Weekly Wrap: Canadian banks make AI investments and INV Fintech launches revamped platform

This week, Canadian banks CIBC and TD made strides with AI and automation technology. CIBC teamed up with IBM to launch its first virtual assistant, and TD leaned into automation for its cybersecurity efforts and introduced a slate of new AI products . Meanwhile, Bank Innovation ’s sister venture INV Fintech launched a new platform designed to support the discovery process of banks’ innovation pipelines. Find this and more in today’s edition of the Weekly Wrap, featuring JJ Hornblass and Bianca Chan for the week ending Dec. 18, 2020. .embed-container { position: relative; padding-bottom: 56.25%; height: 0; overflow: hidden; max-width: 100%; } .embed-container iframe, .embed-container object, .embed-container embed { position: absolute; top: 0; left: 0; width: 100%; height: 100%; } The following is a transcript generated by AI technology that has been lightly edited but still contains errors. JJ Hornblass Hi, everyone. I'm JJ Hornblass and welcome to FinTech Unfiltered from Bank Innovation, the leading digital news service on banking technology and FinTech. This is our weekly wrap up for what's happening in banking innovation. Before I begin, I want to thank bank innovation advertisers Mambu, Biz2Credit and Accuant for their support, so thank you to them. And I am as always pleased to be joined by Bianca Chan of the bank innovation team. Hi, Bianca. It is Friday, December 18 2020. In the news this week, French President Francis president Emmanuel Macron, tested positive for covid 19. On Wednesday, the NASDAQ advanced point 5% this was that index is 52nd. Record close of 2020. As reported extensively by our sister publication Air Cargo world, the aviation industry began rushing to deliver COVID-19 vaccines worldwide. Also this week, the East Coast's first major winter storm of the year, blanketed Pennsylvania, New York, and other northeastern states on Wednesday. And finally, NASA named blue origins new Glenn rocket as one of its potential launch providers for scientific missions later in the decade. Blue Origin is of course owned by Amazon founder Jeff Bezos. In FinTech news this week civc the major Canadian banking concern introduced a new chat bot Bianca why, what makes this development noteworthy? Bianca Chan Yeah, sure. So CIBC tapped IBM Watson technology. IBM has a strong foothold into the financial services space between Watson and also its cloud computing services. But the interesting about this chatbot, which is not common across many chat bots, and virtual assistants we see in the US and Canada today, but more so less seen in Canada today is the ability to have a transactional bot. So basically, a virtual assistant that can help to make account specific changes or transactions of that sort. So there's added security complexities, of course, and authentication processes when, when this sort of capability is introduced. And so civc is pretty excited about it, they're already thinking about, well, they're already developing a mobile interface for the virtual assistant as well as looking at other users of the bots. So currently, it's available to customers with personal bank accounts. And they're looking at deploying this to their internal employee base, and then also across like, different customer segments, whether that be wealth management, or commercial banking, and so on. JJ Hornblass So among the transactions that the chatbot can execute, a couple of them are, you know, our I could see, you know, relatively doable or not doable. I mean, from a security standpoint, they're reasonable. Scheduling bills, for example, is one. But the chatbot also allows for the paying of bills that amps up the security requirement. But more significantly, it allows for instant money transfers. I mean, is there a sense for how this is done in a with, you know, considering risk management requirements? Mm hmm. Bianca Chan Yeah. So, the virtual assistant is basically built on this framework that civc has been developing for the past few years. And it's built on API's and micro services. And so that is how the virtual like IBM's virtual assistant is essentially tapped into all these different areas of CIBC's tech stack and other systems. So it's using API technology. In addition to IBM's orchestration platform, which is basically a hub for all of these API's to plug in to one another. I mean, JJ Hornblass it seems like the instant money transfer in an automated fashion is kind of a landmark. A For for financial services, would you is that? Is that a fair statement? Bianca Chan Yeah, I think it's fair, IBM made the point of saying that that sort of capability is less common in Canada, meaning that it's probably unlikely more common in the US market. Um, but I would say that it is definitely on the forefront or at least on the fringe. JJ Hornblass And in also on the automation front, TD, we, you know, has we've learned that they've decided to lean more heavily on automation in cybersecurity. And so there's, it's this is that there are two permutations of this leaning on an automated decision tree to help their analysts determine outcomes for cybersecurity. And then secondly, deploying automation for its forensics teams to give TD analysts greater visibility into prioritizing security alerts, is there a sense of like, which of these is more is more important to TD? And which is maybe more of a challenge from an automation standpoint? Bianca Chan Yeah, I would, I would venture to guess that probably the first use case was maybe more impactful to TD. So their cybersecurity efforts are sort of born out of their fusion centers, of which there are four across the world. And it basically brings together bank experts across like technology, security, legal fraud operations. Much of the way we're kind of seeing this shift in financial services anyways, apparently sort of like horizontal agile groups. So typically, they're there to get there sitting physically together in these fusion centers. But with social distancing, and work from home orders, TD sort of had to innovate, how are they going to replicate that same sort of open communication that you'd have just turning to the person or the analyst beside you, TD gets like billions of alerts a day, in terms of like, threat incidences coming in. And so in order for all of these dispersed analysts to be able to understand what sort of threat incidents that need to be prioritized, or or in or in terms of seeing, like patterns or trends within these threats, they leaned on this automated decision tree capability, which Yes, I imagine it's some sort of a, like an automated and structured workflow that the analyst would follow to essentially come to the same conclusions when they couldn't just turn and talk to their colleagues, JJ Hornblass they developed this in house where they used a third party for this. Bianca Chan Um, clodagh, who oversees enterprise, cybersecurity for TV didn't go into detail around that. But I imagine, I think decision trees are very common within, you know, software and technology. So it might it might just be sort of replication of like the process through which dissident, JJ Hornblass right, so you said that that was impactful? Like, what's the, like, what do you mean by that? Like, to what degree? Bianca Chan Yeah, well, the analysts come together, and they they write up these reports that are shared across the organization, with different business leaders on from different lines, essentially, like subscribing or signing up for these sort of daily reports on on threat patterns and threat trends across the organization. So in order for the analysts to be able to come to some sort of conclusion about what goes on to that report, and what's shared widely and what people should be looking at in terms of their own business operations. I'm not sure if it would be possible to do that, you know, without the sort of collaborative or collaborative approach to come into the decisions. JJ Hornblass So our sister venture made some news this week, I envy FinTech, our sister accelerator venture that were which unveiled its I envy FinTech discovery product. Maybe you could share some some background on the on discovery and and why it was launched. Bianca Chan Yeah. So it's really an evolution of FinTech which has been around for about five years or so. And it evolved to meet the market need to cut through the noise of all of the FinTech startups that are constantly joining the industry. And it's essentially this this vetted funnel of like innovation. So it's a it runs on a two month program that we run throughout the year. And it basically provides subscribers the program, access to like a live demo day where they can learn and find out about new technologies hitting the market, also have access to our library of recorded demos, which have been vetted by, you know, our proprietary process. And then we've also got the emerging FinTech directory, which kind of serves as a more broad, I guess you'd say, innovation pipeline to discovering new technologies and new companies that are kind of on the forefront of banking that maybe you hadn't heard of before. JJ Hornblass Yeah, so it used to be the case that just starting an innovation operation was kind of, you know, that itself was was revolutionary, post credit crisis. And, and even, you know, seeking out fin packs, was was kind of part of the has become part of the RFI process. What's different today is that discovery needs to become a core function within an innovation operation, because if there are, you know, you could look at any number of new startups in the FinTech space, and there's likely to be 345 groups doing relatively similar things. And so, discovering, doing that discovery and identifying which is the FinTech to work with, and which is not is is really replaced the the notion of just finding out what's out there. And so that's what I envy FinTech discovery, enables financial institutions to do to to be more efficient, about their, their innovation strategies. So we're particularly pleased to introduce it. And and we certainly encourage our our listeners to learn more at Ivy FinTech Comm. So this is our last. FinTech unfiltered Of The Year of 2020. I can say that I am. Mr. belgic for 2020 in the least. But we've certainly enjoyed presenting this to you. And I look forward to more episodes in the coming year. We actually have some significant changes in plans for bank innovation with the new year so stay tuned for that and we will see you next year. Thanks everyone for joining us.

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