ALL THE SMARTS THE BIG BRAINS SOLVING MOBILITY, ID AND PAYMENTS TOGETHER IDENTITY
HACKED OFF HOW AML IS MISSING THE SCAMMERS FLEECING TRILLIONS FINCRIME
SECRET AGENTS WHY SME s WILL ♥ TRADE LEDGER’S BEHIND-THE-SCENES ‘BANKERS’ ARTIFICIAL INTELLIGENCE
Securing payments in APAC: G+D on fighting fraud and enabling frictionless customer journeys
Unlocking secure payments in APAC
Have one-time passwords had their day in this dynamic digital region? Christopher von Mitschke-Collande and Hanspeter Jsler from G+D explore the era of the passkey
A deceptively simple solution
ING’s Marnix van Stiphout discusses how the bank’s approach to building a global workforce is protecting it from skills shortages and making ING a front-runner in adopting AI/genAI
12 SOFTWARE DEVELOPMENT Right on the money
Reliable automated compliance is a Holy Grail for small fintechs. But what that usually means is huge staff resource or expensive systems the organisation can’t afford. The founders of Flagright felt their pain… and came up with a solution
15 CHATBOTS iConsumer
ABN Amro styles itself as ‘a personal bank in the digital age’. It’s a great strategy when your customers are human, but that might not always be the case! Chief Digital Officer Jorissa Neutelings tells us how AI is shaping CX now and in the future
Intelligent lending
SMEs need banks to take centre stage in the high-volume, bilateral loan market – but that’s challenging on so many levels. Robert Downs explains how Finastra’s Loan IQ Simplified Servicing solution can help
Everywhere you go
bunq set out to build a bank that travelled across borders – just like its users. Bianca Zwart tells us why staying close to them has made it not only popular, but also profitable
The 5 challenges facing PSPs – and how to solve them
Aevi, a payments orchestrator that specialises in in-store payments, is helping PSPs and their merchants bridge the cross-channel divide, as Sarah Koch explains
Reinventing the rules
Revolut was born a rebel but now that the UK is shaking up financial regulation, the neo is making its voice heard
The engine room of growth for any economy is its SMEs.
The Singapore government recognised that in its 2025 Budget. With generous measures to help manage business costs and massive financial incentives for small companies to adopt digital solutions, specifically AI, as well as upskill their workforce, there was a lot of love shown for the ‘little guys’.
Elsewhere in the world, they haven’t always felt so supported, particularly by legacy banks, despite SMEs representing around 99 per cent of all firms (according to the OECD), and generating 50 to 60 per cent of value added, on average.
That seems a huge wasted investment opportunity – and a lot of frustrated companies that will never achieve their full potential.
There appear to be two reasons for the funding gap: mainstream banks’ limited risk appetite and SMEs’ struggle to provide reliable data that can help banks assess that risk more accurately.
AI can help address both and, in this issue, we explore how, with Martin McCann and his agentic bankers at Trade Ledger (p29) and Robert Downs, who tells us how Finastra is unlocking more bilateral loans (p18).
There’s a whole new dimension of financial reporting, of course, that’s become increasingly important for investors and banks – the carbon ledger. But it’s been beset by operational challenges, questions over the real value of the data, and lack of a framework that promotes trust and consistency. On page 35 we look at how that might be changing in the UK. Sue Scott, Editor
Private banking for all
The super-rich have access to personal bankers and elite services that help them manage their wealth. Data can unlock the same level of privilege for everyone and deliver it profitably, as Discovery Bank is demonstrating
Agents of change
Demand for trade and working capital credit by SMEs continues to significantly outstrip supply from banks. Trade Ledger’s Martin McCann believes open finance can fix that gap, but agentic AI will fix it faster
Changing horizons
No one expects regulation to stand still, but it’s never been as fluid as it is today. Which is why Focusync aims to ensure the UK’s FIs are as prepared and flexible as they can be… which brings many other benefits, says its Chief Growth Officer
35
The silent witness
Transaction data betrays the environmental cost of doing business. Earthchain turns it into a strategic advantage
Business without borders
Asia-Pacific is a hot spot for global trade, but the proliferation of alternative and domestic payment methods means it’s a challenge for foreign merchants to penetrate. Wang Hu from PayerMax and Standard Chartered’s Luke Boland explain how their partnership is smoothing the way
38 ARTIFICIAL
Pressing all the right buttons
BNP Paribas is leveraging technology at every level to redefine the role of a European bank. But what will benefit ordinary account holders and merchants most is genuinely helpful AI, says Waleran Guinard
Paying in perfect harmony
Thomas Gillan from BR–DGE explains how orchestration focussed on optimisation benefits everyone in the payment chain
42
The app-to-productivity conundrum
An explosion of apps in the back office could be jeopardising the very thing they were designed to improve. ‘Swivel chair integration’ fatigue is real, says Pendo’s Trisha Price
Super-fast forward
Most FIs have done digital transformation once, but technology doesn’t stand still – and upgrades can create their own roadblocks. Newgen’s transformation platform aims to keep the information highway flowing
The lost trillions
Small-scale fraud adds up to a big global problem that needs urgent and co-ordinated action, argue Taavi Tamkivi and Jessica Cath
51
Fertile ground
British neobank OakNorth has definitively planted itself in American soil with the acquisition of a community bank. So what will businesses there make of it?
Check it out!
Rory O’Neill, Chief Marketing Officer at checkout.com, one of the world’s biggest payment platforms, has some key words of advice for merchants
The digital me
Building
Are Nordic institutions being overly cautious about genAI adoption or just waiting for the right moment to land a punch?
A new global leader has emerged in consulting and testing for payments, smart mobility and ID solutions. Fime’s Lionel Grosclaude and Raphael Guilley of Consult Hyperion, now part of the Fime group, look to the future
Have one-time passwords had their day in this digitally dybnamic region? Christopher von Mitschke-Collande and Hanspeter Jsler from G+D explore the era of the passkey
There’s a scamdemic in Asia Pacific. Payment fraud is up. Identity theft is rife.
You could interpret that as an unfortunate symptom of digital success. Sixty-four per cent of global online retail spending happens in APAC. It’s the world leader in wallet adoption. But for security technology provider Giesecke+Devrient (G+D), it’s a reason for everyone in the payment ecosystem to double down on protecting the integrity of digital payments and staying one step ahead of cyber criminals through education, collaboration and innovation.
The stats around regional fraud make for uncomfortable reading. According to a report released at the end of 2024 by the GSMA – an umbrella organisation for mobile services operators – more than a quarter of adults across Indonesia, Malaysia, the Philippines, Singapore and Thailand have been victims of financial crimes, such as online hacking and identity theft. In Singapore, the country where digital
Christopher von MitschkeCollande, Director, Digital Solution Sales, APAC at G+D
Hanspeter Jsler, Managing Director in Singapore for G+D
commerce is most prevalent, some 42 per cent of respondents said they have been a victim of financial fraud.
The report, entitled Consumer Attitudes Toward Fraud And OpportunitiesForMobileNetwork OperatorsInSoutheastAsia, also reveals that consumers ultimately hold banks and fintech firms responsible for safeguarding them against financial crimes, with an overwhelming number saying they would change their provider to one that offered them more security.
In fact, says Christopher von Mitschke-Collande, Director for Digital Solution Sales for APAC at G+D, preventing financial fraud is a joint effort, involving lots of players, including the consumer.
“No single entity can address these types of issues alone,” he says. “There are a variety of different stakeholders that need to collaborate – business, government, technology providers and industry networks such as EMV and the FIDO Alliance.”
For its part, G+D is working on
multiple fronts and with multiple parties to tighten security without compromising the friction-free payment experience that customers expect.
That’s sometimes a difficult path to tread, especially when legislative frameworks mandate that certain protocols must be followed.
“There’s a lot of variation between countries in the APAC region,” says Hanspeter Jsler, MD at G+D in Singapore, where he’s responsible for business development in South East Asia. “Take India and Singapore and compare them to Australia, for example. Legislators in the first two countries have stipulated that every single transaction must be authenticated and then checked for its authenticity.
“So, even if a transaction is five cents, it can’t go through without authentication. That’s done using a one-time password in India and using out-of-band (sending a message via a banking app) in Singapore.
“In Australia, however, authentication is only mandatory under
certain conditions – large payment amounts, for example, require strong customer authentication (SCA), which usually involves 3-D Secure (3DS).
“Not only is authentication mandatory in some countries, but various additional rules apply. It comes down to the risk appetite of countries and cultures. APAC’s diversity demands tailored fraud prevention strategies, not a one-size-fits-all approach.”
Banks and merchants also have to decide their own tolerance, constantly making the cost/benefit comparison between chargebacks, fees, fines and investigations, and the time and investment needed in multiple layers of authentication.
“There is no magic wand to create the perfect balance between fraud and friction,” says Jsler. “Every market participant, be it a bank, merchant or payment service provider, has its own risk appetite against which its fraud prevention measures need to be calibrated. Some markets are very liberal. They accept maybe 20-30 per cent of payments being fraudulent. Another might be five per cent.” Artificial intelligence is becoming an increasingly important tool in this regard, says von Mitschke-Collande.
“These systems correlate various attributes – your email address or phone number, where the merchant is located, which currency you wish to pay in, your country of residence, for instance – to produce a transaction risk score. We can also use AI to monitor transactions to find patterns in real time.
“What does that mean? Say our payment is only $10 and the risk is very low, in many countries it’s not challenged by a one-time password or passkey. That’s how we reach 90 per cent frictionless payments in some markets. It doesn’t mean there’s no authentication; it means the authentication is risk-based.”
G+D has seen rising incidents of account takeover, payment fraud, friendly fraud, chargeback fraud and – the one that’s risen most sharply in APAC – identity fraud, where imposters use stolen or synthetic identities to create accounts. That’s despite many governments (Singapore, India, Malaysia and Cambodia among them) introducing
Asia’s diversity demands tailored fraud prevention strategies, not a one-size-fits-all approach Hanspeter Jsler digital citizens’ ID.
While there are many explanations for these increases – social and technical – some in the industry point to the growing presence of co-ordinated fraud rings in APAC that are vastly outpacing those in other regions, such as the Americas and Europe.
Whoever is ultimately behind APAC’s scamdemic, the impact on business is severe. According to LexisNexis, nearly 3.3 per cent of total annual e-commerce revenue was estimated to have been lost to payment fraud – effectively wiping out the estimated 3.4 per cent annual growth of e-commerce across the region in 2023/24. And it leaves consumers fearful and mistrustful.
But the problem is, too many authentication checks in the checkout process can present a barrier to sales – 75 per cent of respondents to the 2023 LexisNexis True Cost Of Fraud In APAC study noticed a decline in conversion rates after they’d introduced them.
So, what’s the most effective anti-fraud tool in the tool kit? It’s not one, but several, says von Mitschke-Collande: “It’s not a one-off task, it’s an ongoing process, and it’s a multilayered approach.”
In this dynamic environment, even widely adopted fraud prevention tools reach their sell-buy date quickly as cybercriminals edge ahead in the technology arms race. Take the widely adopted one-time password (OTP), sent via SMS or email, which first appeared in the 2010s. Many banks still rely on this as an authentication method, but – like passwords themselves – it’s vulnerable.
“We’re already seeing the OTP being phased out,” says von Mitschke-Collande. “It’s not ideal for a variety of reasons. Mainly because SMS wasn’t a channel designed to send secure information. It can be intercepted and compromised – consumers can be tricked into reading out an SMS to a fraudster, for instance. And the user experience isn’t great, either, swivelling between apps to enter it.”
The future of authentication
The Monetary Authority of Singapore (MAS) sounded the death knell for OTPs in financial services there in 2024. It worked with major banks to quickly phase them out in favour of digital tokens or passkeys (although it hasn’t said definitively which a bank should be using).
“In some countries that have stepped away from OTPs, customers instead receive a message in their banking app [where they can approve or decline the transaction], which is already common in Europe” says Jsler. “But ‘out of band’ as we call it, is still seen as
introducing friction for the consumer by some market participants, particularly in South East Asia. Just giving a fingerprint or using your face for ID instead to confirm a transaction would be super secure but super easy.”
Both Jsler and von Mitschke-Collande see these biometric passkeys, based on standards set by the FIDO Alliance – an open industry association that promotes phishing-resistant sign-ins with passkeys – as being the future of authentication in APAC and elsewhere.
“The technology is based on public key cryptography and is designed to allow a consumer to sign in more securely without the traditional passwords,” explains von Mitschke-Collande. “Google is a big player in this field. When you’re asked to set up a passkey by Google, what’s happening in the back end is a public/private key pairing in conjunction with the device you’re using at
Out with the old: Biometrics will help replace traditional security sign-ins
for any number of services,” he says. “We’re seeing domestic card networks, be it eftpos in Australia or NETS in Singapore, NAPAS in Vietnam or ITMX in Thailand becoming more and more innovative in this area. And by increasing security, they are enabling financial inclusion at the same time.”
G+D remains an agnostic player, responding to the needs of the industry and adapting to ever-changing regulatory environments in multiple jurisdictions. Its pragmatic approach to bridging the distance between usability and safety is demonstrated in one of its latest releases, due this summer.
“Still 40 per cent of cardholders do not like the idea of storing their card details with a merchant," says Jsler. “It’s a surprisingly high number. But, for them, the guest checkout process comes with the disadvantage that they have to enter the card details every time.
We’re already seeing the OTP being phased out, mainly because SMS wasn’t designed to send secure information Christopher von Mitschke-Collande
the time. When you next authenticate yourself, the website or the app will send you a challenge and you will most likely use the device biometrics to unlock the private key on that device to create a response. It ensures that only the registered device can authenticate you.
“What you're doing is basically a two-factor authentication because two elements come into play here. You are using something that you own, in this case your device, and something that you are, your biometrics. So that satisfies those regulatory environments that require 2FA and it’s something clients are approaching us for.”
Jsler describes passwordless authentication as being ‘sea level’ for the industry, above which is the safety zone.
“Gone are the days of using passwords that you keep under the keyboard, or you’ve reused
“Our first version of a solution to tackle this used an OTP that allowed you to see all your cards [on your device] with the details masked out, so you could easily choose the card to pay without having to go through the entire process.
“This year, we will launch a programme using passkeys, which means you can have a click-to-pay or guest checkout just by using your face to bring up all the cards at your disposal. There’s no friction and you don’t enter any card details with the merchant.
“As digital commerce evolves across APAC, staying ahead of fraud will demand more than just technology. It will require a collective commitment to education, cross-sector collaboration, and innovation. G+D’s work here reflects that: combining global expertise with local insights to build a safer, more inclusive and seamless payment experience for all.”
ING’s Marnix van Stiphout discusses how the bank’s approach to building a global workforce is protecting it from skills shortages and making it a front-runner in adopting AI/genAI
According to recent statistics from the Bank of England, 75 per cent of financial services firms in the UK are already using artificial intelligence (AI) and a further 10 per cent are planning to implement it over the next three years.
In conjunction with changing consumer habits and greater reliance on digital channels, AI will almost certainly transform multiple areas of the banking sector, from contact centres and marketing to streamlining processes in software engineering and accelerating data extraction in lending. It’s changing how banks work and indeed, who works for them.
But there’s a problem. The talent required for this new workforce isn’t necessarily there. The Bank of England found that insufficient talent or a perceived lack of skills is one of the main constraints on the adoption of AI and generative AI (genAI).
The issue isn’t just in financial services. The talent crunch is well-documented and across all industries. Seventy-five per cent
of all employers globally are finding it challenging to fill roles, according to research from Manpower Group. Overall, the two attributes that employers struggle to find the most are IT skills and collaboration/teamwork, it said.
But not ING. Long before the pandemic changed our attitudes to where and how we worked, it was feeling its way towards a different organisational structure and approach to recruitment, retention and technology development that is now paying dividends for the Dutch bank.
Like a lot of companies, ING saw that the skilled workforce it needed wasn’t necessarily where it needed them, while talented people – or people with the potential to be great at the work it needed them to do – often couldn’t find employment locally that matched their qualifications, skills and ambition.
So, ING went to them in countries where the company already had presence and was
doing business, and set up what are now called ING Hubs.
Their work collectively is focussed on areas such as software development, data management, non-financial risk and compliance, audit, and retail operations.
But it’s not so much what they do, as who does it and how that has made them such a crucial part of ING’s growth strategy.
“We are innovative, and less stuck in our ways, which also attracts people that have a slightly different attitude towards life and towards banking,” says ING’s Chief Operations officer, Marnix van Stiphout.
No matter their location, the individual Hubs’ purpose is to work to a single agenda, building shared processes and a shared technology stack for the entire organisation.
“We’ve realised that if you want to be successful in banking, sharing technology and processes is incredibly important,” explains van Stiphout. “In that spirit, we needed to see whether the teams in technology and operations, for example,
can sit together. In Manila, in the Philippines, you have technology colleagues, operations colleagues and analytics people.”
ING Hubs Philippines, which expanded its workforce by around a third in 2024, now has nearly 6,000 people working for it. The bank clearly doesn’t seem to have a problem recruiting the people it needs to create the bank it wants, nor in developing the soft skills required to work in such a collaborative environment.
“You can work on all kinds of things,” says van Stiphout. “Take, for example, the way we are developing transaction monitoring, which
“The crux of this whole AI/genAI conversation is mobilisation, implementation, and sticking with what you said you wanted to do, rather than jumping from one thing to the other,” he says.
“You know, banks have been very slow to clean up their huge number of applications, solutions, infrastructures.
so whether I’m in Australia, the Netherlands or Germany, or wherever, I have access to all the customer interaction data coming through those contact centres.
“That allows me to develop new tools that go across the world. That opportunity benefit is there because of the scale that we’ve created with this approach.”
He’s not saying it’s all been plain sailing or that legacy shift is easy.
“A potential pitfall when you are going from where you were to where you need to go to, is that there are a lot of dependencies. If people do their own thing across 10 different units, plan within their own environment,
is part of KYC. The core comes out of Poland, but it is for everybody to use. So their work has an international flavour with early responsibility and early impact, which is liked by people who come to work with us.”
The Hubs’ collective, single-minded vision is particularly relevant to the bank’s adoption of AI and genAI, which is focussed on applying the technology in just five very specific areas of the business: KYC, contact centres, coding, hyper-personalisation and lending.
“We want to be very strict and create maximum impact for these five big use cases,” says van Stiphout. “The Hubs are very much part of the ecosystem that we’re creating of talent and focus.”
He’s convinced that the way for the bank to achieve maximum impact and get the best value from its investment in technology is to team up and follow through.
There’s a lot of legacy in banking, full stop, and the people who have been more focussed on it, I think, are reaping the benefits today. I like to believe we are part of that front-running set.”
There is a huge amount of benefit from becoming less complex
He points, for instance, to the success ING has had in developing a single technology for all of its contact centres, retail and wholesale, across every country in which it operates.
“Now we all have the same technology, the next step is to see if we can get the same data repository,
things are quite easy. If you now need to coordinate to go to a single technology or share technologies and processes across those 10 units, life becomes, planning-wise, more difficult.”
But the prize is definitely worth it.
“There are fewer applications and there are more people who can support these applications, because we all use the same, so there is a huge a mount of benefit to be had from becoming less complex.”
Big organisations the world over that are driven by technology are struggling with two key issues: how to attract and retain IT talent to make the most of AI/genAI, and how, if they do attract them, can they structure their teams so they have a lean approach to development that isn’t siloed, but collaborative.
If anyone’s looking for an answer to those fundamental questions, it’s worth asking ING.
Marnix van Stiphout, member of the Management Board Banking & Chief Operations Officer at ING Bank
Reliable automated compliance is a Holy Grail for small fintechs. But what that usually means is huge staff resource or expensive systems the organisation can’t afford. The founders of Flagright felt their pain… and came up with a solution
When Baran Ozkan built his AML compliance software, he knew exactly what he didn’t want.
Responsible for compliance and fraud prevention in a previous job with a new fintech in Lithuania, Ozkan spent 15 months hunting for a real-time solution for the business. But despite big promises from salespeople, the software he encountered was either too expensive or functionally weak, with poor tools, baffling user interfaces and immature APIs.
Ozkan concluded the existing providers had no interest in the needs of a startup. He’d identified an opportunity and Flagright was born.
Together with co-founder Madhu G Nadig, he developed an ‘AI-native’ AML compliance solution run via a no-code console, which has developed into the AI Forensics product we see today. By giving AI more control of monitoring processes than its rivals,
Baran Ozkan, Co-founder and CEO at Flagright
the tool delivers reports in seconds, not hours, days or even weeks, says Ozkan. And more than that, it has been designed to ‘delight’ the back-office compliance staff who will work with it, week in, week out.
“No one cares about back-office staff. Imagine it, 9am to 6pm each day, clicking buttons,” he says. “Our plan was to make an impact on those lives, while delivering great value to their organisations by cutting the massive cost of AML compliance.
“We wanted to provide AML staff with a pleasant journey. There’s a Walt Disney quote that people can ‘feel perfection’. The best feedback we’ve received is people telling us it’s by far the most intuitive platform they’ve seen.”
An ‘AI-native’ solution
The Flagright story took off when Ozkan and Nadig won a place in a 2022 round of the Y Combinator startup
programme, which provided them with both funding and expert advice.
From there, the company’s offer for smaller businesses and startups was honed – an all-in-one solution to manage financial crime risk and meet AML compliance with a usage-based pricing scheme that meant fintechs could afford banking-level AML compliance protection.
Flagright’s platform has proprietary features for transaction monitoring, case management, risk scoring and AML screening, as well as others provided by partners via an API, such as sanctions screening, ID verification and blockchain analytics.
Due to the modular design, components integrate with each other to provide the ‘all-in-one’ solution that Ozkan anticipated future customers would demand.
The key point of difference – the ‘AI native’ aspect – means a machine does
Ozkan says: “With our AI Forensics product, it’s essentially a set of AI agents that are tailor-made to handle very specific things. Banks may have machine learning detection but a human investigates and they still spend 30 minutes per alert – and there could be millions of alerts per month.
headquarters in London, and its New York operation is currently being expanded.
But despite already having customers across six continents, Ozkan says work is needed to boost Flagright’s brand awareness – and some of the money provided by a $4.3million funding round in January 2025 will be used to do that.
more of the work and humans are upskilled to provide an oversight function, rather than working alongside it, as is more commonly the case currently.
For AML, that means AI drills deep to detect suspicious activity such as behaviour changes, and every individual or organisation being monitored has their own alert parameters.
Low-risk users have a higher anomaly threshold than higher-risk users – and overall, Flagright claims a 93 per cent reduction in false positives, thereby slashing staff workload.
Another example of the system’s automation is a ChatGPT-powered system that monitors a fintech’s merchants across public sources and social media channels to identify changes that could indicate wrongdoing.
On the front end, the AI Forensics platform is code-free, so staff simply enter their instructions and queries in their own spoken language. And its AI Narrative Writer fulfils communication tasks for workers, such as report writing, and captures their particular writing style – further slashing task time and therefore cost.
Another efficiency Flagright can boast is the speed at which its platform can be installed by a customer – typically between one and two weeks, which compares to an industry benchmark of two to four months.
“When we say AI native, we want most of these operations done by AI, and LLMs [large language models] are very powerful in terms of helping with that end vision. Compliance is one of the biggest costs for a financial institution, and LLMs are almost a tailor-made tool to bring that cost down because there’s just so much automation potential you can enable.”
When AI Forensics triggers an alert, it allows users to manually drill down into its data or use an autopilot feature that collates relevant information to present an investigation. That investigation typically pulls up the individual’s details, their history of alerts, historical transaction risk scores, transaction data, any suspicious activity reports filed on the individual, and creates pivot tables to identify who the individual has transacted with.
On identification of these third parties, it automatically scrapes their websites to reveal what they say about themselves, and checks for deviations such as a business industry change.
Once collated, AI Forensics suggests further steps that should be taken – and can then write a report. Ozkan says: “The tool doesn’t just look intuitive, it is intuitive.
The investment, led by Frontline Ventures with participation from Y Combinator, Pioneer Fund, Moonfire Ventures and others, followed a $2.8million seed fundraising round in July 2022.
Ozkan says: “Y Combinator was our biggest milestone. We developed the business idea and met a great network, which provided us with support. From then, we’ve worked to earn the trust of our audience globally. To do that, we’ve targeted security certifications such as ISO and SOC 2, and we’ve doubled down on the future, which is generative AI-led tooling.
“Paul Graham, a co-founder of Y Combinator has a phrase I like, he says ‘in order to receive an investment, just be investable’. We’ve tripled revenue year on year – I guess the reason we’ve received the latest funding is because we are a very good business.”
Ozkan argues the days of batch processing and delayed risk assessments are fast coming to an end and real-time compliance features will become the norm. While AI is already reducing false positives, over the coming decade he believes the technology will fully automate risk assessments, flagging only the highest-risk cases for review by a human. And that’s important on so many levels.
The Nasdaq global fraud report for 2023 estimated $3.1trillion of illicit funds flowed
Compliance is one of the biggest costs for a financial institution, and LLMs are almost a tailor-made tool to bring that cost down
“When you click, all of those journeys are very thought through. Tasks can be achieved easily and quickly. For example, for the majority of our competitors, they will take one to two weeks to generate a report. For us it takes 30 seconds.
“The underlying infrastructure and computing power is drastically different. Obviously, our aim is to isolate that complexity for customers so they are not confused by it – we render data in a way that makes it easy to understand.”
From Flagright’s inception in 2022, the business moved fast. In April 2023, it opened an office in the US and the following month a sales operation was launched in Singapore. More recently, the business opened an EMEA
through the financial system that year, with an estimated $347billion linked to human trafficking and $783billion to drug trafficking. Two years ago, Flagright agreed a partnership with the US-based Anti-Human Trafficking Intelligence Initiative, ATII, which involves data sharing between the two organisations. It was a sign of Flagright’s stature and global intent.
Ozkan says: “We will use the latest funds to double down on our broader market and in our core markets, which are North America, Europe, the UK and the Asia-Pacific region.
“We are building teams in all the regions because we’re so new that people still haven’t heard about us. We will invest in brand awareness so people know what the most important tool in the market is.”
ABN Amro styles itself as ‘a personal bank in the digital age’. It’s a great strategy when your customers are human, but that might not always be the case! Chief Digital Officer Jorissa Neutelings tells us how AI is shaping CX now and in the future
‘What if your customer is a robot?’ sounds like an existential question, right up there with ‘do androids dream of electric sheep?’.
But it’s one that financial institutions and payment services providers might well have to devote more time and resource to answering.
A traditional Google search for guidance reveals very little. Aside from
a few philosophical debates, the number of articles addressing the practicalities of dealing with robot personal assistants in many, if not all of consumer’s future interactions, is practically zero.
However, ask Google AI that very same question and it’s clearly got opinions. In short: “When dealing with a robot customer, focus on clear, concise communication, using precise language and avoiding ambiguity. Ensure the robot understands instructions and can execute tasks effectively, while also being mindful of its limitations… Avoid jargon, slang, or complex sentence structures that could confuse the robot. [And] Don't expect the robot to understand complex emotions or nuances in language.”
This robot has clearly thought about the way it wants its artificially intelligent cousins to be treated and how they want the customer experience to be built around them – perhaps informed by the 16.4 billion or so poorly prompted searches it has to deal with every day from illiterate humans.
Jorissa Neutelings, Chief Digital Officer at Dutch Bank ABN Amro
So, are we in the realm of science fiction, or aren’t we? Dutch bank ABN Amro is already considering this scenario when looking at the consumer landscape in the years ahead.
“What I already see in our ecosystem is that the customer will not always be a human but a bot, buying services and products for many customers,” says ABN Amro Chief Digital Officer, Jorissa Neutelings. “In the future, every one of us will have a personal assistant – or many – who does the business for us in a digital landscape.”
Does that mean that developers are already looking at robot-on-robot customer service – which is precisely the opposite to what they've been endeavouring to achieve with human-robot conversations?
As ‘a personal bank in the digital age’, ABN Amro is tackling that conundrum head-on, acknowledging the need to embrace the opportunities of technological advancements, while still understanding that customers (for as long as they remain human) feel a very real need for individual and personalised customer service.
Bot speak: Could you please rephrase the question?
Neutelings says that using the wealth of data available to the bank to personalise customer experience and improve the quality of interfaces, is how it’s countering user frustration.
“What you see is irritation grows with customers if the service or the product is not especially meant for them as individuals. So hyper-personalisation, really using all the data we have, is really important. We have to ask ourselves, what do we know? What do we want to cater for? What kind of approach does that specific customer want?” says Neutelings.
“A customer used to be just a bank account number. We didn’t necessarily know a lot about them. Today, we have more and more data that we can use to create one digital identity for
commercial clients across 15 countries, has used chatbots for both consumers and its employees for some time. In 2024 it migrated these onto the Microsoft Copilot Studio platform to better utilise AI capabilities.
Today, the ‘Abby’ chatbot, provides assistance to the bank’s employees in areas such as IT support and facility services, whereas ‘Anna’ is the customer-facing chatbot operating across text and voice channels and supports more than two million text and 1.5 million voice conversations with customers every year.
It can cover a wide variety of topics, such as simple requests for a new PIN, unblocking or requesting a new debit card, changing a withdrawal limit or providing an account statement. But it can also answer questions on
non-human interfaces, notably if a customer is calling to tell the bank about the death of a family member. The nature of the experience is focussed on getting the job done efficiently and without emotional stress or frustration – a dispassionate chatbot in that case suits many customers just fine.
That may not be the case for some bereaved individuals who, in fact, appreciate condolences on the other end of the line, but it’s illustrative of the wider point that there is no one-size-fits-all approach.
As Neutelings says, it is the ‘blend’ of services on offer, and what the customer wants now, and in the future, that is important.
“What I see is that not many companies are really customer-driven,” she says. “A lot of
We like our tools, but tools alone will never create a great customer experience
a customer, so we can replicate the service they would have had at a branch where the head of that branch knew who they were, personally, and what kind of advice they needed.
“Next to that hyper-personalised approach, of course, genAI really helps us to proactively reach out on an individual level.”
It’s this combination, in fact, that’s improving the reputation of chatbots.
Often portrayed as one of modern life’s more frustrating advances, many of today’s ‘conversational interfaces’ are beginning to interact more like a human, whilst still delivering all the efficiencies that come with artificially intelligent technology. Many are even programmed with a deprecating sense of humour – financial advice app Cleo excels at bot-human banter and users love it.
Banking (mostly) on the bots
ABN Amro, which is the third-largest bank in The Netherlands and serves more than five million retail customers and 365,000
mortgages, insurance and loans. Crucially, Anna can identify a customer in just a few steps.
At the launch of Abby and Anna, Bobby van Groningen, IT Lead at ABN AMRO, said: “With the rapid introduction of generative AI, we anticipate that our customers are going to expect much more from a chatbot and we wanted to get ahead of that demand.”
“It’s all about how well the interface performs,” Neutelings explains. “If a customer has to pose a question twice, then the chatbot’s out and they will immediately want to speak to a person. On the other hand, if the interface is more human and they can talk to it like they talk to their best friends, ask questions and get a response, we see a lot of positive feedback.
“Anna understands you and knows exactly how you feel from your voice – if you’re angry, for example – and will respond empathetically. She also knows what you need because she has all the data at hand.”
In some circumstances, Neutelings says, the bank has even seen a clear preference for
companies make the mistake of only starting to be customer-driven once there's a problem financially or they receive a lot of complaints or things go wrong.
“Digital transformation is not solely about the digital,” she continues. “It's not about technique. Many companies try to digitalise without a great perspective and vision of what kind of customer experience they want to provide. For us, they go hand in hand.
“At our bank, we have a future view of the expected customer experience that we want to cater for. And we call that friction-free value, which really aligns everything we need to do.
“So, we choose very carefully, so that our digital transformation caters for a situation, the needs and the expectations of a customer, and not the other way around.
“We like our tools, but tools alone will never create a great customer experience.”
That’s something every user could agree with… unless, of course, you’re a robot!
SMEs need banks to take centre stage in the high-volume, bilateral loan market – but that’s challenging on so many levels. Finastra’s Robert Downs explains how Finastra’s Loan IQ
Simplified Servicing solution can help
When Robert Downs’ daughter reached the age of wanting to know what Daddy did for a living, he explained he worked for a bank that lent money to people.
“And what do they do?” she asked. He pointed to an advertisement on the street
Progress for millions of SMEs, though, SMEBANKING
for one of the bank’s clients. “Then I saw the signpost had a manufacturer’s name around it. ‘Actually, we’ve also lent money to the company that made the signpost!’, I said.”
Downs was a director at Credit Suisse at the time. Today, as Vice President and Global Head of Corporate and Syndicated Lending for financial services software provider Finastra, he oversees the syndicated and SME business lending operation, supporting hundreds of institutions worldwide with solutions that span the entire loan processing journey.
What the conversation with his daughter illustrated, he says, is that there would be no economic progress if it wasn’t for lending.
“Lending is one of the oldest businesses on the planet – starting from ‘can I borrow your spear to go hunting in return for some stones?’.
“Hospitals, big industry, tunnels, oil rigs, ships, everything is driven by corporations’ huge appetite for debt.”
is often painfully slow as major banks struggle to make lending to these individually small engines of the economy pay.
A government-sponsored survey into SME funding in the UK conducted by Oliver Wyman last year, found that major UK banks’ mortgage books were bigger than those for SME lending, largely because banks operate a business model that looks for more than 15 per cent return on equity (ROE), while SME lending ‘tends to be a low ROE product and hence dilutive to overall bank returns’.
As a result, the share of gross lending funnelled to larger businesses has risen. It made up nearly 80 per cent of UK banks’ loan books in 2024.
But that’s to ignore a potentially lucrative and indisputably large cohort of borrowers.
Recently published quarterly survey data from loan provider Iwoca has suggested that while ‘more than three-quarters (77 per cent) of SME finance brokers believe high street
banks are reducing their appetite to fund small businesses… almost nine in 10 brokers (86 per cent) thought demand for SME finance would rise over the next six months’.
The British Business Bank is concerned by the lack of available credit, and MPs on the influential Treasury Committee have reportedly accused banks and regulators of stymying growth by unfairly ‘debanking’ such businesses.
Challengers, on the other hand, have the appetite to lend to SMEs, but have limited funds to do so, which means major banks remain critical to provision.
In light of all this, the UK government has just published an open call for evidence on Small Business Access To Finance to inform its industrial strategy this summer. However, if it wants major banks to play a bigger role in driving growth, they need new solutions to help them serve the sector more simply and cost-effectively than they have been able to in the past.
Finastra’s response to the call for evidence would be: automation, automation, automation.
Its offering, called Loan IQ Simplified Servicing, built onto its existing platform Loan IQ, is specifically designed to make bilateral and SME loans more cost effective for banks and easier for businesses to access.
“The two general elements of business lending are the huge syndicated market, the mega loans with thousands of lenders, and the high-volume bilateral business, which enables SMEs to do what they need to do day-to-day. Many banks have a combination of portfolios, so are pulled in many directions,” says Downs.
“We've seen a trend from large banks to say ‘if it looks like a loan and smells like a loan, we'll put it onto Loan IQ‘ because that consolidation allows for consistency in operational processes – consistency in their downstream reporting, easier ways to comply with things like BCBS239 and data lineage rules where you have to prove where your data’s come from. If you can funnel all of that business, be it complex syndicated lending with all its nuances, down to high-volume bilateral lending with lines of credit,
sub-participations and collateral, onto one platform, one system, one set of pipes throughout your organisation, it becomes significantly easier to scale.
“We’ve focussed for a while on making sure our solutions are fully integrated, building a layer around our loan product that allows digital channels to communicate loans quickly and get them booked into operational systems,” says Downs.
“That’s now supported by our Simplified Servicing solution to improve technical performance and make sure the infrastructure scales, because the more volume banks have coming through, the lower the revenue per loan, so the amount of time they can afford to have somebody in their operations team touch each one is next to zero. They need to manage that flow by exception only, where things haven’t worked for whatever reason.
“That’s why everything we’re doing is about reducing clicks, reducing touch points, increasing automation, including automated enrichment of data coming in. Even if a bank has 10,000 loans arriving via its front
Many in the higher-volume space are struggling to stay relevant, compared to new, smaller technology providers
office, they need to be enriched with certain data to feed the back office machine to satisfy regulatory reporting and compliance.
“Simplified Servicing makes scaling up to achieve the economies you need for bilateral lending significantly easier,” adds Downs.
For those providers that can embrace it, the market opportunity in this type of high-volume credit could be considerable.
According to the Federal Reserve Banks’ Small Business Credit Survey, 43 per cent of small businesses in the US applied for loans in the past year, while a report by the Office for National Statistics in the UK suggests 48 per cent of small businesses there
are looking to lenders to help fund their expansion in 2025.
Downs is aware that many banks who do participate in this space are ‘struggling to stay relevant’, compared to new, smaller technology providers.
“That’s because the SME market has become increasingly digital, with different expectations from the generation that’s now coming through the workforce, people who have grown up with a digital-first experience from internet banking.
“Whereas banks’ processes for releasing funds might take weeks or a month, with some newer providers, businesses can go on their website and get the money instantly, if it’s below a certain loan cap. So, banks need to digitise their channel and credit decisioning, maybe supported by AI, to increase their front-office inflow pipeline. This then creates a natural need to widen the pipe all the way through into back office and servicing. That’s where we are focussed.”
And while Loan IQ Simplified Servicing enables growth and propositional expansion at the SME end of the lending market, says Downs, the solution can also help providers move in the other direction.
“We see a lot of smaller banks in high-volume bilateral lending who want to move into more complex lending, to derisk and grow market share,” says Downs. “Having a system designed for complex lending [as Loan IQ was], that can also do high-volume bilateral lending, is a good growth opportunity for them.
“For example, we have a US bank which was sitting below the US regulatory threshold turning point for assets, beyond which requires reporting changes. This client strategically decided to smash through that barrier and has now consolidated its highvolume lending business, alongside its wealth management business and a move into more complex syndicated lending – and all on Loan IQ.
“As a result, it has doubled-to-tripled its assets under management, showing how banks can grow beyond business constraints by leveraging a platform that opens them up for the future.”
That’s a big improvement on spears and stones!
bunq set out to build a bank that travelled across borders – just like its users. Bianca Zwart tells us why staying close to them has made it not only popular, but also profitable
Uber drivers are famously never shy of offering an opinion. Who won’t make it to the end of Big Brother. Where to get the best balti in Birmingham. Why Brighton won’t win the FA Cup.
They’re fun, fleeting, usually forgettable conversations. But when one driver started complaining about banks’ customer service on a ride through Dublin, his fare sat up and listened closely.
The passenger in the back was Bianca Zwart, Chief Strategy Officer for bunq – one of the most successful neobanks in Europe.
“The driver was talking about how no bank really gave him what he needed,” she says. “So I started telling him about bunq. I wasn't looking for market research, but at the end of the drive, we downloaded bunq and started using it. And he actually gave me very interesting insights, things I hadn’t thought about. That conversation led to product fixes that are alive today.
“It proves that great ideas don't come from boardrooms. They come from real moments with real users, people on the street. Moments like that are vital for us.”
It’s apt that an improvement to the bunq mobile banking app should come from an encounter whilst travelling, as the bank itself is the product of and for a new generation of worker-travellers. They go by many names – digital nomads, global nomads, remote workers, telecommuters – but they share the same lifestyle. They are no longer confined by the traditional employment norms, conducting their working lives remotely, and moving internationally.
According to Statista, more than 35 million people considered themselves to be in the digital nomad employment category in 2022. A report by the WYSE Travel Confederation
said it expected the global number of digital nomads to rise to about 60 million by 2030. Notably, roughly half of them are millennials (28-43 years old).
This increase, fuelled by technology, the desire for a better work-life balance, and cost-effective living, made possible by a more flexible global business community, stimulated the need for a banking alternative to that offered by incumbents.
Into that vacuum stepped bunq. Founded in 2012 in the Netherlands and headquartered in Amsterdam, it became the first neobank in Europe to turn an annual profit in 2023. Like others, it pursued a fast-growth strategy, but not at any cost.
“That gets straight to the core of what makes us different,” says Zwart. “We wanted to focus on profitability first because of a very simple conviction we had. We thought if we can build a product that people truly love to use, they’ll be willing to pay a couple of euros or pounds for it, right?
“If we cannot get that right, what are we trying to do in the first place? So we wanted to not only build a user-centric product, but also build a user-centric business model in the process.”
Our users are not dashboards. They’re not numbers. They’re real people with real feelings, real needs. And we focus on building products that they want
Today, the bank serves 14.5 million users across 27 (soon to be 29) countries.
“We’re profitable now, which is not only very exciting, but it also sets us up for the long term, because we now have a proven model that only allows us to be successful if our users are happy. That keeps us focussed on the right things.”
Those ‘right things’ remain in sharp relief because as, Zwart, acknowledges, ‘user expectations in banking have evolved faster
than ever’. With that in mind, its app provides a whole host of tailor-made features for today’s less-tethered customer, such as the ability to open an account in just five minutes, the provision of local IBANS, currency conversion, and a facility to create up to 25 sub-accounts instantly for travel savings, freelance income, or everyday expenses.
There are a few bangs and whistles, too. bunq’s app also allows users to review and share experiences that they’ve paid for on their card, such as a cheap eatery or a welcoming café in which to work.
Users, or ‘bunqers’, can easily sort their incoming payments into budgeting pots and effortlessly save, with the app automatically rounding up each payment and depositing spare change into a savings account. They can also see where their friends and other bunqers are spending their time and what stocks and ETFs they’re investing in. Meanwhile, bunq Elite users get a tree planted for every €100 they spend, through a partnership with veritree.
Add into the mix, personalised budgeting insights, the ability to upload invoices and an eSIM feature for frequent travellers, offering internet access in more than 160 countries and savings of up to 90 per cent on roaming costs, and the bank is a one-stop shop for nomads.
Zwart says that communicating with bunq users (existing and potential – such as that Dublin taxi driver) and acting quickly on their feedback, is very much part of the secret sauce in bunq’s success. The word ‘focus’ is a constant refrain.
“For us, staying ahead means staying focussed,” says Zwart. “It’s a super-crowded market, a lot of players doing lots of things, so it’s very easy to get distracted.
“Everyone at bunq, in whatever role they’re in, speaks to users at least a couple of times a week through a ticket or through an interview, because our users are not dashboards. They’re not numbers. They’re real people with real feelings, real needs. And we focus on building products that they want.
“A great example of that is bunq Stocks, which we recently launched. We didn’t wake up one day thinking, ‘we need an investment product’. We heard from our users that they
The report finds that individuals from the Netherlands are the happiest, but four in 10 French and Spanish nomads say they struggle with their mental health. That’s also true for a third of the Germans it spoke to. Zwart says that the people who work for bunq are motivated to tackle the issues highlighted in the report head-on and this is reflected in the services they offer. She explains: “We put everything into solving problems. It’s what works for the user, not the bank, that matters to us. If we do that, everything else will follow.
“It’s in our DNA to approach things this way round. Our people are ambitious, yes, but not for ambition’s sake. We want to make a positive impact on our users’ lives. If we are not providing a good service, Have laptop, will travel: bunq’s expansion into the US and UK reflects how the world of work is changing globally
there is no point in us being here.”
were struggling. They wanted to start investing, but they simply didn’t know how to. So, we built a product that made it so easy, anyone can do it.
“This all goes back to listening to people and providing what they want.”
Another key development at the end of 2024 was real-time speech-to-speech translation, as part of an upgrade to bunq’s AI assistant, Finn. Working across nearly 30 languages, this can now instantly translate the user’s speech, and the support assistant’s response in real time, negating the need for external translation apps.
At launch, Ali Niknam, founder and CEO said: “At bunq, we have always used technology to make life easy, and this update takes that to a new level. We’re excited to break down language barriers and simplify tedious tasks, making bunq more accessible (and fun) to users all over the world.”
The good, bad and the ugly Given her credentials as a practising nomad herself, splitting her life between the Netherlands and Italy, Zwart was the obvious person to
present bunq’s recent Global Living Report, a deep-dive into the benefits and challenges of the lifestyle.
Compiled from a survey among thousands of nomads, it provides insight into the motivations and, ultimately, the requirements of this growing demographic.
“There’s is more to the story than meets the eye,” says Zwart.
For example, the biggest thing nomads from the UK, Germany and the Netherlands miss is friends and family. But for the French, it is the local cuisine that they pine for most. For Spaniards, perhaps unsurprisingly, it is the weather.
The Brits and the Irish say they long for their local humour, while one in 10 Dutch misses cycling.
Most digital nomads across Western Europe still worry about work-life balance, especially in the UK and Ireland. In Spain and France, people also worry about their financial wealth, and, across the board, feelings of instability and language barriers are a constant source of stress.
Bianca Zwart, Chief Strategy Officer at bunq
This ‘user-centricity’ as Zwart calls it, is clearly paying dividends, so much so that in September of last year bunq announced that it was expanding its workforce by 70 per cent by the end of 2024, in readiness for a future expansion into the US and a re-entry into the UK. Its first foray into the US will be intriguing, as 42 per cent of Americans now hold passports, up from the meagre 10 per cent in the 80s, and, according to Statista, the number of digital nomads in the United States has continuously increased over the last five years, reaching 18.1 million as of mid-2024.
Equally fascinating, will be the return of bunq to the UK. The neobank previously operated in the country but pulled out in 2020, citing regulatory complications as a result of Brexit.
In that time, the landscape has changed somewhat, with 50 per cent of people now possessing a neobank account in some shape or form, although bunq’s biggest rivals there are comparative minnows – Starling, Revolut and Monzo boast a combined user count of 50 million-plus.
“Yes, we’re going global,” says Zwart. “We’re building a product for people who live an international lifestyle, so they need their bank to be international, too. But wherever we operate, our fundamentals will remain the same – our users come first.”
Aevi, a payments orchestrator that specialises in in-store payments, is helping PSPs and their merchants bridge the cross-channel divide, as Sarah Koch explained
It’s no secret that many non-bank payments services providers (PSPs) are finding it harder to stay competitive in a fast-changing and increasingly crowded landscape. But specialist in-person payment orchestrator Aevi puts it more bluntly. It believes ‘the extinction clock is ticking, unless they pivot fast’.
Sarah Koch, Aevi’s Director of Marketing and Communications, says PSPs face five major challenges: shrinking margins; regulatory pressures; increasing competition from Big Tech; rising merchant expectations; and security concerns.
“In the last few years, we saw that PSPs can no longer rely on their role as a middleman. Gone are the days when you can just process payments,” says Koch.
“On the one hand, we’re seeing compressed margins. Just transferring
Sarah Koch, Director of Marketing and Communications at Aevi
money doesn’t do it anymore. PSPs really need to differentiate to survive.
“We also see big players entering the market, the Big Techs like Apple, who want to integrate directly with merchants, meaning PSPs will potentially be cut out. And then merchants’ expectations are rising. They want more than just payments, they want to deliver an ultimate consumer experience at the point of sale, not only in-store, not only online, but holistically. And if a PSP cannot offer this approach, the merchant will go to another supplier.
“There are also compliance challenges. With PSD3 in Europe, for example, coming to the market and other regulations. And, last but not least, security is also a big concern. As the payment landscape evolves, so does the cyber threat landscape, so PSPs really need to work on their strategy for fraud detection and fraud risk management.”
A shakedown by merchants is already happening, according to a survey by UK open banking platform Go Cardless. By the end of 2023, it found that half of the businesses it polled used three or more PSPs for their transaction needs, while one in 10 firms used at least five providers. But with cost reductions being cited as a key priority, two-thirds of the companies said they were looking to reduce the number of PSPs they use and 34 per cent were planning to do so over the following 12 months.
So what lifelines can payment orchestrators like Aevi throw to embattled PSPs?
The answer is a Cloud-based platform that offers a one-stop shop of deeply integrated financial services such as payment accounts, account-to-account transfers, card issuing and revenue-based financing that not only streamlines workflows for merchants, ISVs and financial institutions but can also enhance risk management across the payments value chain.
The latter was identified by market analysts McKinsey last year as being one of the key challenges facing PSPs and merchants, when the cyber threat landscape is evolving as fast as the payment industry itself and just one data breach can destroy customer trust and cause irreversible damage.
McKinsey highlighted four areas that companies can focus on to gain a competitive edge: strengthening risk processes to maintain regulatory compliance; fighting fraud while enhancing customers’ experience; building operational resilience to prevent failures; and improving credit and collection processes to address a new normality.
“The payments industry is being confronted with high levels of risk, intensifying regulatory scrutiny, and significant changes in global standards, especially in key markets such as Europe, the United Kingdom, and the United States,” the McKinsey report warned.
“In this context, players in the payments value chain should not just react but proactively spearhead new risk management strategies.”
“At Aevi, we’ve built a platform that really helps PSPs to thrive in that emerging landscape,” says Koch. “A Cloud-based orchestration platform that does more than just payment processing.”
The platform offers real-time compliance tools that help companies stay ahead of changing regulations with built-in monitoring and reporting. Its data-privacy-by-design model ensures they meet global standards like the General Data Protection Regulation that impacts all businesses trading in and with Europe and the UK, while handling sensitive customer data with confidence. And its solutions are designed to integrate easily into existing systems, making compliance less disruptive and more efficient.
Like McKinsey, Aevi sees compliance as capable of offering a strategic advantage by helping businesses build trust, reduce risks, and drive innovation, leveraging tools like real-time monitoring and automated reporting so organisations stay ahead of evolving regulations.
The company has a strong track record in payments innovation. In 2015 it created the world’s first smartPOS and it is now a leading provider of softPOS technology, which allows phones or tablets to be used as roaming POS devices. Designed initially to help micro merchants, softPOS is increasingly being taken up by larger enterprises.
Aevi now stands at the crossroads of an old payments ecosystem that featured multiple standalone providers in the payments chain, and a new order, which is characterised by partnerships providing deeply integrated experiences in-store and online, often simultaneously for the same merchant.
Late in 2024, Aevi entered a strategic partnership with e-commerce payment orchestration platform Paydock to deliver an omnichannel payment orchestration offering for financial institutions, merchants and ISVs. It enables businesses to centralise their online and in-store payments through a single reporting interface, bridging the gap between digital and physical payments but still allowing them to process through multiple acquirers.
Just transferring money doesn’t do it anymore. PSPs need to differentiate to survive
Earlier this year, Aevi also announced a new collaboration with IXOPAY, an enterprise-grade payment orchestration platform, to help merchants unify their global payment systems by connecting card-present and card-not-present solutions.
That’s important, because more than a quarter of UK merchants don’t offer the digital shopping features that customers want, according to PYMENTS’ 2024 Global Digital Shopping Index. It coined the phrase ‘click and mortar’ to describe customers’ cross-channel online and in-store shopping journeys and found the portion of UK
shoppers adopting click-and-mortar habits had risen by 29 per cent since 2020. By the time the 2025 report was published earlier this year, still only 61 per cent of merchants were offering cross-channel experiences, though.
A collaboration in 2024 with SilverFlow, a Cloud platform for global card processing, has allowed Aevi to bring data from all those transactions, online and off, to different players in the market.
“Data is a really crucial component in today’s payment landscape,” says Koch. “With Aevi’s in-person payment orchestration platform, plus SilverFlow’s Cloud-based processing, we can give merchants access to real-time data and, more importantly, also cross-channel data, so they can see in their portals what are their peak transaction times, for example. Then they can make decisions on staffing, inventory and operations to deliver the best merchant experience for the consumer.”
Koch says giving merchants flexibility by offering a range of online and in-store payment options is crucial as customers demand ever more choice.
“In-store consumers seek the flexibility and choice that they can find online, where they can simply select different payment methods, from PayPal to BNPL to credit card transactions. This is what we also want to bring to the in-store experience.
“By offering a smartPOS, a softPOS, or a traditional device, we can deliver a tailored merchant experience, but being flexible in payment processing is even more crucial. We can route to different payment rails to offer the best cost for merchants, and in the end, the best payment journey for the consumer.”
Revolut was born a rebel but now that the UK is shaking up financial regulation, the neo is making its voice heard
The UK government is loosening the ties of regulation, recognising that the complex, penalty-focussed system –tightened as a protective reaction to the global financial crisis in 2008 – now poses a threat to the growth of the country’s lucrative financial services sector.
Most recently, it axed the Payment Services Regulator (PSR), which has existed since 2015, in a major deregulatory push that will see this watchdog merged with the Financial Conduct Authority (FCA) to create ‘one port of call’ to simplify regulatory engagement for companies.
Prime Minister Keir Starmer is said to have told his cabinet ministers that they must take ‘responsibility for decisions rather than outsourcing them to regulators’.
All of which is music to the ears of digital banking platform Revolut. Founded in the UK 10 years ago, it has risen to become the most valuable tech company in Europe, worth an estimated $45billion, by upsetting the status quo. It was born uttering the words ‘why not?’.
Revolut by name and revolutionary by nature, it carved out a reputation for highlighting barriers to financial innovation. But it famously took three
years to persuade regulators in its home market to issue a banking licence, granted (with conditions) in 2024, followed by a trading licence in November later that same year.
Never known for holding back on its opinions, the neobank’s growth and new status has given it greater clout and confidence. Just a couple of days before news broke of the PSR’s demise, it launched a legal battle against it, in collaboration with Visa and Mastercard, over proposed caps on interchange fees, which are a key part of Revolut’s revenue, earning it £605million in 2023.
Rory Tanner, the neo’s Head of UK Government Affairs, believes that before the recent change of political emphasis, UK regulators were losing their way.
“There are cases where they are focussing on the wrong things, like the recent FCA proposals around naming and shaming that led to the Treasury intervening and siding with the industry, and the PSR’s proposals around capping European Economic area-to-UK cross-border interchange fees, which we think is the wrong approach because artificial price caps damage competition in card payments,” he says.
“We want the focus to be on improving competition and creating economic growth, not acting as a barrier to it.
“To give them credit, the regulators are now doing these things, but we want more clarity around the timing of the delivery. It’s important the UK is not slower than other jurisdictions.”
Tanner’s job title speaks to the journey this neobank has been on as it fought for validity at home, while simultaneous expanding into Europe, America, Asia and the US in pursuit of
customers. Just a few months after Tanner’s appointment in 2023, his boss, Revolut co-founder Nik Storonsky, publicly criticised the UK as being a difficult country to do business in.
Tanner is now preparing for conversations on how to make it easier – or risk the UK’s position as the world’s biggest net exporter of financial services (creating a £92billion trade surplus) being eroded.
“There are certainly areas in which progress has stalled and even cases where other jurisdictions have overtaken the UK for regulatory innovation,” says Tanner.
“Open banking is a good example. In 2019 the UK was the best in the
world and the first to do it, but in the last couple of years it’s been beset by bureaucracy and politics with not much progress, although some is emerging.
“If the UK Data (Use and Access) Bill passes, it provides an opportunity for the principles of open banking to enter other areas of finance, like insurance, investments, credit and pensions, that could benefit from more competition and innovation.
“2025 is going to be really important for open banking in the UK [and] over the next three, four, five years, open finance is potentially a revolutionary piece of regulatory delivery for
the UK, and hopefully for Revolut as well.”
He also believes the FCA’s timelines for the launch of a crypto asset roadmap – currently pushed to at least 2027 – and the UK’s New Payments Architecture (NPA), need more urgency.
“It’s really damaged our reputation as an innovator and trailblazer that the latter has stalled indefinitely and the industry now looks to PIX in Brazil or UPI in India as truly 21st century payment ecosystems,” he adds. “And if we don’t soon have pay-by-bank as a mainstream option for e-commerce, it will have absolutely been a failure.”
When it comes to fraud prevention, too, he believes the UK is falling behind.
Tanner points to other countries that are already developing cross-sector data-sharing
regimes, involving not just payment service providers, but also law enforcement, government, telcos and tech firms.
“Delivering a framework for cross-sector data sharing to create a truly unified approach is really important to us,” says Tanner. “Singapore and Australia are examples of countries that have done that but the UK has not and, from a regulatory standpoint, I would question why.”
Later this year, Revolut staff will move from the neo’s existing headquarters in London’s Canary Wharf to much bigger offices in a neighbouring development that, appropriately
what the customer wants, and delivering best-in-class solutions.”
The popularity this has generated among its customers is clear.
“Revolut initially gained customers from people recommending our card to friends going abroad,” adds Tanner. “The next phase of our journey is consolidating those customers so they’re also using Revolut to pay their bills or their friends. Our objective is to become a primary bank, not just in the UK but in all our key markets, and we believe we have an opportunity to do that in the coming years.
“Because, after being around for a decade, neobanks like us have become more popular and the sector is now maturing – catering for tens of millions of customers, not thousands.
“We’re looking at gaining millions more, so need a different approach. While retaining our commitment to product, technology and innovation, we can’t just rely on word-of-mouth anymore to reach our goal of 100 million customers, because the competition is really fierce and we’re not just going up against the incumbent banking sector, but other fintech competitors who are likely to come out of Europe or the US in the near future.
“From a marketing perspective, we have to go for the big things rather than niche areas. Hence we’re sponsoring the NBA Paris Games and have a skyscraper in Canary Wharf.”
To further broaden this appeal, Revolut is widening its offering.
“Last year, we launched RevPoints to compete with Amex and others. It’s on debit card spending, so if customers can’t get credit because they’re vulnerable or underserved, they still have access to it.
“Democratising services allows us to compete and diversify our revenue stream so
There are areas in which progress has stalled and even cases where other jurisdictions have overtaken the UK for regulatory innovation
for a challenger that’s always asking questions, is called YY.
“What most defines us is our ability to solve market failures, which is exactly what we set out to do back in 2015,” says Tanner. “People were getting ripped off spending or sending money abroad, so we created a multi-currency account with zero foreign exchange fees.
That’ll define us for the next 10, 20, 50 years because that mindset is how we approach every single area we move into.
“Whether payments, banking, trading or crypto, we relentlessly focus on products and
we’re protected from any shocks in the future, which is a really important part of our model. In our last annual report, there was not a single product or market that accounted for more than 30 per cent of our revenue.
“We have a combination of product excellence, ambition and the confidence to provide the best options for our customers.”
Revolut’s neighbours in London’s financial district include Barclays, HSBC, Lloyds and Santander. The neo-with-attitude has definitely grown up, but it clearly doesn’t plan to dial it down any time soon.
The super-rich have access to personal bankers and elite services that help them manage their wealth. Data can unlock the same level of privilege for everyone and deliver it profitably, as Discovery Bank is demonstrating
“The banking system we entered wasn't broken at all. On the contrary, it was really, really strong,” says Hylton Kallner, the CEO of South Africa’s Discovery Bank, one of only two neobanks to challenge the country’s incumbents back in 2019.
The big daddies of the banking system still are resilient – and proving remarkably agile, in fact. But, having hit its target of one million customers two years ahead of schedule and reached monthly profitability early, Discovery continues to put them under pressure. Notably, it’s demonstrating that it’s possible to scale a full-service bank that delivers private banking-grade services without adding significant cost.
Discovery launched at a time when the financial system dominated by Standard Bank Group, FirstRand, Absa Group, and Nedbank Group seemed impenetrable – indeed, they continue to hold 83 per cent of banking assets in South Africa.
In addition, the neo faced the added obstacle of South Africa being a notoriously tricky place for fintech startups, due to its lack of a clear open banking framework and very different consumer cultures across one country.
But Discovery’s distinct, digital first, full banking proposition has delivered consistent, organic growth by tapping into a desire for difference from South African consumers – and happy customers share their experiences.
“Consumer appetite for digital banking was absolutely massive,” says Kallner. “The research that we did showed that about nine out of 10 South Africans had a preference for banking digitally. This reinforced our belief that there was space for us to really make a mark.”
Discovery is unusual in many ways, not least because it’s part of a group operating in both financial services and healthcare/wellness from which it drew synergies to create the world’s first ‘behavioural bank’.
Hylton Kallner, Chief Executive Officer at Discovery Bank
There was no room in its model for a traditional branch structure. When Discovery entered the fray – and still to this day – legacy banks in South Africa conducted much of their business face-to-face. But cultural and behavioural shifts were already on the way and gathered pace one year later with the onset of COVID.
“Smartphone penetration is rapidly increasing in South Africa,” says Kallner. “And therefore, even in rural areas, you find that the appeal of digital banking is strong because you don't have the inconvenience of transport and business banking hours. Digital banking makes sense to everybody at that level.”
Discovery used a back-end SAP platform, providing ‘an industrial strength operating system’, but then designed everything from scratch with the customer in mind from that point on.
Its customers would receive a full range of services, including savings accounts, transaction facilities, credit cards, forex capabilities, budgeting tools
Discovery has identified five behaviours that result in 80 per cent of defaults: namely, customers spending more than they earn, not having enough insurance, not saving for emergencies, not saving for retirement, and managing their secured debt poorly. Spending too much on Grand Cru or not stashing enough in the offshore account results in the same bad metrics, right? But those on more modest incomes don’t usually benefit from the same level of personal advice from their banker.
Kallner explains that zeroing in on generic behaviours, rather than income or social status, builds a better picture of the customer, and allows the bank to reward positive fiscal lifestyles at every level.
“We've developed a shared value model and across the entire Discovery group, we've applied a very similar approach,” he says. “So in our health insurance business, for example, the focus is very much on helping people to get well and manage their health, not just funding when they get sick.
“In our motor insurance business, we track how clients drive and reward them for driving well. It's good for the client and it's good for us because there are lower accident rates.
experience for clients. “Not least because our bankers have the time and the space to actually coach the client, in terms of how they can optimise the products that they’re using. This adds value on that call, way beyond just the immediate query,” adds Kallner.
Building on the co-pilot model, Discovery Bank released a new raft of AI-powered enhancements to its features and services in March this year. It now offers rewards for financial planning to align clients’ short-term goals and long-term aspirations, including estate planning.
Expanded security features include new card and device management capability, fraud monitoring and warnings, a Digital Account Vault, and access to emergency services via Discovery 911 – a move no doubt prompted by the rising kidnapping rate linked to financial crime in South Africa.
and mortgages. But what differentiated Discovery from other established banks was a hyper-personalised package, more akin to that found in private banking services reserved for the super rich.
“We’re the best of both worlds – a hybrid,” says Kallner. “Yes, we’re digital but all Discovery Bank clients have access to full-service call centres and highly skilled bankers at any time, day or night, seven days a week. For us, personal service is the norm, rather than the exception.”
Crosshead to break copy
Banking is naturally stratified, so Discovery does reserve a superior package for its Purple account holders. They need to earn roughly six times the average income in South Africa, but if they meet the criteria – and pay the monthly fee of R679 and an annual card fee of R4,000 – they enjoy an elevated ‘world-class experience’. It helped Discovery rank number one in private banking in the 2024/2025 Ask Afrika Orange Index.
But it applies the same principles to its relationship with all account holders. Behavioural data allows Discovery to get a level of understanding on how every customer lives their life, what impact those behaviours have on the risk attached to them, and then helps it incentivise an individual to adopt ‘better’ habits through personal conversations.
“Banking is exactly the same. If our clients manage their money well, the credit default rate is much lower and we’re able to reward them through better interest rates on their savings, lower interest rates on their borrowings and a whole host of other rewards, through our behaviour-change programme, Vitality Money.
“It’s getting the incentives right so that the value for the client is ultimately a lot better, with a combination of excellent service, state-of-the-art digital banking technology, and a shared value model that rewards them for managing their money well.”
For us, personal service is the norm, rather than the exception
On the face of it, providing always-available, highly trained personal bankers for every customer sounds expensive to maintain and perhaps counter-intuitive for a digital-first bank. But not if those personal bankers all have AI assistants.
“Historically, if you wanted a highly qualified professional banker in a call centre, it would take months of training, if not years. They must train for 100 per cent of every kind of query that's likely to come in. With a really effective co-pilot, you simply train the bankers on how to utilise the AI,” says Kallner.
It gives them instant access to product knowledge and solutions, improving the
Also, Discovery AI is a WhatsApp-accessible platform that drives a more personalised, complex, and intelligent digital banking experience. So, for example, a customer can photograph a coffee purchase to check discounts, or ask, ‘how’s my spending on coffee this month?’ and receive real-time responses. At the launch of the new services, Kallner said: “Digital disruption, changing consumer expectations, and the power of AI and data have completely redefined what financial services can offer. We firmly believe that transactions, accounts, and payments are just the starting point. From the outset, we set out to build a bank that rewards positive financial behaviours, empowers people with data and technology, and operates as part of a greater ecosystem, designed to improve lives.”
In this interview and others, Kallner has stressed that
‘AI is democratising private banking levels of service’. But what of the future? Can the private-bank-for-all continue to grow, perhaps outside South Africa?
“I think it’s going to be a question of how the regulators view this kind of digital proliferation,” says Kallner. “But we’ve effectively grown without adding any headcount to the bank. We’ve added product, clients, a huge amount of load onto the system, and we’ve done that with the core team that we had 12 months ago. Moving beyond borders is exactly the same. The products are very much transportable. The scalability of our platform is significant and the opportunity that comes with it is really, really powerful.”
> Increasingawareness
> Understandingchallenges
> Inspiringlong -lastingchange
Almost 1 in UKpeoplehaveadisability , representing billioninspendingpower
FinTechinnovationhassurged , butaccessibilityo ten remains ab a terthought , creatingmoral , commercial andregulatoryrisks .
Inclusivedesignunlocksnewmarkets , drives innovation , buildsloyaltyandalignswith and diversitygoals .
Demand for trade and working capital credit by SMEs continues to significantly outstrip supply from banks. Trade Ledger’s Martin McCann believes open finance can fix that gap, but agentic AI will fix it faster
In an interview with The Fintech Magazine in 2022, British entrepreneur Martin McCann urged banks to ‘think about what the next three years will look like’ as a juggernaut of open finance technology promised to demolish their model of SME lending. It’s a model that was widely regarded at the time (including by the International Chamber of Commerce, the Organisation for Economic Co-operation and Development, and the Export-Import Bank of the United States) as being deeply dysfunctional,
and still is. But those financial institutions that didn’t take McCann’s advice might now be regretting it.
Speaking today, the Co-founder and CEO of commercial lending-as-a-service platform Trade Ledger, says: “We're starting to see aspects of profitable credit being stripped away from banks and go to non-bank lenders. In the US, the fastest-growing source of credit for private companies is private funds.
“These funds can choose which sectors of the market that they want to steal from banks – and it’s usually the more profitable ones.”
Private lenders might play by their own rules, but in 2023, they funded 86 per cent of leveraged loans in the US, up from 61 per cent in 2019, according to PitchBook LCD. And while they were eating the commercial banks’ lunch at one end of the table, neobanks worldwide were moving from a starter course of solopreneurs to addressing the needs of SMEs at the other.
The shift of credit away from bank lenders is part of a wider dissatisfaction with SME legacy banking services.
A 2024 survey from the IBM Institute for Business Value among 1,000 SME owners and managers across different world economies, revealed a deep schism in what bosses looked for in a bank and what bankers thought they
Martin McCann Chief Executive Officer and co-founder of Trade Ledger
wanted across a range of areas. In one, bosses’ top three expectations were for tailored offers, networking and an understanding of their sectors’ needs. Banks (mis)understood their top three demands as being easy-to-use apps, dedicated managers and local branches, the last two of which, of course, banks have mostly retreated from.
McCann hasn’t given up on the incumbent lenders – far from it. But he knows the nature of the beast.
“Banks are run as capital allocation engines that manage risk and return. That's fundamentally where regulation has driven them,” he says. “So they struggle to be able to understand how to see value the way a business customer wants to see it. Which is why we need to look at reinvention of the entire supply chain of how business and commercial banking works. The banks can’t do that on their own.”
It turns out that three years ago, McCann was planning to double-down on giving banks the tools to prove they can meet some of those customer expectations – and do so within the more cautious risk parameters and regulatory straightjackets than those that confine their rivals.
Trade Ledger was working on a much bigger disruptor than open finance: agentic AI.
“I firmly believe that the emergence of agentic AI systems is the single biggest transformation that’s going to happen in our lifetimes – and banks won’t be exempt,” says McCann.
In fact, he’s updating his bank survival forecast: “Agentic AI systems are going to have more impact and happen much faster than the Internet. Banks need to figure out what is the change in their business model that needs to be implemented in three to five years’ time or risk becoming completely irrelevant, displaced.”
With Trade Ledger’s first agentic AI, or ‘virtual banker’, due for release later this year via the Microsoft Azure marketplace, McCann is confident that change is going to come.
Facing a bigger peril
The trend for SMEs’ working capital requirements to be satisfied by non-banks is of wider concern than the banks whose income might be threatened by it.
Even the European Central Bank has indicated that there might be a systemic risk to financial stability associated with relatively lightly regulated private credit structures taking on a bigger role.
“At the dystopian end of the scale, there is no regulation, control or transparency on where capital flows if it moves outside of the banking system,” says McCann. “So, if you look at things like cryptocurrencies, some will be captured within regulatory frameworks and others, potentially, won’t. If we don’t know
The conversations we’ve been having over the last six months are different. There’s real intent and real fear. Societal pressures are starting to mount because there’s not enough capital going to drive innovation and to solve problems like climate change, inequality, geopolitical instability. All of these things require resources.”
When asked about their banks’ performance by IBM recently, bankers were candid in their response. Only six per cent gave themselves an A grade; 47 per cent awarded themselves a B or C. Banks must try harder, says McCann – and both he and IBM agree that they can reach ‘outstanding’ through a combination of open finance and by moving from what IBM describes as a +AI approach to AI+, ‘which allows banks to redesign all processes from first principles… helping ensure that human intervention into operations is only required
Go with the flow: AI agents are transforming banks’ operations
It puts them at a disadvantage against other industries.
“That’s where we’re stronger together,” McCann continues. “We work with banks, other technology companies, and data providers, and that ecosystem needs to come up with a solution as to how we can systemically start to change the way that data is managed to provide more value, including to businesses themselves.
“An example would be more transparency as to what credit products a business will be eligible for and what products it should be looking at before it even speaks to its bank. For technology partners, it means standardised solutions. And for the banks, it means having prepackaged data sets where the rights and the usage of the data is formulaic and processed ahead of it coming into the bank where it hits that heavy regulatory framework.”
I firmly believe that the emergence of agentic AI systems is the single biggest transformation that’s going to happen in our lifetimes – and banks won’t be exempt
where the capital is flowing, then we don’t know what people are doing with it. That’s one of the reasons banking regulation was created in the first place, to make sure there is governance and transparency; that capital is being used appropriately and correctly.
“All that is threatened unless we find a way to flow more capital through business and commercial banks via the regulatory framework, using data and technology.
“If business and commercial banks don’t figure out how to address the massive undersupply of trade and working capital credit, somebody else will, and a shadow banking sector will emerge, which, arguably, is worse because it’s not regulated at all,” McCann continues.
“My sense, though, is there’s a wind of change happening in trade and working capital.
for exceptions and more added-value activities’.
“As SME banking continues to evolve, a pivotal aspect will be the seamless integration of banking services into the diverse industries that shape the business journeys of each SME,” adds IBM. It has recognised that, in an open finance ecosystem, SME data, be it from merchant terminals or Cloud-based office systems, is more bountiful and more revealing than banks will glean from any corporate. It’s also very connectable.
“Banks are data rich and knowledge poor,” says McCann. “And that’s the key tenet on which value creation is going to change. [But] this is one of the biggest problems that bank executives have, because the regulation around what data they can capture, how they store it, and what they can do with it is minute.
This is the ecosystem in which Trade Ledger’s new virtual bankers get to work.
“One of the agentic AI deployment methods that we’ve always been clear on is Microsoft Teams, because most of the banks we deal with use it,” says McCann. “So, rather than having to learn a new interface, banking staff can implement a specific agent who’s an expert in a topic, or look at an agentic workflow, such as ‘I need a treasury solution for this FTSE 1000 company and it needs to have a number of components that meet these requirements’.
“The agentic workflow AI can break that down and say, ‘well, I need a working capital analysis, I need a product matching analysis, I need to understand the credit headroom within the bank, I need to know the credit history. I’ve instructed 12 different agents to do all of these things and I’ll come back and give you the answer to this in a document’. And it will do all that in 90 seconds.
“This is what the virtual bankers are going to look like by the end of 2025 on Trade Ledger.”
No one expects regulation to stand still, but it’s never been as fluid as it is today. Which is why Focusync aims to ensure the UK’s FIs are as prepared and flexible as they can be… which brings many other benefits, says its Chief Growth Officer
Financial institutions in the UK have invested many millions on specialist skills and systems since 2008 (with the current estimate being around £38billion annually), trying to keep up with the raft of new regulatory rules and reporting requirements introduced to mitigate further financial and economic shocks.
They must now provide more detailed, and more frequent, updates to prove they are effectively managing their risks relating to capital adequacy, liquidity, payment processing and customer data handling – and much more.
It’s not likely to get any easier, either, with fresh change and uncertainty still emerging. The new US administration, for instance, may well throw a spanner in the works by proposing to relax capital rules for US banks under what’s known as the Basel III Endgame, which had already been agreed internationally. That has, in turn, caused the UK to delay its own implementation of the rules. Then there is the ever-evolving environmental reporting requirements coming out of Europe, which impacts domestic frameworks and protocols.
Meanwhile, a government-driven shift of emphasis by UK regulators towards business enablement and growth rather than simply rules-based monitoring may well influence the way data is presented to them.
To thrive in this environment, it is therefore imperative that organisations ensure they have skills, systems and processes capable of delivering the increased volume and frequency of data and reports as efficiently as possible; while potentially looking to derive increased business benefits from these capabilities.
Specialist regulatory software and platform services providers like UK-based Focusync are helping them rise to the challenge, through increased data processing sophistication and automation.
This particular company’s cutting-edge tools are helping organisations build resilience in a changing world – starting with getting to grips with their data: collecting it, identifying gaps, fixing errors, validating and reconciling it.
Clean data, which Focusync’s software can process from any source, not only makes reporting reliable, easier and faster, but once organisations have it, they can repurpose it within the software to inform business
decision-making. And this heavy lifting, done right, can open the door to other efficiency benefits and business growth, says Focusync’s Chief Growth Officer, Andrew Kesbey.
Kesbey acknowledges that ‘we can’t do anything to stop change, nor are we looking to'. However, his company can and is trying to help organisations ease the burden of regulatory change, and grasp opportunities that present themselves the other side.
With regulators rapidly evolving how they scrutinise organisations, and what for, assistive software solutions must be equally agile, he says.
“Regulators are updating how they want information presented, calculated and validated, which means banks and building societies need to keep up with these changes. As a solutions vendor, we’re focussed on mitigating this and insulating our customers from the cost as much as possible. We do this through things like fixed-price implementations and ongoing maintenance agreements covering their ongoing needs, whether implementing from scratch or adapting to a change, backed by 24-7 helplines.”
Accessing and organising the data required for the increasing list of regulatory submissions ranks top of the list of challenges organisations face in remaining compliant, says Kesbey.
“They often have trouble acquiring accurate and complete data because it comes from different sources, so they need a solution that can collect and compile it automatically, repair errors, transform and validate it, and Focusync does all of those things. We adapt the data processing part of our solution to the client’s data. They can throw us different file formats from various source systems and we standardise them so all data records look the same.
“If the regulator then asks for risk-weighted assets to be calculated differently, or certain records validated differently, we insert those into the solution and produce the required format, with the clients’ input limited to sanity and acceptance testing and checking.
“If a data source is producing records inconsistently or erroneously, we can also set up rules to automatically correct, validate and reconcile those, and transfer into a standard format before we send it into
regulatory reporting, stress testing or management information systems.”
Getting the hygiene factors right is a gateway to growth for forward-thinking organisations –as this is more likely to result in them gaining regulatory support for their ambitious change goals, says Kesbey.
“I know from talking to people in the industry that if a bank delivers accurate reporting in a timely manner, it acquires a reputation for this with the regulator.
“If it then wants to extend the scope of its activities, or licence, and needs their approval, they will likely look more kindly upon it than they would an institution known for lack of compliance, which they have to chase up for reports that they then have to send back for figures to be changed.”
Recognising just how much of an investment it takes for firms to get to this point, Focusync tries to help them get more out of the process by applying their newly organised data banks to other business uses, automating wherever possible.
“From that initial validation process, our clients accumulate a repository of accurate and complete regulatory data, which then allows us to offer services around regulatory reporting in other areas of risk,” says Kesbey.
“Because compliance has become an ever-increasing topic, specialist resources are now more valued, and they’re scarcer in some particular areas. So, firms don’t want these experts spending their time on manual tasks when they could be using their expertise more productively.
“This is where automation and using data beyond regulatory reporting to support internal decision-making processes around management information services, treasury, risk and even front-office purposes, comes in.
“We can enable them to create analysis and dashboards to disseminate to relevant people within their organisation, as well as using their data to input into other solutions, like asset and liability and liquidity management solutions and stress testing.
“If their CFO needs to monitor capital adequacy, liquidity, or other
business areas, they may not be particularly interested in the regulatory reporting aspect. But the figures that underlie that may contain insights that give the CFO the ability to make decisions. We can create a dashboard specifically for that or other roles throughout an institution.”
Focusync is actively gearing up for the increasing regulatory focus on environmental and social matters.
“This is something the UK regulator has been looking at for a while, so it will doubtless happen, whether in the next couple of years or over a longer time span,” says Kesbey.
“We’ve started to see the UK green taxonomy and environmental, social and governance (ESG) disclosures, and we will inevitably get the kind of regulatory reporting that happens in mainland Europe in terms of how ESG factors impact the capital costs of certain activities.”
Artificial intelligence (AI) is increasingly a catalyst for the kind of progress required to meet such changes head-on.
“AI is pushing a lot of development forward – you read about how one institution has increased the efficiency of loan applications by 40 per cent, and how it’s helped others avoid regulator fines by picking up anomalies in risk-weighted assets.
“For vendors, it clearly creates a massive opportunity. So, we're incorporating it in various parts of our solution, like anomaly detection – what we've called undirected inquiries.
Normally, the most sophisticated tools require you to point
that statistical analysis at a certain set or subset of data, whereas machine learning and AI let you throw all the data you’ve got at the tool and say ‘tell me where I should be looking’.
“We’re using AI for that and for integration. However, it’s absolutely crucial there is transparency around algorithms, because algorithmic bias is one of its potential downsides and you must have appropriate resolution tools in place to detect anomalies. That’s the only way to truly assess whether there is a fair value outcome and the organisation is adhering to the intent of a regulation.
“As well as offering safeguards to help organisations ensure sufficient data integrity, we’re looking to build solutions that are much more sensitive when it comes to detecting trends historically, and predicting trends going forward.
“We’re also targeting AI capabilities to allow us to provide companies with things like predictive liquidity and behavioural cash flows, as well as using it to cut down the time it takes to get them live with our solutions, and help them respond to regulatory changes.”
There has never been a better time for UK FIs to get their houses in order and be innovation-ready, says Kesbey, given the UK government’s change of focus for its overseers.
“It has tasked the regulator with ensuring innovation in the financial services industry,” says Kesbey.
“To be not just an organisation that oversees regulation and scrutinises banks and building societies, but one with a broader, more strategic vision of trying to help the industry be competitive. We’re still waiting to see what the consequences of that new remit will be.”
Shifting scope: UK FIs need to be ready for regulatory change
Transaction data betrays the environmental cost of doing business. However, SMEs have struggled to collect it, share it and have confidence in it. That might be about to change in the UK, thanks to a collaboration of providers, including Earthchain’s Dan Graf
The US exited the Paris Agreement this year. President Trump’s administration is unpicking ‘woke’ green capitalism. The EU is softening new sustainability reporting timelines. And we’re still waiting for a consultation to even begin on Sustainability Reporting Standards in the UK.
On the face of it, there’s diminishing incentive for businesses – particularly smaller businesses in western economies – to put environmental accounting at the top of their to-do list.
And yet, a survey by Workiva, an integrated reporting platform, among 1600 executives worldwide, showed that 85 per cent of them still intend to move forward with plans to disclose greenhouse gas emissions, regardless of global politics. This is even true for executives who do not need to comply with climate regulations.
Among 286 executives whose organisations did not fall within the scope of the EU’s Corporate Sustainability Reporting Directive (CSRD), 75 per cent still intended to at least partially align their reporting with the mandate.
And, in the US, where the Securities and Exchange Commission appears to have lost its bottle over introducing landmark climate disclosure rules that have been on hold since April 2024, 81 per cent of executives expected to at least partially disclose scope 1 and 2 emissions with some level of assurance.
While it’s difficult to go green when you’re tied up in red tape, it seems bosses are now being braver than the leaders elected to force their compliance. What many still often lack, however, is an automated way of collecting, recording and then auditing or reporting assured, real-economy carbon data – and in a way that supports decision-making and can be shared safely with third parties,
such as customers, investors and lenders, notably banks.
The problem is not a lack of tools.
“There are 270 carbon accounting tools out there – it’s very difficult for SMEs to choose what is the right fit. And almost all of them are glorified spreadsheets,” says Dan Graf, founder of UK-based carbon accounting provider Earthchain.
Rather, it’s a combination of issues that is holding back reporting. And they have accumulated precisely because policymakers have focussed on big polluters, rather than SMEs, to meet net zero targets. In the UK, that’s despite the fact that, collectively, the country’s 5.5 million or so smaller enterprises are responsible for half of all business greenhouse gas emissions.
A proliferation of private protocols for collection and measurement of emissions, no standard data format for sharing carbon accounting information, no third-party data verification requirements, and no trusted data sharing system (among other inconsistencies), have led to low-quality information that is often neither comparable nor actionable by the SME, their bank nor their customers.
There are 270 carbon accounting tools out there… and almost all of them are glorified spread sheets
Dan Graf, Earthchain
But in the UK, there’s signs of progress. Earthchain is part of a collaboration of banks, carbon experts, government, and other organisations brought together by a not-for-profit called Icebreaker 1 (IB1). Launched at Davos in 2020, it exists to develop the standards and frameworks to connect assurable real economy and financial economy
data between organisations and sectors in support of the low-carbon economy. Its financial data scheme, Perseus, enables automated emissions reporting for SMEs by using rules and processes that make comparable, assurable data sharing possible, be it through accounting platforms, emissions calculators, or other reporting software.
Developed with Bankers for Net Zero (B4NZ), Perseus is currently running its first lending pilot, streamlining carbon accounting for SMEs through automatic retrieval of smart energy data, which can then be shared with funders to unlock green finance.
More widely, IB1 addresses the combination of issues that have undermined SME’s efforts to understand and address their climate impact – then use that information to improve their financial performance.
That’s where Graf sees the real value. He believes integrating sustainability metrics into financial reporting is crucial because it provides a comprehensive view of a company’s performance. Part of that is demonstrating how sustainability initiatives contribute to financial success, such as how reducing emissions can cut costs.
Earthchain’s API-led platform, which is integrated with online accounting software Xero, helped one client recently ingest more than 4,000 data points across the business’s operation in a matter of minutes. It was a ‘holy smoke’ moment for the founder.
“Tracking emissions is not just a value or compliance tick-box. It’s critical data that shapes his growth strategy and is directly tied to their performance metrics,” says Graf. “Now, with visibility of his emissions in real time, he can report to his investors and customers with much more rigour and confidence and make more informed business decisions that drive the sustainable growth plans.”
Asia-Pacific is a hot spot for global trade, but the proliferation of alternative and domestic payment methods means it’s a challenge for foreign merchants to penetrate. Wang Hu from PayerMax and Standard Chartered
’s Luke Boland explain how their partnership is smoothing the way
In the world of global payments, there are two major trends currently playing out.
One is the seemingly unstoppable growth in B2C and B2B cross-border transactions. The other is evermore localised and alternative payment methods (APMs), and pressure on merchants and acquirers to cater for them.
The total value of cross-border payments in 2023 was $190trillion and is projected to reach $290.2trillion by 2030, according to Statista. That will be particularly noticeable in Asia-Pacific, which already accounts for nearly half of global payments revenue.
The total volume of alternative payment methods, meanwhile, reached $19trillion globally in 2022 and APMs are predicted to constitute 69 per cent of global e-commerce transactions by 2029.
APMs are popular in Asia-Pacific where they play an increasing role in emerging markets and economies, with the likes of Grab, OVO and TrueMoney finding favour in Southeast Asia particularly.
According to Juniper Research, the increasing adoption of e-commerce across emerging markets will lead to a 63 per cent growth in APMs by 2029, enabling ‘consumers in non-card-centric markets to purchase online for the first time’. Meanwhile, research by EY shows
Wang Hu, Co-founder & President of PayerMax
Luke Boland,
Global Fintech Lead at Standard Chartered bank
more than 85 per cent of merchants are planning to accept new APMs in the next one to three years; 70 per cent of merchants also acknowledge that failing to accept them could result in a fall in sales.
Reaching external markets is appealing to both large enterprises and SMEs alike. Through more people accessing the internet than ever before, they are able to sell to a wider audience. Much of this commerce is aggregating onto platforms such as Shopify, Square, and Toast, and marketplaces like Amazon, eBay, and Etsy. As much as 30 per cent of global consumer purchases today are estimated to go through such platforms and marketplaces.
All this business without borders is shaping international payments innovation and bolstering the development of new service providers, who are aiming to make the process faster, cheaper and easier.
Wang Hu, Co-founder and President of PayerMax, a Singapore-based fintech company providing comprehensive global payment solutions with a strong focus on the Asia-Pacific and Middle East region, is witnessing increasing participation of emerging markets in global trade.
“More markets are coming into the spotlight as global trade and digital commerce become more inclusive,”
he says. “But, in many cases, the payment infrastructure is still not fully developed to cater for this. So companies who want to come to Asia-Pacific to do business should keep in mind there are still some challenging fundamentals, like core payment service functionalities, success rate, fraud prevention, chargeback management, and even system uptime. We take care of all these issues for our merchants,” says Wang.
Another way in which paytechs like his are facilitating what he calls the ‘re-globalisation’ of trade is by addressing
the challenges for merchants around APMs and domestic payment schemes.
“There has been a rise in domestic payment schemes, especially in the Asia-Pacific region,” says Wang. “Many are driven by government initiatives, wanting to promote greater financial inclusion and reduce dependency on the international payment system.”
And potential merchants might also want to consider the role of local currency.
“When we talk about local currency in this region, we talk about emerging market currencies rather than G10 currencies,” says Wang. “So we need to take care navigating this market during volatile conditions.”
a local talent team operating on the ground, which helps us to integrate deeply with local payment systems. We work closely with the local leading e-wallet companies and also local banks. So the network we’ve built over the past four or five years helps us to serve thousands of global merchants today.”
The paytech’s already significant footprint
payment solutions to merchants that reduce their transaction costs and processing time. Those solution includes e-wallets, bank transfers, and cash-based payment methods.
“In terms of liquidity management, Standard Chartered products also helped us, as merchants typically want to centralise their treasury management in APAC, in Singapore
In many cases, the payment infrastructure is still not yet fully developed… So companies who want to come to Asia Pacific to
do business
should
keep in mind there are still some challenging fundamentals
Key [to partnerships with a paytech] is openness and clear communication between us, understanding what each other expects and what each other is going to be doing Luke Boland, Standard Chartered
Deciding which payment choices to offer customers often drives PayerMax clients to ask: ‘which payment method is mainstream or trending?’. And the company is uniquely placed to answer that.
“We have an MPI licence from the Monetary Authority of Singapore (MAS) as well as licences in Indonesia, the Philippines, Thailand, Hong Kong, and others. That network is crucial to our business,” says Wang. “But we also have
in South East Asia and its recent expansion into the Middle East, where it has licences in Saudi Arabia and UAE, has been greatly helped by PayerMax’s partnership with Standard Chartered bank. It’s taken Payer Max’s service and product offering to a ‘new level’, says Wang.
By leveraging Standard Chartered’s infrastructure, it was able to gain global reach while also offering easy-to-use, fully-fledged
Wang Hu, PayerMax
or Hong Kong, for example,” says Wang.
“Working with Standard Chartered certainly gave us that capability.”
Global Fintech Lead at Standard Chartered bank, Luke Boland, describes the bank’s partnership with the paytech as a ‘symbiotic relationship’.
“It helps Standard Chartered to look at the products and solutions that we have today, and adapt those to new business models,” he says.
“We’ve had a presence in a lot of today’s emerging markets in South East Asia and the Middle East for many years. We’ve seen many things and we have many regulators to work with and answer to.
“We enjoy partnering with our clients to really understand their business and understand the activity that they’ll conduct in those markets – what are the local regulatory requirements, whether it’s non-resident, pay-ins, pay-outs, FX controls, etc.
“Key to those partnerships is openness and clear communication between us, understanding what each other expects and what each other is going to be doing.”
What PayerMax and similar paytechs bring to the table is connectivity.
“That’s something we're really working on with a lot of clients, such as PayerMax,” says Boland. “Having an API is one huge advantage that we look at. Having multiple APIs for payments and FX and then linking those into local payments in real time [means] we can support with the collection and the distribution of the last mile. That’s what we really focus on across our key network markets.
“I believe the collaboration between PayerMax and Standard Chartered demonstrates both parties’ leading capabilities in technological innovation and compliance construction. It also injects new momentum into the cross-border payment ecosystem in emerging markets,” concluded Boland.
BNP Paribas is leveraging technology at every level to redefine the role of a European bank. But what will benefit ordinary account holders and merchants most is genuinely helpful AI, says Waleran Guinard
How often have you checked your transaction history and seen something you don’t recognise? Often it turns out to be perfectly legitimate: a purchase you made a couple of days or even hours ago. It just doesn’t have the name you were expecting.
It might not be a mistake, but it is a flaw in the payments ecosystem and a sticking point for positive customer experience, often leading to concern, unnecessary card freezes and a possible erosion of trust between the customer and the bank.
It could also undermine healthy vigilance for genuinely fraudulent transactions.
The thing is, banks can address it and, if they don’t, they’re missing a tremendous opportunity to boost their value proposition in a competitive market, according to Waleran Guinard, who’s been working in payments with BNP Paribas for 15 years.
BNP Paribas has resisted the trend for banks of its size to offload its merchant-acquiring businesses. Instead, it’s leveraging the additional information and partnerships the acquiring business creates and that allows it to increase merchant data enrichment which, among other things, can provide greater transaction transparency.
“We get quite a few calls regarding disputes around transactions, which are
Waleran Guinard, Group Team leader of the Payments (Procurement & Performance) at BNP Paribas
a drain on the client and the bank,” says Guinard. “In the French market in particular, we have a lot of franchise merchants, which means that instead of the transaction being in the merchant name, it’s the name of the group or society behind them.”
With the sheer volume of transactions occurring every day, it simply hasn’t been possible for banks to account for this multitude of discrepancies. Until now.
With the advent of AI, increased processing power, and Cloud-based banking, fintech companies have been able to gain new insights from the data flowing in and out of banks. BNP Paribas is using that to enrich the merchant information available to it and help put itself at the centre of customers’ lives.
“Merchant enrichment is not just about changing the merchant name. For me, it is about providing data that will improve the client’s experience of the banking app,” says Guinard. “For instance, at BNP Paribas, we amend the transaction name to the name of the merchant, but we also add their Google map location, their website and phone number. The aim is to reduce disputes and calls for particular transactions and give more convenience to the client.”
Ultimately, the more services banks like BNP Paribas are able to provide to the
In step with customers: Applying AI to transaction data helps BNP Paribas become the account holder’s friend
customer, the more easily they can defend their established position. They are aware that many neo banks and newer players are building their proposition on a seamless user experience, with fast payments, enriched data, and additional services and features.
They’ve certainly gained an edge in this area, by starting with a modern approach to infrastructure. But when it comes to applying AI to data, the incumbents arguably have the upper hand because they have so much more information to leverage.
The role of fintechs
in-house, but things have changed,” says Guinard. “We have to take advantage of what fintechs provide in the market. They’re accurate, agile, and up-to-date on trends.”
Partners like Snowdrop Solutions, which is focussed specifically on transaction enrichment and enabled by the bank connecting to its API, take services to customers to another level. It’s clear that theirs is an evolving relationship.
“When we started, it was only about merchant renaming. Then we advanced to merchant enrichment, which comes with content, reviews, Google Maps and more,” says Guinard.
“We don’t sell data on spending behaviour or usage data within BNP Paribas. What we do offer is greater accuracy on customer payment data, enabling them to get more out of their own data,” he says. “That’s a promise we make.”
It’s not, however, something the bank can make the most of on its own. BNP Paribas stopped defending the castle a few years ago and instead began inviting fintechs inside its walls to help it improve services.
Fintech partnerships are increasingly essential.
“There used to be a time where it was all mostly
Using that resource and then exploiting the role of generative AI as an agent to go and interrogate it on behalf of the customer in an intuitive and relatable way is the next step.
While BNP Paribas is doubling down on the acquiring business and bringing in the infrastructure needed to run a modern payments service to strengthen its USP, it’s also demonstrating a wider desire in financial services to reclaim control of the European payments landscape – or at least, not cede any more of it to outsiders.
BNP Paribas claims to be unique among European banks in covering the entire payment value chain – it’s investing in both issuing and acquiring, while playing a major role in domestic schemes and clearing systems.
“Customers will be able to ask questions in our digital environment such as ‘which restaurant did I go to in London one year ago?’ and a chatbot will get them the answer and contact details. ‘Here is the phone number, here is this website, would you like to contact them again?’.”
This is about more than adding cool features. When your banking app becomes your personal assistant, there is an even greater incentive to stick with that provider. Key to that happy, long-term relationship is trust – trust to handle data effectively and safely.
“It’s essential,” says Guinard, “particularly payment data and the privacy around that.”
Which is why BNP Paribas might have opened the keep, but it’s not giving up the crown jewels. No individual customer data ever leaves the safety of its estate.
“We build partnerships with fintechs that enable us to keep the hosting of the data within our own safe, technical environment,” Guinard explains. “And what the fintech deals with is
The Paris-headquartered bank was one of the early drivers and adopters of A2A payment solution Wero, which was launched by the European Payments Initiative (EPI) in 2024. It’s Europe’s first true cross-border payment system and the first concerted challenge to the dominance in Europe of Mastercard and Visa. By 2027, Wero aspires to become the bloc’s go-to digital wallet.
Customers of BNP Paribas and other European banks, such as ING and CBS, can access the Wero service via their banking apps and it has enrolled 14 million users so far. In 2025, it’s looking to expand beyond France, Germany and Belgium to the Netherlands and Luxembourg as it onboards more banks.
BNP Paribas has also entered a strategic partnership with fellow French banking group BPCE, to create their own card payment processor to rival the domination of Worldpay
Customers will be able to ask questions in our digital environment, such as ‘which restaurant did I go to in London one year ago?’ and a chatbot will get them the answer and contact details
anonymised data that is unexploitable. So, the enrichment of the anonymised data is being done by a fintech, but it’s personalised and put into the customer’s digital environment by the bank itself.”
Contrary to the business models of big tech companies, some of whom would like to get into financial services themselves, BNP Paribas doesn’t see this data as generating a potential revenue stream for the bank.
– another US giant. According to BNP Paribas, with 17 billion transactions combined, this partnership would be the leader in France and rank among the Top 3 in Europe.
By putting cash management and retail payments at the core of its strategy, and taking a leading role in building cross-border infrastructure, BNP Paribas is drawing a clear line in the sand: the battle for Europe’s payment sovereignty has begun.
Thomas Gillan from BR-DGE explains how orchestration focussed on optimisation benefits everyone in the payment chain
Gone are the days when merchants were held to restrictive, long-term contracts with monoline providers, often tied to the major banks and credit card companies, which held the monopoly and stifled choice.
The past two decades have seen paytech innovation blow the doors wide open on payments, first to increased competition and choice, and now to a whole new level of sophistication, which means vendors can work with not just one but several payment service providers, operating together harmoniously through a single platform. Hello to the new era of orchestration.
In this Q&A, Thomas Gillan, CEO of UK-based orchestration platform BR-DGE, one of the bigger players in this space, tells us how payment orchestration providers (POPs) are reaching critical mass.
This looks set to transfer the balance of power back to merchants so they can satisfy consumers who are demanding ever-more sophisticated and seamless payment experiences. Not only does this help merchants get the best deals, but it also removes go-to-market limitations in an increasingly global world.
In essence, merchants can rely on orchestrators to create a bespoke solution that actually enables, rather than hinders their business aspirations.
Thomas Gillan, Chief Executive Offzicer at BR-DGE
Intelligent routing and management of payments across multiple gateways and processors without the merchant having to worry about how it all happens, could be key to an ambitious company. That said, careful management is required as adding another layer to payment stacks can also bring complexity and additional risk around contractual arrangements.
Gillan describes how BR-DGE’s modular approach means merchants can select additional safeguards proportionate to their risk, which artificial intelligence is helping to automate. And all of this can be beneficial for acquirers, too, he says.
Traditionally viewing orchestrators as a competitive threat, acquirers are now recognising how they can enable them to overcome their legacy tech reliance and avoid disintermediation by utilising some of the white-labelled capabilities offered by the platforms.
In this way, they can create new opportunities for growth through expansion of their merchant services in an increasingly global trading environment where businesses need to operate across multiple geographies, verticals and channels.
The Fintech Magazine: The meaning of orchestration is still subject to interpretation. What do you believe it can deliver for merchants?
Thomas Gillan: Orchestration is getting a lot of coverage at the moment, and it’s important providers define what their version is so that people are clear what services they can provide and how they can add value. For me, it's really important to talk about optimisation.
That’s about both ensuring your customer, the end user of your
checkout flow, is paying the way they want to pay in the least amount of clicks possible. But, critically to the merchant, it’s ensuring you capture every pound, dollar or euro that comes over your platform the first time of asking – whether through elevating authorisation and conversion rates, or just how you stitch together that payment flow to make sure you’re attracting and converting as much as possible from the basket into the bank.
Orchestration can also solve a lot of merchants’ problems and that’s a great opportunity for software providers because offering them new solutions continues to deepen your product.
We major on the optimisation piece because, when orchestration started to come to the fore, some of the payment product providers and acquirers took a sharp intake of breath. All of a sudden it blew open the market and replaced their 100 per cent ownership of the customer, with a multi-acquirer strategy where you can say ‘these transactions here are better processed by this provider and, for these, we’re better with this other provider’.
In this way, it isn’t all just about cost and it’s really helped us build a stronger partner network because we can give partners distribution and access to the flows they’re best at acquiring.
It’s always important to understand what the merchant is trying to achieve, because everyone has different priorities at different times. They might already be very highly optimised and want to focus more time on authorisation rates, for example.
The great thing about orchestration is you can direct the payment flow at any stage. In terms of authorisation, that might be to put in additional fraud
checks, 3DS journeys, or route transactions to take advantage of certain exemptions with some acquirers and do it much smarter. This means it’s really important to work with the merchant and the client to understand where they want to leverage value, and almost go for the lowest-hanging fruit.
That could be through a tokenisation strategy, which they can get through our vault, or through optimising new payment methods, local and alternative payment methods at the checkout. Or they might need to drive conversion through dynamic retries and resilience – it can be one, some or all of the above.
TFM: Why is modularity so important, when it comes to ensuring the best end-user experience?
TG: One of the things we found with orchestration very early on in our journey is that being able to stitch together so many vital parts of the payment ecosystem and solve so many different problems, can be quite overwhelming for merchants in knowing where to start, especially if they have multiple challenges they want to tackle.
So, we were very deliberate in making our offering modular and interoperable, so that customers can draw down certain things as individual services and then expand. For example, one of the really positive market developments we’ve seen is network tokenisation.
We’re seeing big changes with the continued growth in e-commerce and online cardholder-not-present, but then it’s all about the security and making sure we’ve got a much more streamlined customer journey for the end consumer.
Network tokenisation has been amazing at delivering that,
whether it’s keeping the cardholder details up-to-date or just increasing security on a merchant-by-merchant transaction level.
This is why, for us, it’s been hugely important to offer it as a modular service that they can consume as a standalone and really add value from the beginning, while making sure we’re not just stopping there. We’re always asking what other challenges we need to solve but thinking ‘let’s do it in an order that suits the merchant’.
TFM: Beyond the tools themselves, how crucial is access to expertise and support for the merchant-customer, and what additional possibilities could that unlock?
TG: I'm a big believer in the fact that any technology vendor should be able to be a sparring partner, capable of providing advice, support and constructive feedback as well, as organisations go through their growth journey. That’s especially true when scaling because payments infrastructure is complicated, but it’s the lifeblood of an organisation. Making sure the customer feels they have real support – not only someone at the end of the phone, but someone who has their back, is key. If you don't get that right, you’re going to struggle to drive long-term value; and it’s why I talk about a more
partner-led approach because there’s no one-size-fits-all.
In fact, this is how we’re going to start to see certain providers really break out – and there’s going to be a scale tipping point.
Take us, for example. We’re a data company in payments in many respects, and we can only optimise, based on the data we’re seeing across the platform. So, our big focus has been on building volumes to be able to improve the optimisation decision-making we can provide. Over the next three to five years, we’re going to see a couple of providers reach that critical mass and really start to scale, based on the data sets they’re able to build. Alongside security and tokenisation, data will be a key element of the payment journey.
There’s also personalisation to the consumer, because it’s very easy to forget the actual end beneficiary is the consumer. They want to pay using the method they choose and have it as friction-free as possible.
We’re now starting to look at how to turn payments from hygiene factors into value drivers – by personalising the checkout journey so that someone lands in a checkout and can see the payment method they’d like to pay with or their last payment method.
Then, you can build loyalty into that by providing certain payment methods linked to the status of the customer. That’s a fascinating piece that’s going to start to evolve and, for me, orchestration is the enabler to make that happen.
It’s always important to understand what the merchant is trying to achieve, because everyone has different priorities at different times
“I often see financial services companies, banks in particular, not making the correlation between employee experience, productivity, and end-user experience. People often think of them as distinct, but they’re highly related because their employees serve their customers.”
Put like that, the connection between employee and customer satisfaction seems so obvious. Yet Trisha Price, Chief Product Officer at software experience management provider, Pendo, says many firms still miss the vital connection between employee and customer satisfaction and how that impacts their bottom lines.
Having spent her career working for well-known names in the fintech space,
An explosion of apps in the back office could be jeopardising the very thing they were designed to improve. ‘Swivel chair integration’ fatigue is real, says Pendo’s Trisha Price
including building bank operating systems, Price understands how better digital experiences can help companies attract and retain their customers in a highly competitive marketplace. However, following significant industry-wide investment in digitisation over recent years, she believes firms now need greater understanding
of how work gets done internally to improve their bottom line. They need data on how employees are using the software required to do their jobs. Had she had that, her R&D teams could have made the improvements necessary for employees to be more productive.
“I realised I was frequently flying blind with the digital experiences I was in charge of creating, wondering if they were hitting the mark and getting the outcomes we wanted,” she says.
“I never had the data I needed to be confident in that, so it’s been incredibly exciting to come to Pendo and help create the tools to provide that data and clarity, and help ensure product leaders across industries have what they need to drive business outcomes like revenue growth and employee experience.”
She’s watched financial institutions invest heavily in the customer journey, listening to their feedback and iterating endlessly to meet their needs. Meanwhile, the employees behind the scenes, working to make it all happen,were suffering digital burnout.
“That same focus on data and experience for their employees as for their customers is vital,” says Price.
“New applications are an important part of digital transformation, but the constant introduction of new systems and workflows means more for employees to learn and onboard with.
“The number of apps now available really causes issues for them. I call this ‘swivel chair integrations’, meaning they’re working on one application and have to turn and work on another, seeking information and duplicating the same workflow in multiple places, which is error-prone and causes productivity issues.”
There’s good evidence to back this up. Asana's Anatomy of Work Index 2021 report into the work habits of 13,123 knowledge workers in eight countries, found that more than a quarter said switching between work apps made them miss actions and messages, while 26 per cent said app overload made them less efficient at work. All of which is heightened, post-pandemic, with digital platforms now providing the gateway into hybrid working.
By 2023, a Gartner survey of 4,800 employees found the average desk worker was using 11 apps daily, with almost half saying it was harder, not easier, to find the information they needed. More than a third missed important updates due to the sheer volume of apps deluging them.
Employers can’t afford to ignore the experience of staff, especially since a study published by Renascence in 2024 drew a direct correlation between happy employees and happy customers. Financial institutions that improved employee satisfaction saw a 25 per cent increase in client satisfaction.
Pendo’s software experience platform helps improve how work gets done, from employee onboarding to overall software usage.
It believes its insights and in-app communications tools are more effective than one-off training, helping
employees onboard faster and use tools the right way.
Pendo can personalise in-app guidance to individual employee needs, including job role, department and location, to offer ‘real-time, scenario-based assistance’ – helping employees to navigate across the many apps they need to fulfil various tasks.
For example, it can assist employees generate reports with just-in-time, in-app guidance, eliminating the need to hunt down previous training sessions or abandon workflows.
Insights into employee usage are then fed back to the company in real time, so that IT, operations and internal product managers can implement continuous improvement and problem-solving.
AI-powered behavioural analysis reveals trends like where new employees may benefit from additional support, which features they use, and where they’re at risk of noncompliance, so companies can build employee confidence and protect their business from risk – aiding customer retention, productivity and, ultimately, revenue growth, says Price.
New applications are an important part of digital transformation, but the number of apps now available really causes issues for staff
She believes live insight into how staff are coping day-to-day with new technology is key.
“The biggest thing companies need to be successful is to have all the data, such as how many employees are logging into applications and what features they’re using.
“If a company is spending an enormous amount on licences, are those ‘seats’ being utilised? But more importantly, are their employees as productive as they need them to be and are they receiving the value they set out to achieve by purchasing each piece of software?
“The qualitative information is equally important – like how employees feel about each application, whether they
are confused or frustrated, and then being able to actually, at scale, watch how they’re utilising them. See where they are getting stuck and how they are navigating workflows and user journeys. Where they are rage-clicking the same button, over and over again, because they can’t get their job done.
“And when they can’t get their job done, not only are they frustrated and unhappy, but you, the financial institution, are not getting the productivity and the business outcomes, and that has a direct impact on the bottom line.
“All these pieces of the puzzle are critically important to support digital transformation and make sure firms get return on the massive investments they’re making. AI is a great way to see the patterns in this data and then suggest improvements,” says Price.
It can be used to augment employees’ productivity by introducing automation and agents, including tools that help find insights, and even conversational applications that act like banking advisors. They can look at data and provide the employee with suggestions about what other products a customer might want, or how they should price a particular product, such as a loan.
“Agents with the potential to do work on behalf of the employee is where it starts to get really interesting,” says Price.
Staff and customers are, after all, similar in as much as companies like Amazon and Netflix have set all our expectations for personalisation.
“When we log into software, we expect it to know us and what our preferences are. We adjust our user experience, based on those things. Financial institutions need to do the same for their employees,” adds Price.
“If I’m an underwriter, versus a banker, versus another role at a bank, when I log in, I want the experience to be personalised to my job and what I’m trying to do.
“The experience can evolve, based on how many times an employee has used an application. The first time they log in they might want a welcome experience, whereas, if I’ve been using this piece of software for years and I’m an administrator, I don’t want simplicity. I want to get straight to the job.”
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Are Nordic institutions being overly cautious about genAI adoption or just waiting for the right moment to land a punch?
We asked Nordea’s Søren Andreasen
Many anticipated that 2025 could be the year when AI gets over the hype cycle and begins to play a meaningful role in business.
Seventy-seven per cent of bankers believe value derived from AI will be the differentiator between winners and losers in the coming years, according to The Economist. And there’s no doubt there’s serious investment behind it. The International Monetary Fund says the financial sector’s AI spending is set to more than double by 2027.
In practice, fintech strategists at 11:FS say that the breakthroughs will come from automating workflows, streamlining compliance, and enhancing fraud detection. But it has acknowledged there’s been a reality check of late as ‘banks discern [AI’s] true capabilities and limitations’.
According to recent research from Boston Consulting Group (BCG), only 26 per cent of companies have developed the capabilities to move beyond proofs of concept and generate tangible value. And there’s a noticeable change of pace around genAI specifically.
Take the Nordic countries, where you might expect enthusiastic adoption – they are, after all, renowned for being among the most comfortable with digital technology. And yet a survey of 110 business leaders across the Nordics by Cognizant and Oxford Economics revealed they were less optimistic about adopting genAI than elsewhere in Europe – their genAI ‘momentum score’ coming in 14 per cent below the average.
McKinsey had previously reported (in 2023) that AI, in all forms, was ‘not a priority on Nordic C-suites’ agenda’ – although that might have been because ‘the most significant barriers to adoption are a lack of talent, strategy, and technological infrastructure’.
BCG was less empathetic, going so far as to say the Nordics suffer from ‘genAI complacency’.
Søren Andreasen who heads up Digital Customer Engagement at Nordea, the largest bank in the Nordics, with total assets of €584.7 billion, isn’t complacent, but he is cautious.
“It’s pretty evident that banks are laser-focused on genAI,” he says. “A lot are at a similar level, experimenting with it internally, or using it for a few customer applications.”
He told a FinTech Connect event in London in late 2024 that we may only see the transformational effect of the technology over the next five years. That doesn’t mean that Nordea is shying away from it, though.
“I put a lot of effort into making sure my team knows how to use genAI and what to use it for so, when they have a use case that makes sense, they can apply it,” says Andreasen.
The bank has even held hackathons to increase familiarity with the technology and is already using it internally, but as yet it’s not exposing genAI directly to customers.
I put effort into making sure my teams know how to use genAI... so, when they have a use case that makes sense, they can apply it
“It’s a way of building our organisational muscle, learning how to use genAI and discovering its pitfalls and challenges,” says Andreasen.
“We know how to build models that check for biases, but it’s important that our customers’ data is kept safe. And, as a universal bank, we also know some of them are not really ready for genAI prompts yet.”
That said, the bank has implemented some initial use cases. Andreasen outlines just one. “We are experimenting with generating marketing content, where our messages have to be personalised to many different languages, countries, customer segments and form
formats,” he says. “Six languages x four countries x 20 customer segments x 10 channels (web, mobile, Facebook, LinkedIn, etc) will add up to hundreds of different expressions for each campaign we do.”
But, in general, he’s of the opinion that it’s still a nascent technology, and says it’s unclear where the best models will come from. The surprise launch of DeepSeek V3, which proved that models just as transformational as ChatGPT could be built for a fraction of the cost, demonstrated that. As Andreasen points out, billions may already have been wasted.
“Right now, it’s hard to see any significant business opportunities in the industry that could become a sustainable business model, which other banks can’t replicate,” he says. “The consensus is we’re probably five years away from really seeing the transformational aspects of genAI in financial services.”
Is there a danger, though, that hesitancy in the Nordic banking space will lead to complacency and loss of talent? Assessing the overall business landscape, BCG found that only 19 per cent of Nordic white-collar workers report using genAI on a weekly basis, compared to a global average of 61 per cent.
Andreasen is pragmatic. It’s not all or nothing, he says. “Rather, with genAI, we’re moving towards a new norm, where this is just another tool in the banking toolbox”.
As for business opportunities, ‘it will come as the technology matures’, says Andreasen. “And maybe, in five years’ time, we’ll have seen some really transformative use cases for it.”
In theory, he agrees that there’s no better location to roll out the technology.
“Sweden, Norway, Denmark, and Finland are all super-digitised. Everybody has a digital ID, for instance. That gives us a great advantage when it comes to deploying technology and getting customers used to using our solutions.”
But with genAI, that's still to come.
Most FIs have done digital transformation once, but technology doesn’t stand still – and upgrades can create their own roadblocks. Newgen’s transformation platform aims to keep the information highway flowing
Ever been gridlocked at a ‘spaghetti junction’ and thought to yourself ‘there has to be an easier way’?
Well, digital transformation platform provider Newgen had exactly that thought about a different kind of traffic flow – documentation and data within financial institutions – and decided to find one.
It recognised that the race to digitise has left many banks and other financial institutions (FIs) stuck with a complex system of tech upgrades and bolt-ons, which can cause frustrating blockages, tailbacks, bottlenecks, and the occasional accident.
While the pace at which financial services (FS) firms are embracing digital transformation is undoubtedly great news for their customers, a piecemeal approach to getting products out the door has created internal issues. The end-user might marvel at how cleverly automated everything seems at the front-end, but behind the scenes there are endless staff in middle- and back offices, running around, trying to make it all work.
Newgen takes on the role of a traffic controller by providing a single platform and tech infrastructure, which can choreograph end-to-end process and data flows. It’s designed to wave everything through seamlessly, from the customer to the back office –a radically different approach for many.
According to its website, Newgen’s low-code platform helps clients ‘develop and deploy complex, content-driven, customer-engaging business applications on the Cloud. From onboarding to service requests, lending to underwriting, and many more use cases across industries, it says its patented integrations help to ‘save FIs from buying a host of single
Rajvinder Singh Kohli, Senior VP Growth and Strategic Initiatives at Newgen Software
end-point solutions’. With hundreds of clients globally, it has handled major installations for some of the world's biggest institutions.
Rajvinder Kohli is responsible for Newgen’s strategic sales and partner ecosystems, focussing on helping FIs get more from their significant technology investments in digital transformation.
“You have to plan your journey properly,” says Kohli. “If you set the front office right, where applications are being generated, but don't take care of your middle or back office where the processing is happening, it will lead to bottlenecks. it’s a mistake many FIs are making.
“Our capability supports customer onboarding, information validation and finally the management of the whole customer relationship, making customer journeys more effective and pleasant while delivering the return on investment or differentiation a company is seeking from its transformation.”
There is certainly plenty for Newgen to go at in markets like the US where cutting-edge technology is operating alongside archaic systems, creating a hold-up that prevents the speed of change they need.
“Despite it being 2025 and not 1975, there are many obsolete solutions out there,” says Kohli. “And customer preferences and business practices have changed post-COVID. The velocity of change has also increased, with newer, more disruptive technologies like artificial intelligence (AI) and generative AI (genAI) coming into play, which banks must leverage to be competitive.
“We are geared up to support the potential for disruptive transformation through our drag-and-drop, Lego-blocks approach. You put them all together really fast, because if the process takes
you six months, somebody will have already disrupted with something different. Firms need to be nimble, making process changes and transformation happen fast enough to lead the market rather than always just following it.”
Newgen builds belief in the platform by starting firms off on oven-ready solutions, called Accelerators, designed for critical processes like loan origination, digital account opening and trade finance. The Accelerators enable clients to see the benefits early on.
“Together with our large ecosystem of partners, we can then leverage our platform for other process automations – backed by technology transfer training,” says Kohli.
Newgen utilises leading-edge technologies including machine learning (ML) and large language processing (LLP) to help it deliver its promised speed and efficiency. Most recently, it has launched AI tools to tackle specific business requirements. Its Harper Conversion Intelligence Platform helps audit calls, translate customer need and suggest improvements to ‘simplify sales and enhance the customer experience’. Its Marvin Productivity Platform automates routine tasks and processes using advanced AI to streamline operations by taking care of data entry and reducing errors for greater productivity. While its LumYn Growth Intelligence Platform helps FIs identify revenue growth opportunities by analysing customer behaviour using conversational AI for data analysis, then enabling fast deployment and experimentation through its proprietary low-code platform.
Kohli has previously explained Newgen’s rationale for using ‘agentic AI’ as follows: “Organisations are built
around customer journeys, punctuated by numerous decision points. Our vision is to use AI to unify and optimise these through what we call ‘agentic workspaces’, which empower users to rapidly design and deploy end-to-end workflows, with AI assistance at every stage.
“This dramatically reduces workflow development time and delivers a frictionless customer experience, leveraging technologies like generative AI, large language models, and machine learning. Ultimately, our core focus is on creating human intelligence-like or agentic software.”
At the most recent Finnovate Europe event, Varun Ghai, Newgen’s Associate Vice President, outlined how it is applying that in analysing and authenticating customer documents, performing customer data penetration analysis and predicting behaviours in various economic
processes involving documents – like classifying documents – to support employee efficiency and increase accuracy.
“You can create processes through large language models that allow you to say ‘give me the 10 steps required for loan origination’, and it can create a skeleton which can be imported into our software for establishing those processes, speeding up automation and go-to-market time.
“AI is also helping with customer communications – answering questions like ‘what should the content be?’ and ‘how often should you send it?’. AI and ML models, as well as cognitive services, are also useful in data models for decision-making.”
Kohli says Newgen’s low-code platform is ideal for the pace of change required. “It’s about asking how we crunch the cycle of
It all requires significant investment.
“We spend a lot on R&D,” adds Kohli. “About one third of our organisation focusses on new feature capabilities – learnings and experiences from working with our hundreds of customers as reference sites. All our capabilities are homegrown and organic, talking to and integrating with each other, reducing the infrastructure footprint that organisations need, as compared to managing different capabilities with different products.
“We remove the pain for CIOs by providing them with a common platform from which they can automate each process as they go –with strong security, scalability and regulatory compliance across multiple jurisdictions, continuously tested in our Newgen Cloud.
“We apply logical decisions like ‘our experience is that this person with this kind of
scenarios, to generate ‘a whole ecosystem of lending transformation that uses the combined power of data science, decision-making, low code, contained AI and process AI, end-to-end’. This would see financial institutions increase their lending productivity, achieve straight-through application processing, and expand the scope of their business initiatives.
Kohli says: “We focus on the three pillars of content, process, and customer communication.
“AI’s first benefit is finding intelligence within content. All of us have used ChatGPT, which uses content from across the web and comes up with the information you’re looking for, based on contextual questions. This makes unstructured and semi-structured data available for querying all kinds of things.
“The second benefit is extracting information from documents or automating
We remove the pain for CIOs by providing them with a common platform from which they can automate each process as they go along
a process transformation and reduce that time.
A deep tech, low-code solution like ours suits large financial organisations with a large amount of compliance to navigate, requiring privacy, security and scalability.
“It’s about transforming processes with appropriate governance, which is why we are not no-code. Ultimately, what keeps us awake at night is answering questions like ‘how do we make this easy to achieve?’, ‘how do we make integrations easier?’ and ‘how do we do all these things much faster to meet today’s market requirements?’, because it's a competitive world out there.”
background generally pays loans on time, so you don’t need to worry too much, but then you must do a bit more for somebody who doesn't have a regular job – all of which is configurable in a rules engine.”
Among examples of transformative changes that Newgen has helped execute is a medium-sized lender which used the platform for loan origination over multiple channels.
“They were really struggling with this,” says Kohli, “but today they're able to do the majority of loans within 30 to 40 minutes – a big, big improvement for their business, positioning them as one of the US’s leading loan companies.”
Small-scale fraud adds up to a big global problem that needs urgent and co-ordinated action, argue Taavi Tamkivi and Jessica Cath
Fraud-related media stories have haunted the headlines over the past decade, linked to serious topics – organised crime, European conflict and terrorism among them.
Most recently, sanctions imposed on Russia and those associated with its war against Ukraine, have seen financial institutions racing to shore up their systems to identify bogus payments, money laundering and activities by black-listed individuals. It’s not only the right thing to do, but, if they don’t, they risk hefty fines.
It’s the explosion in personal scamming, though, that’s really amplifying illicit money flows. And that doesn’t get the attention it deserves, according to Taavi Tamkivi, CEO and Co-founder of European AML and intelligence sharing platform provider Salv.
He says ordinary individuals represent a practically limitless market opportunity for criminals – and that the money they are conned out of also needs to be ‘lost’ in the world’s financial system.
“Fraud and anti-money laundering (AML), were traditionally seen as distinct challenges [but now] they are mixing more and more,” says Tamkivi. “This is due to the heavy wave of scam fraud, which was tiny when it first emerged a decade ago – when the real dirty money that needed laundering came from drugs, human trafficking and oligarchs.
“Recent studies have suggested scamming is potentially as big as global drug trafficking, volume-wise, and exceeds trillions in monetary value, which has shocked the whole industry.
“I’m surprised by not only the speed of change but the speed of the industry response, because we love to think of fintechs as being super-fast, tech-savvy and adaptable. But criminals are changing their behaviours and how they operate way faster – which shows in the amount of money they are managing to steal from ordinary people.”
According to the Global Anti-Scam Alliance's (GASA) latest report, The State Of Scams In The UK – conducted in association with the UK's leading fraud prevention service, Cifas – victims lost £11.4billion to scams in 2024, up £4billion on the previous year.
“If criminals are selling drugs, their target addressable market is limited to people who have money and are addicted. But the whole world is their market for scam fraud schemes, opening up so many different dimensions for criminals and the crime fighters trying to stop them,” says Tamkivi.
Jessica Cath, from compliance and risk management consultancy Thistle Initiatives, agrees. “While there are different typologies, themes and trends to each, we are definitely seeing a conflation between fraud and AML because the proceeds of fraud need laundering,” she says.
“Around 37 per cent of all UK crime, for example, is fraud – a very high number – and around 70 per cent of cases have ties to overseas. Some of those links overseas are particularly complicated, like scam factories in Southeast Asia, manned by trafficked people being forced into initiating and operating scams across borders.
“No matter how small the fraud, it has a really big impact on people who lose money,” she continues. “However, we shouldn’t forget the other types of financial crime, when there is a war going on here in Europe requiring sanctions, and people being trafficked across borders.
“It’s a huge, challenging issue and the UK is seen as a big hub for illicit money. You’ve got Russian kleptocrats and corrupt, politically exposed money flowing into the UK, and we’re still very much an enabler with lots of law firms, accounting practices, etc, supporting the money laundering infrastructure. Only last month (March), a law firm was fined for engaging with firms sending money to sanctioned Russian entities.”
Tamkivi adds: “Authorised push payment and scam fraud, unlike money laundering, is numerically measurable because victims report their stolen money to the local authorities, whereas no-one ever publicly complains about oligarchs’ or drug traffickers’ money, making it harder to quantify.
“Over recent months, reports from the US, UK, EU and Australia have shown people are losing billions. This is bringing more attention to the issue, and therefore more resources and smart people, to help resolve it."
Both Cath and Tamkivi are joining the call for a more robust and collaborative cross-industry approach.
“We can apply resources on a case-by-case basis to tackle all of it, but the scale we’re talking about needs something bigger,” says Cath.
“Undoubtedly, firms need strong monitoring frameworks to identify, report, address and stop fraud from happening – they need to watch super-fast payments coming in, particularly looking at inbound payments very quickly, risk assessing and deciding whether they’re fraudulent – backed by strong governance frameworks, policies and procedures,” says Cath. “But that’s difficult to do and this is bigger than individual firms.
“There are other layers, like domestic government frameworks. But then we need cross-border interaction, better ways of interacting, regionally and globally. Given some of the geopolitical pullback, nationalisation and lack of communication across borders, I am sceptical that some absolutely key regional and cross-border initiatives won’t be scaled back.
“We are seeing good programmes across Europe and in the UK, though, and other countries are looking to introduce something similar.
We are definitely seeing a conflation between fraud and AML because the proceeds of fraud need laundering
“Then the third element in this are the customers themselves. We need them to be aware of these scams and, although a controversial view, to take responsibility for their payments.”
Tamkivi believes the industry can and should do more, but, ironically, what’s holding it back is the desire to keep the customer happy.
“Enabling industry players to exchange
hints or red flags about fraudulent cases is a missing component in today’s payments world,” he says. “A similar approach existed back in the early days of card and e-commerce fraud, and now we need to apply the same logic again.
“But I’m speaking with large banks and other institutions and they’re saying they’re willing to pay for the losses to maintain customer satisfaction, regardless of the legal obligations. If it doesn't hit their baseline numbers, they are not willing to be too proactive about making changes.”
Since late 2024, UK banks and other financial institutions have been obliged to cover fraud victims’ losses. But the government scaled back the maximum compensation from £415,000 to £85,000 and allowed banks to impose a £100 excess. Almost a third of APP fraud is for values under £100, which means many victims could get nothing and banks don’t lose.
Tamkivi believes governments need to bring more pressure to bear, to encourage the financial crime community to overcome barriers to intelligent information sharing.
“The first element is understanding how different types of crime are happening,” explains Tamkivi. “For example, the different stages where the criminal gang comes up with tactics for their target market and which schema to use – banking impersonation, a romance scam or big-budget sharing, for example. How they’re selecting attack vectors, gathering information about their victims and then starting to execute through social media or telecoms. How they’re buying technology and services from their contacts to set up fake crypto sites where victims can make investments they will lose immediately.
“Then, the second part of the story is the movement of the proceeds, perhaps from the victim’s bank account with a large and secure institution, to accounts they already have with a fintech or neobank, which can move the money quickly.
“The crime-fighting industry understands the whole chain. They are gathering the first element of the story, about telcos, social media sites and technology providers; mapping out
fraudulent IPs, websites, and so on. And this information is starting to move by sharing things like blacklisted or greylisted websites and IP addresses among community members.”
But when it comes to the financial institutions themselves, he says, misconceptions around data-sharing regulations and fear of breaching them is preventing many from collaborating as effectively as they need to – despite the Economic Crime and Corporate Transparency Act making it clear that they can share information if it stops economic crime or facilitates investigation of it.
The UK government also underlined this by issuing guidance in December 2024, encouraging peer-to-peer data sharing between firms related to economic crime. But, at the same time, institutions are even more fearful of falling foul of the law if they wrongly identify a legitimate account holder who ends up being denied access to banking services. It’s a Catch 22 that deeply frustrates Tamkivi because it’s led to a zero-risk rather than a true risk-based approach to fighting fraud.
Studies suggest that scamming is potentially as big as global drug trafficking… which has shocked the whole industry
Taavi Tamkivi, Salv
“Institutions are under major pressure from regulators in terms of things like privacy and General Data Protection Regulation, and afraid to share any intelligence, even if it could have a positive outcome,” he says.
“Now is the right time to use a mature, risk-based approach, but it’s proving hard to achieve mentally for the market. Sanctions-screening software has existed for 20 years and everyone is familiar with it, intelligence-sharing technologies are newer, though, and FIs must adapt to processes they haven’t used before,” he says. “But the technologies are there, the departments are there. And, remember, criminals are taking risks – and they’re winning.”
British neobank OakNorth has definitively planted itself in American soil with the acquisition of a community bank. So what will businesses there make of it?
It may have been serendipity that OakNorth’s first acquisition in the US is based in Oakland County, Michigan. But it’s not just the name that should make the British neobank feel at home.
Built on the back of manufacturing and tech, Michigan is a state that’s proudly pro-business, with hundreds of thousands of small enterprises that fit snugly into niche lender OakNorth’s target demographic of the equivalent £1million to £100million turnover.
The Community Unity Bank (CUB) acquisition, which is subject to approval, is a crucial stage in OakNorth’s plan to expand across the States, having first exported its business lending model there in July 2023. Since then, it has lent more than $700million stateside, including to UK businesses in the US such as nursery brand Mamas & Papas.
In fact, OakNorth chief executive Rishi Khosla recently said demand from US borrowers had exceeded expectations, the bank lending three times more than anticipated.
In CUB, OakNorth found a kindred spirit. Both organisations were built by entrepreneurs for entrepreneurs and they both set out to address a gap in the provision of small business credit in their respective markets. Now, as trade tariffs threaten between the UK and the US, OakNorth finds itself uniquely placed to assess the risks and opportunities for both business communities.
Launched in 2015, OakNorth has never deviated from its target customers – growth-driven, lower-mid market businesses with a proven model and aspirations to grow.
Hugo Oliveira Sousa, who arrived to set up the bank’s marketing operation in 2021, says: “Until then, OakNorth didn’t have a marketing team, the business was profitable from day one and was built on referrals, which is quite a feat.
“It is a brand built on a niche, which is businesses that are routinely underserved in terms of their growth needs. Our differentiator from other banks is that
we are founded by entrepreneurs, not bankers. Our people know inside out the pain points of scaling a business.”
A crucial part of OakNorth’s own expansion will be populating its proprietary data platform, which is used to aggregate information held on its customers to provide a unified view of each individual or business. The knowledge it has provided in the UK has allowed the bank to bridge the gap between digital neobanks that struggle to serve clients with complex capitalisation structures, and incumbents that can cope with complexity but lack the speed and efficiency of digital platforms.
Sousa says: “We didn’t focus on developing technology to support our business to lend more. We developed it to assess customers better, and faster. The new generation of business owners live in the digital age but expect a human element due to the specific needs of their business. To date, no technology can support that complexity with a digital experience only.
“No one wants to pick up a phone if they don’t have to. But, if you want to make a £1million transfer to buy your next business or plot of land, and a computer says no, a chatbot can’t help. You need a human who knows your business.”
Sousa says OakNorth’s goal has always been profitable growth. That means it has resisted the urge to move mass market, which risks onboarding unprofitable customers or such a wide range of them that the bank’s customer support model becomes overloaded.
So far, that’s proved the right course. OakNorth’s annual report for 2024 reported a pre-tax profit of £214.8million, up 14 per cent on the previous year. Loans and advances to customers rose 15 per cent to £4.42billion last year.
Last summer, the bank launched its business current account to build stronger relationships with those customers. And, as senior director, Sousa now co-leads the banking team.
Since a business account is a ‘commodity’, he says, the platform is provided by cloud banking fintech Thought Machine, but the offer is tailored by OakNorth to meet its niche market’s needs.
“When we began work on the business product we knew 60 per cent of our customers on the lending side were recurrent customers, but that’s event-driven, we didn’t keep a consistent relationship,” he says.
“We had customers asking us for a business account that was as seamless as their loans, so we realised it was something we could do. But there’s no point in acquiring thousands of business customers if you can’t monetise and support them with a product they are willing to pay for. We say clearly, we’re not competing on price. We compete on premium service to meet specific needs.”
An example of those needs could be a customer who has to open a bank account fast for a special vehicle it has created for an acquisition – that would typically result in rejection from a neobank and a waiting time of months with an incumbent.
“We can do it quickly because we understand complex company structures,” says Sousa. “Solving specific
needs for specific problems that a business has is proving to be 10 times more valuable than having people open accounts en masse.”
As OakNorth is laser-focussed on the challenges it seeks to solve, Sousa says features such as the business account’s AML provision and payment cards are delivered by proven third parties.
“Our app, our front office, our experience, all that is done in-house,” he adds. “But for cards, for example, why spend millions developing that technology when it’s already there and you can plug and play? Our data platform is proprietary, so we develop that. It’s connecting our systems and that’s an important point.
agriculture loans. And that strong local focus, designed to create and maintain wealth within the areas they serve, is traditionally built on local knowledge and community activism.
Community Unity Bank was created in 2023 as a reaction to a decline in local banks and industry consolidation, plus a perceived lack of personal service and empathy during the economic crisis of 2008 and the COVID pandemic.
With parallels to OakNorth, it brought together entrepreneurs from around Oakland County to meet a need for small business lending and aims to be ‘client-centric and service driven’ while ‘deploying state-ofthe-art technology that is easy to use’.
Its team has worked hard to
“If you go to one of the incumbents and ask for a business loan, it’s a completely different unit to when you go to open a business account. All these systems are disconnected. But a customer is a customer – a business owner may have six different businesses and is probably saving with us at a personal level. So having a unified view is important for our experience and it’s something that we want to control.”
OakNorth will be hopeful its niche focus will win favour with the US’s small to medium-sized businesses, while being protected from defaults by its commitment to building holistic customer data – something that CUB will give it a headstart on in Michigan.
After all, community banks have a long tradition of knowing their local users well in a vast country.
According to umbrella group, the Independent Community Bankers of America, they provide 60 per cent of small business loans under $1million and 80 per cent of banking industry
If you want to make a transfer of £1million to buy your next business and the computer says ‘no’, a chat bot can’t help. You need a human
establish relationships with businesses in the south east of Michigan while providing loans for business expansions and bank accounts to both businesses and individuals.
A recent survey by McKinsey of 1,200 American SMEs found their most important criteria when selecting a primary bank was robust relationship management followed by the availability of online and mobile tools.
With a commitment to offering both of those, the combined OakNorth and CUB teams promise to be a powerful force in a state that is all about expansion.
As Henry Ford, one of Michigan’s most famous entrepreneurs, said: “"If everyone is moving forward together, then success takes care of itself."
across so many departments, says O’Neill
Rory O’Neill, Chief Marketing Officer at Checkout.com, one of the world’s biggest payment platforms, has some key words of advice for merchants
Checkout.com works with the who’s who of the digital economy. Its client list is a global catwalk of familiar consumer and B2B names – Alibaba, adidas, Delivery Hero, Docusign, Dyson, Ikea, Remitly, The Financial Times, Sainsbury’s, Sony, Uber Eats, Wise and Vinted among them. Just 40 of those merchants process more than $1billion a year across Checkout.com’s platform, which supports 145 currencies.
Last year alone the company welcomed another 300-plus new enterprise-sized clients and it’s set a target of achieving a 30 per cent
increase in net revenue in 2025. That’s on top of 45 per cent year-on-year net revenue growth the previous year.
Given where the digital payments market is heading – it’ll be worth US$20.37trillion in 2025, according to Statista – that scale of expansion is looking entirely achievable.
Nevertheless, according to Checkout.com’s Chief Marketing Officer Rory O’Neill, many companies still don’t give payments the strategic priority they deserve. After all, he says: “If you don’t take a payment, you can’t get to revenue. And if you can’t get revenue, you can’t get to profit. And if you can’t get to profit, you can’t get to cash.”
The data around a transaction is even more valuable, which is why he believes companies should reflect payments’ importance within their hierarchies.
We asked O’Neill for his key observations on digital payments trends and what companies should be focussed on.
These were his reflections…
Rory O’Neill, Chief Marketing Officer at Checkout.com
Super-successful companies no longer treat payments as a finance function, says O’Neill. Instead, they recognise payments as being distinctly and powerfully important, touching a whole range of departments and strategies. It’s ‘so important and so material’ in fact, that it should be ‘more present in the boardroom’.
“I know many great CFOs. But the problem is that when you’re running a finance team, it’s not necessarily connected to the customer experience,” says O’Neill. “A lot of the really big digital brands now have the payments function rolling up into product or into customer experience because it’s such an important part of that journey. That’s what our world now looks like, and our businesses need to reflect that shift.”
Key to this is understanding that payments unlock data across
departments and inform communication, loyalty and marketing strategy, says O’Neill.
Data derived from Checkout.com’s billions of transactions a year encourages collaboration, better performance and the development of a complex understanding of customers’ habits, needs and wants. It gives insights into spending trends on key retail events in the year, such as Black Friday or Valentine’s Day, and drills down into demographic behaviour changes, depending on geography and location.
companies that work with us, one bip or two bips on their payments acceptance rate, it can represent tens, millions, billions of dollars.
“The way you break through the acceptance rate challenge in digital payments is to share and collaborate over data, with more parties involved in the ecosystem.
“We did some research on the data across our network and found some super-interesting stuff around, for example, Gen Zs,” says O’Neill.
“It’s amazing to see how much growth there is in parents buying mobile phone subscriptions, or music subscriptions, or TV subscriptions for their children, for instance, particularly in the US and UK. But in China, it totally flips – the Gen Zs buy them for their parents! There are very generational changes, in different countries.
“We’ve also looked at how people respond to offers around the world at certain times of the year. In the UAE, for example, they have the highest propensity (84 per cent) to take an offer on a subscription and then stay with that offer.
“That kind of insight for merchants is super-important, because if their marketing teams don’t have offers for subscription services, then they need to introduce them because they are such an important tool.
“It’s great to be able to get those kind of insights from looking at the data.”
In payments, greater collaboration is going to lead to better performance
In the off-line world of in-person payments, a customer holding their card and putting it in a machine is pretty much guaranteed their payment will go through, if they have the funds available.
In the more risky environment of digital payments, however, the success rate falls to around 80 per cent, equating to billions of lost revenue for merchants. Checkout.com focusses on preventing that leakage, says O’Neill.
“We make sure that we’re putting all our resources, all our tech, all our infrastructure, all our AI, all our machine learning into helping the network process digital payments.
“There is no finish line for us. We are constantly and furiously chasing basis points (bips), trying to close that gap. If we can get the
“If you really want to fix fraud, for instance, then get to the source, which is the card issuers. If we can share data with the issuers about how our algorithms work, so that they know more about the merchant codes, and we, in return, get data that tells us more about the consumer, there’s more chance that you can fight fraud and risk associated with digital payments, while also dealing with the compliance aspects at the same time.”
Good retailing is about taking people’s money in the form they want to part with it
A huge part of the value of the data that Checkout.com and others in its network collect is understanding what the barriers to digital payments are from the customer’s perspective.
More than 70 per cent of consumers say they have been permanently put off from returning to a site because it did not have their preferred payment method, according to Statista. With this in mind, in May 2024, Checkout.com launched Flow, a product designed to offer consumers their preferred payment experience at the moment of checkout and therefore combat cart abandonment.
Businesses can boost their conversion rates by offering buyers their preferred payment, method based on location, currency, and the type of device customers are using. It also allows companies to integrate Flow into their brands – including font styles and colour schemes – and can adapt to a user’s local needs by adjusting the checkout process to the relevant language.
Retailers are comparing the price they have to pay (for payments providers) and the acceptance rate they’re getting, versus the acceptable fraud limits
All of this comes with the security offered by Flow of staying up to date with PCI compliance, GDPR rules, and card scheme requirements.
“It’s a really clever piece of code,” says O’Neill, “which is embedded in websites and makes it very easy for merchants to start processing payments. It uses intelligence to auto-present the payment that a consumer is going to need, based on their location.
“If you present the right payment method, you can increase conversion. That’s just one example of how we’re trying to optimise for the macro trends in very micro ways.”
When it’s really high performing, checkout is completely invisible
O’Neill says Checkout.com will continue to use merchants as its eyes and ears when evaluating trends in consumer behaviours and preferences. If a payment method attracts a critical mass of merchants asking for it, Checkout.com will support it.
In searching for the perfect payment experience, one thing is guaranteed, he says –customers will want it to be completely invisible while also being completely secure. That means merchants must determine a payment-to-value equation that’s acceptable to their business.
“Retailers are balancing the price they pay to payments providers and the acceptance rate they’re getting, versus the acceptable fraud limits,” says O’Neill. “As part of getting that equation right, I think we are going to see more payments becoming embedded so they are more simple and invisible for the customer.
“For example, on a flight back from Riyadh recently, my phone knew when I was going to land, because it’s in my Google calendar. My phone also knew what taxi I tend to order when I leave the airport. So, there’s no reason why my phone provider and a payments provider couldn’t all get together to use AI to embed that experience completely – book the taxi at the right time in the right place and do it all for me, given the right sort of prompts.
“That level of integration is difficult to coordinate and schedule, but I think the tech will solve it for us.
“AI agents are going to evolve to become increasingly customised. They’ll sit somewhere between the hardware and a trusted identity network, such as a payments network, so they can go surf the web to get us the things we really need.”
A new global leader has emerged in consulting and testing for payments, smart mobility and ID solutions. Fime’s Lionel Grosclaude and Raphael Guilley of Consult Hyperion, now part of the Fime group, look to the future
By next year, all EU citizens will have access to a digital ID wallet, unlocking everything from tax records to alcohol sales. In the UK, Londoners have been hopping on and off the Tube simply by tapping their phones for years, while a palm print could soon give you a ticket to ride in Beijing. And everywhere payment providers are striving to securely tie payment details to the individual authorised to approve them. The technologies that support all these areas of our lives will likely converge in a digital future where identity is the most valuable currency. And it’s a future that Fime has been preparing for.
Los Angeles-based VC Gallant Capital acquired Paris-based payments testing businesses Fime and the payments testing division of US firm UL Solutions,
Lionel
Grosclaude, Chief Executive Officer at Fime
Raphael
Guilley, Senior Vice President of Consulting at Consult Hyperion
in a separate deal, in early 2024, going on to combine them under the Fime brand. Just a few months later, Fime completed the takeover of London-based Consult Hyperion, a leading global independent consultancy in digital identity, payments, and smart mobility. The result is a group that now employs more than 900 specialists across all three areas of expertise, with 13 global testing labs, representing a huge resource of knowledge and talent.
Outlining its strategy, Fime CEO Lionel Grosclaude says the newly structured company will differentiate in three ways.
“First, we’re going to be able to deliver both strategic and technical advisory. So basically, we are going to bridge the gap between strategic advice and implementation.
“In French, I would say that we are eating our own cuisine! It’s an even stronger message – the strategic advice is much more effective if it’s backed up by deep technical expertise.
“The second initiative involves establishing an innovation hub within the consulting department. It will be composed of PhD-level and senior consultants working on disruptive, state-of-the-art topics such as blockchain and biometrics.
“This team will have the ability to develop some pilots. So, although we
will never develop any solution, we will develop pilots to show that those solutions could work and bring value.
“We have also reviewed our testing portfolio, as we were combining both Fime and UL to get the best out of the two teams, and we have created a digital management platform for testing. We are also integrating a simulator to replicate the ecosystem. And, if a customer wants to outsource the testing to us, we can wrap it up around a managed services contract.
“Lastly, we have strengthened our partnership with key players in the industry, like ISO, but also central banks,
schemes, large payment service providers (PSPs,) and large technology providers, to make them aware of who the new team is and what we are capable of.”
Grosclaude says the formation of the expanded Fime group had to satisfy three key pillars: expertise, scale and trust.
“Expertise in e-identity came with the acquisition of UL’s payment solutions division and consulting with Consult Hyperion,” he explains. “As to scale, now we have 900 experts throughout the globe in 19 countries, and we are able to serve our customers almost anywhere.
“The last pillar, which is important, is trust. We don’t manufacture, we don’t develop any solution ourselves. So we remain always neutral, totally independent from any solution.
We now have 900 experts throughout the globe in 19 countries, and we are able to serve our customers almost anywhere Lionel Grosclaude, Fime
That is very important for our customers.”
From the perspective of Consult Hyperion, which will continue to deliver services under its own name, Raphael Guilley, its SVP of Consulting, sees huge advantages from being part of the Fime group.
“Combining the teams and having this single entity across many countries helps us to better understand the local ecosystem, the local rules, the local specificities in terms of user experience,” he points out. “So it’s about
geographic reach – but not only that. We are working also for all the ecosystems, meaning the chip makers, the card and terminal manufacturers, the mobile vendors and the wallet providers, the issuing banks, the acquiring banks and all the PSPs. And each of those clients will benefit from the learnings and transfer of knowledge.”
Both men acknowledges the opportunities being created by the convergence of digital identity, payments and smart mobility.
“Frontiers are blurring, which is creating a new set of opportunities for new products and new services,” says Guilley. “Not only can we provide guidance to our customers on where the market is going and what the opportunities are, but with our in-depth technology knowledge, we can also help them build proofs of concept to go a step further.”
A licence to thrill
The Fime group is already involved in projects on both sides of the Atlantic, with Consult Hyperion helping to design the EU Digital Identity (EUDI) Wallet architecture.
“We have launched a new version of our e-identity testing solution, which will be able to test not only mobile driving licences (mDL), but also e-passports,” says Grosclaude.
“We will be part of two main large-scale pilots in Europe for the EUDI project, We Build and Aptitude. And we are partnering with some states in the US and technology providers to deploy the mDL proposition.”
Mobile driving licence systems are already active in 14 states in the US with a further 15 planning to soon introduce them. The Secure Technology Alliance’s Identity and Access Forum has forecast that nearly 70 per cent of states will adopt mDLs within two years.
In Europe, the voluntary adoption by citizens and residents of the EU Digital Identity wallet will enable users to identify themselves to public and private online services, all over
paper documents to a mobile? What does the choice of wallet mean, technologically speaking? What are the use cases you want to explore with partners to enable new services?
“The second group is the wallet providers. As a wallet provider, what type of attributes do you want to have in you wallet? Where do you want to have your different relying parties using these wallets for new use cases, new services? You need to onboard all this ecosystem together, not making it work most of the time, but work all the time.
“The last group is the relying parties, all the banks and other government services. What type of new services do they want? How can they improve the citizen journey? Streamline
“While we have helped these cities to shape the strategy, set up the requirements, select the vendors and support them during implementation, we also help them to make sure it works.
“We have helped them to set up internal labs and operate them on their behalf in order to make sure that on an on-game basis, everything is still functioning, particularly if you’re adding a new operator, new type of services, implementing the introduction of biometrics, for example.
“Some are now looking at how citizens can use the palm of their hand to enter the networks, which is amazing.”
Digital identity has finally come of age, concludes Grosclaude. But while the wallet is
Frontiers are blurring, which is creating a new set of opportunities for new products and new services
Raphael Guilley, Consult Hyperion
Europe. In addition, users will be able to store, present and share digital documents as well as electronically sign or seal documents.
With digital identity becoming an ever-more important weapon in the fight against financial fraud, it is widely anticipated that digital wallets will be increasingly used to provide an enhanced range of services, as well as payments.
From a consultancy standpoint, Guilley sees three types of customers to which Fime can offer its significant expertise in the development of wallets.
“The first customer group is the issuing parties, the ones issuing credentials or different digital attributes,” he says.
“What does it mean for them to move from
KYC processes? Enhance payments through a digital identity wallet?”
Smart mobility is another important market for Fime through Consult Hyperion, which helped pioneer Transport for London’s (TfL) open-loop ‘tap-and-go’ payment system back in 2014.
“We have an amazing track record in major cities like London, Dubai, the Netherlands, New York, Philadelphia, Boston, Washington, Australia and India,” says Guilley. “We are supporting these major cities to implement mobile ticketing because citizens want to rely on their mobile to enter into a metro network.
“Account-based ticketing will help the cities to implement new fare plans and EMV open loop will help to facilitate tourism.
key to enabling that, there are now many more questions that Fime will be helping the ecosystem answer.
“There is one question that is even more pressing now that Apple has announced that it is going to open NFC in some regions of the world. That is, are we going to see wallet fragmentation or consolidation? Does the consumer want their health data mixed up with their bank and travel data [in one wallet]? It comes back to making the choice between privacy and convenience and it’s the big question for the year to come.”
It’s one he believes the new Fime/Consult Hyperion team are well-placed to address.
“The complementary nature of the skills between us means there are new opportunities for the people we employ, as well as the two companies,” says Grosclaude.
“There are new things for people to be excited about. And that’s not just on paper. I can personally feel that.”
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