Wells Fargo, Bank of America and US Bancorp show growth in digital platforms


Wells Fargo, Bank of America and U.S. Bancorp all highlighted their digital growth and use of the payment platform Zelle in today’s earnings calls.

Wells Fargo & Co.

At Wells Fargo, automation helped reduce costs in fraud management, card collection and other areas during the third quarter, according to Chief Financial Officer Mike Santomassimo. He credited automation, along with “strategic enhancement,” as driving process improvements while reducing costs during the bank’s third-quarter earnings call today.

The $1.9 trillion bank also implemented a number of other cost-savings measures, including branch and headcount reduction, vendor consolidation and eliminating consultants, he said. The measures led to an overall 13% decrease in non-interest expenses this quarter compared with a year ago, according to Santomassimo, contributing to Wells Fargo reported earnings of $5.1 billion. Revenue was $18.83 billion, and overall, technology, telecommunications and equipment spending was down 6% year over year, to $741 million.

“We’ve also been working on additional opportunities through technology enablement that have longer lead times but should result in benefits that we expect will reduce operations-related expenses over time,” Santomassimo added.

This news comes on the heels of a pronouncement by Wells Fargo analysts that technology improvements and automation will allow the banking industry to cut 100,000 jobs over the next five years.

The bank is also making significant enhancements to its payment capabilities, added CEO Charlie Scharf, with Zelle usage up by 50% YOY. The bank has 24% more users and 56% more volume than a year ago, he reported. Zelle is a digital payments network owned by Early Warning Services, a fintech owned by the $3.1 trillion Bank of America, BB&T (now the $522 billion Truist), the 425.2 billion Capital One, the $3.7 trillion JPMorgan Chase, the 554.2 billion PNC Bank, the $558.9 billion U.S. Bancorp and Wells Fargo.

Scharf also made note of its “overdraft rewind,” an automation that reevaluates transactions from the prior business day that have incurred an overdraft fee for any retail account with ACH direct deposit. “This feature has helped over 1.3 million customers avoid overdraft-related fees on two and a half million transactions in the third quarter,” Scharf said.

The recent $250 million fine over mortgage practices by the Office of the Comptroller of the Currency (OCC) was a reminder that “significant deficiencies that existed when I arrived must remain a priority,” Scharf said. The OCC, at least in part, noted that technology had played a role in its ruling against Wells Fargo, saying “The bank’s loss mitigation decisioning tools (applications and end-user computing tools) and operational deficiencies have caused errors in the bank’s loss mitigation processes and controls that negatively affected borrowers.”

“We are a different company today and the operational and cultural changes we’ve made are enabling us to execute with significantly greater discipline than we have in the past,” Scharf said. “The investments we’re making in risk and regulatory-related work come alongside investments we’re making in customer experience.”

Specifically, he said, Wells Fargo is investing in new digital and mobile capabilities, a new digital infrastructure strategy, and new products, Scharf added.

Overall, digital customers were up 2% from last year, at 32.7 million. Mobile users increased 4% YOY to 27 million users, according to the earnings supplement.

Bank of America

Bank of America reported net income of $7.7 billion for the third quarter, up from $4.9 billion at the same time last year, noting the “pre-pandemic organic growth machine has kicked back in.” Digital banking and automation also played a role.

“Digital progress has occurred across every business,” said Chairman and CEO Brian Moynihan. “And that’s increased sales of products and high use of digital platforms. This bodes well for future sales levels and for future efficiency.”

The $3.03 trillion bank had total revenue of $22.8 billion for the most recent quarter, a 12% increase from $20.3 billion in Q3 2020. Chief Financial Officer Paul Donofrio said on the earnings call that digitalization helped offset higher revenue costs.

Donofrio also pointed to improvements in digital engagement and digital sales growth. “As all of you know, enrollment is important, but usage is key,” he said. “We now have nearly 41 million customers actively using our industry-leading digital platform.”

In Q3, the bank saw 70% of its customers use some part of its digital platform, with more than 2.6 billion logins. “And while Erica and Zelle use has been tremendous, what I would draw your attention to is the digital sales growth, which is up 27% year over year,” Donofrio said.

Zelle was a high point in Q3, with the bank reporting 15.1 million active users, which now include small businesses, in the digital payments network. All told, users in Q3 sent 202 million transfers with Zelle worth $60 billion, which included 44% more transfers sent and 53% more transfers received YoY.

Going forward, Donofrio noted the bank continues to see investment in technology and people “at a high rate across the businesses.”

U.S. Bancorp

U.S. Bancorp reported net income for Q3 of $2.03 billion, up from $1.59 billion for the same period a year ago.

Chairman, President and Chief Executive Andrew Cecere noted that the $558.9 billion bank released $310 million of loan loss reserves this quarter, and that digital banking capabilities are contributing to earnings growth.

“We’re excited about the many organic growth opportunities we see across the franchise, supported by our continued investment in people, digital technology and data analytics,” he said, also pointing to U.S. Bancorp’s recently announced acquisition of $133.2 billion MUFG Union Bank.

The acquisition will allow U.S. Bancorp to “expand our distribution network in demographically attractive West Coast markets and leverage our broad product set and leading digital capabilities across a loyal but underpenetrated customer base,” Cecere said, and will help “accelerate revenue and earnings growth.”

The bank reported that 43% of its active customers engaged in online banking, down from 51% a year ago. But 62% of active customers used mobile banking in Q3, a 56% YoY increase. Most of the bank’s transactions are digital: 80% of the total for Q3, up slightly from 76% of total transactions for the same period in 2020.

U.S. Bancorp’s technology and communications noninterest expense for Q3 was $361 million, up 8.1% from $334 million in the third quarter of 2020. Total net revenue for Q3 was $5.89 billion, compared with $5.96 billion for the third quarter of 2020.


J’rrive! Arival Bank Launches As a Fully Licensed and Regulated Bank


Arival Bank, which won Best of Show in its FinovateAsia debut in 2018, is now a fully licensed and regulated bank. The company was granted its U.S.-based banking license in Puerto Rico and will leverage its “U.S.-based but internationally friendly” license to work with customers around the world. The license generally allows banks to offer full stack fiat banking services, upon receiving the necessary authorization from the local regulator.

Arival Bank’s primary customers are international technology firms. The bank offers these companies USD-based bank accounts, and supports both domestic and international payments for global technology companies. Arival so far has onboarded more than 100 business customers from more than 25 countries, with the biggest demand coming from firms in the U.S., Canada, the U.K., European Union, and Singapore. Arival has experienced 1.7x month-over-month growth and boasts $13 million in assets under management.

“We’re focused on providing bank accounts to customers who have been labeled as ‘abnormal’ or ‘too risky’ by traditional banks,” Arival Bank COO Jeremy Berger explained in a statement. These firms include everything from international tech startups, digital SMEs, and money service businesses, to crypto exchanges and blockchain startups. “We’ve proudly turned this market of misfits into our niche, and we strongly believe the market demand of the ‘abnormal’ will soon outgrow the demand of the traditional banking clientele,” he said.

Arival’s management team (Director of IT Security Raul Rosado, Head of Finance Vivien Fernandez, CCO Sonia Camacho, Head of Global Compliance Ana Cavallini, Co-Founders Igor Pesin and Jeremy Berger) at the Office of the Commissioner of Financial Institutions in San Juan, Puerto Rico. 

In terms of traction, Arival Bank recently was invited to FinCEN’s innovation program to showcase its compliance technology to more than 20 top U.S. regulators. FinCEN is the Financial Crimes Enforcement Network, a bureau of the U.S. Department of the Treasury that focuses on defending the financial system against criminal and illicit activity, including money laundering. “We’ve built a compliance-first culture and like to think of ourselves as a cutting-edge compliance firm with a banking license,” Berger said. “That’s really our X factor at the end of the day.”

Additionally, Arival Bank has inked a partnership with Railsbank to launch SGD accounts and local payments as part of its borderless account opening offering. The company noted that it may leverage its relationship with Railsbank to expand its services in regions like Europe and Latin America.

“We’ve achieved significant traction since our launch – in large part thanks to our supportive group of visionary investors from our Seed and Pre-A rounds,” Arival Bank co-founder and CFO Igor Pesin said. “They’ve enabled us to invest heavily into key facets of building a digital bank fit for the 21st century: licensing, technology, infrastructure, compliance, and user experience.”

“We’re starting to gear up for our Series A round as we enter a new phase of growth driven by scaling our footprint internationally,” Pesin added. “Being live operationally is somewhat atypical for a licensed digital bank at their Series A round. In other words, our commitment to infrastructure meets our readiness to scale. And we have the license, product, and team to become the go-to digital bank for a new generation of businesses and entrepreneurs.”

Founded in 2018, Arival has 50 employees and hopes to double its workforce by 2022. The company’s investors to date include SeedInvest, Crowdcube, and Polyvalent Capital. Earlier his year, Arival Bank was nominated by Daily Finance as one of the top Fintech Companies in Singapore.

Photo by Donald Tong from Pexels


Bank of England warns of potential crypto crash


The Bank of England is concerned that unregulated crypto growth could end with major price correction with far-ranging consequences. “There are well-founded concerns around crypto assets in relation to investor protection, market integrity and financial crime” that could have implications to financial stability, said Sir Jon Cunliffe, deputy governor of financial stability at the $959 […]


Community Banks Are More Financially Inclusive Than Neobanks Finds MANTL


Neobank valuations continue to rise but only 7% of consumers and 8% of businesses trust neobanks over a traditional bank, according to the 2021 Banking Impact Report released by MANTL, a digital account opening solution for banks and credit unions. Neobanks also ranked lowest on providing personalised service, a positive impact to local communities, convenience and better access to underrepresented communities when compared to community banks, credit unions, regional banks and megabanks.

The 2021 Banking Impact Report, commissioned by MANTL in partnership with Wakefield Research, surveyed bank executives, small business owners (SBOs) and consumers to identify how evolving banking
trends impact the local community and the role that community banks and credit unions play in the US financial system. The report findings underscore the resilience of the traditional banking model in generating trust and delivering personalised service but foreshadow how rising digital expectations among consumers and small business owners might eclipse other banking needs.

Despite low trust levels and the fact that nearly two-thirds of bank executives (61%) observed an increase in fraudulent activity with accounts held at neobanks in the past 12 months, consumers and small business owners are still considering digital-only offerings. Nearly half of consumers (47%) are likely to open an account at a digital-only bank in the next 12 months and 44% of small business owners are likely to open an account with a fintech company in the next 12 months.

“Neobanks continue to score massive valuations but consumers and businesses are not completely sold
on the neobank promise. In fact, they are just as likely to open an account at a community bank or credit union in the next 12 months,” said Nathaniel Harley, CEO of MANTL. “The biggest threat to traditional banks is not a neobank but the opportunity cost of not keeping pace with increased demands for digital banking.”

Online account opening is now table stakes but nearly half of banks, credit unions don’t offer it

Currently, 43% of community banks and credit unions do not offer online account opening for consumers and that figure is even higher for businesses. However, more than half of consumers (58%) and SBOs (57%) will not do business with an institution that doesn’t offer online account opening, regardless of whether they prefer to open an account online or in-person. With 48% of consumers and 50% of SBOs likely to open an account at a community bank or credit union in the next 12 months, this will severely limit new customer acquisition, particularly among younger demographics and high-earning SBOs, for institutions that do not offer it.

“Consumers and SBOs are drawing a line in the sand: online account opening is now a must-have feature and they simply won’t use a bank that doesn’t offer it. This is especially true for Millennials and Gen Z,” said Harley. “Community banks and credit unions must act now to meet the demands of an economy that will be fully Millennial-led by 2030 or risk losing out on younger customers with long-standing earning potential.”

Notably, 77% of SBOs with over 50 employees and more than half of SBOs (59%) with $1million to $25million in revenue also require online account opening to do business.

“Community banks and credit unions have built incredible goodwill with the businesses in their communities. Providing business customers with a simple and intuitive online account opening experience will be critical to growing and maintaining those relationships in 2022,” continued Harley.

Bank executives forecast housing market crash in five years

The MANTL report highlighted the critical role that traditional banks played in covid-19 recovery nationwide. Three out of four consumers (74%) believe community banks and credit unions were important to their region’s ability to manage economic conditions caused by covid-19 and 88% of SBOs agree that community financial institutions played a role in the economic recovery. Furthermore, bank executives report a full quarter (26%) of their business customers, on average, would have gone out of service during the pandemic had it not been for their assistance.

Executives remain positive about near-term recovery from the pandemic: 95% of executives are optimistic about the economic conditions in their local community over the next 12 months. However, a shocking 78% of executives predict a housing market crash in the next five years, signalling caution as housing market prices reach record highs in 2021.

Community banks and credit unions lead in providing financial inclusion and accessibility Consumers, bank executives and businesses emphasise the growing importance of providing access to financial services and financial inclusion, particularly among underserved communities. Half of community bank and credit union executives (48%) said their primary banking benefit was providing financial inclusion for underserved communities and 90% of community banks and credit unions have or are planning on implementing a formal program for financial inclusion for underserved groups.

“Financial inclusion is an important social justice issue and a driver for economic mobility. By expanding access to financial services, community banks and credit unions are helping their communities remain resilient and their efforts are widely recognised and championed by consumers and businesses,” said Harley.

The study shows that these institutions are being recognised for their efforts: the majority of consumers (55%) said community banks and credit unions better serve and provide access to underrepresented communities over neobanks, regional banks or megabanks. Furthermore, one-fourth of community bank and credit union customers (23%) came to their institution after being underserved by a large national bank and 95% of community banks and credit unions have provided a loan for a small business denied by a large bank.

“The report findings suggest that consumers and business owners are becoming increasingly aware of socially responsible banking practices and are making their banking choices based on the institution’s impact on their community and society at large,” said Harley.

Four out of five SBOs said it is important that their bank serves underserved communities.

Consumers do not trust government-backed bank accounts

Lawmakers have proposed legislation around government-backed bank accounts, called FedAccounts, which would give consumers access to digital accounts held at the Federal Reserve that are accessible at
bank branches and post offices. However, consumers are wary of the government’s involvement in their

Nearly three-fourths of consumers (70%) trust a private banking institution over a government-run institution for their banking needs. Gen Z is most likely to trust a government-run institution, which aligns with the generation’s willingness to embrace new ways of managing finances.

“The idea of a government-backed bank account is not new but it has received renewed attention over the last year. Whenever new government financial initiatives are proposed, such as FedAccounts or a digital FedDollar, the government must consider how consumer trust can impact adoption. Some programs might be better executed in partnership with existing institutions who have already earned consumer trust,” said Harley.

  • Francis is a junior journalist with a BA in Classical Civilization, he has a specialist interest in North and South America.


Morgan Stanley CEO: ‘I don’t think crypto is a fad’


Morgan Stanley Chief Executive Officer James Gorman is staying respectful of cryptocurrencies.

Photo by Bloomberg Mercury

“I don’t think crypto is a fad. I don’t think it’s going to go away,” he said on the bank’s third-quarter earnings call with analysts Thursday morning. “I don’t know what the value of Bitcoin should or shouldn’t be. But these things aren’t going away, and the blockchain technology supporting it is obviously very real and powerful.”

That sets him up as a foil to rival Jamie Dimon, who runs JPMorgan Chase & Co. “I personally think that Bitcoin is worthless,” Dimon said this week at the Institute of International Finance annual membership meeting. He added that clients are “adults” and that the firm can give them “clean as possible access.”

Citigroup Inc. boss Jane Fraser struck a similar note this week: “We’re fairly cautious around crypto as a bank. We proceed with great caution on that one as to where the value is and isn’t,” she said. “I am frankly much more excited about the technologies behind crypto than some of the products themselves.”

In September, Morgan Stanley said Sheena Shah will lead a new team researching cryptocurrencies. On the earnings call, Gorman added that the firm isn’t directly trading crypto for retail clients, instead giving them access to buy crypto through various funds. “For us, honestly, it’s just not a huge part of the business demand from our clients. And that may evolve and we’ll evolve with it,” he said. “We’re watchful of it, we’re respectful, and we’ll wait and see how the regulators handle it.”

— By Max Abelson with assistance from Nabila Ahmed and Zijia Song


The CBUAE Leaves the Dubai Expo 2020 With a String of New Agreements

  • Tyler is a Fintech Junior Journalist with specific interests in Online Banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.


Behind the Idea: Fourthline


Fourthline works with some of the fastest-growing financial institutions in Europe including SolarisBank, Vivid Money and Trade Republic to authenticate and verify the identities of thousands of new customers every day

The pandemic has triggered a surge in financial crime. Fraudsters are becoming smarter, using deep fakes, social engineering techniques and creating synthetic online identities to evade detection. Financial institutions find themselves in an almost impossible situation. Regulators across Europe have tasked them with not only improving financial crime checks on new clients but also reviewing the Know Your Client (KYC) files of existing clients through large-scale remediation. This requires a very diligent, high-quality process under strict timelines. We are helping solve this problem by identifying emerging financial crime trends across borders and working with regulated enterprises to address fraud and meet compliance.

Krik Gunning, CEO and co-founder, Fourthline

Krik Gunning is the CEO and Co-Founder of digital identity specialist Fourthline. He is leading its mission to build a safer, more accessible global financial system. Krik has 20 years’ experience working in financial services previously as M&A advisor at ABN AMRO and co-founding Dutch M&A boutique IvyRoads. 

What has been the traditional company response to financial technology innovations?

Traditional banks and wealth managers through to emerging crypto platforms and digital marketplaces require the highest quality fraud detection. Getting compliance right is hard, and done incorrectly, can fundamentally damage a business or even destroy it. So, there is always a cautious approach to innovation.  

We’ve been focused on monitoring fraud and financial crime patterns across borders. It’s our march to provide a single source of truth on fraud hotspots and emerging fraudulent behaviours. This is an Achilles heel for many financial institutions. Fourthline, like our clients is a regulated financial institution. We bring a bank-grade technology stack, internationally recognised fraud experts and the flexibility and agility of a fintech. 

How has this changed over the past few years?

We have always been focused on fighting financial crime to build a safer financial ecosystem. What’s changed has been banks’ individual approaches and understanding of the scale of the challenge.  Five years ago, ‘Know Your Customer (KYC) wasn’t on the radar of most banks. Today, it is a top priority, and every bank realises it is a challenge it needs to solve and needs outside expertise to do so.

Regulatory scrutiny now requires banks to re-validate existing clients – we call this continuous KYC. Done right, it leads to better customer data and significantly less fraud—but done wrong, it can be the ultimate money pit. 

Another key change is the shift to real-time intel and analysis of fraud patterns. It’s the only way to stay one step ahead of criminals. In 2021, almost half (47%) of the detected financial fraud attempts in Europe involved ‘social engineering’ where fraudsters duped their victims into disclosing confidential information and making payments by using psychological manipulation. We also witnessed criminals use advanced silicone masks and deep fakes to assume the identity of someone else. It is simply not enough for banks to have core identity checks and balances in place to protect against fraud. 200 words

Is there anything that has created a culture of change inside the company?

We believe that if financial institutions could join forces in their battle to fight financial crime, the cost of compliance across the industry could be reduced by 90 per cent and there would collectively be 60 per cent less fraud.  As criminals become more inventive to gain access to the ever-evolving financial ecosystem, it’s crucial for society that we don’t allow crime to pay. Our culture is centred on not just helping our clients prevent fraud and protect their businesses. Rather we’re all driven to help protect the end-users – society as a whole – from criminal activity. This permeates everything we do. 

What Fintech ideas have been implemented?

To stay one step ahead of financial fraudsters, we approach problem-solving with a unique combination of advanced AI techniques and highly trained financial crime analysts.  We only automate checks if it leads to a higher quality conversion rate. Some examples of new initiatives we recently implemented include:

  • Our proof of address (PoA) solution: Traditional documents such as utility bills and council tax bills are not designed to deter fraud. They have no security features and are easy to falsify. We’ve built a more reliable and customer-centric alternative to PoA checks.
  • We launched six new AI Models: In addition to algorithms indicating whether an ID document is fraudulent, we now also have algorithms indicating whether an ID document is authentic and why. The latter is something no one else in the industry has been able to achieve through AI/ML.
  • Public- private partnerships: We have been actively engaging with local and international law enforcement agencies in multiple cross-border public-private initiatives such as the French National Police and Europol. 

What benefits have these brought?

Implementing these approaches has driven many benefits including:

  • Creating a safer financial ecosystem: Our work with the French National Police and Europol demonstrates that identity fraud does not stop at national borders. 
  • Stronger Conversion Rates: Proof of Address checks are a typical drop-off point for end customers. With our Proof of Address solution, we achieve a 99.7 per cent conversion rate overall with only 0.3% failing at the address verification stage.
  • 60 per cent Greater Fraud Detection: We continuously recalibrate our in-house built and trained AI models to eliminate bias, incorporate new learnings, and perform more data checks than the market, detecting 60% more fraud than competitors
  • Higher optical character recognition (OCR) than Google – We enable our partners to identify and authenticate over 3500 official documents from around the world and can collect data and process cases in seconds—with 99.98 per cent accuracy. 

Do you see any other industry challenges on the horizon?

Governments around the world have announced plans to create digital identities as trusted as passports and the pandemic has fuelled this with vaccine passports becoming part of everyday life. If you look at the EU specifically, the success of providing all European citizens with access to a digital wallet will be predicated on the delivery of a common toolbox. The EU Commission has provided the impetus for change. The opportunity now lies with European technology companies to deliver.   

Can these challenges be aided by Fintech?

Absolutely. Who do you trust with your most personal information? Banks. Fintechs have a critical role to play in the building out of digital identity passports. After all, their success will hinge on societal trust in the technology: the security, compliance, and overall user experience. Who better to provide that expertise than fintechs? 

Final thoughts…

Brexit shouldn’t mean that the UK chooses to fight financial crime in isolation. Financial crime operates beyond borders. Whilst hotspots in crime are emerging, the link between detecting cases and prosecution is not yet strong enough. A key issue contributing to this is the lack of communication, data sharing and therefore transparency between law enforcement agencies in different jurisdictions. Regulators, governments, financial institutions, and technology companies must work together across Europe to help prevent financial fraud, achieve compliance and protect the individuals that use our financial institutions from criminal activity. 

  • 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.


XBRL News about sustainability reporting, proxy votes and value chain reengineering


Here are the three most relevant developments in the world of structured reporting we became aware of in the course of last week.

1  Ep. 5: Jason Meyers on Continuous Audit and Real-Time Reporting

Jason is currently developing the only known use case of blockchain for the auditing industry with AuditChain, and bringing some much needed change with real time assurance and financial reporting. If Satoshi Nakamoto will go down in history as the inventor of the world’s first peer to peer payment system without central intermediary with Bitcoin, Jason will be remembered for being the pioneer of decentralized continuous audit.

Listen to this at your own peril if you’re currently engaged in state-of-the-art financial reporting. Auditchain provides an (the?) infrastructure for reengineering the full reporting value chain, in which XBRL plays a crucial role. Note that the author has a commercial interest in this. 

2  SEC proposes enhanced, structured disclosures on proxy votes

XBRL looks set to be deployed for reporting on funds stewardship in the US, facilitating access to information on how asset managers are voting at AGMs. The US Securities and Exchange Commission (SEC) has proposed rule changes to enhance the information disclosed by investment funds about their proxy votes, in the form of amendments to its Form N-PX. Crucially, in addition to improvements to the content of disclosures, it would require filers to use “an XML structured data language.” 

Proxy voting behaviour by asset managers is an important piece of information in the assessment of their engagement activity, especially when monitoring for greenwashing. This information is currently accessible through tedious manual labour only. This proposal will hopefully change that.

3  Insights on reporting the business model, sustainability risks and opportunities

​​Following a collaborative effort in the review of reporting practices and gathering stakeholder feedback, the PTF-RNFRO, whose focus was on the reporting on sustainability risks and opportunities and the linkage to the business model- a key element of a proposal for a Corporate Sustainability Reporting Directive (CSRD)- has published its findings in a Main Report and Supplementary Document with good reporting practices.

Although rife with Eurospeak acronyms, these insights indeed provide helpful pointers to current best practice in business model and sustainability reporting, which – admittedly – is a dynamic space.


Christian Dreyer CFA is well known in Swiss Fintech circles as an expert in XBRL and financial reporting for investors.

 We have a self-imposed constraint of 3 news stories each week because we serve busy senior leaders in Fintech who need just enough information to get on with their job.

 For context on XBRL please read this introduction to our XBRL Week in 2016 and read articles tagged XBRL in our archives. 

 New readers can read 3 free articles.  To  become a member with full access to all that Daily Fintech offers,  the cost is just USD 143 a year (= USD 0.39 per day or USD 2.75 per week). For less than one cup of coffee you get a week full of caffeine for the mind.


Signature Litigation: Crypto Regulation – Where Will It Lead?


The call for crypto regulation is not a new one. Governments across the world are establishing new ways to deal with the competitive currency, be it through regulations or an outright ban. However, if there is too much regulation enforced, are regulated entities going to be driven underground, and in doing so open up more opportunities for fraud and money laundering?

Crypto regulations are being called to stop fraud, money laundering and get better security to stop hackers. Kate Gee is a Counsel at Signature Litigation with a special interest in disputes involving digital assets. She spoke to The Fintech Times to explain how over-regulating crypto could be counterproductive and instead of stopping the issues that are currently being faced, it would further enable them:

Kate Gee, Counsel at Signature LitigationKate Gee, Counsel at Signature Litigation
Kate Gee, Counsel at Signature Litigation

Despite their inherent volatility, the aggregate market value of cryptocurrencies has twice breached the $2trillion mark this year. Some forecasts of the crypto industry’s value suggest that this figure may increase to $3trillion by 2026, indicating a compound growth rate approaching 10%. It therefore comes as no surprise that the potential development of further regulation continues to attract attention and engagement from the global financial markets and investors alike.

Globally, politicians have fired assorted warning shots. This year, US Treasury Secretary Janet Yellen has repeatedly spoken of the dangers that cryptocurrencies – in particular, bitcoin – pose both to investors and to the public. She has argued that there are important fundamental questions about their legitimacy and stability. In July, she “underscored the need to act quickly to ensure there is an appropriate US regulatory framework in place.” Meanwhile, China’s government continues to clamp down on what it perceives as a speculative and volatile markets – it has recently declared all cryptocurrency transactions to be illegal, following which the price of Bitcoin fell by more than $2000.  This is not the first time that FUD (Fear, Uncertainty and Doubt) from China has impacted market confidence.

Global regulators are taking a more pragmatic approach. Rather than advocating a ban, they have made prudent calls for cryptocurrencies to become subject to the toughest bank capital rules of any assets. They have further suggested that banks which are exposed to the most volatile cryptocurrencies should face stricter capital requirements to reflect the enhanced levels of risk. Much of the focus is on enhancing the existing regulatory regime to meet the fast-changing crypto market and the parallel risks that are developing alongside it – including fraud, hacking, and money laundering and sanctions risks, as well as market and credit risk more generally.

On any realistic view, devising an appropriate regulatory regime that is bespoke to crypto will take considerable time and effort by the global crypto industry.  The task is made more difficult by the inconsistent use of terminology relating to digital assets globally, and the inconsistent rules and regulations that have been introduced – often on a piecemeal basis – in various jurisdictions around the world.  At the same time, some industry experts think that the regulators do not fully understand the market they are seeking to regulate or the technology used in it – and that there is a risk that unnecessary, unclear or overly stringent regulation could do more harm than good.

However, as the crypto market continues to expand and develop, regulatory bodies worldwide call for more regulation. Gibraltar was the first to take a lead, with a largely positive reception.  Since the Financial Services (Distributed Ledger Technology Providers) Regulations 2020 came into force on 1 January 2018, any entity which, by way of business in or from Gibraltar, stores or transmits value belonging to others using distributed ledger technology must first apply to the Gibraltar Financial Services Commission (GFSC) for a license.  During the rigorous application process, which typically takes a number of months, applicants must show, inter alia, that they will comply with the GFSC’s nine regulatory principles (for which helpful guidance notes have been set out by the regulator).  At the time of writing, there are already 14 licensed DLT Providers and one Virtual Asset Arrangement Provider active in Gibraltar.  No doubt, more will join the ranks in the near future.

By contrast, and despite UK financial regulators having issued warnings about cryptocurrencies and digital assets that are not dissimilar in tone to the remarks made by Janet Yellen, the UK is still some way from having a bespoke regulatory regime for the crypto market. Currently, whether or not a particular cryptocurrency activity is subject to financial regulation in the UK depends on whether it falls within the scope of one or more of: FSMA, the AML regime, the Payment Services Regulations 2017, and the Electronic Money Regulations 2011.

As matters stand, the scope and nature of regulation varies across EU member states.  Recently, French regulators have proposed that EU member state governments give responsibility for overseeing cryptocurrencies to the pan-European markets watchdog, the European Securities and Markets Authority (Esma), instead of to the domestic regulatory bodies of each Member State. Although strengthening the powers of Esma might deliver some consistency across the EU, it remains to be seen whether national regulators will be prepared to relinquish some or all of their control in this area, and enter into a form of centralised supervision operated by Esma – the nature of which is uncertain.

In circumstances where a lot of activity in crypto asset markets falls outside the regulated sector, a strict approach to regulated entities that operate in the crypto market imposes an additional burden on those institutions. Regulated institutions have to grapple with how to balance the increasing appetite for investments in digital assets and cryptocurrencies with their regulatory obligations, in an environment in which unregulated entities have comparative freedom.  They also have their due diligence and KYC obligations, sanctions risks and credit/market risk to consider.  Trade groups including the Global Financial Markets Association, the Institute of International Finance, ISDA and the Chamber of Digital Commerce recently wrote to the Basel Committee on Banking Supervision to say that their proposals are too conservative and simplistic, and may well preclude bank involvement in the crypto asset markets, not least by making it too costly, risky and commercially unviable.

This begs the question: if regulated entities are required to operate within strict regulatory parameters, will the crypto asset industry be driven underground?  If so, it seems likely to increase the opportunities for fraud, money laundering and other misconduct rather than limit them.


Lift Off for To The Moon’s New FinTel Offering


As a direct response to the increasing importance of mobile phones to large swathes of the general population, both financial and network capabilities have been combined in the latest offering from the future-focused mobile network To The Moon.

The mobile network, which was launched during the turbulence of 2020, has announced the arrival of the first debit card and mobile network combination to hit the UK market; delivering better access to the FinTel needs of an increasingly digital audience.

The launch will allow users to manage their network and finance needs through just one single interface.

To the Moon Mobile’s hybrid service is a direct response to the developing behaviours and needs of its tech-savvy and digitally native consumers, who prefer to manage most of their networks, subscriptions, and banking services from the comfort and convenience of their mobile devices.

Unlike other competing challenger banks, the new To The Moon service benefits from offering two crucial services through just one access point. The consolidated approach combines their flexible data bundles with the finance in one offering, which can be established without the need to provide ID, when having a To The Moon Mobile account.

With this streamlined and tech-centred approach, To The Moon has the capabilities to make their clients’ lives a little simpler; from buying a new SIM, to ordering a debit card, changing your data bundle, or tracking all finance operations, notifications about transactions. The hassle-free service will be available in both GBP and EUR currencies.

It should also be noted that for the first 1000 customers to join, To The Moon will offer a special orange limited edition card, whilst also offering a £10 welcome bonus to all their mobile customers who decide to use the debit account.

Andy Hallam, CEO, To The Moon UKAndy Hallam, CEO, To The Moon UK
Andy Hallam, CEO, To The Moon UK

Speaking on the combination of both network and financial services, To The Moon UK CEO, Andy Hallam says: “Younger consumers are now accessing social media apps years before they can open an actual bank account, which means traditional financial institutions are lagging behind in how they want to operate – with everything at the touch of one button.

“By consolidating the management of an ongoing monthly outgoing (like a mobile contract) with a banking system that sits within the same interface, users will be able to keep better track of their spending, whilst also being able to adjust their flexible mobile data and call plans each month according to their needs. We believe FinTel is the future.”

  • Tyler is a Fintech Junior Journalist with specific interests in Online Banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.


Open Banking Adoption Imminent as UK Businesses Wake Up To Associated Benefits


The credit reference agency Equifax has recently released research that strongly suggests that Open Banking is firmly on our doorstep.

Of the respondents that participated in the agency’s Open Banking research, 55% of UK credit providers stated that they were planning to implement Open Banking in 2021, with 93% of those businesses expecting to do so in the next 12 months.

With the pandemic accelerating consumer adoption of new technologies, and more digital data available as a result, the rise of Open Banking has gone hand in hand with the digitalisation of the financial services sector.

New data shows that the majority of consumers who have used Open Banking enabled products (80%) are willing to recommend them to friends and family, strengthening Equifax’s belief that it is only a matter of time before more businesses look to adopt the technology to keep up with customer demand.

The New Consumer Landscape

With many of the nation’s banks remaining closed during the first lockdown, mandatory aspects of the credit lending process, such as ID verification and payment tools, were forced to readjust to a new online lifestyle. This inevitable move to digital requires new forms of verification, powered by Open Banking. The technology has proven to be effective, and now the wider financial services industry has expressed its interest in integrating data into its decision-making processes.

When looking beyond digital adoption, it’s to be found that consumer behaviours have also evolved, with research finding that new customer profiles emerged over the past 18 months, including those needing debt support, savers who need to know where to invest and save and borrowers, prompted by the ability to save. With more data, lenders are more able to offer insight-driven solutions, improving the customer experience.

Emma Steeley, CEO, AccountScoreEmma Steeley, CEO, AccountScore
Emma Steeley, CEO, AccountScore

Speaking on the research and the benefits of Open Banking, Emma Steeley, CEO at AccountScore, an Equifax company, commented: “Open Banking data analytics allows credit lenders to build a 360 perspective of a consumer’s financial life, leading to more rigorous financial checks and therefore a fairer, more affordable journey for both lenders and consumers. Our research shows 47% of people worry every day about their finances, yet customer confidence can be built in the long-term with the knowledge that data is adding an extra layer of protection throughout.”

Benefits to Credit Providers

As well as benefits to consumers, Open Banking provides many benefits to lenders. Equifax currently has 180 live clients benefitting from the use of Open Banking with users able to leverage its real-time abilities to improve customer satisfaction and retention by providing control over their data and help to engage with third parties securely and seamlessly. The top-ranked benefits of Open Banking according to research participants are:

  1. Improved decision-making on credit risk as a result of better data insight
  2. Faster decision-making and reducing customer drop-offs on customer
  3. Removing manual processes
  4. More detailed data for a better understanding of Covid-19 impact
  5. Improve access to thin-file credit customers (increase acceptance rates)

Implementation in 2021

Open Banking is now a key strategic imperative, and 55% of UK credit providers plan to implement Open Banking in 2021, with 19% of lenders planning to fast-track their implementation of Open Banking-enabled products because of Covid-19.

The commercial impact of this development in the UK cannot be underestimated, with increased focus from the Financial Conduct Authority (FCA) on responsible lending within both traditional and new credit products. Widespread adoption of Open Banking aids accurate lending decisions through improved credit risk, enhanced collections and recoveries through automated income and expenditure assessments, and improves estimation and verification of income, to further protect the consumer and the credit provider alike.

“Access to fast, accurate and up-to-date transactional data, via Open Banking, has enabled credit providers to understand the potential circumstances of their customers throughout the pandemic, and responsibly lend as a result,” Emma continues.

“Equifax has experienced more than a 300% increase in Open Banking adoption over the past 18 months, with providers who do not adapt at risk of lagging behind and overlooking the curve of digital innovation. Open Banking is undoubtedly a crucial part of the credit industry’s future.”

  • Tyler is a Fintech Junior Journalist with specific interests in Online Banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.


This Week in Fintech: TFT Bi-Weekly News Roundup 14/10


The Fintech Times Bi-Weekly News Roundup brings you the latest fintech partnerships, product launches, job appointments and industry updates.

Chetwood Financial has appointed Adrian Gurnell as chief information officer to oversee the engineering and delivery of IT services. This also includes strengthening DevOps and automation to facilitate delivery across multiple product portfolios. As well as extending the firm’s credit decisioning scale, accelerating the introduction of new products and the development of platform banking services.

Meanwhile Rodney Prescott joins asset broker GlobalBlock UK as chief technology officer. He most recently worked as a strategic consultant to Input Output, the research arm of the Cardano blockchain, as well as cross-chain protocol Qredo. GlobalBlock’s ambition is to be UK’s leading provider of digital asset trading products and solutions.

Anna Sant joins CPPAnna Sant joins CPP
Anna Sant joins CPP

Reach, the global payment localisation provider, has unveiled Jade Ohlhauser as vice president of software development. Prior to joining Reach, Ohlhauser was the technical co-founder of RPM Software. At Reach, he oversees the development of solutions that help businesses accept cross-border payments through localised processing.

Insurtech firm CPP Group UK has appointed Anna Sant as its new commercial development manager for its parametrics insurance offerings. She will work closely with the sales, business development and CPP Blink Parametric teams, as well as CPP UK’s parent business CPP Group. She previously spent 17 years at Moneysupermarket Group.

Digital bank Zopa appoints Helen Beurier as its first chief people officer. Prior to Zopa, Beurier held senior HR Executive roles at M&S, PepsiCo and GSK. She will focus on strengthening Zopa’s key capabilities for growth.

Clearwater Analytics, a provider of SaaS-based investment accounting solutions, has named Sai Perry as head of solutions, Europe and Asia. He leads the solutions group that helps clients streamline and future proof their operating model to meet their growth ambitions. Perry was most recently a director at PwC in London.

Mergers and acquistions

ConsenSys has acquired the Treum team and its NFT platform from Mesh, a Web3 incubator, for an undisclosed amount. Through the acquisition, ConsenSys welcomes a team of creators, product managers and software developers who have pioneered use cases of non-fungible tokens since 2017.

The Western Union Company has completed its acquisition of a minority stake in stc Bank (formerly stc pay) and is in the process of launching as one of the first digital banks in the Kingdom of Saudi Arabia. According to transaction terms, Western Union has acquired 15 per cent ownership of stc Bank for $200million.

Financial services firm Lunar has snapped up Paylike, the Danish-based and modern full-stack payment platform. The acquistion of the gateway and payment service provider will make it possible for Lunar’s business customers to receive payments from their customers without having to use an intermediary.

Funding and investments

Fintech Juni has raised $52million in funding led by EQT Ventures with additional investment from FJ Labs. It will use the funds to triple the number of its employees and launch a fully integrated credit line product. Juni plans to recruit 120 more employees in the next 12 months.

Nelo, a startup offering buy now, pay later services to Mexico, has raised $20million. In the Nelo app, customers can buy from over 100 merchants like Amazon, Netflix and Spotify. Nelo will use the capital to grow its consumer and merchant base, as well as build out its team.

SUMA Wealth, a fintech for US Latino youth, has received an additional $2million pre-seed round of funding, bringing its total to $3.3million. The funding will expand SUMA’s technical capabilities and grow headcount. SUMA has also launched a free financial checkup that provides a snapshot of key financial wealth metrics.

9fin has secured an £8million Series A led by Redalpine – investors in Robinhood and N26. 9fin has opened an office in New York and is using the Series A for expansion. So far, 9fin has secured more than £10million in funding, including backing from Seedcamp and AI Seed Fund.

9fin is opening a New York office and will launch a US product
More investment updates

InfluenceInk Inc., parent of INK Games, has closed a $9.5million Series A fundraising round. The proceeds are funding development of the INK Platform, including IP development, mobile game content development, talent acquisition and platform deployment.

While alsoug, a digital classifieds and marketplace in Sudan, has enjoyed a $5million fundraise to establish a national payments network. The investment will expand alsoug’s presence in fintech, building on the company’s payment platform, Cashi, by creating a network enabling people to deposit, withdraw and transfer cash and transact digitally.

Insurtech Humn has raised £10.1million in Series A funding led by BXR Group and Shell Ventures as well as Hambro Perks Leaders Fund and Woodside Holdings. With the investment, Humn aims to further develop its insurance data capabilities and expand the commercial functions of the business. It also plans to expand into Europe next year.

Perch, a Toronto-based proptech firm, recently toasted a $1million seed funding round. It also accepted a place on the 2022 REACH Canada growth accelerator. Perch gives home buyers and homeowners financial insights via an analytics platform.


Thunes, Singapore-based fintech company, now has the ability to provide instant cross-border bank payments to Russia through a partnership with Bank 131. With the addition of Russia, Thunes’ global network grows to 115 countries where it can facilitate inbound consumer or business payments.

Airbank has selected open banking infrastructure provider Yapily to help its users manage their finances. The company provides a simple financial management solution that aggregates all bank accounts in one place. Yapily’s API infrastructure lets Airbank users connect to more than 1,500 banks across the UK and Europe.

Data aggregation platform Envestnet | Yodlee and accounting software firm Intuit QuickBooks have formed a collaboration to provide aggregated financial data and information to small businesses in multiple countries.

“Our collaboration with Intuit QuickBooks is another example of Yodlee helping to build a financial ecosystem that supports financial wellness and it enables access to digital innovation in markets across the globe.”

Jason O’Shaughnessy, head of international business at Envestnet | Yodlee

SmartGift has teamed up with Klarna to let shoppers buy and instantly send gifts from any Klarna merchant and pay in interest-free payments. Accoding to the e-commerce platform, the partnership also provides merchants with significant benefits for driving customer acquisition and brand loyalty.

Meanwhile GoDaddy has forged a partnership with Arab Fashion Council to empower creatives in the UAE and MENA region to scale their online presence. As part of their collaboration, GoDaddy will also support the AFC with a series of workshops on using GoDaddy products and tools.

GoDaddy AFCGoDaddy AFC
GoDaddy to support creative entrepreneurs, like Yara Bin Shakar
Further partnerships and collaborations

Mambu and Rich Data Corporation have teamed up to support AI innovation for lenders. Their collaboration will ‘enable banks to improve workflow and address efficiency issues, achieve faster time to yes, and faster time to fund’. They say they’re working together to support a number of lenders in market.

Markaaz has paired up with Mastercard to bring products and services to its platform to help support small businesses. Mastercard will share its capabilities, know-how and team to unique assets and resources for Markaaz. Earlier this year, Markaaz announced a partnership with Equifax to use its data and insights to support the Markaaz platform.

Nexpay, the banking infrastructure provider, is to run all KYC, AML, and e-signature processes through Ondato’s compliance management platforms. The strategic partnership will bring a fintech startup to Ondato’s roster and a ‘better experience’ to Nexpay’s customers.

Meanwhile N1 Partners Group is the first firm to join the SOFTSWISS Jackpot Aggregator. The new product provides the ability to run jackpot campaigns using ready-made jackpot templates. As a part of the agreement, N1 Partners Group has begun connecting its all casinos to the SOFTSWISS Jackpot Aggregator.

Core banking provider Yobota has partnered with UK challenger bank Chetwood Financial as it moves into the banking-as-a-service market. Under this new partnership, the technology vendor provides the core banking system that will empower businesses to develop their own innovative financial offerings under Chetwood’s banking licence.

Finally, Green Dot Corporation has enlisted the Temenos Banking Cloud as its platform of choice to power its direct digital bank and banking platform services partners. Temenos’ Cloud platform will power Green Dot’s technology stack, enabling the BaaS provider’s partners to embed financial services into their ecosystems.

Launches and announcements

Borrower wellbeing app ilumoni has launched on app stores following beta testing. The app has received £1.63million in investment since inception and gained FCA authorisation earlier this year. It  uses AI to help users understand and manage their borrowing better.

Airtel Tanzania has launched an overdraft mobile money service that will lets customers complete their transactions seamlessly without sufficient funds in their Airtel Money wallets. Dubbed Kamilisha, the overdraft service will be facilitated by I&M Bank Tanzania.

Subscription loan provider Creditspring has unveiled Step, a new credit builder product that helps members gradually improve their credit score. Creditspring research reveals that 28 per cent of 18 to 34-year-olds are unaware of how to improve their credit score.  Step provides no-interest loans.

FinTech Australia announces 2021 Finnies Award winners. Women founders and executives from Brighte, Paypa Plane, Athena Home Loans and Adatree are among the biggest winners of the sixth annual awards. In addition, Afterpay and Airwallex, long-running winners of the Finnies, were inaugural inductees into the Finnies Hall of Fame.

Meanwhile, SEBA Bank has introduced SEBA Earn to enable clients to earn yield on their crypto holdings. SEBA Earn’s staking management platform will let users generate rewards from their crypto investment on networks including Tezos, Polkadot and Cardano.

Finally, investment app Ziglu has unveiled a fee-free euro account that lets travellers spend without incurring currency exchange charges. Customers can open euro accounts and convert cash from their sterling account instantly.

Company updates

Railsbank, the embedded finance platform, has opened a new global headquarters in Broadgate, London. The company has expanded its team from four staff in 2016 to more than 450 globally today. The London HQ also reaffirms the company’s commitment to the capital and to the UK.

Insurtech Hiro has revealed a new identity: Locket. Krystian Zajac, co-founder and CEO of Locket says: “When people think about a locket, they think of memories, sentimentality and protection. This is exactly what we represent as a company, and our new brand truly reflects this.”

Yamgo, a crypto-asset rewards platform built on the Hedera network, is celebrating after passing the 100,000 user milestone following the launch of its beta service in mid-July 2021. Through Yamgo users can earn Hedera’s HBAR cryptocurrency for downloading and playing games, or viewing adverts.

  • Claire works across print and online as Editor for The Fintech Times.


Smashing the Glass Ceiling with Blend Network, Finder, Trackstar.ai, 21Shares and OBE


This October at The Fintech Times we are championing the fantastic females in the fintech industry. Around 30% of the fintech workforce are women, and we want to spotlight those who have not only made it to the top, but those who have overcome hurdles, bulldozing a path for the women to follow.

Here we hear from Roxana Mohammadian-Molina, Jinnee Lim, Diane Myer Brown, Ophelia Snyder and Helen Child as they share with us how they smashed the glass ceiling.

Roxana Mohammadian-Molina, Chief Strategy Officer at Blend Network

Roxana Mohammadian-Molina,Roxana Mohammadian-Molina,
Roxana Mohammadian-Molina, Chief Strategy Officer, Blend Network

“The one single most important thing that has helped me smash the glass ceiling throughout my career has been seeking and finding mentors who could support my career goals. From my experience, it is essential to have internal advocates who can assert and support your career growth and who can mentor and guide you. 

“Another key thing has been to have role models I could look up to in order to guide my career. The funny thing is that when people talk about role models, they often think of high-profile people who have achieved extraordinary things. I have had many role models throughout my career, some of whom are high-profile people, yet the best role models have been ordinary people doing extraordinary things in their own way and working hard to smash the glass ceiling in their own organisations. One of my favourite high-profile female role models is Dame Helena Morrissey, former CEO of Newton Investment Management managing nearly £50bn in assets. I love something she once said: ‘‘the [glass ceiling] narrative gets stuck on women, women, women, and how bad men are, and that’s not going to help us get results.’ I agree with this. I believe it is not all about women. Instead, including the perspective of men and recruiting male champions is a crucial element of smashing the glass ceiling once and for all. 

“Another important point is that I don’t believe you ever stop smashing the glass ceiling. What I mean is that attaining equality at the table is an ongoing job and that we can’t rest on our laurels once we have reached a certain position within our organisation or within our industry. In fact, I believe that once we have reached senior positions, we have an even more urgent responsibility to keep working hard to ensure we set the tone at the top and create champions for change in order to raise awareness and take collective action. I strongly believe that senior leaders have an ongoing duty to develop awareness of where glass ceilings exist within organisations because the better we understand the issue, the more opportunities we will identify to promote change. Ultimately, our efforts on smashing the glass ceiling, on work equality and inclusion for women is a marathon, not a sprint and we must be unashamedly talking about these issues because they influence the quality of our lives and our society.”

Jinnee Lim, Chief Growth Officer – Southeast Asia at Finder

Jinnee Lim, Chief Growth Officer - Southeast Asia, FinderJinnee Lim, Chief Growth Officer - Southeast Asia, Finder
Jinnee Lim, Chief Growth Officer – Southeast Asia, Finder

“When I started my career, I was quiet and would hesitate to speak up even when I had good ideas to contribute. Sometimes I would bounce off my thoughts with my male colleagues to validate my views and they ended up sounding off those ideas with the superiors, passing on as their own.

“I realised that I needed to be more visible and confident in a male-dominated environment, in order to stand out and that being good at what I was doing technically would only get me so far. It had been suggested to me many times that I needed to be more aggressive, loud and thick-skinned, which are against my personal beliefs. Instead, I focused on creating opportunities for myself to speak up even though it freaked me out the first few times. Now, no matter what the situation is, if I have a view, I speak up.

“Once I told a regional head that I disagreed with a decision that he’d made, and I laid out the reasons. Some people thought it was career suicide because nobody dared disagree with him before. Turns out he thought my approach was honest and refreshing… and that my points made sense! We sat down to discuss deeper and I ended up working on the topic with him to get to a better outcome. I was rewarded with more responsibilities thereafter – and later, took on a regional leadership role to oversee implementation of top strategic priorities.

“In another role, I once told the CEO that the day I would agree with everything he said and become a “Yes” person, I would be of no value to him or the business.

“Having the courage to stay true to yourself to define who you are as a leader is important. Yes – you can be feminine and you can be an effective leader. You just have to discover your own “X” factor and nurture it.”

Diane Myer Brown, Chief Marketing Officer at TrackStar.ai

Diane Myer Brown, Chief Marketing Officer at TrackStar.aiDiane Myer Brown, Chief Marketing Officer at TrackStar.ai
Diane Myer Brown, Chief Marketing Officer at TrackStar.ai

“I led with data to smash the glass ceiling because It is hard to argue with it. When reflecting on my career I can pinpoint key moments where I focused on doing great work and leading with data instead of getting sidetracked by being the only female in the room. I succeeded by leveraging data and leading teams to focus on the story that needed to be told and from there, I leveraged technology to overcome the types of challenges that come up for marketers. Once people can trust you and understand that you are knowledgeable, they are more open to your ideas.

“It’s ok to acknowledge gender inequalities when they arise, but I made sure not to let that affect my work product. For example, calling someone “poopsie” in an executive leadership meeting after they just called you “sweetheart” goes a long way.”

Ophelia Snyder, Co-Founder and President at 21Shares 

Ophelia Snyder, Co-Founder and President at 21Shares

“The glass ceiling for me has always been something that I have continuously worked to raise., I’m only 29, but I am proud to be the co-founder and president of 21Shares, the world’s largest issuer of cryptocurrency exchange-traded products (ETPs).

“Hany Rashwan and I started this business in part because we wanted to demystify cryptocurrency for our own mothers, who had expressed interest in this growing asset class but didn’t feel like it was accessible to them – and so we asked ourselves, why not? My journey to 21Shares is certainly never one I took for granted. After growing up in Italy and the United States, I graduated from Stanford University with a B.S in Earth Systems, thinking that I would pursue a career as a climate scientist. However, I went on to complete my MBA from New York University. This led me to work for a venture capital firm based in California before becoming an M&A banker at UBS and Evercore.

“While my career shifted in multiple ways, I knew that I wanted to do something bigger than myself and cryptocurrency was part of that journey. Upon becoming close friends in graduate school, in 2018 Hany and I founded 21Shares to simplify the trading of cryptocurrency products in a safe and accessible way, combining our knowledge of institutional asset management and cryptocurrency. It’s been a surreal adventure – not only is it unfortunately far too rare to be a female executive in the fintech and cryptocurrency space – but I’ve led an extraordinary amount of growth in just a few years.

“Our success has been bolstered by investments from star stock pickers like Cathie Wood (who is now on our board of directors!) and Anthony Pompliano, a major figure in the cryptocurrency industry. As women, the challenges of making headway in fintech and specifically in cryptocurrency, take determination and courage. I’m grateful for the women in my life like Cathie who have also shattered the glass ceiling and I hope that in the years to come, I can inspire others to do the same.”

Helen Child, founder at Open Banking Excellence

Helen Child

“I suppose you could say I broke the glass ceiling by the time I was 30, because I was working as a system integrator at ING Barings. But have things changed much since then for women? Is fintech doing enough to make sure women don’t face obstacles in their path to the top? 

“To answer that, you just need to look at the stats. Globally, just 7% of fintech founders are women. In the UK, 30% of the fintech workforce is female, with just 17% of senior roles filled by women. Startup funding is also heavily weighted towards men, with a Deloitte study revealing that women fintech founders raised $875 million in the first six months of 2020, whereas the men raised $3.5 billion.

“In the UK, women make up 34% of FTSE 350 boards and around 30% of all leadership roles. Which isn’t totally equal, but is still an improvement, because in 2011, just 9% of women served on FTSE 350 boards. That’s a remarkable change in a very short space of time. So I’m optimistic.

“Today, I collaborate with amazing women (and men) from around the world. At Open Banking Excellence (OBE), we lead global conversations with changemakers and financial innovators that are shaking up finance. When you get great people together, amazing things happen. 

“It’s always an honour to pass the mic and sit at the centre of a community. 

“I come from a long line of strong, go-getting women. My grandmother was among the first women to get a degree from Oxford University and was a suffragette. I’m continuing her work in more ways than one. Next year, OBE is collaborating with Oxford University, which I think she would have been very pleased about. 

“The illustrious Child ladies played an integral role in the history of Child and Co. – the oldest private bank in the United Kingdom and the third oldest in the world. I like to think I’m keeping some of their spirit alive, as well as making sure the fire of innovation is still burning. Child and Co. was the first bank to introduce a pre-printed cheque. I was the Founder and CEO of the first eMoney license issuer in the UK to be awarded licenses by both Visa and Mastercard. Payments are in my DNA, along with the spark of the inspiring Child women. 

“When reflecting on my career, I often think of the line about Ginger Rogers doing everything that Fred Astaire did, but backwards and in high heels. That sums it up!”

  • 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.


Win Some, Lose Some in Accelerated Life Insurance Underwriting


Life insurance ownership has seen a decline in the recent past. There was an estimated $25 trillion gap between coverage purchased and needed in the event of a loved one’s death in 2016, in the US alone. Suboptimal processes might have contributed to this shortfall. Consider something as basic as getting a physical examination, often required to buy a policy. Research found that half of respondents were more likely to purchase if this invasive step was removed.

Life insurance underwriting has traditionally been a manual process. From collecting proof of insurability to assessing mortality risks of individuals, the application process can be overly tedious. In recent years, there has been a marked shift to accelerated underwriting (AUW), which waives underwriting requirements for select applicants. Most limit the scope of AUW to term life with face amounts between $100,000-$1 million and applicants in 18-60 age range. The pandemic sped up the adoption of AUW as the industry took to writing policies based on new technology, with less in-person contact.

On average, companies with acceleratated programs take 3 days (from application arrival) to reach the medical questionnaire – versus 8 days for traditional underwriting. For the final decision, the mean estimate is 9 days – versus 27 days for traditional underwriting.

While accelerated underwriting waives traditional requirements, automated underwriting automates underwriter activities. Most companies report that AUW programs have reduced policy issuance time.

Top (re)insurance companies have developed AUW platforms in which the underwriting manual is embedded as automated rules. Built on modern standards, these typically include workbenches to support workflow, APIs to incorporate third-party data and modules with cutting-edge AI (e.g. natural language processing). On some platforms, 90% of applications are processed within minutes, and a mere 5% percent require human touch.

Most accelerated pathways today are limited to simple products like term insurance policies. Fluid-less options are available only to relatively few customers who fit age and face-value requirements. In several cases, such limitations are aggravated by additional medical criteria with insurers choosing to accelerate only high-quality risks.. Consequently, many customers that start on an accelerated journey have to move back to a traditional manual underwriting path, leading to increased frustration.

One of the toughest challenges life insurers face when adopting AUW is determining how to compensate loss of information previously derived from tests. Insurance exams and fluid specimens reveal important evidence for risk assessment of life insurance applicants. Fluid-less underwriting gives up this value and carriers are exploring ways to offset the loss.

An example is Hannover Re that is collaborating with ExamOne, a Quest Diagnostics Company, to incorporate its LabPiQture data into Hannover Re’s AUW to enhance their automated capabilities and cut issuance time. ExamOne provides access to a comprehensive suite of real-time laboratory data – serum biochemistry, microbiology and toxicology – in a digitally standardized format.

The data and models used in AUW pose new risks for insurers. Assumptions about factors affecting mortality need further testing. Although medical data may be better correlated with mortality, behavioral data such as gym memberships, shopping habits, wearable technology and credit scores may lead to questionable conclusions. A high-income individual, perceived as someone with excellent medical care, may also have the resources for illegal drug use. On the contrary, a healthy young couple with lower disposable income to join a gym, may exercise on their own. The lack of a gym membership or lower income may not construe an increased mortality risk.

The approach of several companies’ accelerated or automated underwriting programs has been cautious, partly because insurers have taken an incremental approach to scaling automated decision making. These companies are opting for modest improvements to their risk frameworks and processes. With growing adoption and rising maturity, many more will look to embark on transformative programs.

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Issue #333


Changpeng Zhao wants Binance to become the first blockchain with one billion users.

The CEO of Binance announces that the company launched a $1 billion Growth Fund for Binance Smart Chain adopters, to help fintech companies who want to use BSC to build their projects.

Binance focuses on blockchain-rich regions like Russia, India, South East Asia, Europe, the US and South America, to manage the growth of blockchain adoption regionally.

The BSC will work closely with fintech comapnies, crypto advisors, blockchain researchers and influencers.


Coinbase to Launch NFT Marketplace by Year’s End


Cryptocurrency exchange platform Coinbase announced plans this week to launch its own NFT marketplace. Dubbed Coinbase NFT, the new marketplace will help users mint, purchase, showcase, and discover NFTs.

“Just as Coinbase helped millions of people access Bitcoin for the first time in an easy and trusted way — we want to do the same for the NFTs,” said Coinbase VP of Product and Ecosystem Sanchan Saxena.

Coinbase NFT, which the company aims to launch at the end of this year, will offer a user-friendly interface that the company said will be “as simple as tapping a few buttons.” The new platform will be creator-centric, placing art and the artist’s experience at the forefront.

Coinbase is putting creators first by leveraging decentralized contracts and metadata transparency to help artists maintain creative control. Additionally, the platform will cultivate a community for artists and their fans using social features to help users discover and discuss NFTs. Coinbase NFT will curate a personal feed based on users’ interests. User profiles will showcase all of their NFTs and will help them connect with like-minded collectors and artists.

“Our ambition with Coinbase NFT is to allow everyone to benefit from their creative spark; to contribute to a future where the creator economy isn’t a small subset of the real economy, but a central driver,” said Saxena.

Coinbase NFT will compete with NFT exchange platforms such as OpenSea, one of the major players in the space. According to TechCrunch, OpenSea facilitated $3.4 billion in transaction volume in August of this year. Coinbase NFT boasts two differentiating factors that set it apart from OpenSea. The first is that Coinbase is placing a large focus on the social and community aspects of its tool, something that OpenSea lacks. Coinbase’s second differentiation is that it comes with brand recognition and a built-in client base of 68 million users.

Currently, there is no word from Coinbase on the commission percentage it will charge artists, nor on the royalty percentage for perpetual trades. Whatever it decides, it will need to compete with OpenSea’s relatively-low 2.5% fee.

Coinbase went public on the NASDAQ earlier this year, trading under the ticker COIN. The San Francisco-based company’s user numbers increased 44% in the third quarter of this year, up from 56 million users in the previous quarter. Brian Armstrong is CEO.

Photo by Kelly Sikkema on Unsplash


Stablecoin News for the week ending Wednesday 13th October.


How will Stablecoins be regulated?

Here is our pick of the 3 most important Stablecoin news stories during the week.

It turns out everything is regulated, if it’s not it’s called self regulation, and that is how the stablecoin industry has been up until now.  In pure numbers, you would say it has worked well.

Firstly, this week we heard from the Central Bankers Bank, the Bank for International Settlements’ (BIS) which says stablecoin payment systems should comply with international standards for payment, clearing and settlement.

A new report published Wednesday by the BIS Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) includes preliminary guidance on how to apply the Principles for Financial Market Infrastructures (PFMI) to stablecoin arrangements.

BIS Outlines How Stablecoins Could Comply With International Money Standards — CoinDesk

Then there are jurisdictional differences.  The Financial Stability Board (FSB) — an international body that monitors and makes recommendations about the global financial system — this month said that countries’ implementation of its recommendations for “global stablecoin” regulations was “still at an early stage” and international coordination was critical to overcoming regulatory arbitrage.

How Global Stablecoin Regulations Are Evolving (forkast.news)

But stablecoins are not just used for payments, they are more than money – they’re programmable money! There’s a difference between the tokens themselves and the issuers. It’s all well and good for Circle to become a bank, for the U.S. government to insure its deposits and for greater transparency across the board. But the rules need to be flexible enough so that they don’t crush the utility of the tokens themselves.

US Wants to Regulate Stablecoins First — CoinDesk

So in summary we have regulators looking to push square pegs into round holes!  It’s going to take more time and a lot more thought before we have suitable regulations to this new and innovative asset class.


Alan Scott is an expert in the FX market and has been working in the domain of stablecoins for many years.  

We have a self imposed constraint of 3 news stories per week because we serve busy senior Fintech leaders who just want succinct and important information.

For context on stablecoins please read this introductory interview with Alan “How stablecoins will change our world” and read articles tagged stablecoin in our archives. 


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.


Smashing the Glass Ceiling with Camino Financial, RenPSG, CNote, Connectd, Anonybit, & Horizen Labs


This October at The Fintech Times we are championing the fantastic females in the fintech industry. Around 30% of the fintech workforce are women, and we want to spotlight those who have not only made it to the top, but those who have overcome hurdles, bulldozing a path for the women to follow.

Here we hear from Roxane Herrera, Kelly Palmer, Catherine Berman, Claudia Stankler, and Liat Aaronson as they share with us how they smashed the glass ceiling.

Roxane Herrera, Director of Corporate Development at Camino Financial

Roxane Herrera, Director of Corporate Development at Camino FinancialRoxane Herrera, Director of Corporate Development at Camino Financial
Roxane Herrera, Director of Corporate Development at Camino Financial

“During the course of my career, I’ve worked across industries spanning finance, insurance, and community development with financial institutions and general industries clients. After receiving my Business Administration and Economics undergraduate degree after receiving a full scholarship from the University of Southern California, I started my career at Bank of America Merrill Lynch in San Francisco. I underwrote Senior Credit facilities for Paper, Packaging, and Forest Products clients and built my financial analysis and credit underwriting skillset. I chose to pursue a corporate banking track, despite the fact that it was challenging, and sometimes caused me to question whether or not I belonged there. Ultimately, my love of the work and determination to master the intricacies of portfolio management, propelled me forward.

“I then transitioned to a state impact investing role at the California Department of Insurance. At the California Organised Investment Network (COIN), I helped deploy insurance capital into California projects that created impactful jobs and benefitted underrepresented communities while delivering sound financial returns through a state tax credit program. I then pursued my Masters in Business Administration from Duke’s Fuqua School of Business concentrating in Investments, Innovation, and Entrepreneurship. At Fuqua, I co-authored “The Role of Big Society Capital in Growing Impact Investment” at the Center for Advancement of Social Entrepreneurship.During my Duke MBA summer internship, I worked as an MBA graduate intern with Dimensional Fund Advisors (DFA). Within the DFA Broker/Dealer group in Financial Advisor Services, I worked on business development and presented a final business recommendation related to the 2016 Department of Labor Fiduciary rule. After business school, I worked as a Senior Associate Consultant at Charles River Associates within the Transfer Pricing team. I worked with multinational clients advising them on their full documentation of Internal Revenue Code Section 482 regulations and conducted economic and financial due diligence to help guide clients through strategy on ongoing worldwide tax regulations and government litigation/policy issues. Thereafter, I worked as a Senior Manager of Community Development Lending at Charles Schwab Bank where I structured loans to top Community Development Financial Institutions (CDFIs) to deploy $2billion in capital across Western State CDFIs under a three-year CRA Strategic Plan. The goal was to fund affordable housing, education/healthcare facilities/other, and small businesses through community partner intermediaries. In my new role as Director of Corporate Development at Camino Financial, a neo-CDFI FinTech, I am focused on developing strategic partnerships and raising flexible capital to grow our micro and small business lending portfolio centered on scaling underbanked businesses nationally.

“As I look back on my educational and career trajectory, I attribute my success, in part, to perseverance, maturity, and a willingness to take risks on tough projects. My advice to those graduating from college or embarking on a professional career, is to network, volunteer, and pursue the thing that drives them. ‘Fight for your dreams as only you truly know best what motivates you, and what you are capable of, don’t let others make that decision for you.’

“In this environment, attending remote events and networking is more challenging yet not impossible since I find myself listening in to more strategic webinars while asking questions to continuously learn more about the industry. This is crucial to diversifying one’s skill set and becoming more well-versed in this industry.”

Kelly Palmer, Executive Vice President of Client Transition at RenPSG

Kelly Palmer, Executive Vice President of Client Transition at RenPSGKelly Palmer, Executive Vice President of Client Transition at RenPSG
Kelly Palmer, Executive Vice President of Client Transition at RenPSG

“I believe that a woman can achieve anything that a man can achieve, but it usually requires a very strong will and a lot more effort on the part of the woman. Hard work, dedication and continuous learning are the most effective ways for anyone to overcome obstacles that may be difficult to identify or withstand. But for women to truly smash the glass ceiling, they often must make more sacrifices than men do. As a single mother, I sacrificed significant amounts of family time to dedicate myself to not only my career, but my education. I began my career at RenPSG as an administrative assistant and worked my way up, completing my education later in life and ultimately graduating with an MBA. Now, as EVP of Strategic Growth Operations, I realise that smashing the glass ceiling or bending traditional boundaries not only requires a higher level of personal investment, but also surrounding yourself with great mentors that can help you develop skills to reach your goals. Several years ago, I was asked to lead the IT development and infrastructure department, which was a huge sign of trust on the part of the company because at the time, I had no experience in IT and the team was predominantly male. This didn’t faze me or RenPSG, because I had developed a good management skillset that I could rely on to be successful. It was a turning point in my career that I believe came from a place of not only personal sacrifice but paying close attention to those around me and recognising who I could learn from along the way.”

Catherine Berman, CEO and co-founder of CNote

Catherine Berman, CEO and co-founder of CNoteCatherine Berman, CEO and co-founder of CNote
Catherine Berman, CEO and co-founder of CNote

“In 2017, my cofounder and I—two finance women—competed for Fintech Innovation of the year at SXSW. We were bringing a very different solution than the others: a way to turn cash into a strong return and positive social impact. Cash? Impact? Those certainly were not as sexy as the AI and other platform strategies we were competing against. But we made it to the finals and we won—not just the Fintech Innovation category, but the entire SXSW Pitch Competition. It was a testament to what happens when you bring new voices to the table to design the next generation of finance.

“Since then, we’ve launched and grown three products that drive capital to financial institutions that help underserved communities thrive: the Flagship Fund, for retail investors; the Wisdom Fund, which supports loans for women of colour entrepreneurs; and the Promise Account, an FDIC-insured cash management solution for corporations and other institutional investors.

“During that time we also raised several funding rounds, the most recent one last year, in the midst of the pandemic. That added a layer of complication—we wondered how we could build trust with investors and really get to know one another over Zoom. What got us over the line was the fact that our investors made the effort to get to know the team and our business over time. They saw that when we say we’re going to do something, we do it, whether it’s getting SEC qualification or releasing a fully insured FDIC product.

“We also took the time to have in-depth conversations with investors to make sure their values aligned with ours. That’s essential because we want investors who are committed to our mission—closing the wealth gap for those often ignored by traditional finance, including women and people of colour.

“That mission is what gives us the energy and persistence to push through barriers. The entrepreneurs CNote drives capital to face an array of obstacles, including outright bias and structures that put them at an inherent disadvantage. But as our quarterly impact reports demonstrate, when women and business owners of color get the capital they need, their businesses grow—generating wealth for their families, jobs for others, and needed products and services for their community.”

Claudia Stankler, COO of Connectd

Claudia Stankler, COO of ConnectdClaudia Stankler, COO of Connectd
Claudia Stankler, COO of Connectd

“I have got to where I am today through self-learning and sheer hard work. Having graduated at 22 with a psychology degree, I was aware that this degree doesn’t always naturally lend itself well to a career in business, certainly in the eyes of many others.

“I quickly realised that to get ahead, I needed to learn more, work harder, and know more than those who might have had traditional institutional training in business management.

“That is when my desire to learn kicked-in to overdrive to make sure I broke through the glass ceiling. I would read business books and listen to podcasts until 2am and I would attend every event possible to meet people I could learn from.

“I successfully navigated positions where I have run operations for all three of the London-based tech startups I’ve been involved with. I may have lacked experience at the start of my journey, but I always believed that if I put the effort in then the rewards would be there.

“It hasn’t always been easy. I am acutely aware that my journey to the senior leadership team has been different from my male counterparts. When it comes to raising funds, I have experienced instances where I have been overlooked because of my gender.

“In one particularly damning incident, I was in an investor meeting with three men who were speaking among themselves. When I chose to put my opinion across, they all paused, looked at me, then continued as if I hadn’t spoken. It was so blatant that it was almost comical.

“This is just one example, but discrimination is still unfortunately rife. I have now reached a point in my career where I have proved myself enough to no longer encounter this day in, day out, but I am always surprised when I encounter the occasional person for the first time and feel the need to prove myself all over again.”

Frances Zelazny, CEO and founder of Anonybit

Frances Zelazny, CEO and founder of AnonybitFrances Zelazny, CEO and founder of Anonybit
Frances Zelazny, CEO and founder of Anonybit

“I haven’t always thought about my role as a female tech leader as “smashing the glass ceiling,” although today I’ve come to appreciate and respect this turn of phrase. For me, I was always the only woman in the room so I was more focused on doing what I had to do to get the job done. I’ve worked with startups my entire career so by definition everybody in the room, including the women, were expected to contribute and punch above their weight. This environment helped to drive me, see past gender, and rise up the ladder. Working with Israeli startups for so long, I can also say that they have a more egalitarian culture – that helped me to avoid some of the roadblocks women in more traditional corporate environments have faced.

“Looking back on my career, there were certainly times where I was challenged by male colleagues, though. One time, early in my career, I was faced with a situation where I thought my male boss was acting out of line. I called him out on his behaviour – I tried to be assertive while also staying polite and empathetic. I actually wrote him a letter so I could flesh out my thoughts more clearly and less emotionally. He reacted very positively to this feedback – I think I still have his reply somewhere in a drawer – and we worked through the issue while deepening our mutual respect for each other. This gave me the courage to further stand up for myself in future roles and to point out behaviours that I thought were also disruptive to others.

“What’s most important for other women leaders is to acknowledge we’re not alone in the challenges we face professionally and personally. We should lean on each other for support and we shouldn’t be afraid to connect and share our experiences. I’m lucky to have had both female and male mentors along the way who helped me raise the bar in my work. Nobody gave me a break because of my gender. And I’m thankful for that. But like I said before, I also had to be assertive and make my voice heard. Behind it all, too, was a strong support system at home, which cannot be ignored or underestimated. Growing up, my parents never held me back because I was a woman, and today my husband is an incredible partner who has been my biggest cheerleader and supporter when it comes to my career.”

Liat Aaronson, Chief Operating Officer and co-founder of Horizen Labs

Liat Aaronson, Chief Operating Officer and co-founder of Horizen LabsLiat Aaronson, Chief Operating Officer and co-founder of Horizen Labs
Liat Aaronson, Chief Operating Officer and co-founder of Horizen Labs

“Barring a clerkship interview that basically ended when the interviewer learned I had a child, I’ve been fortunate in my career to work with leaders and partners where there was no glass ceiling to break. Luckily for me, the supportive role models I had the privilege to work for, or with, over many years and many industries including law, venture investing, academia and tech start ups, never made me feel my gender and family priorities were an issue.

“I have had more general experience with glass ceilings in academia. When I took on leadership of the Zell Entrepreneurship Program, an academic accelerator at Reichman University (formerly IDC Herzliya, a small private university in Israel), there was a lot of push back. I managed to override the concerns and create a thriving venture creation program that helped launch some great startups over the 10 years I ran it.

“That experience of breaking the academic glass ceiling was a formative experience for me. Today at Horizen Labs, I am always inspired to see the many strong women in our team and believe my co-founders are giving them the same springboard with no ceilings based on gender.”

  • Francis is a junior journalist with a BA in Classical Civilization, he has a specialist interest in North and South America.


Fintech Developers Aren’t Happy; Finds Rapyd Report


Rapyd has recently released a damning report that has exposed a high level of job dissatisfaction amongst fintech developers.

Whilst the report, which is entitled “The State of the Global Fintech Developer“, was commissioned by Rapyd, the research was conducted by 451 Research who themselves exist as a brand of S&P Global Market Intelligence.

Their survey was conducted in Q2 2021 and was based on a global survey of 502 fintech developers in the US, UK, Singapore, New Zealand, India, Hong Kong, and Australia.

Respondents to this survey represented a variety of fintech categories, such as payment processors, e-commerce businesses, mobile app developers, authentication/security vendors, digital banks, and money transfer providers. Examples of job titles surveyed include front-end/back-end/full-stack developers, systems administrators, IT managers, and system/solution architects.

Although the report highlighted a strong general consensus towards job dissatisfaction, respondents also added that they had experienced a growing demand around the creation of payment applications and in-house tools.

Jordan McKee, Principal Research Analyst, Customer Experience and Commerce, 451 ResearchJordan McKee, Principal Research Analyst, Customer Experience and Commerce, 451 Research
Jordan McKee, Principal Research Analyst, Customer Experience and Commerce, 451 Research

“Strong developer expertise has become one of the most essential inputs for driving differentiation and diversification in fintech,” said Jordan McKee, Principal Research Analyst, Customer Experience and Commerce at 451 Research. “Given the intense level of complexity, regulatory scrutiny and competition associated with fintech, there is no single role that will be more important to the sector’s continued evolution.”

The report indicates a clear prioritization of payments-related applications over the last 12 months, with 56% of respondents stating that they have been involved with such projects, besting the next closest category (investments) by 15 percentage points.

Underscoring how critical having a strong in-house developer base is, only 26% of respondents answered that most of their tools are commercially available off-the-shelf, with the majority of their tools and products designed in-house. Nearly half of the developers surveyed said they are spending more time developing in-house tools than their other job responsibilities.

“On a global scale we are seeing an increased focus by developers on Payments, Investing and Digital Banking as a priority for embedding fintech services,” said Drew Harris, Senior Manager of Developer Relations at Rapyd. “Improving payout processes and integrating local payment methods are top priorities, according to 36% and 33% of respondents respectively, demonstrating the growing need for business to support sophisticated payment integrations. Fintech developers are being tasked with creating new frontiers of embedded finance on which entire business models rely, no small feat.”

Despite the meteoric growth of the industry, the report also identified a troubling level of dissatisfaction among developers, with 26% of respondents somewhat or very dissatisfied with their current jobs, a cause for concern for companies that have come to learn just how critical their developer workforce truly is.

  • Tyler is a Fintech Junior Journalist with specific interests in Online Banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.


Closing the tech investment gap: How mid-tier banks can get ahead


When it comes to choosing a bank, customers indicate that a leading digital experience is one of their top two deciding factors — bested only by product pricing and offers, according to recent Kearney research. The sophistication of a bank’s digital operations is no longer a nice-to-have; instead, digital innovation has become table stakes in the war for customers.

Image by CanStock

While most mid-tier banks understand the growing role digital plays in all parts of their operation, they’re struggling to keep pace with their larger counterparts. Top-tier banks have invested billions in new technology, acquiring fintechs and developing their own in-house solutions. Meanwhile, mid-tier players remain encumbered by legacy systems, which demand most of their IT budget and resources. The result is a growing digital divide between global and regional banks.

The good news is that despite the hurdles, digital transformation is possible for mid-tier banks — and perhaps at less cost than many expect. We’ve helped regional and super-regional banks reduce their legacy IT costs to free up resources for innovation and strategic partnerships. Doing so levels the playing field for mid-tier banks and enables them to acquire the digital capabilities they need to stay competitive.

The double-edged sword of legacy systems

The reliance on legacy systems presents dual challenges for mid-tier banks. First, older systems are typically less amenable to continuous improvement and delivery models that can help manage quality and increase responsiveness. The legacy systems bog down go-to-market efforts, which are often a competitive differentiator for fintech firms. Legacy systems also lack the capabilities required to support the evolving needs of bank employees and customers, including rapid onboarding and integration with partners and third-party systems.

What’s more, maintaining legacy technology is expensive. Smaller banks find themselves allocating most of their IT budgets to security and maintenance, which leaves little for digital advancement. For example, a Kearney study shows that banks with $100 billion or less in assets dedicated just a third of their IT budget to innovation.

That pales in comparison to what top-tier banks set aside for digital investment. JPMorgan Chase, for instance, spends $12 billion annually on digital efforts, including funding a team of 50,000 in-house technologists. Such resources have helped big banks widen the digital gap between themselves and their smaller peers and increased the imperative for mid-tier banks to innovate if they want to retain and win customers.

From maintaining to transforming

Fortunately, many regional and super-regional banks recognize the need to invest in digital. In a recent Kearney survey, for example, mid-tier banks ranked digital payments as one of their top areas of strategic importance. The need for innovation, of course, touches every aspect of the organization, from IT operations and business process automation to the retail customer experience. So how do mid-tier banks find the resources to move forward?

We’ve discovered that the solution is not rooted in spending more or through incremental selective investments. Instead, the key is to drive focused transformation that simultaneously improves productivity and digital capabilities. For example, we helped financial service clients save up to 30% of their IT budget via:

  • Reducing IT complexity with automation. This includes automating IT workflows as well as processes across the organization.
  • Optimizing IT operating models. Consider right-sizing IT to save even more and implement agile development concepts to improve time to market.
  • Improving supplier spend management. With third-party spend accounting for up to 35% of banks’ total cost structure, creating more conscious spend management systems can pay off.
  • Reducing IT demand. The flipside of optimizing operating models is finding ways to decrease the demand for IT assets and services.

The combination of these efforts frees up budget and resources that banks can direct toward innovation. Notably, the result goes beyond cost savings, facilitating the sustainable transformation of banks’ IT operations — one that’s focused on the future.

Partnering for success

Even with significant cost savings, mid-tier banks may still struggle to acquire fintechs or build on their own. However, using freed-up IT resources to support partnerships with third-party innovators enables smaller banks to punch above their weight class in a new digital world.

Such partnerships can help regional banks move past the limitations of their legacy platforms. Even better, they often provide banks with digital solutions more quickly, allowing them to leap the digital gap and land precisely on what customers want. Partnering creates a basis for mid-tier banks to compete with larger banks while defending against fintech challengers.

The digital imperative for financial service is only growing stronger. Mid-tier banks can — and must — compete at a higher level, even with relatively fewer resources. Rethinking legacy systems and operations along with exploring innovative partnerships can help regional banks do just that.

Hemal Nagarsheth is an Associate Partner at Kearney. In this role, he is a senior leader in the Financial Institutions Group with particular focus on the intersection of technology and innovation with banking and payments.