” — Teodor Blidarus, Founder, Fintech OS 56

JANUARY 2021

– but more importantly brand identity,”

while they have “benefited customers

says Behzad.

in many ways, in some instances it has

Already a growing number of fintech

placed the emphasis away from the

ventures are springing up to chaperone

customer-centric model which once

them. Step, the US mobile banking

defined banking.”

platform launched amid the COVID-19

“We will see a return to relationship

outbreak, has set its sights on increas-

banking in 2021 as a priority, but now

ing financial literacy among teens. Its

combined with the convenience and

digital platform offers fee-free FDIC

benefits offered by digital banking,” Limb

insured accounts, Visa-backed cards,

adds. “It’s a delicate balance, but employ-

along with a suite of educational tools

ing the right technology will be critical for

and trackers for teenage users to learn

banks to deal with customers in the right

more about where they spend and

way, according to their expectations.”

where they could save. Step says its

Behzad agrees, and believes “the digi-

users save an average of the three

tal banking space is not slowing down

times the amount they spend.

any time soon. There is a multi-decade change taking place, all the while the

THE FUTURE OF MOBILE BANKING

world also continues to change and

Though mobile platforms have done well

evolve at breakneck speed, so there is

to attract new users and fill the gaps

no slowdown in sight, at least not until

in modern day financial mobility, Elliott

late into the 2030s.”

Limb, Chief Customer Officer of SaaS

“To continue this growth in the future,

cloud banking firm Mambu, believes digi-

digital banks and payment providers

tal banks must now focus their efforts on

must build their trust with consum-

a return to the personal services a local

ers. Currently, incumbent banks are

bank manager once offered.

considered more trustworthy, hence

Up until now they have focused on

they remain the go to for credits such

“convenience, increasing competition

as mortgages. Digital banks need to

and making the mobile customer experi-

establish themselves as the go-to for

ence the key differentiator,” he says, and

all financial needs.” f i nte c hma ga z i n e. com

T O P 10

Fintech Unicorns FinTech Magazine kickstarts 2021 with a breakdown of the Top 10 fintech unicorns ranked by their valuation

WRITTEN BY

JANUARY 2021

GEORGIA WILSON

f i nte c hma ga z i n e. com

T O P 10

2015

YEAR FOUNDED

CEO

NIK STORONSKY

UK HQ

Revolut

Value (USD) : $5.5bn

Founded in 2015, Revolut describes itself as “one app for all things money,” helping its customers to make more of their finances by building “the world’s first truly global financial superapp.” Revolut aspires to help customers improve their financial health, give more control, and connect people seamlessly around the world. While founded and headquartered in the UK, following successful investments from the likes of index Ventures, DST Global, Ribbit Capital, Revlout has recently expanded into the United States.

JANUARY 2021

National Stock Exchange of India Value (USD) : $6.5bn

Founded in 1992, National Stock Exchange of India strives to be the catalyst for India’s growth by creating investment opportunities, enabling access, and empowering its stakeholders. The company works hard to be smart and fast when it comes to delivering impact in the investment ecosystem by constantly reinventing itself to stay ahead and redefine the future. “Our ambition gives us direction. It pivots, and propels us. It is the leap we take from today, towards a brighter tomorrow.” National Stock Exchange of India has received investments from TA Associates, SoftBank Group, and GS Growth.

1992

YEAR FOUNDED

CEO

VIKRAM LIMAYE

India HQ

f i nte c hma ga z i n e. com

Make Every Customer Interaction Count Create innovative & delightful customer experiences with programmable communications. www.nexmo.com | sales@nexmo.com |

2012

YEAR FOUNDED

CEO

BRIAN ARMSTRONG

USA HQ

Coinbase

Value (USD) : $8bn

Founded in 2012, Coinbase sees cryptocurrency as “the future of money and a catalyst for creating an open financial system around the world”. As a result Coinbase strives to provide everyone around the world with easy and secure access to Bitcoin. With a mission to “create an open financial system for the world,” Coinbase believes that building a robust, trusted, and accessible cryptoeconomy will result in a more fair, impartial and open financial system. “An open financial system can be a great equaliser and lift billions out of poverty while accelerating the pace of innovation around the world. This is the best way we know to change the world.” Coinbase has received investments from Y Combinator, Union Square Ventures, and DFJ Growth. f i nte c hma ga z i n e. com

T O P 10

Ripple

Value (USD) : $10bn

Founded in 2012, Ripple strives to develop the future of global finance, develop decentralised solutions, and connect businesses to the people they serve. In order to achieve these goals, Ripple aims to unlock the power of blockchain and digital asset technology to dramatically improve the speed, cost and reliability when it comes to transactions, as well as provide access to open and inclusive systems anywhere in the world via decentralised financial technology, and harness the internet of value (IoV) as a catalyst for value exchange to redefine industries and globalisation. 64

Ripple has received investments from IDG Capital, Venture51, and Lightspeed Venture Partners.

2012

YEAR FOUNDED

CEO

BRAD GARLINGHOUSE

USA HQ

JANUARY 2021

2013

YEAR FOUNDED

CEO

DAVID VÉLEZ

Brazil HQ

Nubank

Value (USD) : $10bn

Founded in 2013, Nubank aspires to reinvent what’s possible and redefine people’s relationship with money. With many in Brazil paying high fees and interest rates for poor banking services, NuBank believes that by combining technology and design, this problem can be solved. Since day one, Nubank has strived to showcase that it is possible to do things differently; That “it was possible to treat people like humans, not numbers. And offer a service that is fair, simple and transparent. Because, after all, what we want is to give control back to people. To give them the chance to reinvent their own financial lives.” Nubank has received investments from Sequoia Capital, Redpoint e.ventures, and Kaszek Ventures.

f i nte c hma ga z i n e. com

Driving insurers

digital future into a

At Cognizant, weâ&#x20AC;&#x2122;ve invested in the end-to-end capabilities needed to help insurance organizations not just do digital, but be digital. We partner with our clients to unlock new value and through the power of digital technologies and new ways of working, we help them evolve into more competitive, progressive versions of themselves. Learn more at Cognizant.com

Klarna

Value (USD) : $10.65bn

Founded in 2005, Klarna’s founding mission was to make it easier for people to shop online. While technology and consumer behaviours have rapidly evolved since its founding, Klarna states that its mission remains as relevant today as it was back then: “to make paying as simple, safe and above all, smoooth as possible.” As one of Europe’s largest banks, Klarna provides payment solutions, including direct payments, pay after delivery options, and installment plans to 90 million consumers, across 200,000 merchants, in 17 countries. The company’s multiple offerings allows its users to pay for their purchases when and how they prefer. Klarna has received investments from Institutional Venture Partners, Sequoia Capital, and General Atlantic

2005

YEAR FOUNDED

CEO

SEBASTIAN SIEMIATKOWSKI

Sweden HQ

f i nte c hma ga z i n e. com

T O P 10

Robinhood

Value (USD) : $11.7bn

Democratising finance for all! Founded in 2013, Robinhood was built on a philosophy of democratising finance for all, flying in the face of the fact that “big Wall Street firms pay effectively nothing to trade stocks, while most Americans are charged commissions for every trade.” As a result, the company set its mission to build products that provide inclusion for everyone when it comes to the financial markets - not just the wealthy - by leveraging technology to “encourage everyone to participate in our financial system”. With the finance industry encompassing a complex system of regulation, 68

financial institutions, and assets, Robinhood aspires to always make its solutions simple, focused, and immediately understandable. Robinhood has received investments from Google Ventures, Andreessen Horowitz and DST Global.

2013

YEAR FOUNDED

CEO

BAIJU BHATT

USA HQ

JANUARY 2021

2013

YEAR FOUNDED

CEO

CHRIS BRITT

USA HQ

Chime

Value (USD) : $14.5bn

Founded in 2013, Chime strives to change the way people feel about banking by protecting its customers and helping them to stay ahead of their finances. Chime lives by its values to be a force for good in the banking industry alongside its banking partners. “We created Chime because we believe everyone deserves financial peace of mind. We’re building a new kind of online bank account that helps members get ahead by making managing money easy. It’s your money. It’s your life. Chime in.” Chime has received investments from Forerunner Ventures, Crosslink Capital, and Homebrew.

f i nte c hma ga z i n e. com

E M E A | A P A C | | APAC N O R T H | A EMEA MERICA AMERICAS FIND OUT MORE

FIND OUT MORE

T O P 10

2000

YEAR FOUNDED

CEO

PATRICK COLLISON

India HQ

2000

YEAR FOUNDED

JANUARY 2021

CEO

VIJAY SHEKHAR SHARMA

India HQ

One97 Communications Value (USD) : $16bn

Founded in 2000, One97 Communications is one of Indiaâ&#x20AC;&#x2122;s leading mobile internet companies, which operates its flagship brand Paytm. Paytm is a digital goods and mobile commerce platform, driven by an ambitions to provide great customer experience. In addition to being a commerce platform, Paytm also provides payment solutions to ecommerce merchants. Headquartered in New Delhi, One97 Communications has received investments from the likes of Intel Capital, Sapphire Ventures, and Alibaba Group, as well as investing itself into early stage mobile companies through the One97 Mobility Fund (OMF).

f i nte c hma ga z i n e. com

T O P 10

01 Stripe

Value (USD) : $36bn Founded in 2010, Stripe operates with a mission “to increase the GDP of the internet.” With a value of $36bn the company builds economic infrastructure for the internet, allowing businesses to accept payments and manage their business. Stripe’s payment platform is said to put revenue data at the heart of

business operations, with solutions to prevent fraud, manage revenue, expand, and move money with reliability, scalability, and security. Stripe is backed by multiple investors including Khosla Ventures, LowercaseCapital and capitalG.

2010

YEAR FOUNDED

CEO

PATRICK COLLISON

USA HQ

JANUARY 2021

Using the Stripe Dashboard CLICK TO WATCH

14:05

f i nte c hma ga z i n e. com

Digital & data drive Orange Cameroonâ&#x20AC;&#x2122;s virtual growth 76 WRITTEN BY

DOMINIC ELLIS PRODUCED BY

STUART IRVING

JANUARY 2021

f i nt e c hma ga z in e. com

ORANGE CAMEROON

Abdallah Nassar, Director of Engineering and Network Development, explains how a focus on data and strategic partnerships are driving growth

range Cameroon has been at the forefront of technological changes in west Africa for the last 20 years. Abdallah Nassar,

Director of Engineering and Network Development, 78

chronicles the key telco periods as “voice, data and virtualisation” and, in line with the group’s wider African strategy, highlights four key priorities for the next five years – digitisation, data, rural and ‘green’. During our online meeting, we talk through each of the key areas. But it is a comment he makes halfway through which resonates and may explain why Orange Cameroon continues to see marked growth and receive prestigious network and coverage awards, most recently winning the nPerf (Best Network Performance for year 2019 and H1-2020 and Ookla Speedtest Awards for Best Mobile Network Coverage for H1-2020. “Orange Cameroon is not only an operator – it’s also a Foundation,” he said. Established in 2009, the Orange Cameroon as operator and foundation

JANUARY 2021

f i nt e c hma ga z in e. com

ORANGE CAMEROON

â&#x201A;¬42bn 2019 sales

Countries in network

143,000

Number of employees worldwide 80

JANUARY 2021

EX EC U TIV E PROFILE:

Abdallah Nassar Title: Director of Engineering & Network Development Company: Orange Cameroon Industry: Mobile, data, communications 21 years of experience in the telecom domain, holding senior positions in Africa, MEA and Asia Pacific. assigned as CTO with key operators in West and Central Africa, CTO with Digicel Pacific, CTO with Vodafone and Chief Engineering and Network Development with Orange Cameroon. Assigned as Technical Operational Consultant for a governmental projects in North Africa, Middle East and Asia. Holding a Management Information System degree, Chartered Computer Engineering from Manchester University. Certified as Executive Business Administration from Wharton School Pennsylvania. Holding certificates such as MCP, MCDBA and MEP from Microsoft, UNIX certified, IT project with an I-Net and CIW certificates.

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83 has played a pivotal role investing in the country’s development, channelling investment into basic education, healthcare for people with communication-related disabilities, professional training and culture. Having an unwavering socio-economic outlook has definitely stood the company in good stead. Two Cameroon concepts were

“Before the customer was following the operator, now the operator must follow the customer ” — Abdallah Nassar, Director of Engineering and Network Development, Orange

recently among 13 digital projects selected for the 2020 Solidarity FabLabs challenge, while the Orange Africa and Middle East Social Entrepreneur Prize celebrates its 10th birthday this year. f i nt e c hma ga z in e. com

ORANGE CAMEROON

“ We are aiming to be almost 90% digital by the end of 2020” — Abdallah Nassar, Director of Engineering and Network Development, Orange

Over the last decade, the Orange Organization’s success has engendered huge respect among Cameroonians and provided a model for sustainability; Nassar is proud that only around one percent of his 500 to 600 direct employees are expatriates. “People here are very dedicated and have an open mindset,” he adds. Demographically and virtually, Orange Cameroon is on firm foundations for virtual growth. He describes the company as the “one of the largest operators in Cameroon”,

although almost in the same breath says he sees itself as equal with the undisclosed front-runner. He tells me that Africans typically own two or three SIM cards, so achieving a dominant market share isn’t straight forward. Cameroon also has some distinctive dynamics given its Francophone-Anglophone mix. Nevertheless, it has the biggest network “in terms of the number of sites, towers and coverage,” he said, with its customer base hovering between 8.5 and 9 million. We start our discussion on digitalisation, a vast area which he likens to a spider’s web, and discuss some of the

JANUARY 2021

Spot Life Taste CLICK TO WATCH

0:30

85 key COVID developments, such as

investment right now is to keep your

‘My Office Everywhere’ and other initia-

quality in place,” he said. “Three to four

tives such as digital archiving, which

months wasn’t enough time to bet-

is simplifying RFPs and order taking.

ter understand customers’ changing

“Before the pandemic, it was 10 per-

needs, but it was enough to change

cent, but now we’re touching 50-60

the way we are working and investing.

percent in the digital terrain. We are

We are always putting the customer

aiming to be almost 90% digital by the

and market need in front of us.”

end of 2021. There is always the 10%

It’s no surprise to hear that data is crit-

which cannot be digitalised as we are

ical to Orange Cameroon, but it’s worth

working with the public and government.”

stressing how just pivotal it is to the

One key change to emerge from the

virtualisation push. “Five years ago,

pandemic has been the focus on quality.

the voice revenue started to decline,

“The top priority of each and every

now all investment is around data.

f i nt e c hma ga z in e. com

ORANGE CAMEROON

“ Now all investment is around data. The virtual will be based on a solid data network” — Abdallah Nassar, Director of Engineering and Network Development, Orange

JANUARY 2021

253mn Customer base

208mn Mobile customers

We are heavily investing in new services, first to introduce 4G+ in country, and working on launching the new 4.75G. The virtual will be based on a solid data network.” We move into the rural domain, where he is keen to emphasise its partnership with Canadian-based NuRAN

21mn

Fixed broadband customers

Wireless (Cameroon’s 26 million population is evenly split between cities and rural areas). “They have a very unique product, it’s a radiocoverage telecom product which is specifically designed for rural areas and can be quickly deployed,” he said. Its rural network penetration stands at about 80 percent. “Geographically we are not yet there, we will still have five years to continue the rural coverage – many of them are small hotspots.” Alongside NuRAN, he Huawei, which are working closely with Orange to cooperate in virtualization and Core Network development. “despite the serious competition and challenges that Huawei is encountering these days but still Huawei represent a very strategic vendor for Orange Cameroon and Orange in global. We are on fast development track with Huawei to f i nt e c hma ga z in e. com

H I T YO U R O B J E C T I V E S W I T H Z E R O I N V E S T M E N T.

SCALING WITH NETWORK-AS-A-SERVICE

solutions start here!

bring in advanced services to market

and cloud systems, and take another

such as Smart-Wifi, Cloud Services

four to five years. On completion, we will

and Virtualization. There is no end of

have fully modernised our network.”

plans with Huawei,” he says.

He adds that financial services will be a

Nokia and Orange embarked on a

key focus in future.

major 4G LTE regional roll-out in 2018,

Technology’s changes have been

which saw the former upgrade Orange’s

profound and there is “no comparison”

radio access network to enhance

between 1999 and 2020. “Before the

mobile broadband services.

customer was following the opera-

“This was the first step of monetisation

tor, now it’s the other way round – the

of the network,” he says “The radio is

operator must follow the customer,

almost completed and the second step,

and the vendor must follow the operator.

with Huawei, will focus on virtualisation

Moving from legacy to virtual concept, f i nt e c hma ga z in e. com

ORANGE CAMEROON

“ I am ‘hands-on’ and a team player, and I do share my experience. If my team is not dev eloping, I cannot develop myself” — Abdallah Nassar, Director of Engineering and Network Development, Orange 90

the entire technological mindset has

being finalized by the United Nations

changed.”

Economic Commission for Africa

On environmental matters,

(ECA). Nassar said one option could

Cameroon’s private sector is curr-

be to create more green solarisation

ently ill-prepared to leverage a spate

concepts and find hybrid solutions

of opportunities offered by the green

to minimise power consumption

economy but a comprehensive set

and pollution.

of measures, which “Government

While many developed markets are

should spearhead”, can turn the issue

swept up in 5G hype, Nassar says

around, according to a new study

much of West Africa remains on 2G,

JANUARY 2021

primarily because of the product and

government dialogue to see how it

power purchasing of the customer.

can develop its own technology and

“First we must convert them to 3G,

continue to grow the economy. “We

and then 4G. To talk about 5G now

have the will to invest more.”

on the continent is very difficult and costly. Are we ready in terms of frequencies? Yes. But we are not ready in terms of regulations, infrastructure and monopoly.” He says it is maintaining f i nt e c hma ga z in e. com

JANUARY 2021

The worldâ&#x20AC;&#x2122;s largest platform for working capital WRITTEN BY

HARRY MENEAR PRODUCED BY

CAITLYN COLE

f i nt e c hma ga z in e. com

C2FO

Saket Sarda and Iain Rolfe discuss C2FO’s revolutionary fintech platform, releasing working capital back into the market, and the company’s APAC expansion

uring times of financial hardship, the ability for companies to remain flexible, adaptable and agile is paramount. Having

ready access to the necessary liquidity in these situations is essential. Unfortunately, since the outbreak of the coronavirus pandemic in March, 94

many firms have found the channels through which they access additional working capital closed off to them. “COVID-19 was a huge shock to the market system. The initial reaction was to hunker down, stop investment, and minimise risk,” explains Saket Sarda, Head Enterprise Sales for APAC at C2FO. “At the same time, the banks issued a blanket credit freeze, large scale enterprises, all the way down to small-scale operators. Nobody could get access to any working capital.” Even though that freeze has begun to thaw, its benefits have disproportionately served larger, more stable firms, leaving smaller and mid-sized companies out in the cold. Not only is this state of affairs potentially devastating for smaller firms cut off from sources of liquidity, Sarda continues, but JANUARY 2021

f i nt e c hma ga z in e. com

C2FO

Saket Sarda @ C2FO CLICK TO WATCH

1:03

“ Your supply chain is only as strong as its weakest link” — Saket Sarda, Head of Enterprise Sales, APAC, C2FO

necessary liquidity to make the screws, machine parts, whatever it is you need, your entire production suffers and creates a ripple effect on the other suppliers in the supply chain,” he says. “On our platform, we have close to a million of these compact suppliers. When their lifelines were taken away from them,

the impact has the potential to ripple

the only option for liquidity remaining

outwards through their supply chains.

for them was C2FO. We worked with the

“Your supply chain is only as strong

banks and the corporates to get liquidity

as its weakest link. If the small supplier

to the buyer, so that it can then make its

that makes up the farthest end of your

way to the supplier to, in turn, support the

supply chain can’t get access to the

operations of those large corporates.”

JANUARY 2021

Based in the US, C2FO is one of the

“The most disruptive innovations are

larger fintech firms working to revolu-

typically the most simple,” says Iain

tionise the ways in which buyers and

Rolfe, managing director of C2FO’s

suppliers of every size in every indus-

operations in Australia and New

try can access the working capital

Zealand. “That’s what we’re doing –

necessary to survive challenging

challenging this really fundamental

times and thrive in the years to come.

notion of the power dynamic between

E X E C U T I V E P R O FILE :

Saket Sarda Title: Head of Enterprise Sales, APAC

Industry: Financial Services

Location: Singapore

Saket has more than 25 yrs experience working in the Banking and IT industry with expertise in Business Development, Corporate Sales, Trade Product Management working in Africa, Middle East, Russia, ASEAN and Southeast Asia. Saket serves as Head Enterprise Sales, APAC for C2FO and brings a wealth of expertise to expand C2FO’s footprint in this region, where partnerships and product offerings must be augmented in innovative ways. He would be driving C2FO current efforts in India, Taiwan, China and Australia, as well as focus on new opportunities in the Asia Pacific region that are vital to global trade and corporate supply chains. Prior to C2FO, Saket was Managing Director at Standard Chartered Bank managing the Trade business regionally working closely with corporates, regulators and third-party platform providers. Saket holds a B.Eng degree and a Post Graduate Diploma in Management from IIM-A. Saket, his wife and two children reside in Singapore. f i nt e c hma ga z in e. com

C2FO

A HELPING HAND

The COVID-19 crisis has been economically devastating for companies of all sizes and backgrounds, but particularly for minority-owned businesses. Research done by the University of California, Santa Cruz, found that approximately 440,000 blackowned businesses in the United States (over 41%) were forced to close in response to COVID-19. In contrast, only 17% of white-owned businesses experienced the same setbacks. C2FO’s Equity and Inclusion Program is aiming to help change this state of affairs by providing diverse supplier certification, reduced rates and access to a broadening funding ecosystem. “We’re trying to help those minority segments get easier access to capital through special offers. It’s good for everyone and it addresses the impediments and biases that exist for those minority groups through no fault of their own,” says Rolfe. “That concept of economic justice and of equity inclusion is very strong in C2FO’s culture.”

JANUARY 2021

buyer and supplier, and disintermediating third parties that have become part of those interactions over time.” We sat down with Sarda and Rolfe to discuss C2FO’s ongoing expansion into APAC, following more than a decade of growth in the US and a successful expansion into Europe.

THE WORLD’S FIRST WORKING CAPITAL MARKETPLACE C2FO was founded in 2008, in direct

response to the global financial crisis,

established in response to the need

a catastrophe which cost the US alone

to get liquidity flowing out of the bank-

an estimated $22trn. The response to

ing system, as well as from buyer

the crisis, Rolfe explains, was similar in

to supplier.

a lot of ways to the market’s response to COVID-19. “Liquidity dried up and smaller sup-

Even when the world isn’t languishing in the grip of a pandemic or financial crisis, Rolfe explains that

pliers were unable to access working

there is a fundamental issue with the

capital through normal banking relation-

way that suppliers are often forced

ships, as well as through the invoices that

to acquire their working capital.

were outstanding from their customers,” he says. C2FO, Rolfe continues, was

“Lack of liquidity is a situation that our customers and suppliers face f i nt e c hma ga z in e. com

C2FO

“ The most disruptive innovations are typically the most simple” — Iain Rolfe, MD, ANZ, C2FO

“Going to a bank is going to be a much more painful and lengthy process to free-up liquid capital that they may need urgently,” he says, adding that the cheapest form of financing is money that the company is already owed. This is the core solution that C2FO is built on. Companies can use the C2FO working capital market platform to access funds that are owed and

100

every day. At a fundamental level,

invoiced ahead of their due date, in

whether you’re a large or small organi-

exchange for a fee, and at a price that

sation, a supplier, a buyer or both, you

they themselves determine. “It’s an

need to have access to working capi-

equalised system of suppliers and cus-

tal,” he explains.

tomers which cultivates collaboration,”

What this means is that firms are

says Sarda. “We bring price discovery,

constantly trying to thread the needle

profitability, and cash flow into our

between income and outgoings, whilst

customers’ supply chains.”

also having enough liquidity to support

C2FO onboards approximately

expansions, mergers, new ventures,

50mn invoices to its platform every

or to respond to something unexpected

day. “It’s a mammoth technological

– like a pandemic, for example.

challenge,” Rolfe notes.

“When a crisis emerges, you

In order to support this kind of vol-

either go out of business or find

ume, he explains that the company

more working capital to get through

has built a “SaaS platform that runs

that period of time,” Rolfe explains.

on the underlying compute, security

Historically, the typical response

and storage capabilities of a big cloud

has been to get a loan from a third-

services organisation. We then run

party financial institution.

a very sophisticated set of algorithms

JANUARY 2021

on top of that stack that allow us to

keeping a continuous interface

ingest and process that volume of

between the platform and its cli-

invoices every day at scale.”

ents. Instead, they use point-in-time

For the sake of both security and simplicity, C2FO’s platform avoids

onboarding each day. “We can pull the necessary invoices from our

E X E C U T I V E P R O FILE :

Iain Rolfe Title: Managing Director, Australia and New Zealand Industry: Financial Services

Location: Greater Sydney Area

Iain leads C2FO in Australia and New Zealand, working with multinationals and local corporations in need of more flexible solutions that provide better control and management of their financial performance. Previously, Iain held multiple roles during his tenure at Cisco, including Chief Commercial Manager for Australia and New Zealand and Chief Operations Officer for their Technical Services division. While there, he established the overall commercial management function for Asia Pacific and led the structuring of their first three direct deals in China and India. Previous to Cisco, Iain worked for Orange Business Services, France Telecom, and founded his own Internet company. Recognized as a global expert in complex adaptive business models, Iain was awarded a Ph.D. from Macquarie University and holds a Master of Commerce and Bachelor of Business in behavioral economics. He is based in Sydney, Australia.

f i nt e c hma ga z in e. com

101

C2FO

C 2FO AU ST RALI A

102

Rolfe has been leading C2FO’s expansion into the ANZ market since May 2019. Almost more than anywhere, he says, the ANZ market needs new ways for companies to access working capital. “Australia has gone through a period of many challenges. There’s been the financial crisis, there was a government intervention setting out the terms of engagement between big and small suppliers, and then we hit bushfires followed by COVID-19. People here are just punch drunk,” he reflects. In order to recover, Rolfe continues, the ANZ market needs to find new ways to collaborate using technology. C2FO’s role will be to work as a

JANUARY 2021

national working capital control centre through its platform that provides companies with multiple different avenues to generate value. “We’re going to help companies look at an invoice and think about the best way for the capital locked in that invoice to benefit the entire supply chain,” Rolfe continues. “Australia has a very special market with its own financial culture and system. What we’re doing here is taking the best of what C2FO does around the world and customising it for Australian customers. We want to be able to look back in a couple of years and be proud of our role in this collaborative recovery for the ANZ market.”

“ When a crisis emerges, you either go out of business or find more working capital to get through that period of time” — Iain Rolfe, MD, ANZ, C2FO

The platform, Sarda explains, straddles the customer’s procurement and sales functions. “It means that you have a uniquely better view of your cash flow,” he says.

ENTERING APAC C2FO’s presence in the APAC market is relatively new, launching its operations in China and Australia two years ago, expanding its presence in India

customers’ ERPs into our system, do

and adding Taiwan to its portfolio in

what we need to do, and then push the

2019. Sarda’s role in the company’s

equivalent instructions back into their

expansion has several elements, each

systems,” Rolfe adds.

aimed at increasing C2FO’s APAC

Iain Rolfe @ C2FO CLICK TO WATCH

1:06

f i nt e c hma ga z in e. com

103

C2FO

2008

Year founded

463

Number of employees

180

Countries 104

“ If C2FO wishes to achieve the same market penetration it has in Europe and the US, it needs to find ways to appeal to the huge numbers of mid-market, midsized firms in APAC” — Saket Sarda, Head of Enterprise Sales, APAC, C2FO

foothold, and developing the uniquely APAC-centric value proposition it can present to its new customer base. “The first part of my role is business development, which is different from direct sales,” Sarda explains. Whether they’re with large corporates, banks or governments, the partnerships that Sarda is building are intended to fuel the local economic engine with C2FO, making the platform a more

JANUARY 2021

105

relevant proposition to companies in a

innovation that supports those goals.

given market. Second, the direct sale

In contrast to the US and Europe –

of services to new clients, both in the

which are fairly homogeneous markets

four countries where C2FO is operat-

– APAC is a very different beast with

ing, and beyond, initially in markets

an eclectic collection of varied rules,

like Thailand, Malaysia, Indonesia,

taxes and practices.

Singapore and later expanding into

“In the West, the very nature of

the Philippines, South Korea, Japan.

the Fortune 500 belies how many

Lastly, he is working to ensure the

large-scale corporations there are

broader relevance of C2FO’s offerings

in that market. APAC has a smaller

to the APAC market, and driving the

percentage of large corporations f i nt e c hma ga z in e. com

C2FO

by comparison. In APAC, and more

a mid-sized company that might not

importantly in ASEAN, a few high-level

have too much data of its own, we’re

corporations control large segments

able to provide a far more nuanced

of the economy - equivalent to that

view of their own supply chain that

which 500 companies control in the

they might not have had so far.”

US,” Sarda explains. Therefore, if C2FO wishes to achieve the same

COVID-19 AND BEYOND

market penetration it has in Europe

The past year has been a challeng-

and the US, it needs to find ways to

ing one for companies worldwide.

appeal to the huge numbers of mid-

As liquidity has dried up, and larger

market, mid-sized firms.

corporations and banks adopt more

“We’re looking at a comprehensive 106

conservative stances, C2FO has

offering which straddles payables

become a driving force in preserving

and receivables, creating an invoice

resilience and agility in the markets

central for a corporate, and also by

it serves.

connecting to their ecosystem of sup-

“Since COVID-19 hit, many large

pliers and customers to be more like

organisations drew down large

an invoicing intermediary between

amounts of capital through their

firms,” he says, adding that another advantage that C2FO hopes to leverage in APAC is its data. “Our existing presence in a lot of APAC countries, across numerous industries means we have a lot of data on trade,” Sarda explains. The 50mn invoices that are added to C2FO’s platform every day help generate deep insights into the wider market. “We can use all this data to give value back to our clients,” says Sarda. “For JANUARY 2021

“ We want to be able to look back in a couple of years and be proud of our role in this collaborative recovery for the ANZ market” — Iain Rolfe, MD, ANZ, C2FO

T H E C H I E F F I N AN CE AN D I N SI GHT S O FFI CER

The nature of executive roles is forever changing, as digital transformation reshapes the capabilities and demands placed on companies’ leaders. Sarda reflects that the traditional role of a Chief Finance Officer (CFO) may look very different in just a few years. “Historically, a CFO uses past data to explain why things have happened and provide analysis. Going forward, I think that the CFO role will become far more about providing insights for future decision making,” he says, adding that the role will become about developing insights into how

one course of action will interact with other elements of the business, and ultimately figuring out how to make the company more nimble. “If the world keeps undergoing the kinds of crisis that we’ve been seeing, the companies that end up being successful are going to be the ones that manage to have more variable practices,” he adds. “Passive knowledge of things like accounting is going to evolve towards strategy, ecosystems and therefore outsourcing and the need for platforms like C2FO that can help provide good data in those areas.” f i nt e c hma ga z in e. com

107

C2FO

108

credit lines, got lots of money in the

like the Equity and Inclusion Program,

door, and began tightening up on their

C2FO is working to help the world sur-

expenses. It’s the same reaction that

vive and even thrive in these challenging

they had to the financial crisis in 2008,”

times. Rolfe reflects that the past year

says Rolfe. “What’s different this time

has been one of, at times, frantic activity

around is that our customers have had

for himself and his team.

the ability to treat the crisis in a more nuanced, technology-driven way.”

“In many ways, we’re a counter-cyclical business. When the chips are down for

Through its market-based approach

the economy as a whole, that’s when

to freeing up liquidity, as well as initiatives

more people come to use our platform

JANUARY 2021

dilemma whether we should continue to try and expand into new markets, given that we can’t travel, recruit and train new people,” explains Sarda. “This year, we decided to double-down on the investments we’ve made in the countries where we’re already active.” Going forward, Sarda intends to continue focusing on the three main areas of his remit: developing relationships with key partners, expanding into new markets like Singapore, Thailand and Malaysia, and continuing to develop new products and services that are uniquely tailored to help APAC companies get the most out of every part of their balance sheet. Looking to the future, Sarda is optimistic about the potential for progress, even in uncertain times such as these. and our services, so we’ve had our hands

“I think that what C2FO did in the US and

full this year,” he says. “We’ve had a huge

Europe in a matter of five to six years

uptick, not just in our customer base, but

will be accomplished much more quickly

also in our range of products on the mar-

in APAC.”

ket. We’re iterating and releasing new products almost bi-weekly because of how fast the landscape is moving.” In ANZ, as well as the rest of APAC, C2FO has pivoted its operations in response to the crisis. “There was a f i nt e c hma ga z in e. com

109

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