Goldman nears deal to sell Greensky to Sixth Street Group

Goldman Sachs Group Inc. is in advanced talks to sell its GreenSky unit to a consortium that includes Sixth Street Partners, according to people familiar with the matter. No final decision has been made and discussions could fall through, said the people, who asked to not be identified because the matter isn’t public. The group […]

Cybersecurity a top risk, Sibos attendees say

TORONTO — Forty-three percent of the audience identified cybersecurity as the No. 1 risk management concern, according to a poll taken Monday during a risk-management session at the Sibos 2023 event this week.  “Our ability to succeed in payments over the long haul is fundamentally rooted in this concept of embracing uncertainty while managing risk,” […]

Transactions: NatWest taps AWS for personalized banking tool

NatWest is deepening its ties with Amazon Web Services to leverage the IT solutions provider’s generative AI capabilities.   By the end of 2027, the $886 billion bank aims to use AWS’ generative AI to help nearly 10 million people manage their finances, according to a Sept. 18 NatWest release.  AWS will help NatWest provide personalized […]

Bank of America launches AI-driven chatbot capabilities for commercial clients

TORONTO — Bank of America announced the addition of AI capabilities to its CashPro Chat function at Sibos 2023 Monday, bringing an enhanced user experience to its corporate and commercial clients.  The $3.2 trillion bank’s CashPro Chat now uses the same proprietary technology as the bank’s AI-driven consumer-facing bot Erica, Tom Durkin, global head of […]

SVB’s integration with FCB going ‘better than expected’

Silicon Valley Bank’s integration with First Citizens Bank is going “better than expected.”   Acquiring Silicon Valley Bank (SVB) in March was an opportunity for First Citizens Bank (FCB) to go beyond traditional banking, Christopher Hollins, head of solution sales and delivery at SVB, a division of First Citizens Bank, told Bank Automation News at […]

Building the Foundations for Next-Gen Technology to Transform Customer Experience

Upcoming Finovate webinar, in collaboration with InterSystems, Thu 12 Oct, 3pm BST / 10am ET

How can financial services firms improve the client journey and experience? Next-generation technologies that advance digital transformation are at the heart of that answer, but these rely on the firm’s ability to gather and analyze all available data across the business.

By now, many in financial services will have adopted technologies such as AI, ML, and analytics to enhance the experience their customers receive. However, to reach their full potential, they depend heavily on a solid data technology platform to build, train, and continuously improve model quality and predictions.

Hyper-personalization can foster loyalty in an era in which loyalty has declined, and it pushes customers and investors towards those firms which can be agile in what they offer. This level of hyper-personalization offers immense growth opportunities for all providers if they can cater to small and specific groups – but on a large scale.

Join this webinar and learn from the experts:

  • How to achieve competitive differentiation by delivering better customer experiences.
  • How to optimize your existing infrastructure with a smart data fabric.
  • How other firms are building these data foundations and the results of their deployment.

On the panel:

  • Joe Lichtenberg, Global Head of Product and Industry Marketing, InterSystems
  • Virginie O’Shea, CEO and Founder, Firebrand Research

In collaboration with

Can’t join us live? Register now, and we’ll send you the recording. 

The post Building the Foundations for Next-Gen Technology to Transform Customer Experience appeared first on Finovate.

Towards a More Transparent Financial Ecosystem with Matthew Parker of ModernTax

How can greater transparency in financial services help improve underwriting, lower risks, and create more opportunities for banks and small businesses alike?

We caught up with Matthew Parker, founder and CEO of ModernTax, to discuss how bringing more transparency to areas of finance like taxation can help credit providers make better decisions.

Founded in 2021 and headquartered in San Francisco, California, ModernTax made its Finovate debut earlier this year at FinovateSpring. At the conference, the company demoed its Business Verification Platform and Verifier API, a secure solution that enables fintechs and banks to verify tax records, business standing and KYC data.

Last month, ModernTax launched its Live Contributory Network for on-demand tax verification. The solution connects licensed tax professionals with ModernTax customers to provide on-demand, secure, and reliable tax verification services.

To start off, what is it about taxes that interests you? Of all the areas of finance, what’s special about taxes?

Matthew Parker: My first job out of college was in social services, specifically working in child support. My responsibilities included calculating the combined income of two people with misaligned incentives. This experience opened my eyes to how broken the world of tax, income, and finance can be at the ground level.

A few years later, I worked in consulting, helping banks understand what went wrong with the mortgage crisis. I then stumbled into my first entrepreneurial endeavor: a franchise tax preparation company. Over three years, I grew from one office to five and learned the ins and outs of the tax preparation business.

In 2017, I caught the technology bug and bought a one-way flight to San Francisco with the goal of starting a tax startup that utilized all of the tax data I had been accessing through my tax preparation business as alternative data to underwrite loans.

Six years later, I am building ModernTax to make use of this data to help underwrite, decrease risk, and create a more transparent financial ecosystem for U.S.-based small businesses.

Can you elaborate on that?

Parker: One thing that has consistently bothered me is the black box of tax information that lives outside of our bank feeds and accounting feeds. There is an entire business that helps accountants export accounting data into tax software (they are a customer), but that is a niche market.

The real problem we are solving is financial transparency. Many businesses that provide financial services are locked out of access to critical financial records, and 99% of U.S. businesses are not required to report any financials. This results in a massive transparency gap. Tax records are one way to fill this gap, with 15 million unique entities and 160 million individual tax returns filed annually in the U.S. alone.

How does ModernTax solve this problem better than other companies, or other solutions?

Parker: ModernTax aims to solve the problem of financial transparency by providing tax information on all U.S. small businesses, which can level the playing field and create a more transparent financial ecosystem. The commercial credit market in the U.S. alone is worth $8.8 trillion annually, and the average company in this industry generates approximately $7 billion in yearly revenue.

By utilizing tax records, which are filed by 15 million unique entities and 160 million individuals annually in the U.S. alone, ModernTax’s strategy revolves around transparency and eliminates the need for countless hours of back-and-forth communication and manual data entry to collect this information, saving commercial providers time and money, and making it easier to evaluate businesses.

What is your primary market? What has the response to your technology been like?

Parker: We primarily sell to commercial credit providers such as banks, online lenders, and other data providers that assist companies in underwriting, fraud prevention, and verifying financial documents for their customers.

We have received positive responses from data providers such as D&B, Experian, and Transunion, as well as from our first paying partner, Enigma Technologies. Moreover, ModernTax has been well-received by direct carrier insurance companies for both underwriting and claims processing on income-related products.

Are there any deployments or features of your technology that are especially noteworthy?

Parker: In the past month, we have added 14 new features. One notable observation is the need for a robust platform that allows our contributors to efficiently provide us with data. Unfortunately, the IRS does not provide adequate tools to help companies maintain transparency in their reporting. We are constantly learning from our contributors on how we can build tools to address this issue.

ModernTax is headquartered in San Francisco and was founded in 2021. What is it like to be a young startup in San Francisco today?

Parker: Personally, it feels surreal to me. I moved to San Francisco in 2017, lived through the pandemic, and experienced the boom of 2021 and the correction of 2022. Nevertheless, San Francisco is resilient. Although there are political and socioeconomic problems that come with being a high-stakes, high- reward city, founders can arrive here with nothing and become paper billionaires and liquid millionaires faster than anywhere else in the world.

This creates a tale of two cities. To be a young startup, you have a ton of resources right in your backyard, but you also realize how competitive it is. There was a new billion-dollar company born every day for a certain amount of time and now, with AI, we are seeing history repeat itself. It’s important to keep your momentum but also not get too distracted.

We also wanted to talk with you as a Black founder and entrepreneur. What advice would you give to other potential founders-of-color?

Parker: Starting a company is hard, full stop. I even joke with my wife that I don’t mind telling my 18-month-old son “no” a lot because it’s just the nature of life in general. As a black founder, I have experienced both ups and downs. George Floyd’s murder created a domino effect of predominantly white people at large institutions feeling guilty, which led to a lot of initiatives that were half-baked and more PR moves than anything. That sentiment wore off pretty quickly, especially as markets turned for the worst in 2022.

If you built your brand “how hard it is to be a black founder”, you are likely bitter right now because we learned that the market didn’t care about you being black or about what happened with George Floyd. We are now seeing pushback with the rollback of affirmative action, the lawsuit impacting Fearless Fund, and I think more challenges will come. So, I would say focus on your business, focus on your customers, and build products. If you play the victim in a game that is already hard, you decrease your chances of winning.

You demoed your technology at FinovateSpring earlier this year. What was that experience like for you and your team?

Parker: This demo helped us think about how our product helps financial institutions and we were able to demonstrate the capabilities that companies can experience by getting access to this information in real-time.

What are your goals for ModernTax? What can we expect from the company over the balance of 2023 and into next year?

Parker: ModernTax aims to provide near-instant access to verified tax and financial information through a network of licensed tax agents to create a more transparent verification process for their customers. Over the balance of 2023 and into next year, the company plans to add eight new customers, launch new features for its contributor portal and business user features, and attend various business development events and in-person client meetings.

Photo by Nataliya Vaitkevich

The post Towards a More Transparent Financial Ecosystem with Matthew Parker of ModernTax appeared first on Finovate.

Movers and Shakers: SVB names Murrell, Santiago to new roles

Silicon Valley Bank, a division of First Citizens Bank, named Martin Murrell the new head of global payments and Milton Santiago the new head of global digital solutions last month.   The pair will bring “the vision and execution needed to enhance SVB’s product suite, bringing inventive and bespoke solutions to our innovation economy clients,” Gagan […]

FinovateFall 2023: AI, the Fintechification of Everything, and Why Boring is the New Black

How will AI help drive fintech innovation? How can digital transformation power greater financial inclusion? Where is the smart money investing in fintech? What will be the Next Big Thing in financial services?

FinovateFall wrapped up just days ago – and much of the three days of fintech demoes, keynote addresses, and panel discussions was dedicated to providing answers to these questions.

Here we’ll reflect of those responses and highlight some of the key takeaways from our mainstage fintech experts, our innovative demoing companies, and Finovate attendees themselves.

What we learned from the experts

Our invitation-only, Leaders+ session held the evening before the conference began featured a number of insights on the present and future of fintech. The lead-off address on major fintech themes set a tone for our invitees that foreshadowed much of what the rest of our attendees would see and hear once FinovateFall got underway the following morning.

Analyst and expert Alex Johnson of Fintech Takes provided one of the more surprising insights of the night in his keynote on top trends in banking and fintech. Johnson suggested that the relatively unglamorous areas of the industry may turn out to be the “Coming Attractions” in terms of fintech innovation over the near term. Much of the fintech revolution to date, Johnson explained, involved solving consumer problems – many of them bearing an uncanny resemblance to the problems of the company founder’s themselves.

As innovation in this space runs its course, opportunities in other, neglected areas can emerge. Johnson encouraged invitees to keep an eye on “the boring stuff” like payments infrastructure and the B2B world when gauging the overall level of innovation and opportunity in the fintech and financial services industry.

Johnson also observed that we should continue to see fintech deployed to solve problems that are not necessarily considered to be financial problems. Our own Finovate research team has noted the increased news flow from companies looking to help small businesses survive supply chain financing challenges. It was heartening to hear Johnson use the example of fintechs providing financing to SMEs caught in supply chain snafus in that part of his presentation.

The other major topic of conversation in our Leaders+ session was AI and the metaverse. This was another discussion that extended over the balance of FinovateFall. The jury may still be out on the impact of the metaverse in banking. But the potential of AI in fintech and financial services seems clear.

From greater personalization of services to more efficient, more secure, and more innovative financial products, banking and financial services are ready to find roles for AI.

Start with Generative AI. One commonality between keynote speakers on AI was to compare the adoption rate of a Generative AI solution like ChatGPT to the adoption rate of previous popular technologies from the past. Think everything from Napster to LinkedIn to TikTok. GenerativeAI was clearly in a class of its own. This sentiment – that AI is here to stay – was echoed in virtually every discussion of the technology – from Leaders+ and keynote speaker Tomas Chamorro-Premuzic to Analyst All-Star Tiffani Montez of Insider Intelligence. At one point, even David Letterman’s classic skewering of the Internet in an interview with Bill Gates back in 1995 (“Does radio ring a bell?”) was deployed to remind our FinovateFall audience that we’ve underestimated innovation before.

What we learned from the innovators

There is no better way to feel the pulse of fintech innovation than by attending the Demo Days at a Finovate event. And there is no better distillation of what direction fintech innovation is going than the companies that take home Finovate Best of Show awards.

FinovateFall was no exception. Of the six companies that won Best of Show last week, we saw three companies demo solutions in areas that observers long have said are ripe for innovation. Chimney demoed a solution for homeowners that gave them actionable advice on their home’s value and equity, their borrowing power, and the availability of relevant pre-qualified offers. Trust & Will demonstrated technology that streamlines and simplifies estate planning and settlement with attorney approved, legally valid documents. Wysh, an innovator in the insurance space, demoed a deposit solution that provides micro-life insurance coverage of up to 10% of the account holders balance.

Best of Show winning companies like showed fintech to be at the cutting edge of enabling technologies like AI, as well. The Israel-based company, whose founder helped launch three-time Finovate Best of Show winner, demoed’s AI-powered client interaction solution that provides human-like conversation and engagement. Mahalo Banking, headquartered in Michigan and also winning Best of Show in its Finovate debut last week, demonstrated fintech’s commitment to diversity and inclusivity. The company leverages innovative technology to deliver online and mobile banking solutions for credit unions that help them serve neurodiverse customers with visual, cognitive, and other challenges.

And the return of Debbie to the Best of Show winner’s circle is a reminder that solutions that respond to the basics of financial wellness – saving and reducing debt – remain critical components of the fintech ecosystem. Having won Best of Show in its Finovate debut last fall, Debbie was back with new tools to help users manage debt, including a credit card refinancing marketplace for credit unions.

Where we go from here

There were a few dogs that did not bark – at least not as loudly as they once did. Cryptocurrency and digital assets, for example, did not draw as much attention this year as they have in previous years. We’ve seen more from mortgagetech, as well. It is hard not to wonder what the impact of higher interest rates will have on this industry and other consumer-facing, interest-rate sensitive sectors and services from lending to Buy Now Pay Later.

Therein lies the opportunity. The problems may seem more intractable and the solutions not as sexy as they used to be. But the eagerness of founders and financial institutions to embrace both new technologies like digitization, automation, and AI – as well as new causes like financial inclusion and sustainability – is a strong sign for the future of our industry.

The post FinovateFall 2023: AI, the Fintechification of Everything, and Why Boring is the New Black appeared first on Finovate.

4 AI-driven startups to watch from Finovate Fall 2023

Fintech startups are increasingly leveraging AI to make operations and offerings more efficient for financial institutions. At Finovate Fall 2023 in New York this week, fintechs hit the stage to demonstrate the latest in AI innovation — AI is serving a wide variety of use cases.  Of the more than 70 that demonstrated their technology […]

3 global banks identify AI use cases

Barclays, Citi and HSBC are all exploring AI, and representatives of the three banks are sharing how to identify where to invest in the tech. When should banks start implementing AI?   “Yesterday,” was the response by EJ Achtner, global head of AI for commercial banking at HSBC, at last week’s “Global ideas for better […]

UBS cuts about a dozen US bankers as part of its Credit Suisse integration

UBS Group AG this week eliminated about a dozen jobs in its US investment bank as part of its integration of Credit Suisse, according to people with knowledge of the matter. Jeff Rose, UBS’s global co-head of consumer products and retail, and Patrick Dixon, a managing director, were among employees impacted, people with knowledge of […]

AI to boost FI developer productivity

Financial institutions are looking to AI to enhance developer productivity and get products to market quickly.  “Developer productivity is a huge use case [for AI] that is amazing,” Prag Sharma, global head of AI at Citi, said Thursday during the webinar “Global ideas for better banking AI,” presented by Bank Automation News.   Throughout the […]

AI presents opportunity for unstructured data, bank execs say

Financial institutions collect vast amounts of structured and unstructured data on a daily basis, and AI is presenting more efficient ways to utilize that data — opening analysis and innovation potential for the industry.  Roughly 80% of the data Citigroup sees is unstructured — from emails, contracts and regulatory documents — and that data can […]

TD Bank explores AI for cross-selling

TD Bank’s commercial banking arm is looking to AI to understand and predict customer needs to sell targeted products, Chris Giamo, executive vice president and head of commercial banking, told Bank Automation News at Finovate Fall 2023.  “Banks inherently have a tremendous amount of data. … We’re spending a lot of time on data and […]

Transactions: NatWest modernizes payments with Icon Payments Framework

NatWest has selected fintech Icon Payments Framework to modernize its payments capabilities.   Icon Payments Framework (IPF) is a low-code, cloud-native platform that allows financial institutions to enhance their payments technology, according to the fintech’s website.  “The low-code element of the framework empowers our business community to continuously review and enhance our payment flows in […]

Citizens to debut digital assistant on mobile app next quarter

NEW YORK — Citizens Bank will launch a virtual assistant, Digital Butler, on its commercial banking app in the next quarter, Jo Wyper, executive vice president of commercial digital operations at Citizens Bank, told Bank Automation News at Finovate Fall 2023.  The $222 billion bank’s Digital Butler launched in February but was only available on […]

Banks look to tech as they slash jobs

Barclays, CitiGroup, Truist Financial and Santander announced layoffs this week as they look to cut costs and gain efficiencies.  Truist is making “sizable reductions” to its workforce in the coming months to save $300 million in costs, the bank announced at the Barclays Financial Services Conference Monday.  As the bank cuts personnel, it is also […]

Congrats to the 2023 Finovate Awards Winners!

The financial technology landscape is ever-evolving, with innovation and creativity driving the industry forward. It’s in this dynamic environment that the Finovate Awards stand as a testament to excellence. We are thrilled to present this year’s Finovate Award winners.

The Finovate Awards honor both established institutions and rising stars that have made significant strides in delivering cutting-edge products and services to the financial sector. From breakthrough banking platforms to revolutionary AI-powered solutions, these winners have not only adapted to the demands of the modern financial world but have also set new standards for innovation and customer-centricity. Each winner was selected from the a group of finalists that demonstrated exceptional contributions to society and developed groundbreaking solutions that have reshaped the fintech landscape.

Without further ado, let’s celebrate the visionaries and innovators who have earned their place in the spotlight as this year’s Finovate Award winners.

Best Alternative Investments Solution CAIS
Best Back-Office/Core Services Solution Arteria AI
Best BNPL Solution Yabx
Best Consumer Lending Solution Lending Point
Best Customer Experience Solution Hometap
Best Digital Bank SoFi
Best Embedded Finance Solution QuickFi
Best Enterprise Payments Solution EBizCharge
Best Financial Mobile App ANNA
Best Fintech Accelerator/Incubator Mastercard Start Path
Best Fintech Partnership US Bank and Submittable
Best ID Management Solution 1Kosmos
Best Insurtech Solution Bolt
Best Mobile Payments Solution Zenus Bank
Best RegTech Solution SentiLink
Best SMB/SME Solution Mercury
Best Use of Robotic Process Automation KYC Agent by JP Morgan
Best Wealth Management Solution Atlas Point Edge
Excellence in Decentralized Finance Amberdata
Excellence in Financial Inclusion Tricolor
Excellence in Sustainability ImpactGINI by GreenArc
Executive of the Year Mike Massaro, Flywire
Innovator of the Year Rochelle Nawrocki-Gorey, SpringFour
Top Emerging Fintech Company Union Credit

Photo by cottonbro studio

The post Congrats to the 2023 Finovate Awards Winners! appeared first on Finovate.

4 ways tech expected to enhance cross-border payments

The cross-border payments industry is expected to hit $250 trillion by 2027, up from $150 trillion a decade before in 2017, as adoption grows and technology, including real-time payments, AI and new payment rails, evolves.  “Clients, more and more, are demanding efficient ways of receiving and sending money,” Linda Kugblenu, vice president and product solutions […]