Highlights from Finovate Europe 2017, Day One (Or “Banking still has a long wAI to go…”)
As media partners to Finovate Europe 2017, we were invited along last week to see what the key trends, latest innovations and newest tools and products in FinTech and digital banking were. We were certainly not disappointed with the selection on offer…
DAY ONE SESSION ONE
First to present was Angelique, CEO of GainX, who introduced Flow AI, which they described as a tool for ‘innovation strategy management’. It uses AI and machine learning to help organisations… manage their innovation strategy. This includes showing where ideas are coming from, predicting what will happen to them, improving and measuring the ROI of ideas, and shaking up the ‘clay layer’ within the organisation (preventing ‘Innovation Drag’). Their apps are called Intellect and Open Thinking and they likened their platform to Salesforce i.e. it’s like managing sales/customers, but for ideas.
Next up we had Danny Watkins from Market Early Bird, which he describes as ‘Professional read-only Twitter for banks’. He collects Tweets, relevant for traders and analysts, and presents them in a cloud-based interface that is ‘professional, read-only, compliant and organised’. It uses AI to identify the most relevant Tweets, and which ones are going to go viral, and to ‘cut out the noise’. He says it helps banks ‘get to the value of Twitter’. (Apparently it can be used on any device, is low price and rolls out quickly).
Philip and John from Jumio – the ‘biggest/fastest-growing/market leader in online identity verification’ – spent 2016 talking about facial recognition, but today focused on their new tool, Net Verify. It’s an address verification tool that works with ANY household utility bill in ANY condition – even, as they demonstrated, crumpled and pulled recently from the bin. They talked about having a focus on the ‘mobile web’ but do have solutions for apps and desktop. The solution is expedient enough to aid customer conversion, and the information can be accessed server to server or via API.
Ncino brought a little team to the stage to talk about their cloud banking software technology – an efficient, compliant end-to-end operating system, no less. They walked through the example of a customer attempting to take out a small business loan via Victoria Bank, one of their clients. Rather than being declined for a $250k loan, he was auto-approved for $150k and could provide more details (a photo of his business’ financial statement) to secure the higher amount (no manual data entry). Data appeared in the bank’s dashboard creating a rich profile of the customer and aiding the decision making process. Their solution is customisable and configurable, and uses AI to make the decision-making process ‘not just about credit score and not a black box’. The UI was nice – ‘Mr Snell will be thrilled’ when the bank employee approved the loan – and they mentioned balancing quick access with a better relationship. I think they said they had 130 customers.
Dutch company Five Degrees took the stage with their client Munnypot, an online financial advice service who has taken the Five Degrees system (Matrix) ‘to the next level’ with their robo-advice technology. It’s a goal-based investment platform using a Whatsapp-Style chat-based interface. It makes suggestions and recommendations for customers’ investments. There is a dashboard and alerts. It gives Robo ADVICE (emphasis on advice). (According to Five Degrees’ blog, ‘During Finovate, Five Degrees will launch a dramatically improved version of Matrix, with new product features to help customers overcome the challenges of innovation, disruption and PSD2 legislation.’)
James Stickland, CEO of Veridium the identity access management company, introduced its new product – four-finger authentication or ‘4F’. The depth of the image makes it harder to spoof. Their core competence is biometrics and they use ‘visual cryptography’ – half of the secure key is stored with the customer and half with the enterprise. Their focus is on replacing passwords and letting people be passively authenticated – £5-6m was apparently spent on resetting passwords in JP Morgan.
Dan at SaleMove introduced their hybrid robo/human experience, where they ‘make the bank’s website like the branch’ with a clever application of co-browsing technology. Customers are onboarded faster (and can service their accounts more effectively/efficiently) thanks to software that uncovers where customers are getting stuck on forms and so on. ‘Let’s chat’ or ‘Let’s speak’ means they can share their screen with an advisor, speak to them on video chat (and turn on ‘pyjama mode’ if they don’t want to be seen!) and use a unique telephone number to call the help centre so everyone is caught up quickly. Rather than ‘how can I help you?’ bank advisors can jump straight to ‘Can I guide you through the final steps?’
John Saffron from PUSHFOR opened with ‘Smart people push’. Its technology is around content sharing, focused on the three Cs – conversion, control, and configuration. The platform lets you set permissions, and send documents with security, tracking and the inability to download it when you get it and so on. The client’s phone doesn’t have to have the software installed, but documents will still render in high definition. You can use geo ring-fencing, make it invisible later, and use analytics around it for your business. ‘Fintech is not just about numbers, it’s about content.’
CollectAI introduced an efficient debt collection service – a way to ‘reinvent debt collection’ with a platform/API that helps brands manage outstanding payments, invoices, accounts payable and debt collection, at a low cost while still creating a good client relationship. You can use APIs or a CSV upload to share the debt portfolio with the system, and it uses artificial intelligence to work out the good, fair and bad debts and the best way and time to approach the person.
ING Bank Poland came to talk about what they mean when they say innovation, and show off their new-look banking channel. Built from scratch, it is ‘simple, intuitive, pretty’ and ‘built with customers for customers.’ It includes real-time spending categorisation, a new customer communications engine, ‘budgets’ you can set up, savings goals, and advisory services. Based on 1400 hours of customer testing, they realised they were initially making it too over complicated. It now takes three clicks to apply for a loan, for example. You can search all transactions, as well as upcoming payments/Direct Debits, and of course do all the usual banking activities.
DAY ONE SESSION TWO
Session 2 of Tuesday kicked off with Comarch, who introduced their assistant Myra. She helps you manage your wealth while in your car. Basically, a voice-controlled wealth management tool with some AI in the mix.
We then saw a new digital identity solution from Signicat. They posited that banks were set to lose 43% of retail payments due to PSD2 (Accenture stats). So they have built a cloud-based on-demand solution – which has already seen 100m transactions and 200+ institutions use it (mainly in the Nordics) – in the ‘battle to onboard’. In the German market it uses live video to onboard customers. They also mentioned the GOV verify scheme and partnering with DirectID to look at data from your current account to establish your creditworthiness. They helped Barclays with EnterCard and the solution is being used by Bank Norwegian.
EyeVerify was, unsurprisingly, talking about an eye print ID solution. It’s a biometric authentication method, based on the veins in the whites of your eyes, and is very secure and fast. Controlled by the bank and very hard to spoof, it can be used for the login process or authentication. YapiCredi in Turkey is a client, and they have 3m mobile banking users ‘using their mobile like a remote control’ (e.g. they can authenticate on mobile for desktop banking). The company is also letting users withdraw cash (with a QR code) and customers who get through to the call centre don’t need to reauthenticate – they did a great live demo to the call centre and the woman said ‘hello Finovate Europe!’ like Eurovision and it was fab.
Envestnet Yodlee was next; a company that was referenced by several others as a partner throughout the event (they have 60m consumers, I believe). They have an open API platform and developers portal, where they offer data enrichment and predictive analytics. They have URLs for a range of APIs plus integration guides. They will be able to categorise transactions based on merchant ID, and they use network data too. They have a sandbox. They help you offer a ‘superior customer experience’, for example via a chatbot app. The tech allows for personalised recommendations and AI can help customers make ‘smarter financial decisions’.
The guys at Configo sported jaunty hats during their demo to make it more memorable. They showcased a ‘personalised and contextual human-centric’ ‘mobile experience platform’ that would let you target different audiences with the right content in real time. It allowed you to increase engagement and sales by testing and then deploying segment-specific content. For example, changing the text, layout, colour, promotional pop-up etc. based on age, balance levels and customer type. It did look very easy to turn off or gradually roll out features, and quickly make the app look (and work) differently depending on who was using it.
Opentech (plus David from MasterCard) presented its mobile payment solution, via a funny fake purchase of a Burberry bag. They talked of banks prevailing in payments and offering a ‘smooth, multichannel user experience’ that is secure and also acts as a cross-selling opportunity. Their mobile wallet, Open Pay, combines payment and loyalty cards, uses geolocation to suggest the relevant store card, and sends notifications of purchases. You can scan a copy of your receipt and the data will be stored in the app. You can also choose to pay in instalments, or use the wallet to buy online.
Stefan and Kristoff from Aqubix presented a KYC PORTAL. Helping with due diligence and compliance, their platform puts data in one place and provides a ‘holistic’ view. It automates risk and notifies banks of suspicious behaviour. Rather than a reliance on manual processes and human bias, it uses an organogram and real-time transaction monitoring ‘across the entity structure’ not just the subject. From the portal you can invite people for a ‘face-to-face’ (video call, which you can record) and during this their face will be compared to identity docs. It reduces cost and provides a full audit trail. They also have a ‘global AML dashboard’ with specifics at a country level.
Infosys Finacle presented something to do with Blockchain that was hard to follow but Emirates NBD and ICICI bank are already trialling it. It’s a closed loop network for faster, more transparent payments. Smart contracts, based on pre-set business rules, and a shared ledger for a single source of truth. A shared document repository that wasn’t paper intensive. API-driven – so could integrate seamlessly with existing systems. ‘Increased integration, trust and transparency.’
Next up was Brett King of Moven (Enterprises), the ‘only profitable neobank in the world’ according to him. Greg Midtbo, CRO, said that 2016 had been a ‘transformative year’ as they added another million customers and set up fintech partnerships with banks, giving (all of?) them the number one app in the app store at launch. Working with TD bank they’ve found customers are now half as likely to leave the bank and making 8% fewer discretionary purchases i.e. they are becoming better at saving money. Moven can launch apps in 5-6 days, and have added Alexa integration and account aggregation to their platform. They use Yodlee. They give people a longer-term savings potential via ‘behavioural gamification’ and talk about the velocity of savings rather than simply savings goals. ‘The goal paradigm is broken,’ said Brett. People have competing interests and there is a difference between short term and long term. They are now in 6 geographies with 10m users. They said ‘we drink our own champagne’ because they are both a technology provider and a bank themselves – launching in the UK as Moven UK. It only took 4 weeks.
CrowdProcess introduced JAMES, a narrow AI for assessing credit risk. In a team it could take 3-4 months; with James it will happen in 6 minutes. You provide the data and the system builds the most appropriate model, parsing the most interesting columns in the data set, using machine learning. (Only bank doing it is Capital One!) You can set restrictions around traditional metrics, and the model is built. It compares itself to other models and uses a Bayesian optimiser (it’s apparently tech that was used at CERN) to ensure it is optimal. A report is written in 5 seconds, looking good and still totally compliant. You can deploy the model to write a script and run in the cloud. You can ‘monitor’ it as you will get notifications. ‘Risk systems have not evolved enough,’ they claimed.
DAY ONE SESSION 3
After lunch, Tobias, CEO of DSwiss, presented alongside Stephan from UBS, showing off a secure digital wallet. Because ‘people trust banks most of all’ with their money, UBS has launched UBS Safe (with DSwiss), a digital version of the safe deposit box. As well as becoming the default ‘inbox’ for messages from the bank, the area can be used as a repository for sensitive documents, a password manager, and a way to create ‘happier and stickier’ customers. All data is stored on their servers in Switzerland. The platform now offers up semantic search functionality, even though the documents are encrypted – very smart stuff. Having launched 5 months ago, 15% of UBS customers are using the platform actively. They think they have ‘hit a relevant customer need’.
Don and David from Infolio presented something a little different – tech for a digital workplace. They demonstrated a ‘digital canvas’ where you could share documents, categorise things, make lists, annotate documents, chat and so on – all in a secure way. For example, any docs from SharePoint would be on the Infolio boards with the exact same permission levels/structure as they had in SharePoint, automatically. It can also link dynamically with your CRM. Basically, it integrates well with other systems, but has a very useful user interface and a clever approach to analysing the unstructured data in documents. They say it gives companies a ‘competitive advantage’ by helping them work across silos. Quite cool.
Co-founder Marten Nelson presented Token, a turnkey PSD2 compliant solution used by Fidor, whose Head of APIs Stefan Weiss was also on the stage. Their case study looked at the opportunity in open banking and the chance for banks to stay relevant and make money as PSD2 comes into force. Token is connected to Fidor’s (own) operating system, allowing them to access and link accounts, with requests made to a user’s ‘trusted device’ to allow the linking to take place. No data is stored, and they claim Token offers the highest possible security and easiest user experience. It also facilitates one-click online purchases, and is described as a win-win for merchants and banks.
MISYS was next up, with Alex and Felix sharing their new product, Fusion Fabric Cloud. Their demo looked at trading but they said this was just one of many use cases for the technology. Anyone can create apps for their particular ‘store’, and they have many built by academics – so that developers can access powerful valuation tools and reduce weeks of activity to minutes. Powerful but easy to use, according to them.
Caxton CEO Rupert launched his demo with the words: ‘The future of the API is dead.’ Blockchain connectivity, he argued, is the faster, cheaper and more secure way to deal with payments. Their FIREBIRD payments platform and private Blockchain overlay was shown via a demo for ‘Motopay’ to purchase a motorbike. Two accounts (seller and buyer) were updated simultaneously. The CTO Russell explained that thanks to a private key the system was secure and immutable, and offered a lot of control. With their solution, banks could reduce development time and costs, and have a simpler infrastructure. They also offered a multicurrency payment app.
Hooyu – ‘Know who you’re dealing with’ – offered protection for businesses and individuals from scammers. From romance to villa rentals, individuals can use the system to check the identity of someone they are meeting or buying from. The system blends database checks, biometrics and document checks for the best confirmation of identity. A selfie plus connecting your ‘online identity’ (e.g. Facebook) helps Hooyu establish if you are who you say you are. (A rich history of posting, engagement, and reach on Facebook helps prove you are real, verifies other information, and is hard to fake.) KYC is done through their tool, along with an ID confidence score from the ‘trusted sources’ and data matching.
Bankup (powered by Solaris bank) is a smart fintech bank for small and medium-sized businesses. They offer the functionality of a normal bank account plus added value. With a personal, relevant user experience and plenty of insights and an open marketplace, Bankup offers transactions, contacts, cashflow, payables, budgets and accounts through the widgets in their personalised dashboard. Smart tagging helps create ‘Budgets’ (or spend categories) and there is also a Revenue IQ dashboard that helps analyse trends in this area. It integrates with your accounting software, and with any other bank accounts or fintechs you want to add in, like credit and lending partners. PSD2 ready!
AIXIGO was all about technology for personal investments, or digital wealth management as an API. They showed some examples of how their background tech could power an Alexa app for portfolio development. You get all the figures about your investment as well as context and timeline information. ‘Your developers will love it’ said Mario and Marcus, and they talked about a ‘completely new ecosystem’. The response time was so quick that it would be very scalable and garner good user feedback.
Alex and Ike from Ephesoft talked about ‘extracting meaning from unstructured data’, and presented their document analytics platform, Ephesoft Insight. Using big data and unsupervised machine learning, their tech is already used by US intelligence agencies to spot criminal behaviour. As an AML tool, it is useful in trade finance where crooks often cover their tracks using unstructured data (we’re talking all the paperwork linked with the transaction). So this data is pulled and compared against structured data like actual price information, geographical info and a visualisation is produced. The aim is to accelerate legitimate transactions and reject fraudulent ones. You can create something of a ‘mind map’ across multiple accounts and transactions, and use predicative analytics to combat fraud.
Wealthify was the final ‘act’ of the third session, and they took the opportunity to announce that its investment services are now available as a white-label solution. They started with some audience participation – hands up who is satisfied with their savings account? – and went on to say that despite low interest rates, the stock market has risen 12.48% in the last year – so everyone should ‘Expect more from your money’. They aim to ‘make investing the new norm’ and say they are the first company to address the mass market in regards to investing. They don’t offer advice (and are not roboadvisors) they don’t use jargon and they claim to remove the barriers from investing. The dashboard offers an aggregated view of how your investments are performing and they’ve now got a circle thing – ‘Once you’ve signed up, you’ll be able to invite people to join your Wealthify Circle. And the more people you have in your Circle, the bigger the discount you’ll get on your monthly fee.’
DAY ONE SESSION 4
Meniga demonstrated an API around financial fitness, comparable to Strava and Fitbit. ‘We transform the way banks and advertisers use transaction data.’ Their financial activity feed (potentially fed by a range of bank accounts, one assumes) where you can be set challenges – compete with peers and compare to them – depending on your personality type. I can accept the challenge and in turn I challenge my friends. Different personalities get different type of challenges (based on the ‘big five’ personality test.) The other guy – who was more neurotic and anxious – was shown the Money Monster in his feed – a bot that wants to eat up my current account at random (sweep it into savings). He was also shown The Chopping Block – encouraging him to remove a subscription and save money. He could then level up to SUPER SAVER. They claim to be challenging the status quo, and are being used by banks based on a scalable and robust API to create a differentiated offering. ‘Banking does not having to be boring. Digital banking should be both inspriing and personal.’ You can increase the quality and quantity of engagement with your customers.
Memento announced that ‘We believe that money is social.’ Voted best app in Iceland, Memento aims to bridge the gap between social and banking. Their MyMoney app combines different channels e.g. WhatsApp, Skype and Facebook to bring people together around financial goals. The demo shows them using a chatbot to help us find e.g. flights. They buy them and can choose to split it with this group on chat. They get an overdraft approved and can create a money event – and the form is filled in with input from Facebook. The virtual savings event can be used to. Those who haven’t registered can just click the link to pay their part (they just scan a card). To remind people of money owed you can ‘Remind privately’ or ‘Shame publicly’ with a tasteful nude photo on Facebook, for example. Great guys and one of the winners of best in show.
Mode Finance demonstrated analytics and forecasting in credit risk management. They build and develop systems for big brands, performing big data analysis. They know the credit risk of any company – in any country. They have a mobile/desktop application – s-peek. They aim to ‘Democratise the credit rating and credit risk analysis’.
Ebankit claims that ‘All banks need to engage with customers securely.’ Today launching 3.0 of platform, helping clients to digitally transform with
- Omnichannel banking
- PSD2 – view all accounts in one place
- API gateway
- Chatbot – integrated with FB messenger
Data can be checked across all accounts to identify products that are relevant, users can check social feedback on products, you can log in using facial recognition. All new accounts can be pre-filled with your details. ‘Future-proof your business’ with rich middleware, an API gateway, a development environment, and fully-formed apps.
Backbase is a digital banking software solution that they claim is the latest innovation in AI and PSD2. How can a regular banking app become a smart personal assistant? Say you’ve just bought a bike – do you need insurance? The app can promote relevant offers. Authentication is built in. You can add external accounts, or use your savings account to settle an external amount.
Connor from Leveris introduced another ‘modern banking platform’ – it’s ‘Not an app, bank, system, or middleware.’ It’s an ‘End-to-end digital banking platform or bank in a box.’ He claims if Google built a bank it would look like this. Well, it looks like a bank – in that it has ‘all the hygiene factors you would expect’ but ‘the difference is that it is easier to make a change.’ Leveris has taken an ‘integrated approach to data and technology at a system level’. Customers can pay a fee to cover the transaction or can watch an ad to get transaction for free (and bank doesn’t pay it either so it’s win win). He gives four benefits:
- This is a low-risk option with a high potential upside – it can be deployed alongside legacy systems.
- Rapid deployment – in 180 days you can be a full service bank!
- New revenue lines – from a valuable data repository
- Mitigate threats from other banks and FinTechs (and current and future changes in regulation…)
Add an ‘app’ from the ‘store’ – native ones in there, like an ATM finder app, but also authored by third parties e.g. Transferwise. He notes that they ‘didn’t invent open architecture’ but they HAVE ‘put it into a bank system.’ Could be good for challengers OR new market/demographic – apparently a good choice if you are price sensitive.
iProov lets you authenticate to online services from laptop and mobile. It’s easy to use and secure (MORE THAN ANYTHING, apparently). The tech is ‘one-time biometrics’ and it’s already being used. Face recognition technology for logging in, or some are using it for ‘step up’ authentication. ‘We can detect replays and spoofs – that’s why it’s so clever.’ Thanks to unique patented flashmark technology (that has won a KPMG award), there is illumination on the face when you take the selfie, and the tech analyses how the face reacts with the light so it can tell it’s static/a recording because it ought to be different every time. He turns his face into a one-time biometric! So, it’s not useful if your device is stolen. ‘Not just secure but resiliently and durably secure.’ It can also confirm if the person who submits documents is really there in real life (remote KYC).
Jeff Mullen from Dynamics claimed to be trying to ‘solve the largest problems in payments.’ They have two business units but used Finovate to launch PSD2 Products. The older but ‘revolutionary tech’ includes a double use card – you press a button for Visa, another for a loyalty card – and another one that doesn’t display the whole card number, so is useless if stolen. Their new product can be used in three different ways. It has a Dynamic CVC, requires Multi-factor authentication and is highly secure. Thanks to ‘natural organic recharging’ it will last for ages – and represents a ‘Watershed moment for interactive payment cards’. It costs banks $3 an account a year and replaces that moment of friction when someone loses a card. The tech ‘gives the card more meaning’ – so less chance of it being lost – and reduces costs to bank with ‘dozens of cost reduction features’. Your systems don’t have to change at all and you can offer customers a ‘more meaningful relationship and more control.’
SWAPER offers ‘premium returns’ from its platform – it’s a P2P marketplace offering unsecured loans at 12% – 14% return. You choose the amount to invest, a term and are shown the expected return. Doesn’t seem revolutionary but those are pretty good returns.
EDGE LAB demoed its portfolio management technology. You can make optimisations (and add constraints) to your portfolio, view analytics that are good thanks to lots of data points being processed. ‘We help institutions to digitalize a crucial part of their business – Investment – in line with all the regulatory constraints (e.g. MiFID II, Solvency II, Basel III …).’