Here is our pick of the 3 most important Stablecoin news stories during the week.
This week we saw arguments for and against the implementation by Central Banks of a state backed stablecoin or CBDC.
Firstly, the BIS published a study on the rise and power of digital platforms which are defined as marketplaces that enable connectivity of buyers and sellers along with the facilitation of exchange such as AirBnB and Uber. These will be early adopters and most likely issuers of stablecoins and/or CBDC’s.
“Three types of digital platforms are expanding in financial services: (i) fintech entrants; (ii) big tech firms; and (iii) increasingly, incumbent financial institutions with platform- based business models. These platforms can dramatically lower costs and thereby aid financial inclusion – but these same features can give rise to digital monopolies and oligopolies.”
Significantly, the paper called for ex ante (early or ahead of time) regulation of platforms and the need for Central Banks to be focused on their role as protector of consumers interests.
Then, later in the week in the UK, the Lords Economic Affairs Committee said introducing a central banking digital currency (CBDC) “would have far-reaching consequences for households, businesses and the monetary system”.
“The introduction of a UK CBDC would have far-reaching consequences for households, businesses, and the monetary system for decades to come and may pose significant risks depending on how it is designed,” the committee said in a report.
“These risks include state surveillance of people’s spending choices, financial instability as people convert bank deposits to CBDC during periods of economic stress, an increase in central bank power without sufficient scrutiny, and the creation of a centralised point of failure that would be a target for hostile nation-state or criminal actors.”
In a similar manner in the US, citing the privacy dangers posed by China’s digital yuan, Rep. Tom Emmer proposed a bill to bar the Fed from creating a digital currency for consumers.
In a press release describing the bill, Emmer warns that a digital currency issued by the Fed could be a slippery slope in which consumers could one day be forced to register with the central bank to access money, which could in turn lead to mass surveillance of their financial activity.
So in summary, do we trust our Gamekeepers (Central Banks) to turn poachers and issue their own CBDC? Or are we better off having them focus on their role as regulators and protectors for consumers and let BigTech and FinTech succeed and sometimes fail to deliver us this new innovation?
New readers can read 3 free articles. To become a member with full access to all that Daily Fintech offers, the cost is just US$143 a year (= $0.39 per day or $2.75 per week). For less than one cup of coffee you get a week full of caffeine for the mind.
Throughout the entire month of January, The Fintech Times will be exploring every dimension of one of the industry’s most pressing topics: cybersecurity.
We covered the latest innovations to look out for in 2022 in cybersecurity, but as with all new and experimental things, this adoption won’t be seamless at first. These innovations will each face unique challenges. Exploring these obstacles in further depth, The Fintech Times heard from JamesBore, Director of Bores Consultancy; LukeTenery, Partner at StoneTurn; BronwynBoyle, Chief Information Security Officer, Mambu; JohnnyYoung, Founder of CyberD TV; and KyleRice, CTO of SAP NS2.
Finding a genuine innovation that can radically change an industry is no easy feat. James Bore, Director of Bores Consultancy, argued that many ‘innovations’ are near on carbon copies of other products, so finding a new, innovative one is like finding a diamond in the rough. “Security fundamentals haven’t changed for millennia, and so most true innovation is about better applying those fundamentals to a technology landscape. Sadly a lot of the real innovation is buried beneath a slew of barely-novel products piled high with marketing keywords, and sorting through the chaff is a painful process that many don’t have the time or resources for.”
The idea that cybersecurity fundamentals are not in need of a huge change was echoed by Luke Tenery, Partner at StoneTurn. Believing that a lot of the cybersecurity issues we face in the modern-day are a result of poor employee training rather than faulty technology, he said, “There are two primary reasons why innovation in cybersecurity has in large part stagnated. The first is, it actually isn’t needed. The vast majority of networks suffer from failings around basic security hygiene. 61 per cent of the vulnerabilities on CISA’s known exploited vulnerabilities catalogue are at least a year old. Most intrusions can be tied to human error, whether it is password reuse, clicking a phishing link, misconfiguration of a public-facing asset, or failure to appropriately patch. These are not things technology can actually fix, it is a cultural and training problem. When the foundational security problems that have been endemic to networks since the early 1990s are still the primary issue, it is hard to find an innovative solution, especially given that the problem is one of combating human nature and not actually a technology issue at its core. The second primary reason is that the security industry isn’t properly incentivised to be truly innovative. In fact, it is incentivised to move slowly and incrementally. Truly solving a category of threat or fundamentally reducing the amount of impactful intrusions undermines the cybersecurity industry, as they make their money and VCs pour money into the sector, based on the ever-increasing fear of these intrusions and the outcomes. So, between the economic disincentive and the fundamental problem that cyber security is generally a human behaviour rather than a technology problem, you have a severe reduction in innovative solutions.”
Many companies simply cannot risk experimenting with new technology. In a field that is so ruthless if mistakes are made, Bronwyn Boyle, Chief Information Security Officer, Mambu explains many SMEs cannot risk using a new and unproven form of technology, “From a resourcing perspective, new ventures and partnerships can struggle to get traction with target buyers; organisations are often so stretched that they lack the capacity to trial and experiment with innovative solutions. Many firms that would benefit most from cyber innovations also work in highly regulated industries, which means greater risk requirements and additional barriers to entry. Finding ways to facilitate sandboxes or working with innovation panels is key to pioneering innovative solutions in a challenging operational environment.
“If you look at how cyber innovation has been pitched, there’s a lot of hype in the market – with security businesses making up a growing proportion of unicorn valuations. But where the value is often overlooked is the SME and middle market. It’s also where cyber innovation is most needed as smaller businesses can provide a foothold for much bigger cyber attacks. SMEs don’t always have the money to invest in big-buck solutions and may not understand what’s the best on market or which products are right for their business. So, it’s vital that vendors prioritise this market in the year ahead, to provide that education along with affordable services.
“In terms of social impact, fraud has continued to present a significant threat since the start of the covid-19 pandemic. Changing consumer behaviour, working from home and increased reliance on digital services have driven exponential increases in cybercrime and fraud. Figures show that more than £4million is stolen by fraudsters every day in the UK – with UK Finance equating it to a national security threat. With consumers having to adopt more digital services than ever, it’s vital that they’re fully educated on the risks involved and how to protect themselves when doing things like managing their money online. We often hear that people are the weakest link when it comes to cybersecurity, but they’re also our first line of defence – as an industry, we must do more to innovate with end users in mind.”
Johnny Young is the Founder of CyberD TV argued that many of these innovative companies are simple trying to capitalise on a booming industry but will end up paying more in insurance fees if they are unable to properly protect their clients, “Cybersecurity innovations occur every day, as they must. Hardware, software, and developing technologies such as quantum computing, all are driven by high-speed innovation.
“But let’s think on an even grander scale; what are the main problems to be faced by companies purchasing cybersecurity insurance, an entire industry that’s currently exploding?
“Companies are popping up like mushrooms to take advantage of the growth in cybersecurity insurance demand, though the best thing about some of them is their marketing skills.
“Having a policy is one thing, as it makes the insured company feel like they have a safety net. Getting paid after a data breach is another. As a wise philosopher once said, ‘Insurance is great to have, until you need to use it’.
“New companies are writing policies in great numbers, but do they have the cybersecurity experience, or knowledge of their customer’s security posture, to even know what they’re insuring against? To do this they’d have to do an extensive audit of their client’s policies, processes, and procedures, run compliance tests, and get deeper into the business than most companies would ever allow.
“On the other hand, innovative insurance companies could be on-site partners, and take responsibility for the cybersecurity work as an additional service. This can be another great source of revenue, as many smaller companies would love to outsource their cybersecurity needs.
“But still, what happens if a company writes a ton of policies, and many of their clients are hit with data breaches at the same time, such as SolarWinds, or the logj4 exposure? Will they pay up, or just fold their tent, and go out of business?
“If they stay afloat, the court system will be overwhelmed. Insured companies will sue to be paid, while the insurer countersues, claiming policy violations.
“I expect soon we’ll see a multi-billion-dollar cybersecurity insurance industry, albeit one that innovates itself into an unregulated mess. Yikes!”
Kyle Rice, CTO of SAP NS2, points out the sheer number of hackers and cybercriminals outdoes that of a cybersecurity team, and with each hacker trying new forms of trickery to access data, security teams have a huge burden in keeping up with all the new forms of attack. In addition to this, there is no room for error. Security teams must be 100 per cent successful each and every time or face possibly devastating consequences:
“Cyber threats rapidly change and evolve, so it is critical that cyber defenders continue to innovate to stay ahead of these threats. Due to the inherent asymmetry of cybersecurity, there are two aspects of cyber defense that make innovation in this space particularly challenging.
“The first complicating factor is that cyber attackers have a significant numerical advantage. Your cyber team and vendor partners are innovating as fast as they can to come up with new strategies to protect your network environment. But there is an entire world of potential cyber attackers who are innovating against you – and there are simply more of them.
“The second factor is that in a traditional network environment, cyber defenders have to be successful 100 per cent of the time, while attackers only have to be successful once. This dichotomy extends to innovation: a cyber innovation that works 10 per cent of the time will be largely useless to a defender but will be hugely valuable for an attacker.
“So how do you innovate successfully? The key is to strive to balance the asymmetry. Don’t restrict your defensive innovation only to your team and partners, instead expand your collaboration to include industry and government allies. Organisations like the Cybersecurity and Infrastructure Security Agency (CISA) are helping to drive these public/private partnerships which can significantly expand your defensive innovation network. Configure your environment so that when the inevitable occurs and an attacker is successful, they are not able to cause immediate damage. This is the concept of Defense in Depth (DiD): a series of wooden doors that are 90 per cent effective is much more secure than a stone wall that is 99.99 per cent effective – because now you can detect and mitigate the much smaller set of attackers that made it through the first door.”
The role of the CFO has changed considerably in a relatively short period of time; 2021 saw sustainability move up the C-suite agenda, new rules and regulations came into force in the aftermath of Brexit, and pandemic uncertainty caused more disruption for many businesses. It’s unsurprising then that 97% of UK CFOs believe their role has become more complex over the last two years, according to latest research byTipalti. However, finance leaders were already being asked to juggle a multitude of priorities, which has meant they are now wearing even more hats.
Forced to navigate a new set of challenges, it will be crucial finance teams are ready to innovate, finding new solutions to changing business needs. From becoming more attuned to ESG rating to fighting against the burden of manual processes and tasks, here, Rob Israch, GM Europe at Tipalti explores what finance teams can expect to experience in 2022.
The CFO to work closer with the CEO
As opposed to solely managing financial operations and ensuring compliance, the CFOs relationship with the CEO will intensify in 2022. This shift will see the CFO become increasingly involved in looking at the strategic ways the business can grow and diversify.
Nearly two-fifths (39%) of CFOs have noted a larger demand to collaborate with the c-suite now than two years ago. However, organisations are still slowed down by old ways of working, as nearly a third (29%) of CFOs state they are having to deal with more manual finance operations. As a result, CFOs aren’t afforded time to support the business leader in the way that their job requires.
By innovating financial processes through automation, finance teams can free up time for the strategic tasks that matter most to the business. In fact, UK CEOs believe that the ability to prioritise innovation (25%) and the ability to improve financial and business reporting accuracy and timeliness are the most important qualities for a successful CFO today.
Fighting fraud will become harder
Every year, defending against fraud gets increasingly challenging. As accounts payable complexities rise, finance teams will experience payments fraud at an alarming rate.
Finance teams today are tasked with managing more diverse payment methods, increasing cross-border transactions and dynamic tax compliance and financial reporting. Yet, teams struggle to cope when operations are processed manually. The most common perpetrator of payment fraud is manual processes. They are neither efficient nor airtight enough to ensure optimum financial control. Busy finance teams, escalating complexities in AP and error-prone manual processing sets the perfect scene for fraudsters to take advantage.
To mitigate such risk, companies need to leverage people, processes and technology. This means investing in robust technologies such as automation to standardise procedures. Data entry will be minimised, end-to-end payments processing visibility will be optimised and policy compliance becomes automated. Not only does AP automation relieve workflows by minimising manual intervention, but the technology acts as a hub for enforcing strong financial controls as the number of people and systems involved in payment processing is reduced substantially.
In addition, 2022 will see more multi-entity businesses emerge as organisations recognise the value of the ‘work from anywhere’ model. It can be challenging to manage finance functions across these multiple entities, and that is often why different business units in geographical locations run their finances in isolation, with varying processes and approvals being managed in different ways. However, with no central control or oversight, you run the risk of internal fraud.
Finance leaders to drive sustainability strategies
Following COP26, business leaders are under pressure to set and meet green targets, and many are turning to their CFOs for solutions. In fact, CFOs ranked incorporating environmental, social and governance (ESG) and sustainability into the business and its operations as the greatest driver of complexity in their role (27%), above even the global pandemic (22%).
A key reason for this is that ESG ratings have become an important tool for asset managers and investors to evaluate and compare future investment prospects. Currently more than a quarter (28%) of UK business leaders rank international growth as a top priority for the year ahead, so a less than favourable ESG rating is not an option. So far, the challenge for CFOs has been finding the time to work on sustainable initiatives.
Brexit hangover far from over
It has been over five years since the UK voted for Brexit – but it will most certainly be on the agenda in 2022 as new regulations emerge. There are a number of challenges that Brexit brings, and much uncertainty still remains in place.
In navigating the uncharted waters of Brexit, businesses will encounter new hurdles when looking to fill roles, as the Global Talent Visa makes competition for skilled employees more formidable than ever before. With the visa application deadline passed, some employees may have chosen to move back home contributing to headcount issues for finance teams.
Moreover, the UK is still yet to agree on many key trade agreements. Businesses will need to stay vigilant – watching out for any changes at relatively short notice and be ready to adapt.
Increased attention paid to the well-being of the finance team
Along with many other departments, the Great Resignation period has meant finance is experiencing Churn. Whilst the wellbeing of all employees will be a key focus for the c-suite this year, CFOs will need to ensure the work of the finance team is engaging and talent is not wasted on tedious and time-consuming operations. Introducing automation to take care of those manual tasks will free up time to upskill employees while making them feel valued in their role.
The future office of finance
The year ahead will certainly push finance teams to review the way they operate. The emergence of a wealth of new responsibilities for the CFO, including implementing sustainable initiatives, driving strategy, navigating the uncharted waters of Brexit and managing the wellbeing of their team, as well as fighting against the increasing risk of fraud, will mean finance teams must find methods to work more efficiently. By moving away from fully manual and administrative work and towards new technologies and automation capabilities, CFOs will reserve time for the tasks that matter.
Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.
In this episode of “The Buzz” podcast, hear how executives in retail digital banking are least confident in their organizations’ ability to create a well-defined innovation strategy and measure the results. Over the next five years, banks expect most innovation to happen in product delivery. Bank Automation News digs into a study from digital banking […]
Wells Fargo will continue to drive its digital capabilities in 2022, building around an enhanced mobile banking suite and rapid growth in real-time payments during the previous year. The $1.95 trillion bank reported fourth-quarter 2021 revenue of $20.9 billion, up 13% year over year. Net income clocked in at $5.8 billion, up 86% year over […]
Citigroup added 5,500 technology workers and increased its tech spend 10% to about $10 billion in 2021. The $2.9 trillion bank reported $3.3 billion in net income for the fourth quarter of 2021, down from $4.3 billion in Q4 2020. Tech and communications spending reached $2.1 billion in Q4, a 3% year-over-year increase and 4% […]
FinovateFall Best of Show winner SpyCloud has launched its latest solution to combat online fraud. The SpyCloud Identity Risk Engine, unveiled this week, analyzes billions of data recaptured from the dark web to help businesses and financial institutions make faster, more accurate, real-time fraud mitigation decisions.
What’s unique about SpyCloud’s approach to fighting fraud is the company’s focus on identifying credentials that have been exposed during data breaches and are actively being traded in the criminal underground. These exposed credentials are sold to fraudsters on the black market or used by the hackers themselves to steal confidential information, access secure systems, or commit fraud. Because many of these sources of stolen credentials cannot be readily accessed by automated software tools or web crawlers, SpyCloud uses a combination of technical innovation and human intelligence to find and recapture data from online criminal communities. The company also gives businesses and financial institutions access to the kind of authentication systems that will help defend them against cyberattacks that leverage stolen credentials such as account takeover (ATO), identity fraud, and new account fraud.
With the release of its SpyCloud Identity Risk Engine, SpyCloud gives businesses in financial and ecommerce services actionable, predictive fraud risk assessments based on breach data and stolen credentials that have been recaptured from the dark web. The technology combats difficult-to-detect challenges including data harvested by malware and the use of synthetic identities. SpyCloud Identity Risk Engine also gives businesses insight into which customers have the highest risk of account takeover due to risk factors such as exposed credentials or weak password protocols.
Businesses place the Identity Risk Engine at their most critical points of potential fraud (i.e., at account opening, login, transactions, etc.). From there, all that is required is an API query using an email address or phone number. SpyCloud then scans billions of recaptured data points to deliver a risk score that enables businesses to make more accurate fraud decisions. SpyCloud has recaptured more than 145 billion breached assets, more than 30 billion email addresses, and more than 25 billion total passwords. The company’s technology collects 50+ breach sources every week.
Winner of Built In Austin’s Best Places to Work for a second year in a row, SpyCloud was founded in 2016 and made its Finovate debut one year later. The company was featured in Fast Company’s inaugural Next Big Things in Tech roster last fall and, in October, SpyCloud announced a partnership with Houston, Texas-based identity and access management solution provider Identity Automation to help schools fight ransomware threats.
“Preventing ransomware is possible by negating the top attack vector: credentials that have been exposed in data breaches,” SpyCloud SVP of Business Development Cassio Mello explained. “This service gives schools early identification of compromised accounts, enabling them to take action quickly and prevent cyber attacks that leverage recently-breached identity data.”
SpyCloud has raised $58.5 million in funding from investors including Centana Growth Partners, Microsoft’s Venture Fund M12, March Capital, and Silverton Partners. Ted Ross is co-founder and CEO.
Remember when Andreessen Horowitz’s Angela Strange said that every company will be a fintech company? Though there has been much debate over the now-infamous catchphrase, there is news this week from automaker Ford Motor Company that further proves its truth. Ford announced it has signed a five-year partnership agreement with ecommerce technology company Stripe.
Ford aims to leverage Stripe to scale its ecommerce capabilities. “Stripe’s platform will help us deliver simpler, outstanding payment experiences in any channel customers choose and scale improvements faster,” said Ford CEO Marion Harris.
Under the deal, Stripe will process ecommerce payments for Ford’s personal and commercial customers. Beginning in the second half of this year, Stripe will power vehicle ordering, reservations, digital functions, and charging services. Stripe’s payment services will also be brought into Ford’s tech stack as the automaker develops more ecommerce offerings.
Specifically, Ford will implement Stripe Connect, a set of programmable APIs that helps businesses facilitate purchases between third-party buyers and sellers, to scale new ecommerce services. Ford will use Connect to facilitate payments between customers and their local Ford or Lincoln dealer. Among Stripe’s other customers for its Connect tool are Squarespace DocuSign, Mindbody, and Jobber.
The deal comes at a time when shoppers are more willing than ever to try digital experiences. “During the pandemic, people got comfortable paying online for groceries, health care, even home haircut advice from barbers,” explained Stripe CRO Mike Clayville. “Now, they expect to be able to buy anything and everything online. Ford is making ecommerce possible, too, and scaling that strategy with Stripe’s help.”
Founded in 2010, Stripe has millions of customers. Today’s partnership with Ford, however, marks one of the biggest deals the California-based fintech has landed. During a funding round last March, Stripe’s valuation was boosted to $95 million, ranking it among the most valuable fintech startups.
Digital investment services and infrastructure company WealthKernelsecured $7 million in Series A+ funding to start the week. The round was led by XTX Ventures and featured participation from Digital Horizon, Big Start Ventures, and ETFS Capital. The U.K.-based company said that it will use the capital to fuel expansion across Europe.
“I’m incredibly excited to take this next step in WealthKernel’s journey,” WealthKernel CEO Karan Shanmugarajah said. “Our investors’ backing will not only help us bring our product to a wider audience and expand our platform, but also achieve our goal of becoming the leading provider of API-based wealth and investment infrastructure across Europe.”
WealthKernel offers businesses the building blocks they need to power their digital investment offering. From client onboarding and trading to portfolio management and custody, WealthKernel enables neobanks, roboadvisors, PFM apps, and embedded finance platforms to focus on building their brand and customer experience while leaving the heavy lifting to WealthKernel’s all-in-one investing API.
“We often describe what we do as the plumbing for wealth management companies,” Shanmugarajah explained. “The current industry is built on leaky legacy pipes and that leakage directly impacts the savings and pensions of millions of people, particularly those with smaller sums of money. Our mission is to enable the change that makes financial services and investing better for everyday people.”
This week’s Series A+ round is an extension of the company’s $6 million Series A round from 2020. In addition to supporting the company’s growth plans in Europe, the funding will enable WealthKernel to expand its investing infrastructure to accommodate intraday trading, as well. The company currently has $13.9 million in total equity funding according to Crunchbase.
A leading embedded investing solution provider in the U.K., WealthKernel’s platform supports more than 100,000 transactions a month, and more than 72,000 trades per month are executed using its technology. The company’s clients include U.K.-based financial coaching app Claro Money, Sharia-compliant ethical investment platform Wahed, and wealth management service provider Rosecut. More recently, WealthKernel has forged partnerships with GOODFOLIO, an ESG-based investment platform, and investment app Stratiphy, which offers personalized investment and trading strategies. WealthKernel was founded in 2015.
Advocates of a decentralized future of money based on distributed ledger technology are chasing an illusion, according to Bank of International Settlements General Manager Agustin Carstens.
Their vision, which is to “democratize finance” by cutting out big banks and other middlemen, is “not what decentralized finance applications are delivering,” he said on Tuesday addressing an event in Frankfurt.
“There is a large gulf between vision and reality,” Carstens argued.
DLT technology, which underpins cryptocurrencies such as Bitcoin and is being experimented with in large parts of the financial system, in principle allows anyone to be a validator in a shared network. Carstens — who’s long been a skeptic of Bitcoin — countered that “in practice, there is a lot of centralization in decentralized finance.”
That’s because self-executing protocols, or “smart contracts,” can’t cover every possible scenario, and rely on individuals to write and update code. In addition, certain features of DeFi blockchains favor the concentration of decision making power in the hands of large coin-holders. For example, transaction validators need to receive enough compensation to give them “the right incentive” to participate, he said.
“Decentralization can be a noble goal. In many applications, governance improves when power is genuinely dispersed, with appropriate checks and balances,” Carstens said. “To date, the DeFi space has been used primarily for speculative activities.”
Canadian fintech startup and credit assessment company Periculum has launched its service in Nigeria, alongside the appointment of a new Managing Director, to improve the country’s rate of financial inclusion and economic growth through transforming domestic credit.
Canadian fintech startup and credit assessment company, Periculum has launched in Nigeria to tackle the challenge of domestic credit to the underserved markets.
Utilising a suite of automated credit assessment tools, the company is actively seeking to assist the country’s financial institutions in the provision of credit facilities. This move, it hopes, will close the consumer credit gap whilst increasing Nigeria’s rate of financial inclusion.
The company has also announced the appointment of DamilolaAluede to the position of Managing Director, to accelerate its business in Nigeria.
The Problem With Nigeria’s Credit System
The key issue with the country’s current credit system is that it’s not as accessible, or as far-reaching, as it ought to be. The vitality of financial services such as banking, savings, debt and equity financing, investment management, and point-of-sale lending is largely dependent on the maturity of its domestic credit industry; yet Nigeria’s remains somewhat in its infancy.
For context, credit to the private sector in Nigeria is about 12 per cent of GDP, lower than South Africa’s 129 per cent and Malaysia’s 134 per cent. High ratios of credit to the private sector in these countries have helped to ramp up real sector growth, create innovative innovation possibilities for technology-enabled businesses, accelerate financial development, ensure the efficient functioning of the economy and guarantee the prosperity of the private sector.
The Central Bank of Nigeria (CBN) and other development partners including the BankofIndustry (BoI), the BankofAgriculture (BoA), among others have embarked on significant credit injections to support the critical sectors of the economy, but the paucity of credit assessment infrastructure ensures many potential borrowers are denied access to loans, and when they do, they can be charged as much as triple the base interest rate. This financial exclusion has significant outcomes for the real sector as lack of access to credit can be a disincentive to entrepreneurship, investment, and economic growth.
Speaking at its Nigeria launch, MichaelTemitopeCollins, Periculum’s founder and Chief Executive Officer, said: “Africa needs domestic credit to stimulate real economic growth. And this is not only bank-to-business credit; it can also be digital lending for short-term credit as well as “buy now, pay later” schemes. The absence of tech-enabled credit assessment infrastructure has limited the quality and quantity of lending and may be behind the risk premiums borrowers have to pay, and the harassment practised by predatory lenders in countries like Nigeria.
“Periculum will change that. We are a top provider of data analytics and credit assessment services targeted explicitly to underserved markets. We help our customers to reduce their lengthy loan application processing times and loan default rates and offer loans to the underbanked and unbanked consumers as well as micro, small and medium-scale enterprises. With reliable, tech-enabled, credit assessment services, financial institutions can increase lending to those that need credit.”
Founded in 2019, Periculum helps its banking and lending customers identify fraud risk, assess creditworthiness, and analyse existing data. Periculum offers real-time decision-making, analysis, and credit underwriting solutions to financial institutions including banks, non-banking financial companies, and fintech companies.
By providing information on the financial worthiness of customers and automating the loan decision process, Periculum’s customers can gather and analyse borrower information and assign a credit score faster, with real outcomes on financial inclusion in Nigeria and other markets.
Periculum offers data aggregation APIs and platform solutions that aggregate data from partners including open banking APIs and the credit bureaus, to provide complete financial and data profiles of prospective borrowers and third-party entities.
On its product roadmap and current services, Collins added: “We offer services that include Credit model development, SMS data aggregation and analysis, financial data analysis, and other data analytic solutions. We can help our customers with solutions such as fraud detection, insights for lenders based on customer segmentation and customer lifecycle value, insights to retailers and ATM operators, and several other benefits.”
For many countries in Africa, there is still a financial divide. By tackling the credit assessment challenge, Periculum can build the financial infrastructure that helps in addressing the issue of access to financial services and improves development outcomes for millions of people, with better opportunities for businesses, financial institutions, and lenders.
The Fintech Times Bi-Weekly News Roundup on Tuesday sees fintech Phos partner with BORICA, while open banking payment provider Crezco appoints its first chief financial officer.
CryptoUK hires Teana Baker-Taylor as a new non-executive director. Baker-Taylor is chief policy officer for the Digital Chamber of Commerce, a US trade association representing the digital asset and blockchain industry. She also formerly worked at Crypto.com and Binance.
Canadian fintech Buckzy Payments Inc has appointed Carlos Garcia as its chief operating officer. Buckzy’s mission is to offer global customers a one-stop financial solution, making international payments faster, more reliable and more cost effective. Most recently, Garcia held the position of chief of payments operations at NanoPay.
Meanwhile, intive, a global digital consulting, design and engineering firm, has named Abhishek Dahiya as chief design officer. Dahiya has ‘been solving design problems’ for startups as well as in large corporations such as the London Stock Exchange Group, NTT Data and Barclays, across a variety of industries including fintech.
CoinFund, a blockchain-focused investment firm, unveils J. Christopher Giancarlo, the former chairman of the Commodity Futures Trading Commission as a strategic advisor. Giancarlo’s recent book CryptoDad: The Fight for the Future of Money depicts his reckoning with the future of the global economy and also puts forward the fight for a digital dollar.
Marcus Hughes joins BitMEX as chief risk officer (CRO). As CRO, he will serve on the executive board, with responsibility for BitMEX’s regulatory affairs, risk, legal and compliance functions. Prior to joining the trading platform, Hughes was managing director of Coinbase’s European business.
Claims guidance platform EvolutionIQ expands leadership team with appointment of Alex Young as its executive vice president of sales. Most recently, Young was executive vice president of business development at Sapiens, where he led tier 1 market development.
B2B open banking payments provider Crezco has appointed Ivelina Delcheva as its first chief financial officer and chief operations officer. Delcheva, who joins from Chip Financial, will lead the London-based startup’s growth agenda. She will also establish KPIs and processes that reflect Crezco’s values and goals.
Funding and investments
Gr4vy, the cloud-native payments orchestration firm, has bagged $15million in Series A extension funding, led by March Capital. Participation also came from Nyca Partners, Activant Capital and Plug and Play Ventures. Gr4vy plans to use the funding toward further global expansion. It will also support its product roadmap for its cloud-native payment orchestration platform.
Arc, the full-service finance platform for SaaS, emerged from stealth today with $161million in total funding. In partnership with Stripe, Arc is building a fintech solution where software founders can borrow, save as well as spend on one digital platform. NFX founder James Currier, who led the fund’s investment in Arc, has also joined its board.
Koia, the alternative investment platform, has secured a $1.4million pre-seed round. Investors included Seedcamp, RTP Global, Portfolio Ventures and a number of angels. The startup is launching with collectibles including watches, wine and Pokémon Cards.
Shield unveils $15million Series A Round to address ‘surging demand’ for its AI-driven communications compliance platform. The round was led by Macquarie Capital and OurCrowd with significant participation also from Mindset Ventures. Shield will use the funding to significantly expand its US presence, while further establishing itself in markets throughout Europe, the Middle East, Africa and the Asia Pacific. The funding will also be used to ramp up development of Shield’s platform.
Spendesk, the 7-in-1 spend management solution for SMBs, has raised €100million as an extension to its Series C round in July 2021. The new investment comes from Tiger Global, with existing investors, including General Atlantic, Eight Roads Ventures, Index Ventures and eFounders. Spendesk plans to heavily invest in growing headcount.
Fintech Soft Space enters into strategic partnership with JCB. Collaboration will expand JCB’s presence in Southeast Asia and act as a bridge for Soft Space to link Japanese consumers with the region. The strategic partnership also aims to harness synergies between the two parties and includes the expansion of JCB’s merchant network, the establishment of card issuing solutions and the provision of customer marketing solutions.
INGOT Brokers, a premium multi-asset brokerage firm, has signed a partnership with fintech firm Acuity Trading and signal provider Signal Centre. Traders at INGOT Brokers now have access to a wealth of unique market insights and trade ideas.
Bitget, a global cryptocurrency exchange, has deployed its Launchpad in conjunction with cryptocurrency wallet BitKeep. Launchpad aims to support the crypto ecosystem by offering access to promising crypto projects. The first project on Launchpad, Contents Shopper Token, is the utility token of a property management and transaction platform.
Meanwhile, Pay360 by Capita partners with Ordo. Ordo’s open banking platform will integrate Pay360’s payment services solution. Pay360 and Ordo are also integrating the ability to attach invoices, bills or reminders to a payment request to further improve and simplify the customer payment process.
Phos, the fintech behind a software-only point of sale system, has partnered with BORICA, a payment provider in Bulgaria. Phos’ technology will be available to Bulgarian banks, allowing them to offer customers the ability to turn any NFC-enabled Android device, such as a smartphone or tablet, into a payments terminal.
Ford Motor Company and Stripe have signed an agreement to scale the automaker’s e-commerce capabilities faster. For Ford and Lincoln dealers offering digital payment services, Stripe’s service is expected to drive new efficiency into processing of e-commerce payments, such as vehicle ordering, reservations and digital and charging services. Rollout of Stripe technology is expected to begin in the second half of 2022, starting in North America.
Tenet Compliance Services (TCS) has introduced a financial vulnerability identification and reporting solution from fintech firm Comentis. The solution enables TCS advisers to identify, support and record vulnerable client activity through a clinically developed assessment process.
There’s also a partnership for Saudi Arabia-based Quara Holding and B.A.M Ticketing, a blockchain-based ticketing technology provider. The new collaboration aims to help event organisers in the Kingdom eliminate ticket fraud and keep track of the tickets sold.
Property group Coldwell Banker partners with Coinweb to spearhead its real-estate tokenisation piloting in Thailand to fully leverage blockchain technology and unlock liquidity. Development has already begun on the platform, with a product release in beta planned for Q3 2022.
Visa announces a partnership with ConsenSys to develop an infrastructure to help central banks and traditional financial institutions build services on top of CBDC networks. Visa’s CBDC Payments Module is designed to provide an on-ramp for CBDC to existing payment networks, so that CBDC networks can easily connect to traditional financial service providers.
Canadian fintech Periculum officially launches in Nigeria. Periculum helps its banking and lending customers identify fraud risk, assess creditworthiness as well as analyse existing data. The company has also announced the appointment of Damilola Aluede as managing director.
Following Bitcoin becoming a form of legal tender in El Salvador, interest in this form of paytech has boomed, with industry leaders speculating as to who could be next to board the crypto train.
Here, MarcusSotiriou, Analyst at the UK based digital asset broker GlobalBlock discusses the use of Bitcoin, its current trends, and who the next state to adopt the cryptocurrency in 2022 might be.
Bitcoin is currently hovering around $42,800, with some telling signs that this price region could be a good buying opportunity. Data from Glassnode shows that short term holders (investors who bought Bitcoin within the past three months) is at a historically low level of three million (shown by the chart below).
This figure is the lowest since August 2020, which preceded a 500 per cent rally in price. A low level of short term holders could precede a rally for Bitcoin because this type of investor tends to sell for quick profits, as opposed to institutions that typically hold for at least six months.
Will more sovereign states adopt Bitcoin in 2022?
In a report by Fidelity on crypto trends and their potential future impact, they discussed the adoption of cryptocurrency by sovereign nations. They said they wouldn’t be surprised to see two more nation states acquire Bitcoin this year, after El Salvador decided to make Bitcoin legal tender last Summer and buy Bitcoin frequently since.
As per its report, Fiedlity explains: “We also think there is very high stakes game theory at play here, whereby if bitcoin adoption increases, the countries that secure some bitcoin today will be better off competitively than their peers. Therefore, even if other countries do not believe in the investment thesis or adoption of bitcoin, they will be forced to acquire some as a form of insurance.”
The CEO of deVere is more optimistic and thinks there will be three more countries to adopt Bitcoin as legal tender this year: “I agree with the notion that more countries will follow El Salvador in 2022, particularly South American countries that are severely impacted by inflation.
“Paraguay and Brazil are reported to be looking to adopt Bitcoin on a national level, and this adoption would dramatically decrease the volatility of Bitcoin over time.”
People often talk about getting onto the property ladder, but property is only one type of asset used for wealth creation.
Equities is the primary asset used by the wealthy.
Imagine somebody born into a poor family who on her/his 21st birthday receives a certificate that in real inflation adjusted terms represents more money than they can earn in a year at a minimum wage.
That is a feasible scenario if that person is given an Equities Birth Certificate and cannot cash them in for at least 21 years.
Let’s run some numbers for the donees/recipients. Assume $1,000 invested at birth and and an annual real return (after fees, taxes and inflation) of 3%, compounded over 20 years. Age 21 donees will have $18,0611 as per this handy compound interest calculator. Now assume that person’s only work prospects are minimum wage in America ie $7.25 per hour and they work 8 hours per day for 20 days and 12 months (no holidays), they can earn $13,920 per year. $18,0611 could change their life.
That $1,000 seed money invested at birth comes from donors – more on them later.
At age 21 donees can choose to cash in whatever % they want. Some will leave it invested ‘till retirement. Some will blow it all on sex & drugs & rock ‘n roll. At 21 it is their call. Before the age of 21 it has to stay invested.
These Equities Birth Certificates have three values:
– cash value. $18,0611 is a meaningful amount.
– learning value. Learning about the compounding value of equities in such a simple visceral way can also change their life.
– value of popular commitment to a free market system. This is where the interest of donors and donees converge. Donors want/need a society committed to a free market system, so that people will resist the siren songs of authoritarians of both right and left; because they see that free market innovation puts money in their pockets.
Now let’s run some numbers for the donors:
Minimum commitment is $100,000 = 100 babies getting $1,000 each.
Assume some people give $1m = 1,000 babies =1% for a family with assets of $100m and the super wealthy donate 1% of a $1 billion wealth = $10m = 10,000 babies.
Donors cannot choose which equities are used or choose donees and all donations are anonymous
The equities Birth Certificate concept requires government buy in, as it is critical that donees can accumulate tax free and so that Donors can get a tax deduction. The first countries to do this will prosper from a lot of wealth creation.
No market timing, but free education about the value of being greedy when others are fearful and vice versa. In most 20 year periods, equities have yielded positive returns, so even babies born during the late stage of a bull market will usually do ok.
However the babies born when the conventional wisdom hates equities will do best. There are over 400k births every day, so those babies fortunate enough to be born when this magazine trumpeted “the death of equities” (image source) will do well – and free education about the value of being greedy when others are fearful and vice versa will be them comparing the value of their certificates to those who invested when equities were being hyped by the media.
The equity assets on the birth certificates must be fee-free and global. This will require some global index provider to become a partner.
Some subjects are too complex for our short attention spans, so we do 4 posts one week apart, each one short enough not to lose your attention but in aggregate doing justice to the complexity of the subject. Stay tuned by subscribing.
Elliptic, the provider of on-chain blockchain analytics, has announced the launch of its market intelligence unit; a second line of business for the organisation that is focused on leveraging Elliptic’s identity graph to build new propositions and use cases for businesses trading crypto.
The new unit, led by Elliptic co-founder James Smith and LauraCoffey, will harness Elliptic’s dataset as an intrinsically valuable data layer for the burgeoning institutional crypto trading market. The data will provide access to the broadest asset coverage of on-chain identity metrics in the industry, allowing traders to:
Forecast: Utilise real insights behind the movements of money to access fundamental activity metrics for a wide range of crypto assets.
React: Profile the different types of actors behind deposits, withdrawals and other transactions in real-time to assess the motivations behind market-moving activity.
Analyse: Explore flows between businesses and other types of wallets to identify which sectors are growing and at what pace, with the identity graph cutting through the noise.
Elliptic’s dataset has been developed over the past eight years and includes 20 billion-plus data points and covers 148 assets, representing 98 per cent of global trading volume. Two-thirds of global crypto volumes are transacted on exchanges that use Elliiptic’s products.
Commenting on the new proposition, James Smith, co-founder of Elliptic, said: “Elliptic was built with a clear vision in mind: to help businesses capitalise on the opportunities presented by the growth of the crypto market. We pioneered the use of blockchain analytics, and the unique dataset we have developed provides a rich source of intelligence to fuel winning crypto trading strategies, for both crypto-native businesses and traditional players who are moving into crypto trading.”
Hackers are not the only ones committing financial crimes in the modern-day. In 2021, UK banks and individuals were fined a total of £568million by the FCA for carrying out regulated activities without authorisation, insider dealing, and non-financial misconduct.
This data was contained in a new press release published to the FCA’s website, and analysed by a Parliament Street think tank. Experts concluded that the high quantity of financial penalties is in response to the new forms of financial crime buoyed by the covid-19 pandemic.
Dr. Henry Balani, leading regulation expert for EncompassCorporation, commented, “The pandemic has provided criminals with the opportunity to defraud, launder and perpetrate other forms of financial crime with more efficiency than ever before.
“Lockdown, and the resulting dependence on digital services, has made it easier for criminals to impersonate legitimate services and scam consumers. On the other hand, it has caused difficulties for the financial institutions themselves to detect malicious activity, as digital identities are harder to verify than the physical or in-person alternatives that existed before the pandemic.”
Interestingly, however, the FCA demonstrated success when it came to protecting consumers. Its contact centre prevented £4million being lost to scams, and the FCA secured £5million to be paid back to people who invested in companies that were not authorised to undertake financial activity in 2021. Also, a record 1,300 warnings about scams were issued over the past year.
Furthermore, over £1.2billion has been paid out to settle claims made by small businesses after the FCA won its Supreme Court case to clarify business interruption insurance cover.
The FCA also improved its decision-making processes in 2021, and standards were applied more efficiently but also more robustly when authorising firms. In the year to 2nd December 2021, one in five firms, up from one in six when last reported, which applied for authorisation were refused, rejected or withdrew their application after discussions.
Henry Balani continued, “Unfortunately, the number of scams prevented, and fraudsters fined in 2021 is just a fraction of the total amount of financial crime successfully perpetrated. Therefore, combatting it requires a concerted effort from not just the regulator, but the financial institutions, industry leaders, and banks themselves.
“Equipping said financial institutions with sophisticated RegTech which is able to deal with, and adapt to, modern trends in financial crime is imperative to helping to combat it. This is particularly the case when it comes to Anti-Money Laundering, the detection of fraud, and identity due diligence.”
Nikhil Rathi, Chief Executive of the FCA, said, “The FCA has protected customers, enhanced the integrity of the UK’s financial system and promoted competition this year, despite the additional challenges of the pandemic. We have reformed the general insurance market, saving consumers £4.2billion over 10 years, led the transition from LIBOR and helped small businesses claim £1.2billion against business interruption insurance cover. We are looking forward to using our innovative, adaptive and assertive approach to achieve even more for consumers and the financial market next year.”
A joint experiment by the Bank for International Settlements (BIS), the Swiss National Bank (SNB) and SIX (Switzerland’s main provider of financial infrastructure services), which also included five commercial banks: Citi, CreditSuisse, GoldmanSachs, Hypothekarbank Lenzburg and UBS; titled Project Helvetia, has found that central bank digital currencies (CBDCs) are compatible with existing core banking systems and processes of commercial and central banks.
Issuing a wholesale CBDC on a distributed ledger technology (DLT) platform operated and owned by a private sector company is operationally and legally feasible under Swiss law.
The experiment was carried out during the fourth quarter of 2021. It tested the settlement of interbank, monetary policy and cross-border transactions on the test systems of SIX Digital Exchange (SDX), the Swiss real-time gross settlement system – SIX Interbank Clearing (SIC) – and core banking systems.
Project Helvetia looks toward a future in which more financial assets are tokenised and financial infrastructures run on DLT. International regulatory standards suggest that providers of systemically important infrastructures should settle obligations in central bank money whenever practical and available. While none of the existing DLT-based platforms are systemic yet, they may become so in the future. Moreover, central banks may need to extend monetary policy implementation to tokenised asset markets.
“We have demonstrated that innovation can be harnessed to preserve the best elements of the current financial system, including settlement in central bank money, while also potentially unlocking new benefits,” said BenoîtCœuré, Head of the BIS Innovation Hub. “As DLT goes mainstream, this will become more relevant than ever,” he added.
“To continue fulfilling their mandates of ensuring monetary and financial stability, central banks need to stay on top of technological change. Project Helvetia is a prime example of how to achieve this. It allowed the SNB to deepen its understanding of how the safety of central bank money could be extended to tokenised asset markets,” said Andrea M Maechler, member of the SNB’s Governing Board.
“SIX is proud to contribute its experience in the settlement of tokenised assets in partnership with the BIS Innovation Hub and the SNB. Project Helvetia demonstrates the successful end-to-end integration of wholesale CBDC for the safe and secure settlement of digital assets, while also ensuring a level playing field with other financial market infrastructures,” said JosDijsselhof, CEO, SIX.
“SIX is proud to collaborate with the BIS Innovation Hub and the SNB and contribute to Project Helvetia by leveraging SDX, the world’s first regulated DLT-based financial market infrastructure. The project demonstrates that the SDX platform supports wholesale CBDC for settling tokenised assets end to end.” Dijsselhof continued.
As an experiment, Project Helvetia is of an exploratory nature and should not be interpreted as an indication that the SNB plans to issue a wholesale CBDC. Phase II continues the exploration of tokenised asset settlement in wholesale CBDC that was started by Project Helvetia Phase I in 2020.
Throughout the entire month of January, The Fintech Times will be exploring every dimension of one of the industry’s most pressing topics: cybersecurity.
Having previously discussed the relationship between cybersecurity, remote working and personal safety, today we’ll be opening the next chapter into our coverage of this sector, to investigate the cybersecurity innovations that we can hope to see over the course of the next 12 months.
To answer this question, we sat down with a panel of industry experts, including representatives from Utimaco, BoresConsultancy, Performanta, FusionRiskManagement, Mambu and Drawbridge, to gain an on-the-ground understanding of where the technology is taking us, and how future innovations are working to secure the experience for consumers.
According to Utimaco’s Chief Technology Officer NilsGerhardt, cybersecurity innovations in 2022 should seek to appease the immediate threat posed by quantum computers: “At the end of 2021, we have seen that post-quantum cryptography (PQC) has gone from a theoretical computer science problem to a matter of urgency. Within the space of a week, the US Department of Homeland Security announced that quantum-safe encryption was a priority and a Chinese laboratory demonstrated a quantum computer that is tens of millions of times more powerful than the fastest conventional supercomputer.
“What’s more, IBM announced its ‘Eagle’, a working quantum computer with 127 quantum bits (or ‘qubits’). This, and the developments that are going to follow, will hopefully spur more organisations to look into what post-quantum security means for them and develop plans around it.
“If your company hasn’t implemented quantum-resistant security yet, then how can you go about it? Because the threat is perceived to be at an indeterminate point in the future, and we still don’t know exactly what quantum computers will be capable of, it can be daunting to transition an organisation to quantum-resistance, and even more difficult for security professionals to persuade management that it is a priority when current cybercrime threats are so pervasive.
“However, what is often overlooked is that data that is encrypted today and needs to remain confidential could potentially be revealed in seconds, as soon as quantum computers are able to break today’s encryption. Threats to digital signatures are similar. Thus, there is a need to assess the risk and act now to prepare the organisation, using methods like crypto agility to protect against the looming threats to data security in a quantum computing age.
“We will see more discussion around this topic from within the security industry, and this will hopefully spread to our customer base and to companies around the world. Over the next year, we and our peers will be looking to push the conversation around PQC forward, showing how it’s something that needs to be addressed this year, not when quantum computers become a commercial reality. We are aiming to show how this is not an insurmountable problem, but that updating cryptography is a task that existing cybersecurity companies can address.”
Although JamesBore, the founder of Bores Consultancy, somewhat agrees with Gerhardt’s concerns around the threat of quantum computers, he predicts that the structure around security responsibility is going to see the most change: We”’re going to see a lot of talk about new technology, a lot more on AI/ML and quantum encryption, but these are largely about marketing rather than genuine innovation.
“Where I’m really seeing the potential for innovation is around the approaches to training and ownership of security. During 2022 I’m expecting to see security responsibility moving more and more towards a distributed model where everyone in an organisation is taught to understand and own their own risk rather than being taught that security is a problem only for the security department.”
Reiterating James’s vision of a more holistic approach to the situation, EladSherf, Global Head of Defence at Performanta argues that companies should look to utilise their existing arsenal of tools in a pragmatic way to fight the growing number of cyberthreats: “Often most of an organisation’s security is fit for purpose, but not being utilised correctly. Innovation in 2022 lies in how tools are used rather than what they are. Security leaders need to be asking what their existing security tools and processes are and how they can best be used to protect their organisation.
“Innovation is too often associated with buying shiny, new tools. I would argue that organisations need to adopt a more creative stance in order to be innovative, rather than just buying the latest product to hit the market. While quality tools and technologies are important, they should be seen as a starting point.
“In 2022 and beyond, organisations need to look back at their existing infrastructure and bring tools together in a sensible, pragmatic way and where external help is needed look to find a partner that can work with their business to achieve their security goals. This is how businesses should innovate in 2022 and how they’ll stand apart from the rest.”
Interestingly, Fusion Risk Management’s Director of Cybersecurity SafiRaza echos the importance of company-wide responsibility and the capabilities of AI in stalling oncoming attacks: “In 2022, businesses will face a greater expectation of accountability in minimising risk as underwriters have grown a lot more aware of what kind of risk controls make effective cyber programmes. They will need to evidence to the cyber insurance provider that they have robust and structured processes and policies to prevent a breach as much as possible.
“To ensure businesses are secure, AI integration, machine, and deep learning systems will become more popular for businesses to protect their data. It is no secret that humans are the weakest link in the data security chain. AI has increasingly become a critical technology to filter out false-positive alerts, analyse user behaviour and examine the massive amount of data to discover anomalies. Zero trust access will likely become increasingly widespread as a secure option to control remote access to specific applications and network resources. The Zero-Trust security model assumes that a breach has probably already occurred, so it constantly limits access to only what is needed and looks for anomalous or malicious activity.
“We will likely also see an increase in the adoption of next-generation firewalls. Utilising Firewall as a Service (FWaaS) has helped fortify the digital parameters and forced hackers to alter their attack methods. The truth is that most sophisticated IT security and anti-phishing tools are not 100 per cent effective. Annual security awareness training and periodic phishing campaigns are no longer enough. Creating a security-focused culture, frequent interactive cyber security exercises and games, security ambassador programmes, lunch and learn events, etc., helps spread awareness. It is essential that employees feel comfortable reaching out to the information security teams for any anomaly they have noticed without feeling embarrassed if the alert turns out to be false-positive.”
Although skill shortages are crippling the fintech industry, as BronwynBoyle, Chief Information Security Officer at Mambu points out, this could actually be a significant turning point for cybersecurity, and one of the main drivers behind the innovation we can expect to see this year: “The ‘Great Resignation’ and ‘War on Talent’ are particularly relevant to the cybersecurity industry. We’re facing a huge skills gap, with statistics suggesting a shortage of over four million cybersecurity professionals worldwide. As a result, we’re likely to see a shift toward greater automation of tasks in 2022 to reduce the burden on already stretched teams, increasingly being asked to do more with less.
“This skills shortage is encouraging innovative approaches to the recruitment and training of cyber professionals, especially in the development of technical expertise. Innovative learning platforms are helping accelerate the acquisition of new and transferable security skills, while changing attitudes to professional certifications are helping lower barriers to entry. The shrinking talent pool is having a positive effect, by encouraging the industry to be more welcoming of those from non-technical or non-traditional backgrounds. This includes being more open to considering candidates with transferable soft skills, experience in different sectors and, importantly, untapped talent in previously overlooked demographics – helping to stimulate diversity and equality. Over the next 12 months, we’re likely to see the most radical innovation yet in how we source, train, attract and retain talent.
“From a tech perspective, we’ll continue to see more aggressive strains of malware and viruses, and of ransomware-as-a-service which continues to lower barriers to entry for bad actors. Further innovation in cross-industry sharing of intelligence and collective organisational responses will help bolster defences. With cybercriminals now targeting managed service providers for maximum spread and impact, this heightened risk will necessitate a more coordinated global response in 2022. The pervasive impact of the recent Log4Shell vulnerability, threatening the entire internet, is a stark reminder of the risks associated with open source software; the extent of this meltdown is likely to drive further innovation in 2022.”
As SimonEyre, CISO at Drawbridge points out, developers are increasingly adhering to the changing cybersecurity demands of increasingly remote workforces, and that this is set to be a major feature in the innovations of the coming year: “The monetisation of cyber-attacks will continue to drive attack execution in 2022. We’ll see additional data exfiltration and data leak threats as more sophisticated ransomware attacks garner sharp scrutiny from governments and concern from businesses.
“Aside from the reputational damage such attacks can create, businesses now realise these escalating incidents can also significantly impact privacy/and or intellectual property and have a cascading effect on their broader client and partner ecosystems. The key here will be extending traditional technology from a fixed perimeter environment (like the Office) out to hybrid working environments. We see this via more functional endpoint monitoring and vulnerability management that’s capable of extending itself out of the corporate network.
“As more businesses move their technology to public cloud platforms, SaaS, PaaS, and IaaS, the SOC teams are having to monitor an increasing footprint of logs and events that can be a challenge to reconcile. In order to correlate those events, SIEMs are becoming more ‘aware’ of these platforms and intelligently relating events from one SaaS application to others such as public cloud email and file services. These next-generation SIEM solutions in conjunction with Security Orchestration, Automation, and Response (SOAR) will become more mainstream for SME businesses too.
“Cyber Technology can extend itself outside of the traditional SOC team and into the hands of Compliance, HR, and Risk Assessment teams too. With supply chain attacks of vendors (particularly technology suppliers) becoming a real-world risk for businesses, systems and services that allow the monitoring of vendor and Internal risk management will be a key tool. Utilising a platform for risk management allows multiple departments to work in conjunction and tackle business risk efficiently.”
Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.
The Governor of the Bank of Israel and the Supervisor of Banks have notified One Zero Digital Bank Ltd. of the Governor’s approval to remove the restrictions from the bank’s license, after the bank completed the process of meeting the milestones set for it, and after the Supervisor’s certification of the completion of the establishment process.
One Zero Digital Bank Ltd. (hereinafter: “One Zero” or “the Bank”) completed the process of meeting all the milestones set for the establishment of the bank, including raising the required amount of capital. After the Supervisor of Banks certified the completion of the process by the bank, the Governor signed the approval to remove the restrictions from the bank’s license and for its continued operation according to its business plan.
The Bank has thereby completed its preparations, and its status is now the same as that of all the other banks in Israel—supervised by the Bank of Israel’s Banking Supervision Department to ensure its stability and in order to protect the money of its depositors.
One Zero is a bank controlled by Prof. Amnon Shashua, and managed by Chairman of the Board of Directors ShukiOren, and CEO Gal BarDeah.
The Bank was given a restricted license on December 30, 2019. The license was dependent upon the completion of administrative and operational preparations to establish the bank, the establishment of information systems and infrastructure including through a computer services centre that obtained a grant from the State, connection of the bank to the payment and settlement systems and to monetary tools, the completion of a pilot process, and raising the necessary capital.
Following 43 years in which no new bank was established in Israel, there were numerous innovative challenges involved in establishing the bank. The bank was established with the close guidance of many entities at the Bank of Israel. The bank’s readiness was examined in terms of information security and cyber-protection, technological risk management, evaluation of the quality of risk management, and the supervisory and control tools existing at the bank.
Bank of Israel Governor Prof. Amir Yaron said, “I am proud to approve today the removal of all restrictions from One Zero Digital Bank’s banking license. After 43 years, a new bank is being established in Israel, and this is further good news for competition and innovation in the banking and financial industry. I congratulate the management and employees of One Zero Digital Bank for meeting the challenges involved in establishing the bank. This process, combined with other steps we have advanced, has the ability to increase competition in the banking system. The Banking Supervision Department will continue closely supervising the bank professionally and guiding it along its path, as we do with each bank in Israel. I wish the bank success, and hope that its establishment will pave the way for other banks to contribute to competition and to the well-being of consumers.”
Supervisor of Banks Yair Avidan said, “This is a happy occasion for me as Supervisor. The Banking Supervision Department has worked hard in recent years to create the conditions and remove barriers to enable the establishment of a new bank in Israel. As part of this, regulatory changes were made to the Supervisory directives, the Banking Supervision Department guided the establishment of a computer services centre, a Licensing and New Banks Unit was established in the Department to guide the establishment of new banks from the application stage through the removal of restrictions from the bank license, and more. This is another element among the measures being advanced by the Bank of Israel to increase competition in the financial system. We have guided, and we will continue to guide, the bank in its work, we will supervise its integration into the banking system, and we will work to assist any other entrepreneur that wants to establish a bank in Israel.”
Martin Wilson, CEO of Digital Identity Net discusses whether banks are the answer to the UKs identity crisis.
The subject of Digital Identity hit the headlines again at the end of 2021 as the UK introduced a digital covid pass which was met with serious concerns about data privacy, civil liberties and the introduction of a National Identity Scheme by stealth.
What many people don’t realise is that they already give up their identity data online every day. They painfully and repeatedly fill out the same details of name, address, email, phone number and passwords, scan documents, take awkward selfies, and share sensitive, personal information.
If they do think about websites tracking their activity and storing this data, they envisage images of nefarious actors like hooded strangers on the dark web. But all sorts of websites, including social media platforms, have a huge amount of data on each of us.
Being online is the new Wild West with most of us not knowing where this data goes or how it is used. It is estimated that we all have over 200 digital identities on the web right now without any control over what that data is being used for or who has access to it.
My belief is that people should be able to safely and easily prove who they are online, while having complete control of their own data and preventing access by unauthorised third parties.
The best way to achieve this is through a trusted digital identity utility that lets people prove who they are in seconds. This will enable them to verify their age, set up new accounts and sign into their favourite accounts quickly and securely, safe in the knowledge that only they can access their own accounts, with full control of their data and a record of who has it.
It will not only remove inconveniences such as logging into accounts and constantly resetting passwords, it will also tackle larger issues such as the fraud epidemic which saw criminals steal over £753m in the first half of 2021.
Businesses will benefit too, as they will be able to quickly onboard new customers, safe in the knowledge they are who they say they are, reducing the risk of fraud and negating the need for manual checks on age, address or identity.
But the UK is far behind many in the provision of such a service. In Sweden, Norway, Denmark, Belgium and the Netherlands, this trusted utility is provided by a platform linked to the banks in those regions.
There is a golden opportunity for the UK banks to be at the forefront in providing a means by which people can safely identify themselves online. Our research shows they are still amongst the most trusted of institutions to be custodians of things we value; way ahead of other third-party providers such as the Post Office, social media or even government. In addition, they are the only institutions who have already authenticated the majority of UK citizens – 98% of adults in the UK have bank accounts for which their identity details have already been verified.
The infrastructure to provide this service already exists thanks to the banks’ £1.5 billion investment in Open Banking. By supporting a trusted platform, banks could easily and quickly provide a safe and trusted means by which people could identify themselves online whilst at the same time protecting their privacy, civil liberties and avoiding a national identity scheme.
They would enhance the banks’ role as trust custodians, be a force for good by helping businesses and consumers tackle fraud and build new revenue streams. Furthermore, they can start to see a return on their investment in Open Banking.
If we can get banks and businesses on board and build a brand the general public can trust, we can create a ubiquitous digital identity utility that protects people’s data and makes it safe and easy for them to prove who they are online.
Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.