FV Bank focuses on emerging trends and nimble technology as it invests in digital.

Head of Core Banking and Cards Madhu Balasubramanian told Bank Automation News that the San Juan, Puerto Rico-based bank considers customer needs first and technology needs second, with regard to product and service implementation.

The digital bank, founded in 2019, has invested in technology and compliance in recent months, adding cross-border payment capabilities in February and appointing a new chief risk officer and compliance officer, Luz Mabel del Valle, in April. FV Bank has raised $15.5 million since 2021, according to Crunchbase.

Balasubramanian told BAN the bank looks to market trends, client needs and automation when approaching digital efforts. What follows is an edited version of the conversation:

Bank Automation News: How does FV Bank prioritize its digitization strategy?

Madhu Balasubramanian: At FV Bank, we are on a unique journey. We consciously decided not to tie ourselves to decades-old core systems or processing platforms. We have chosen and will continue to choose flexible, nimble and cutting-edge tools and technologies to fulfill our business needs.

What is interesting is that most organizations would define “digitization” as replacing legacy software with newer software and services to improve usability and gain efficiency. The outlook of digitization is different for us — we recognize digitization is a journey and not a destination. Hence the digitization strategy is to look at market trends and be a front-running early adopter while ensuring the products and services we bring to market are compliant and within regulatory frameworks. Our prioritization is based on market needs and emerging trends.

A great analogy for this space is whether you buy an old house and choose to upgrade the interior and/or exterior, or you choose to build new on a piece of land (green field). I am so glad we chose the green field approach and hence our improvements are not limited by an existing solution.

BAN: What role does automation play in your approach to digitization?

MB: Automation plays a key role in scaling and improving our solution. However, automation is Step three. Step one is understanding the need. Step two is implementing a robust solution. Then comes automation of repeatable tasks. The level of automation depends on the nature of the workflow being automated. In a complex solution blueprint with multiple systems and multiple integrations, a well understood and robust process is key before automation is brought in to improve efficiency. Automation without a well understood and robust process often results in roadblocks when it comes to evolving and improving the solution. A solution that cannot evolve cannot stand the test of time and keep up with market trends.

BAN: How does the bank decide what products and services to implement?

MB: In one word: needs. In practice, it’s a bit more than a single word. We classify our needs in two categories: Customer and business, and technology.

Customer and business: All customer experience, business plan, compliance and security falls into this category. We give these items in this category a healthy 70% weight and priority.

Technology: Engineering tools, version upgrades and general maintenance falls into this category. We give items in this category a balanced 30% weight and priority. Despite popular belief, security and infrastructure don’t fall into this category, they are major business constructs.

All the needs from different stakeholders are categorized as above and we strive to hit the ratio of 70/30.

BAN: What is the bank’s fintech partnership strategy?

MB: Having extensive experience in this space — “FV” represents Fintech Ventures — we prefer partners with existing capabilities and products over partners with solely the ability to build products. Our strategy is to leverage and improve with our partners rather than partner up and build from scratch.

BAN: What technologies are you excited about in the industry?

MB: The improved maturity of low-code/no-code frameworks, especially the ones that could deliver output in multiple tech stacks, is one of the topics I am excited about in the year ahead. The other topic I am excited about is the availability of consumable pre-trained AI/ML algorithms, with the results getting better and the focus on Explainable AI.