Core and digital banking solutions provider Jack Henry is adding real-time fraud and anti-money laundering (AML) solutions to its software stack to keep up with continuing growth — and a range of fraud — in digital payments.

The company has taken on the new fraud and AML solutions because of the speed they can achieve, Ben Metz, chief digital and technology officer at Jack Henry, said during its investor conference last week. “What do you have if you have fast payments? Fast fraud,” Metz said.

“We’re getting near-real-time data out of our stack, and we make it available to internal products at the same time that we make it available to fintech integrators” through APIs, he added.

The Monett, Mo.-based core and digital banking services provider told Bank Automation News it is not yet discussing how automation and artificial intelligence (AI) are employed in these solutions.  However, public and private cloud services account for about 30% of the company’s revenue, and payment processing — which includes all card products and remittances — makes up 40% of the company’s total revenue, according to Chief Financial Officer and Treasurer Kevin Williams.

Jack Henry has developed and begun using a real-time anti-fraud solution to bolster its contactless and digital cards business, said Greg Adelson, president and chief operating officer.

Also targeting real-time operation, Jack Henry is working on an institutional AML solution slated for beta testing by the end of 2022. Chief Executive David Foss said the company will provide more details later in the year.

Beyond speed of operation, it’s also good business strategy: Anti-fraud and anti-money laundering solutions are “sadly, a growing opportunity,” Foss said.

Getting to ‘real time’

Though large banks may claim “real-time” functionality, most transactions — and the anti-fraud solutions that monitor them — have lag time between components, Metz explained. “The systems that are used in banking were just all designed before the internet, and they basically bolted the internet on top of these systems,” he said.

Fully cloud-native, API-enabled applications help to solve this problem, and this is why Jack Henry’s Banno digital banking platform is entirely cloud-based. The company said recently it is “unbundling” its products to be able to run elements independently, also called offering microservices.

“We have always thought of core as being a big thing that has a whole bunch of functionality,” Foss said. “We’re essentially unbundling all those services and creating discrete components that will sit on the public cloud and operate as discrete components.” Customers can choose which components they want and integrate them in any order, he added.

Metz noted that Jack Henry has built upon and modernized its Banno Digital Platform “from the ground up” to allow easier integration for clients and fintechs. The platform now has 7.2 million users, according to the company. Some elements of the digital banking platform, including a securely authenticated customer conversation tool, are being added to Jack Henry’s core systems.

[stock_market_widget type=”inline” template=”generic” assets=”JKHY” markup=”Shares of {name} ({symbol}) are trading at {price} ({change_pct}) as of {last_update}.” api=”yf”]

Bank Automation Summit Fall 2022, taking place Sept. 19-20 in Seattle, is a crucial event on automation and automation technology in banking. Learn more and register for Bank Automation Summit Fall 2022.