Bank Branch Closures Risk Leaving People Behind

By Ian Bradbury, CTO for Financial Services at Fujitsu 

Although we are moving towards a cashless society, and card spending is overtaking cash spending, a rapid move towards digital banking risks leaving people behind.

The latest report from Which? highlights this problem, and it’s now businesses’ and financial institutions’ turn to work together to ensure millions of people are not left struggling to access everyday banking tasks.

We need to think about how digital and traditional banking can coexist, rather than compete, as both are becoming critical in maintaining a healthy financial life for Britons across the country.

In fact, our recent research found that while access to reliable digital services is a high priority for almost half (47%) of consumers, two-thirds (67%) are more likely to do business with a bank if it has a high street branch.

“We need to think about how digital and traditional banking can coexist”

Banks need to find a balance between their physical and digital offerings. As consumers look at technology to improve their overall banking service, it is hugely important that banks are able to manage their expectations by providing convenient, efficient and even an exciting experience.

Further transformation of the sector looks inevitable, but it is vital that banks consider how new technologies can shape their future while ensuring no one is left behind.

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The Block vs Binance intersection of niche media implosion and Crypto Fintech cambrian explosion

What's up with The Block vs Binance saga? .001

Daily Fintech lives at this intersection. Thankfully we avoided the temptation to monetize via advertising and as we are self funded we have no pressure to meet external growth expectations (which is the sort of pressure that leads to sacrificing editorial independence). So the media implosion does not worry us and we can focus on creating useful content related to the cambrian explosion in the world of Crypto Fintech. Digging below the headlines and gory battles, this post looks at the trends behind The Block vs Binance saga and what these trends reveal about the state of media, of Crypto Fintech and of the intersection between the two.

Bernard Lunn is a Fintech deal-maker, investor, entrepreneur and advisor. He is CEO of Daily Fintech and author of The Blockchain Economy.

The Block vs Binance saga explained

On November 21, The Block released a report stating that “Binance offices in Shanghai shut down following police raid”.

This had a negative impact on Binance, who responded quickly with  “No police, no raid, no office. Hope you didn’t pay to read that FUD block.” Binance then sued The Block claiming inaccurate reporting.

The Block later changed the headline taking out the bit about police raid, but that does not seem to be the full extent of the inaccurate reporting.

More cock-up than conspiracy

There are lots of conspiracy theories floating around, that The Block was paid by competitors of Binance or that they shorted Binance. I tend to believe  cock-up more than conspiracy, that this was simply shoddy journalism under pressure to create an exciting clickbait headline. That pressure, which leads to editorial integrity being challenged, happens when revenue is declining.

In ye olden days, a journalist would have spotted a potential story taken it to the Editor who said that they should investigate on the ground in Shanghai and, without factual backup from multiple sources, would have binned the post.

Hmm, where is the revenue to fund that sort of hard work?

Integrity is challenged when revenue is declining

High quality journalism and editorial independence was easy when the revenue was pouring in. Imagine All The Presidents Men with Woodward & Bernstein under pressure to crank out posts, clicks and page views each and every day.

Those days are gone.

When bits of destruction first hit media, the oft repeated line was that “$1 of print advertising revenue would return in the digital realm as 10c.” This decimation of revenue was brutal, but once media firms went digital it got worse!

Whether you call it Adpocalypse or less alarmingly, Adlergy, there are some alarming trend lines:

– rise of fake bot traffic (around 50% by many accounts).

– adblockers and ad-blindness (people “tuning out” ads even when the ads are shown) leading to decline in engagement as evidenced by click through rates.

– increasing resistance to privacy invasion among wealthy early adopters (prized by advertisers); this is accentuated by regulation in many markets.

With revenues declining, journalists are told to a) write more articles b) increase traffic. That is not conducive to thoughtful articles with lots of primary research and fact checking.

The Block also has a paid subscription model. They clearly aim to do quality work. This was no fly by night content scraping site. So them getting it wrong took more people by surprise and that is why we need to dig below the surface to look at the underlying trends.

An unregulated market needs a well compensated journalists

In Legacy Finance, there is some protection from the most egregious behaviour thanks to the regulation watch dog. 

An unregulated market needs some other watch dog.

How it works today with lots of fake news and an occasional legal battle is not a healthy market.

A media business under pressure to crank out posts, clicks and page views and accept payments from interested parties is clearly not that kind of watch dog. It does not matter how many times we say that journalists must do xy&z, if there is not a good way to compensate journalists well for doing that kind of work. It is unrealistic to say journalists must do very high quality work but also use Adblockers and tricks to get past Paywalls.

The money is there. Crypto Fintech is in a cambrian explosion phase, with money pouring into the space. There are also plenty of journalists who would like to exercise their skills to do a good job digging out the truth. Both parties want a solution. What is needed is a business model that connects the two. Shameless plug: Daily Fintech is working on that, please get in touch if you are interested on working on this with us.


Daily Fintech provides daily original insight from a select team of market practitioners. Subscribe to get your insights fresh from the knowledge bakery. Yes, we have a Paid Membership model. In case you don’t already have your own Membership, if you subscribe by 30 November 2019 (yes, TODAY) you get a 50% discount off your first year. Simply use the coupon code: Thanksgiving in the payment field of the Subscription page, and you’re on your way to being that well informed Crypto Fintech person at the next Thanksgiving table.

Inaugural SFF x SWITCH sees over 60,000 participants from 140 countries

The Singapore FinTech Festival (SFF) and the Singapore Week of Innovation and TeCHnology (SWITCH) concluded its combined week-long event on 15 November 2019, which attracted more than 60,000 participants from 140 countries. The event also saw a record 569 speakers, close to 1,000 exhibitors and 41 international pavilions. 

SFF x SWITCH will return next year from 9 to 13 November 2020. It will build on the energy, ideas and partnerships established this year, to further strengthen the ecosystem for FinTech and deep tech in Singapore and the region. 

Key Announcements 

In line with the theme of Sustainability and Climate Change, Minister Ong Ye Kung unveiled the Monetary Authority of Singapore (MAS)’s green finance action plan to strengthen green financing capabilities in Singapore and announced the launch of a US$2 billion Green Investments Programme, among other initiatives under the action plan. 

DPM Heng Swee Keat unveiled Singapore’s National Artificial Intelligence (AI) Strategy in his keynote speech, and highlighted a new framework, Veritas, introduced by MAS to promote the responsible adoption of AI in the financial sector. He also announced the expansion of the Global Innovation Alliance (GIA) network to include London, and the launch of the Open Innovation Network (OIN)2 by Enterprise Singapore and Infocomm Media Development Authority (IMDA) to promote open innovation across sectors.

Under the GIA, Enterprise Singapore signed a Memorandum of Understanding (MOU) with UK-based accelerator IoT Tribe, to facilitate two-way innovation and business partnerships.

It also inked MOUs with three new partners – DayDayUp (Beijing), Plug and Play Asia Pacific (Jakarta) and Leave a Nest (Tokyo) – to run GIA programmes in their respective markets. 

MAS and the Bank for International Settlements (BIS) jointly launched the BIS Innovation Hub Centre in Singapore, to foster innovation and greater collaboration among the central banking community globally. The opening of the BIS Innovation Hub Centre in Singapore marks BIS’ first expansion of its global footprint in 17 years. 

MAS also established partnerships with financial authorities in Canada and France, to strengthen cooperation in FinTech and cybersecurity respectively, and welcomed Banque de France (BDF)’s opening of an overseas office in Singapore in early 2020.

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Copper Covers 96% of the Crypto Market After Walled Garden Expansion

Copper, the London-based custodian for digital assets, has expanded its Walled Garden infrastructure and is now connected to the top 15 exchanges – including: Coinbase,  Deribit, OKEx, Bitstamp, Bitfinex, Huobi, Binance, Bitmex, Kraken, Bittrex and HitBTC.

This gives Copper’s institutional customers access to a larger liquidity pool as the company’s trade and settlement volumes continue to increase 50% month-on-month.

Copper’s infrastructure creates a unique Walled Garden for each client, connecting crypto funds and major liquidity providers directly to their exchange accounts.  Copper’s platform provides a single view of a client’s portfolio, while the inter-exchange custody eliminates the risk of internal fraud.  Using APIs, client assets are transferred seamlessly inside the secure environment, supported by Copper’s multi-key cold storage, providing a safe off-exchange depository.

Exchanges must meet a threshold of security conditions before being eligible for integration, including permission-based API keys and whitelisting of wallet addresses, among others.

The news follows Copper announcing it has processed $500m in transactions in the three months following its launch in June.

The company already provides digital asset safeguarding for multiple funds and investors operating a full range of investment strategies.

Dmitry Tokarev, Founder & CEO of Copper, has commented: “We have first-hand knowledge of the needs of institutions. Our custody, trade and settlement infrastructure creates a Walled Garden environment tailored to each client, allowing serious investors to fully-engage with crypto markets in T0 time without having to worry about security or bad players.

As our institutional customers have increasingly seen the benefits of using our trading and settlement infrastructure, we are very happy to be able to offer them access to the top 15 exchanges which allows them to engage with 96% of the crypto market.

We pride ourselves on being able to offer funds and sophisticated investors market-leading security, as well as market-leading investment tools so they may work their capital harder and have peace of mind their assets are safe from bad actors.”

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£1.7 Billion Paid in Travel Expenses Due to Inefficient Processes – How Can Businesses Work Smarter?

By Thore Vestergaard, MD of Commercial Cards, Allstar Business Solutions

Travelling overseas for business matters is expensive and can be frustrating. Even with huge advances in technology that is making conducting business overseas much easier, there will always be the need for face-to-face meetings.

Thore Vestergaard

In Europe there are around 44 million business trips made between countries within EU borders. In the United Kingdom, around £30 billion on business travel annually with more than £450 spent on average for each trip. 

With such high costs, it is imperative that companies find efficient ways of paying for business travel, particularly important when companies factor in the administration cost, loss of efficiency and charges for using cash and some debit, credit and fuel cards abroad.

It also raises the question that when travelling abroad, do businesses adequately equip their workers with the right tools and policies? This article will look at the latest insight from Allstar Business Solutions for how businesses can more effectively address the issues of paying for foreign travel and managing expenses.

How to put in place a robust payment system for employees who travel

According to research from treasury and international payments specialist Centtrip, half of businesses ask employees to pick up the cost of booking travel before claiming the money back. And when these expenses are made abroad, there are additional fees that can be levied against purchases and exchange rate fluctuations to be considered. This adds up to a £1.7 billion bill that is footed by employees every year. 

In Europe there are around 44 million business trips made between countries within EU borders.

With workers reliant on pay-and-reclaim systems that depend on paper receipts, they can’t afford to lose their proof of purchases. But losing receipts is easy to do, meaning they risk being refused an expense claim on top of the inconvenience and financial pressure of using personal cards to pay for expenses. This can be bad for businesses as employees lose productivity and engagement with the company.

We’ve outlined the following five steps that will help streamline your payment processes, ease the burden on employees, increase efficiency and gain greater control and insight into expenses.

  • Dealing with foreign transactions and exchange fees

One of the problems with expenses paid abroad by employees and claimed back later is exchange rate fluctuations. Exchange rates can increase by the time employees make a claim. The claim which could be made days or weeks later, might use an entirely different exchange rate and could cost your business unnecessarily. 

Another way it can cost a business is through Dynamic Currency Conversion, where the merchant offers to process a card payment in either GBP or in the local currency. If you opt for GBP, the exchange rate will be set by the merchant and their provider. Therefore, employees should always opt for paying in the local currency wherever possible. Paying on a card typically makes it easier to consolidate and submit expenses, as well as being more transparent for the business and employee.

  • Understanding conversion

A core problem with exchange rate fluctuations is that it is awkward for employee and employer to manage and verify that the right amount is reimbursed. With a card-based solution, each purchase automatically has the relevant exchange rate applied for that day and time. It also avoids the employee needing to include the exchange rate commission costs as part of their expense claim, making reimbursement far simpler through being able to match receipts with the card statement.

half of businesses ask employees to pick up the cost of booking travel before claiming the money back.

  • Using a fuel card abroad

In the UK, some businesses may have chosen a particular fuel card provider because the network suits their operational purposes. But that’s not to say that in other countries the same situation applies. Instead, it pays to be using a card that has universal acceptance from a trusted issuer such as Visa, which makes journeys less stressful, transactions will be reported back in real time, as well as converted at a transparent and competitive exchange rate.

  • The power of control

Foreign travel can open up businesses to abuse. Some employees spend more freely with the assumption that because they are travelling on the company’s behalf, there are more relaxed spending rules.

Therefore, having a clear expense policy in place means less stress for employees when conducting business abroad and can improve the convenience and speed of getting things done. A good expense management system ensures electronic uploading of receipts that can be matched to transactions. It also allows businesses to put in place suitable controls on each card that allows businesses to correct any issues as they arise rather than for the problem to be noticed weeks later when receipts are submitted manually.

  • Building a clear picture

By using an expense management system, companies can monitor spending in real-time to ensure policies are enforced, as well as utilising pre-transaction controls on categories of spend and spending limits. Businesses can also see what employees are spending abroad through digital receipts – the result is complete transparency.

Businesses can then own that data, using it to create insight reports to analyse expenses which allows them to see if employees or departments are overspending on hotel rooms or entertaining, and the data can be extracted and uploaded into accounting systems quickly and easily. This means that businesses are now on the front foot when it comes to keeping in control of business travel. 

Some employees spend more freely with the assumption that because they are travelling on the company’s behalf, there are more relaxed spending rules.

Don’t let your employees pay an emotional toll

Travelling abroad can be stressful. From working in a foreign environment, often under time or schedule pressure and negotiating travel in unusual conditions. The International SOS Foundation looked at the impact of international business trips on employees and found that 45% experience an increase in stress levels while travelling for work.

As a result, it can hit a business’s bottom line when employees become less productive and disengaged if they feel stressed and unsupported. But, through effective expense management technology, businesses can put in place the supporting payment and expense claim solutions to ensure employees remain productive.

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SmartStream Partners with Union Systems to Meet Demand for East and West Africa

SmartStream Technologies, the financial Transaction Lifecycle Management (TLM®) solutions provider, today announced its partnership with Union Systems Limited, a key provider of financial software solutions and professional services to major banks in East and West Africa.

The two companies together will support organisations in their digitisation strategies of post–trade environments – whether it is liquidity transparency, reducing operational risk or moving to the processing of digital payments.

Union Systems supports customers in 19 African countries and helps to effectively scale processes, improve compliance and drive operational efficiencies for some of the leading banks in the region. Under the new agreement, SmartStream’s TLM solutions will help organisations make the journey towards digital transformation by providing a range of solutions for the transaction lifecycle. Artificial Intelligence (AI) and Blockchain technologies are being embedded throughout the solutions, which are also available in a variety of deployment models.

Commenting on the partnership, Chuks Onyebuchi, CEO, Union Systems said: “The partnership with SmartStream to deliver its suite of Transaction Lifecycle Management (TLM) solutions to the region complements our existing product offering. We are particularly excited about SmartStream Air, which is a game changer for reconciliations through its use of AI”.

Guenther Ruf, Director Partners and Alliances, SmartStream, states: “Union Systems is a very reputable organisation in the region that has the knowledge we require in order to help banks strengthen their back-office functions. SmartStream’s TLM solutions increases automation levels to help drive up STP rates, bringing down the overall cost of processing, whilst at the same time improving customer service through the reduction of errors, and in addition protecting and enhancing a firm’s reputation”. 

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Has Softbank’s Vision fund lost sight as it invests in PayTM $1 Bn raise despite mounting losses?

They lost $4.6 Billion with the WeWork deal. They have struggled to raise fund-2. They are now focused on profitability rather than growth.

Yet, Softbank fund joined by Alibaba’s Ant Financial pooled in $600 Million for PayTM’s recent $1 Billion fund raise. PayTM is valued at $16 Billion at the end of this funding round. They were valued at $10 Billion just last year when Warren Buffet’s Berkshire Hathaway invested in them.

The recent IPO fiascos that Softbank’s portfolio firms have been involved in, have forced their hand to take a profitability focused investment strategy.

Softbank’s Masayoshi Son has mandated that his portfolio companies need to demonstrate a few years of profits before they can plan for IPOs.  However, the new investment into PayTM is in stark contrast to their new position on profitability.


Image Source

The India payments market has been a fairy tale ride since 2016. I have discussed this several times in the past, and perhaps the biggest contributor and beneficiary of this boom has been PayTM, and its Chinese investors.

However, the market is no longer completely dominated by PayTM. Their payments growth has slowed down. Walmart’s PhonePe have grown from 26% market share to 47% in about a year, and at the same time PayTM only grew from 51% to 52%.

Their losses have doubled in this time. In the financial year ending March 2019, they reported a loss of $549 Million, which is more than double their previous FY loss of $206 Million.

PayTM claim that they have cut down their costs by more than 33% in the last six months, with a view to doing an IPO in 2-3 years. The payments market is still growing in India, and it is expected to be $1 Trillion by 2023. But there are more takers now than there were a couple of years ago.

Google pay has also upped its game, and have about 67 Million daily users. Whatsapp is planning to roll out its payments app to its 400 Million users in India. PayTM really needs to find new revenue lines, with good margins – before they start trailing in the payments game.

The new funding round is primarily to grow their base of merchants from its current 15 Million to 35 Million. Vijay Shekhar Sharma, the CEO, mentioned that they would be spending $2.7 Billion in the next couple of years to grow their merchant base further. It looks like atleast another 24 months of further growth and loss making lies ahead.

PayTM have started to focus on improving their margins. They are moving from Peer to Peer payments to online and offline merchant transactions. Vikas Garg, the firm’s CFO, mentioned that in Q2 and Q3 2019, PayTM have reduced costs by 10%. Vijay wants to take back 66% of the payments market, and improve cashflows before any IPO plans.

From a Softbank perspective, they have got a stake of over 20% in the firm, and as per the deal, they can’t sell their stake in the firm for another 5 years, except when its via an IPO.

The way forward is a bit murky to me. On the one hand, they want to grow, invest $2.7 Billion into tier 2 and 3 cities in India. On the other hand they are cutting costs with a view to going public. With Google Pay, Phonepe and Whatsapp payments breathing fire, Vijay may need to grow some extra hands and heads to tackle the next few months.

The question still remains though, growth or profitability?

The Next Year in Payments – listen now to the full podcast series
The Next Year in Payments – listen now to the full podcast series | Fintech | Blogs | Linklaters

Fintech News Issue #245

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UK Retailers Targeting China Need to Focus on Culture, Censorship and Local Competition

JGOO, the next generation mobile payments platform, says many UK retailers are failing to break into the Chinese market because they don’t acknowledge its huge scale and localise their propositions accordingly.

Further, it says that many companies don’t understand the country’s strict censorship arrangements or adapt to the unique shopping habits of Chinese consumers.    

Richard Morecroft, Director and Co-Founder of JGOO said: “Western retailers continue to look toward new opportunities in China, but this is not Australia, America, Europe, or even Hong Kong. Many international brands don’t make the grade in China because they fail to recognise they are dealing with a very different market and need to localise their offering.”

“There is a reluctance among smaller retailers to enter China as they watch on in despair as hugely successful Western brands such as Amazon, Google and Uber slink away in defeat when it comes to conquering the East. However, they shouldn’t be intimidated by China.”

In developing a strategy for China, JGOO says retailers need to focus on culture, censorship and local competition.

It’s crucial for Western brands to do their research and avoid the ‘copy and paste’ approach when it comes to thinking about their China strategy.

The key to succeeding in China is to recognise that it’s not one homogenous market but a diverse one. The country has an enormous culture behind it with 14 major cities, 23 provinces, 56 ethnic groups and 7 major dialects. Western brands often fail to alter their strategies, adapt to the unique culture and appropriately target the technology savvy consumers.

There is simply no culture like China’s and when it comes to cracking this market, one size does not fit all. It’s crucial for Western brands to do their research and avoid the ‘copy and paste’ approach when it comes to thinking about their China strategy. With the correct strategy executed, China is an almost unlimited opportunity for Western brands to get on the map.

The Chinese government will go to extreme measures to maintain the country’s reputation and support local businesses in upholding their market share amongst a sea of Western brands. This has led to extreme censorship in China with Google, Facebook and WhatsApp being blocked due to China’s lack of control of these Western platforms. This had led to the rise of China’s super-app – WeChat, which combines all the most pertinent Western apps such as Facebook, WhatsApp, Uber and Tinder and many more.

In order to avoid censorship issues in China, it is important for brands to do their research and adjust their strategies accordingly.

When it comes to the Chinese consumer, they have unique shopping habits, notoriously low levels of brand loyalty and they often refuse to pay with anything other than WeChat Pay or Alipay. For Western brands who seem to map these traits to an alien consumer, it can be difficult to compete with local Chinese brands who inherently understand consumer traits such as the above.

Richard Morecroft concluded: “Western brand are not doomed to fail in China.  To succeed, they need to play to consumer preferences, and do their research before attempting to tap into China’s digital generation.”

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Why a Poker-Playing AI is Changing the Game

AI has reached a milestone in the strategising department.

Just last July, a poker bot developed by researchers from Facebook’s AI lab and Carnegie Mellon University beat some of the world’s top players in a series of no-limit Texas Hold‘em poker games.

In a 12-day session with over 10,000 hands played, the AI system, called Pluribus, emerged victorious against 12 professional poker players in two different settings. First, Pluribus played alongside five human players; and in the other, five AI bots played against one human player. Take note that the bots were not able to collaborate with each other in this scenario. In the end, Pluribus won an average of $5 (£4) per hand, winning around $1,000 (£803) every hour. In total, the bot won a virtual $48,000 (£38,500).

Pluribus’ achievements are significant as it is the first to beat not just top professionals, but win in a multiplayer setting no-limit Texas Hold‘em game, which is considered the elite form of poker. Aside from five copies beating top players such as Darren Elias and Chris Ferguson in a 5,000 hand game, a paper published in Science describes how a single copy of Pluribus took on five human professionals for 10,000 hands, and won.

Pluribus learned how to play poker (and play well) by playing against copies of itself, a common technique in AI training known as self-play. It only took 8 days on a single powerful server with 64 processor cores equipped with less than 512GB of RAM for Pluribus to master the game. In fact, the AI bot has developed a “blueprint strategy” that it uses for the first round of betting. The bot projects the potential outcomes from particular points in the game, looking only a few moves ahead at a time instead of all the infinite possibilities, as it may take a more powerful computer to determine all the outcomes of a six-player game.

Winning against multiple humans counts as a milestone for AI, as no computer program has ever achieved this — something that the two researchers, Noam Brown and Tuomas Sandholm, can gladly take pride in. Pluribus’ forerunner, Libratus, was able to win against poker players, but only in a one-on-one situation. AI systems have already been developed in other games; The Guardian’s report on AlphaZero reveals that game-playing AI has beaten the world’s best chess player after teaching itself how to play in just under four hours, while another Google-invented system can play against Go players.

These, however, are just 2-player games, and given that all the information is available to the players on the board, it’s easier to see the possibilities and risks, in order to act accordingly. In poker, however, players are only given partial information, with the possibility of others bluffing — making it a much tougher challenge for both human and AI players.

So, given all this, what does a successful poker-playing AI mean for greater society?

Well, poker has many similarities with real-world situations, which is why it has taken so long for researchers to pull off such an achievement. Unlike chess, PartyPoker’s guide to Texas Hold’em explains that players must play without knowing what kind of cards their opponents hold, as is the case in politics, business, and even war. And given that the system uses less computing power than one that tries to compute every single possible outcome at different points in time, Pluribus is cheaper and more efficient to run, without losing its accuracy or how effective it is.

In fact, Brown says that the AI can be developed on a cloud computing service for just $150 (£122), making it easily applicable to other domains. This proves something that we’ve outlined on how ‘AI-Based Finance is the Future We Should All be Prepared For’: AI’s primary benefits involve an affordable business model, eliminating the need for thousands of employees for a task AI can complete in seconds.

In the long term, Brown and Sandholm are hoping that the methods they’ve demonstrated with Pluribus can be applied in domains such as cybersecurity, fraud prevention, and financial negotiations. “Even something like helping navigate traffic with self-driving cars,” says Brown, will be a great application.

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First Cohort of Firms Unveiled at Launch of Birmingham Fintech Hub

The first eight firms and tech communities chosen to take part in Velocity Birmingham, a new state-of-the-art FinTech hub, have been unveiled by the Investment Association (IA).

Velocity Birmingham will provide a valuable hub for FinTech innovation and development, supporting FinTechs based in the West Midlands. The chosen innovators will have access to a network of existing investment management firms and 5000sqft of co-working space, to develop technology to help Britain’s savers and investors.

The facility is a collaboration between the IA’s FinTech hub and accelerator, Velocity, along with IA member firm, Wesleyan, a specialist financial services mutual. The eight chosen firms include:

  • Delta Financial Systems, the market-leading FinTech provider of pensions and retirement administration software for the SIPP and pension drawdown markets.
  • eXate, which enables firms to share data securely, by means of a digital Ink Bomb that allows those firms to destroy or revoke access to the shared data.
  • Fregnan, which use advanced machine learning techniques to support unbiased, high-quality equity research for investors and fund managers.
  • GFA Exchange, which use AI to benchmark and monitor business performance, to help B2B lenders discover new opportunities, whilst reducing financial risk.
  • METCloud is a multi-award winning cyber security platform, harnessing sophisticated cyber defence, surveillance, AI and Machine learning technologies to protect organisations operating in the financial services sector.
  • moneyinfo, a private FinTech firm specialising in account aggregation client portals and mobile apps for the wealth management industry.
  • Silicon Canal, a Birmingham tech community to connect, promote and support the tech ecosystem in the West Midlands region.
  • VendEx Solutions, Inc.the centralised hub for the financial services market data industry.

The first cohort was announced at the official launch of Velocity Birmingham on Wednesday evening (27th November) at Wesleyan’s Birmingham head office, and was attended by senior executives from the investment management industry and local FinTech innovators.

Firms for Velocity Birmingham were chosen by the Velocity Advisory Panel of industry experts, overseen by Graham Kellen, Chief Digital Officer of Schroders and Chair of the Panel.

Chris Cummings, Chief Executive of the Investment Association, said:

“Just over a year after the launch of our FinTech innovation hub and accelerator, Velocity is going from strength to strength with the launch of Velocity Birmingham today.

Birmingham has one of the UK’s largest tech clusters outside of London and a hub of professional and financial services, and through Velocity Birmingham investment managers can embrace the technologies of the future to the benefit of customers and the wider economy.”

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Innovate from the customer backwards- but caveat innovator!



The insurance industry is in large part past the hysteria of disruption, innovation and entrants solving the issues of the insurance world, and is moving into the stage of implementation, collaboration and iteration. Startups that have gained traction are now broadening their markets, and in some cases, their offerings. And, the industry is recognizing that innovation is good, prevention is better, and combination of the two is best. But is prevention without issues? Can a large gray beast show the way?

Patrick Kelahan is a CX, engineering & insurance professional, working with Insurers, Attorneys & Owners. He also serves the insurance and Fintech world as the ‘Insurance Elephant’.

It’s Thanksgiving Day holiday in the U.S., having a sumptuous feast with families and friends is de rigueur so this column may serve as an appetizer.  For those many readers outside of the feasting zone- perhaps serve as a substitute for your almond Khari tea biscuit, scone, pastelito, kuchen or kaya.


Prevention in P&C insurance has to date been a tech/device driven effort- telematic plug-ins like State Farm’s Drive Safe and Save developed by Cambridge Mobile Telematics, home moisture sensors, or driving habits observed by DriveWise or Snapshot. Getting customer buy-in has been a barrier to general adoption, as has been how to manage the cost of a program and how regulators might see programs where carriers provide equipment or premium reductions.

Some jurisdictions do not allow rebates or inducements, or activity that seems as such, however, the U.S. state of Florida recently announced passed legislation where the Department of Insurance is exempting certain prevention devices (read as IoT) from the insurance laws regarding inducements.  The state sees there is technology available that will serve to reduce frequency and severity of claims, and with some oversight will not act as policy inducements.

The Iot Observatory championed by Matteo Carbone has chronicled successes with IoT/prevention activities, particularly in the Italian motor insurance industry and positive steps taken by American Family Insurance (as reported by Coverager) in the US.

Additionally, German plumbing fixture company Grohe and Finnish insurer LähiTapiola recently announced and implemented a water sensing device initiative, with an estimated 100K installations planned by 2026.

Good efforts in these initiatives, but all typically emanate from the company to the customer.  Can value-addition for preventive insurance claim measures be a reasonable expectation?  Can customer engagement in prevention be an answer?  Perhaps yes, with the efforts of an active insurance startup, Hippo Insurance (already a forward-thinking carrier) in conjunction with the firm’s recent acquisition, Sheltr, a home maintenance and inspection service.  An apt case study of considering the customer as a focus of innovation and adopting operating strategy from that perspective.

The premise of the Hippo/Sheltr partnership is that a combination of periodic, comprehensive dwelling inspections will not only identify potential repair issues, but will through time and attention gain the involvement of homeowners in the prevention business, and be extension reduction in the frequency and severity of claims.  It’s not a new concept- auto owners conduct preventive measures programs now without considering the action to be anything other than part of auto ownership.  Of course, knowing that failing to have oil changed would lead to mechanical failure that would probably not be an auto insurance covered peril makes moral hazard is not an issue in that instance as dwelling maintenance and having homeowners’ insurance might produce.

Hippo Insurance has since its founders, Assaf Wand  and Eyal Navon conceived and rolled out the company felt responsible for end to end positive customer experience.  In discussion with Hippo’s VP of Growth Initiatives, Daniel Blanaru, the company’s concept of service was referenced as, “The Hippo Way.”  How has that manifested within the customers’ true experience?  NPS scores that significantly exceed the industry’s.  As the company’s geographic growth reached multiple US states the firm strategically vetted multiple potential partners to help build the vision of not just an insurance company, but an end to end service company that included proactive/prevention options as well.

Sheltr was identified as the option best able to synch with Hippo’s service concepts- excellent team caliber, apt tech leverage, ease of onboarding into Hippo’s culture, and a proven culture of customer communication.  Seemingly a very good choice.

But here comes I, veteran of property insurance, property claims, and obsessive customer experience person.  I read the announcement and thought, “Here comes another effort to mate insurance service, indemnification, and repair options!”  Realizing the homeowners’ insurance claim experience has been littered with the worn failures of contractor partnerships, flooring programs, TPAs (although some remain very successful to this date), and inspection services, speaking with Hippo might find a different take on that aspect of claim handling.

As much as Hippo had shown a proactive, ‘NPS is the True North of service’ approach, efforts to canonize the firm are surely premature.

Concerns that came to mind with the addition of an inspection and preventive maintenance company to the CX path on which Hippo’s customers are led included:

  • Will inclusion of the inspection/maintenance services to the insurance PIF portfolio be seen by regulators as a form of rebates or inducements?
  • Would customers be denied coverage if they fail to take action on an identified problem and a claim ensues?
  • How will CX perceptions be affected if a referred repair vendor performs inadequately?
  • Customer survey results are affected in a linear fashion as providers are added to the service chain, so even if each participant rates service as 98% effective, having four equal providers (insurer, adjuster, inspection co., and repair service provider) produces a net service effect result of 92%, not what the firm’s expectations are.
  • Having an inspection that identifies an issue may not reduce the effects of moral hazard for the customer since they know insurance will respond to any claim issues.
  • Can the inspection service and network of repair contractors be adequately grown to keep up with growth of insurance PIF?

These are not concerns that relate solely to the Hippo/Sheltr service partnership but can be in any prevention service environment.  How to engage the customers is the key, driving adoption of a preventive actions approach for the customers. Hippo had found that a majority of cases that had a prior preventive aspect resulted in significantly mitigated effects of damage when claims occurred.  Having the added service provided by Sheltr’s 30 item semi-annual inspection and repair regimen is expected to result in lower frequency and severity of claims, but as the relationship is new and the concept is just that, the firm is in ‘observation and adapt’ mode as of the writing of this article.  It’s really a behavioral economics experiment, not a charitable giveback approach for claim mitigation as with Lemonade, but a participative, preventive approach encouraging customer participation through early identification and remedying of concerns.  How many, how much, how scalable, not known at this early juncture per Mr. Blanaru. But it’s an effort taken to innovate from customer involvement backwards to insurance operations (and surely underwriting).  The bulleted points noted above did elicit a response from Hippo but those will remain outside of this article as in all fairness the relationship between the firms is too new to call.  However- having awareness of past industry failures surely helps with not repeating history.

Prevention innovation does have its tech aspects but Hippo may find its customer focus on prevention, end-to-end service through claim concierge principles, and careful growth without sacrificing service standards will make the Hippo/Sheltr approach successful.  It’s not just Hippo’s customers who will benefit from service ‘innovation from the customer backwards’, but any company in the industry who remains an observer of this iteration of the vendor partner experiment.

Thanks to Courtney Klosterman, MyHippo PR maven,  for background info.

FIS Integrates with IBM to Help Clients Counter Fraud

Financial services vendor FIS has announced that it has integrated IBM’s Safer Payments solution within its peer-to-peer (P2P) services to aid in the prevention of fraud, reports Alex Hamilton of Fintech Futures, Finovate’ sister publication.

With the IBM solution integrated, FIS believes its P2P services will be able to monitor high volumes of transactions and provide “real-time detection and decisioning” using artificial intelligence.

The vendor claims that since it first installed IBM’s solution it has seen a “significant” reduction in attempted and completed fraudulent transactions.

“Criminals are growing ever-more sophisticated in their methods for conducting payments fraud and they are increasingly targeting P2P services due to the growth in this market,” said Jim Johnson, head of Americas payments and wealth at FIS.

“FIS is excited to incorporate IBM Safer Payments to provide the highest level of fraud protection to our U.S. clients and their customers who rely on P2P services for fast, convenient payments.”

According to a 2018 PwC report, 53% of US companies were hit by fraud between 2016 and 2018, while 37% of companies reported losing more than $1 million as a result of it.

“FIS is taking aggressive steps to protect its clients against new and evolving threats in the industry,” said Michael Curry, vice president at IBM RegTech. “IBM Safer Payments uses artificial intelligence designed to deliver insights and to quickly adapt to a changing threat landscape. This technology is yielding successful results for FIS and some of the world’s largest and most complex payment portfolios.”

FIS most recently demoed at FinovateFall 2016. The company debuted its Cardless Cash solution that provides fast, secure options for sending and picking up cash at any ATM. Headquartered in Florida, FIS’ solutions move $9 trillion each year for 20,000 clients in 130 countries.

IBM’s IBM Trusteer demoed its new account fraud solution at FinovateEurope 2018.

RBS officially launches digital bank to challenge UK competitors

RBS officially launches digital bank to challenge UK competitors

Royal Bank of Scotland officially launched its digital bank Bo´, creating its own challenger bank that will be in direct competition with Revolut, Monzo, N26 and other digital banks. 

Bo´, which operates as a cloud-based bank under RBS’s NatWest brand, will provide customers with a mobile banking app and bright yellow Visa card, and is designed to help users better manage their spending.

“In this digital contactless age, people need support managing their money more than ever,” Mark Bailie, chief executive officer of Bo´, said in a release from the bank. “It’s all too easy to lose control.” 

“Our data suggests that three quarters of people in the U.K. are living financially unsustainable lives,” he said. “We want to help change this.”

The bank cited anonymized data from 2.6 million NatWest customers that was analyzed in July. The data showed that half of those customers spend everything they earn, while one fourth of them spend more than their income. The data also showed that for people earning less than 100,000 pounds ($128,900) there is no link between income levels and the amount of money they save, meaning the issue regarding the lack of savings is behavioral. 

A spokesperson said the digital bank has about 3,500 current users and growing. The mobile app is available for download on Google Play and the App Store.

Cover image: Bo´.


Topics: Mobile Apps, Mobile Banking, Region: EMEA

Companies: Royal Bank of Scotland

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Alipay says mutual aid healthcare platform attracts 100M in first year

Alipay says mutual aid healthcare platform attracts 100M in first year

Alipay said its Xiang Hu Bao mutual aid healthcare platform has attracted more than 100 million participants in its first year of operation. 

The service allows lower income and rural consumers to use the platform to cover the cost of healthcare for major illnesses. More than 10,000 people in China used the platform to get financial aid to help cover specific treatments as of Nov. 22, with the funds contributed by other members on the platform. 

“Xiang Hu Bao was designed with inclusiveness in mind,” Ming Yin, vice president of Ant Financial, the parent of Alipay, said in a company release. “We hope Xiang Hu Bao can support participants to help one another by providing a trustworthy platform in addition to the medical care protection provided by China’s social security and premium health insurance companies.”

More than two thirds of consumers using the platform earn less than RMB 100,000 ($14,000) per year and about one third of users are from rural China.

The platform was launched in October 2018 and provides basic protection against 100 types of critical illnesses, including thyroid cancer, breast cancer, lung cancer, critical brain injury and other health problems. 

Cover image: Alipay.

Topics: Mobile Apps, Mobile/Digital Wallet, Region: APAC, Regulatory Issues

Companies: Ant Financial, Alipay

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Alipay, Finablr launch cross-border remittance partnership

Finablr, the parent firm of remittance and currency exchange brands ranging from Travelex to Xpress Money and others, announced a global partnership with Alipay to enable cross-border money transfer services, according to a company release. 

Alipay, which has 1.2 billion users when combined with its local digital wallet partners, will have access to Finablr’s multiple remittance brands, which also include Unimoni and UAE Exchange. Finablr will become one of the first cross-border remittance partners that Alipay has ever worked with.

“We are delighted to welcome Alipay to our growing portfolio of partners,” Promoth Manghat, group CEO of Finablr, said in the release. “Together we seek to empower the financial aspirations of billions of consumers with enhanced access and convenience for their cross-border payment needs.”

He said the companies would build on their complementary capabilities and plan to work on additional opportunities. 

“We are excited to partner with Finablr for global remittances, as we continue to explore new ways to apply our technology in order to benefit more people around the world,” Clara Shi, head of Alipay’s global remittance service, said in the release.

She noted a separate blockchain remittance partnership that AlipayHK created with GCash allows real-time transfers between Hong Kong and the Philippines. 

Alipay and Finablr will also be working on digital gifting and driving efficiencies through the Alipay Blockchain Information System. 

Topics: Blockchain, In-App Payments, Mobile Payments, Money Transfer / P2P, Region: APAC, Region: EMEA

Companies: Alipay

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Weekly Wrap: MoneyLion prepares for growth, as fintechs focus on holiday promotions

Welcome to the latest episode of our weekly wrap video series, for the week ending Friday, November 29, 2019. In this episode, Suman Bhattacharyya, deputy editor, and Angely Mercado, associate editor, discuss the following news developments: How MoneyLion’s appointment of a chief operating officer will help fuel its growth plans; The debate among banks and …Read More

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Japan cashless incentives could be extended as part of stimulus

Japan’s measures for encouraging the spread of cashless payments will likely need more funding beyond the end of March and could be extended as part of a planned government stimulus package.

The International Monetary Fund recommended Monday that Japan consider lengthening the time frame of its measures to support consumption after an October sales tax increase to support the economy, citing the cashless-payment reward program among the measures.

The program is aimed at supporting consumption in the wake of the tax hike and increasing efficiency at small- and medium-sized retailers. It provides subsidies for installing cashless-payment equipment and 5% rebates for consumers making cashless purchases at registered businesses through the end of June.

Japanese consumers still lag far behind their international counterparts in using cashless methods such as mobile phone-based payment platforms, credit cards or e-money.

Under the program, daily rebates to consumers from Oct. 1 through Nov. 4, averaged 1.2 billion yen, according to the economy ministry. The government has budgeted 280 billion yen for the year ending in March for the rebates and installing cashless-payment equipment at businesses.

If the pace of daily outlays continues, the portion of the budget initially allocated for rebates would run out in February, according to a Bloomberg calculation. The ministry could draw on funds not used for equipment subsidies to make up a shortfall should one arise.

The ministry is still monitoring the situation and no decision has been made about how to deal with a possible shortage of funding, according to Yoshiko Tsuwaki, the economy ministry’s official in charge of the program. Seasonal factors may influence the pace of consumption and rebates, she added.

More money could be provided for the cashless measures and their duration could be extended in the stimulus package ordered by Prime Minister Shinzo Abe earlier this month. The package is aimed at supporting the economy as it recovers from typhoon damage and deals with the impact of the sales tax and a global slowdown.

Lagging Trend
Cash is still king in Japan partly because the nation’s low crime rate makes it safe to carry and use bank notes. Promoting cashless transactions is one way for the country to boost productivity and deal with its chronic labor shortage as its population grays and declines.

The government’s cashless incentives are part of a wider set of measures aimed at smoothing out consumer demand before and after the sales tax increase. A previous hike in 2014 triggered a 7.3% contraction of the economy as spending dived after the increase.

“The cashless initiative is having an impact,” said Takashi Miwa, chief economist at Nomura Securities Co. “It spread widely among small and medium-size stores during the final period before the tax hike. They are also showing greater interest since the program started in October. This is likely to limit the drop in consumption.”

The IMF also said the measures were helping lower the economic impact of the tax this time round.

Under the program about 770,000 small and medium-sized companies have installed cashless payment terminals using the government subsidies, according to a Nov. 21 tally by the economy ministry. That represents 39% of about 2 million businesses eligible under the program. The tally is expected to grow to about 860,000 by Dec. 1, the ministry said.

There are also signs that consumers are losing their reluctance to use cashless payment methods. Nearly 49% of multiple-member households are now making cashless payments, according to a Bloomberg calculation based on data from the Central Council for Financial Services Information at the Bank of Japan.

Still, the proportion of spending covered by cashless transactions is much lower. The government wants cashless transactions to cover 40% of consumption by 2025, compared with 21% in 2017.

 — Yoshiaki Nohara and Emi Urabe (Bloomberg)

eShopWorld Partners with APEXX Global to Streamline Payments

APEXX Global, the first single marketplace for global payments, is today announcing that it has partnered with international cross-border e-commerce giant, eShopWorld, to transform the payments process for its clients, whilst reducing associated costs. 

eShopWorld is Ireland’s fastest growing technology business, working with some of the world’s leading fashion e-commerce businesses and a presence in over 100 markets and dozens of currencies.

The partnership kicked off with APEXX Global processing payments for eShopWorld’s clients in Russia. APEXX Global is one of the first platforms to process payments through the national MIR payment system. It is connected to the three largest banks in Russia – Sberbank, VTB, and Alpha Bank – making it possible to route all transactions back to the issuing bank and guaranteeing On-Us processing of 80% of all transactions. With On-Us processing, businesses typically see a 5-10% increase in local transaction approval ratios, and a 25-30% increase in cross-border transaction approval ratios.

Implemented to mitigate against political risk between Russia and the US, the MIR payment scheme was mandated for issuers by the Central Bank of Russia. It is fast becoming one of the biggest card schemes in Russia, with over 37 million MIR cards issued to date.

Partnership will allow some of the world’s largest fashion brands to see savings of up to 15%

With 35% of Russians regularly shopping online and two thirds choosing to specifically buy from international retailers, eShopWorld’s clients are able to tap into this growing economy without the worry of possible regulatory action affecting international payment schemes.

All brands using eShopWorld’s platform will benefit from APEXX Global’s Russian presence and will soon be able to use the platform in additional markets across Europe and Asia. Through the APEXX Global platform, they will see savings of at least 15% on payment acceptance fees thanks to features including card acceptance, analytics, transactional reporting and advanced routing capabilities.

Commenting on the partnership, APEXX Global’s co-founder and Managing Director, Rodney Bain, says “We are very excited to be working with eShopWorld and its network of clients, some of the biggest fashion brands in the world. The addition of APEXX Global’s platform will allow them to improve their offering in Russia’s growing market, whilst also saving money on the costs of processing payments. We now look forward to working even more closely with them as we roll this out across new markets.”

Tommy Kelly, CEO of eShopWorld says “As the global leader in cross-border ecommerce sales we at eShopWorld are always looking at ways to improve the customer offer through our localised checkout. APEXX Global is a true innovator in the payments space and we are delighted to be using its routing capability to significantly improve our payment performance in the Russian market.”

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