JJ Hornblass 0:01
Hi everyone, I’m JJ Hornblass and welcome to the buzz from Bank Automation News, where we explore how automation technology is transforming the banking industry. This is our weekly wrap for what’s happening in the industry this week before beginning. A great thanks to Bank Automation News advertisers fiserve and MX for their support. I am pleased to be joined by Bianca Chan and Loraine Lawson from the Bank Automation News team. Hello to both of you. It is Friday January 29, 2021. Everyone and their mother has been buying jet game stock GameStop stock excuse me until today. The stock dropped 44% in yesterday’s trading after triple digit gains all week. us COVID hospitalizations continued their weeks long decline. new cases hovered around 150,000. For the third day in a row as of yesterday Thursday. The South African Coronavirus variant has been detected in South Carolina and the decline in U S. cigarette sales slowed last year as lockdowns spurred smoking and some vapors switched back to cigarettes. And finally, GM has set a 2035 target for phasing out all gas and diesel powered vehicles globally, presumably in favor of battery operated vehicles in banking automation. This week, we heard about the significant automation goals at Wells Fargo where they are looking to add something on the order of 300 automations across the institution. Bianca what is the sort of details behind this initiative? And what does it say about Wells Fargo’s automation plans over the next 12 to 24 months? Yeah, sure.Bianca Chan 2:26
So the the automations are supposed to come out over the next couple of years. That’s the plan at least as part of as part of the enterprise robotics and Intelligent Automation program. There’s a lot of information you can glean from from job postings at banks, as we’ve learned, and a quick scan of Wells Fargo’s careers page showed that they are actually hiring, not looking to hire nine automation focused executives. So definitely trying to boost the bench strength, if you will, from that, from that point of view, all online postings have been posted in the last month. It’s interesting when we when we’ve spoken to Wells Fargo in the past, they’ve broken down how their automation team or effort is kind of organized within the bank and the executive broke it down from on the left side and the light on the right side of the brain. So the left side kind of deals with strategy, roadmap, oversight, governance, business operations. The right side is the coding side, the software engineering, talent, implementation and tech support. And all of the most, if not all, of the job postings currently up are looking for engineers. So they’re definitely trying to beef up their their tech talent from that point of view.JJ Hornblass 3:47
That’s interesting, because one of the one of the driving themes in wells, his most recent earnings was their shortcoming in their efficiency ratio versus other large financial institutions. I mean, are developers going to yield better efficiencies internally? That’s not they’re not necessarily known as a drag on efficiency for large corporates. Right? Well,Bianca Chan 4:19
I think the idea is maybe the RPA program as it’s being built out and invested in will hopefully help lift that efficiency or at least boosted by some degree. Lorraine’s reporting, last week of new data from automation, anywhere found that organizations have seen like a 50% to 150% return on investment within the first 12 months of of implementing RPA. And the measurable returns amount to an average of two and a half times the RPA investments overall costs. So I think in building out this program in the next few years, that should helpJJ Hornblass 5:00
I mean, it would seem that it would seem that I mean, Wells is top four bank in the country, one of the four largest banks in the nation. So if they’re the ones with the lagging efficiency ratio, this sort of 300 or so a slate of automation efforts, this is probably like the maximum that you would see at a large institution these days. I mean, I can imagine that there would be an initiative at another financial institution that will be larger right now, or is that not really the case is just that wells is sort of playing catch up to the other large institutions?Bianca Chan 5:49
Well, I guess the 300 pluses in addition to whatever existing RPA the bank already has, they started their automation project around whether their automation, I guess, like endeavour, about two and a half years ago, when most other big banks sort of gotten to the same game. So I think, based on timelines, it should be relatively competitive, I think, comparable?JJ Hornblass 6:13
Yes. Like, like a comp to the other. Yeah. Okay. And also, this week, there was news from plaid that they introduced a new product. Lorraine, what’s the good please share with us some background on that new product or tool that they introduced?Loraine Lawson 6:32
Yes, it’s a new tool called deposit switch. And it’s in beta, actually. But what it’s designed to do is to automate onboarding and account funding by allowing people to automatically switch their paycheck to an account. And that’ll be offered through the banks. And then it will use plaids API to connect that stuff.JJ Hornblass 6:56
And do you think that this is, I mean, banks witching historically has been pretty low? Is this the sort of grease that might eventually that might finally, you know, get those skids moving?Loraine Lawson 7:11
Well, that’s what plaid thinks. And that’s exactly why they wanted to introduce this product is that they thought it was a to paper heavy process. And a lot of banks have had problems with people starting accounts and banning them or not funding them, because they simply don’t want to fool with the paperwork.JJ Hornblass 7:29
I wonder whether this is like something that they can only introduce now that the visa deal fell apart? Because I mean, what were they going to do, they were going to have, they were going to introduce this product that effectively would allow visas customers to lose their customers to other banks.Loraine Lawson 7:52
They have been at it was, it’s 18 months in the, in the process, building this and then actually had two banks. Well, one bank and one app, try out the product. They said in the blog post Lily, which is a a bait for freelance writers has tried it out and liked it. And then a company called Yoda, which promotes savings and works with banks to promote savings, customer savings. Yes. AndBianca Chan 8:19
if it sounds familiar, JJ, we’ve also when we spoke with green dot, when they launched their new go to bank app, they actually spoke about the the plaid integration to help automate the switching of direct deposits, or at least the setting up direct deposit. So it seems as though green.is also leveragingJJ Hornblass 8:36
was also one of the Yeah, I mean, it’s it you can’t help but notice these like initiatives that start after the deal falls through but I mean, there’s you can’t you equally can’t, you know, make a connection, although I guess our our listeners can make their own deductions. And what about at MasterCard? What did we learn about at MasterCard this week?Loraine Lawson 8:59
So to two news items for MasterCard, the first is that they stopped $20 billion worth of fraud with their AI automation. So that really paid off for them. But they also said that hackers are now starting to use am bots, which puts companies at more risk of being targeted by automated attacks. SoJJ Hornblass 9:24
do you have a feeling for how that works?

Loraine Lawson 9:27
how that works?

JJ Hornblass 9:28
Like, how would they do that?

Loraine Lawson 9:30
They would use the cloud, I’m sure. Using AWS services. I mean, if you’re in another country, you log on and upload your bots and go to work. Right? I don’t know. I don’t know that they would use AWS but there are clouds out there that they could use.

JJ Hornblass 9:46
Right, right, right. Sorry. What’s interesting

Bianca Chan 9:48
was in the MasterCard story that you wrote Lorraine was that they’ve kind of seen this trend of of SM a fraud among SMEs or small medium sized businesses. And when we start To fraud analysts and experts back at the beginning of PPP, we heard that fraud is a common sort of like, I guess, symptom of government relief programs. And so maybe that’s sort of what’s helping to drive this. Like concentration on on SMEs specifically. Yeah.

JJ Hornblass 10:20
They said and I, sorry, go ahead. Sorry.

Loraine Lawson 10:23
They said that they estimated the two thirds of SMBs have been targeted now.

JJ Hornblass 10:29
By by fraud, and but where is but their savings in, you know, that that sort of $20 billion number, is that coming? Is that preventing fraud among SMBs? Is that we are No,

Loraine Lawson 10:45
I mean, that would be over their networks. So that’s where that savings would be found. And I guess in so far as SMBs use their networks, there would be a savings there.

Bianca Chan 10:58
Right? So it’s a portion of the of the 20 billion. But MasterCard also did just launched their their Trust Center specifically geared for SMBs. Correct?

Loraine Lawson 11:08
Yes, they have a trust center that as best practices on it, but it also has a free tool that you can use to you can apply to have them automatically evaluate your website for risk. And they do sort of vet that we applied to have our site of editing, I still haven’t heard from them, interestingly enough, but I think that’s actually a good thing. Because it means that hackers couldn’t use the tool to find out what they could exploit on your

JJ Hornblass 11:36
site. Or maybe it means that the tool is not as automated as, as we would expect. It also may be that Yes, right. Right. Coming up next week on our coverage, what’s happening on the news front? And then also, in the center of excellence, what are we? What are we expecting to produce the center of excellence is our our best practices, corner of the site. So what do we have coming down? in those two? in on those two sides of the of the site? Yeah, we’re

Bianca Chan 12:11
gonna continue to look at RPA trends. From from data from automation anywhere, maybe feature a podcast if, if we’re into the multimedia thing, and then also checking out what what’s in store for lockstep, which is a new automation, FinTech with some interesting plans coming down the pipe. And then of course, taking another look at a couple of big banks job postings to try to glean where they are investing their least their hiring budget for automation projects.

JJ Hornblass 12:42
And in the end, and we’ve been doing a series on like, how to automate. So what’s the what’s the most recent one that we’ve done?

Bianca Chan 12:53
Ah, it’s actually going up. It went up yesterday. It’s Lorraine wrote it on how to automate PPP. And it’s actually quite interesting. We’re seeing a lot of smaller financial institutions or have kind of used PPP as a gateway to automation. And and so it’s basically a how to step by step on how they’ve gotten into the game.

JJ Hornblass 13:13
Right. So that offers a bit of a bit of help on a protocol and how to implement automation and very so. Okay, great. Well, thank you both so much. And thank you everyone for visiting with us at the buzz. We’ll see you next time. Visit us at Bank automation news.com and of course on Twitter and LinkedIn. We’ll see you next time.

JJ Hornblass 0:01
Hi everyone, I’m JJ Hornblass and welcome to the buzz from Bank Automation News, where we explore how automation technology is transforming the banking industry. This is our weekly wrap for what’s happening in the industry this week before beginning. A great thanks to Bank Automation News advertisers fiserve and MX for their support. I am pleased to be joined by Bianca Chan and Loraine Lawson from the Bank Automation News team. Hello to both of you. It is Friday January 29, 2021. Everyone and their mother has been buying jet game stock GameStop stock excuse me until today. The stock dropped 44% in yesterday’s trading after triple digit gains all week. us COVID hospitalizations continued their weeks long decline. new cases hovered around 150,000. For the third day in a row as of yesterday Thursday. The South African Coronavirus variant has been detected in South Carolina and the decline in U S. cigarette sales slowed last year as lockdowns spurred smoking and some vapors switched back to cigarettes. And finally, GM has set a 2035 target for phasing out all gas and diesel powered vehicles globally, presumably in favor of battery operated vehicles in banking automation. This week, we heard about the significant automation goals at Wells Fargo where they are looking to add something on the order of 300 automations across the institution. Bianca what is the sort of details behind this initiative? And what does it say about Wells Fargo’s automation plans over the next 12 to 24 months? Yeah, sure.Bianca Chan 2:26
So the the automations are supposed to come out over the next couple of years. That’s the plan at least as part of as part of the enterprise robotics and Intelligent Automation program. There’s a lot of information you can glean from from job postings at banks, as we’ve learned, and a quick scan of Wells Fargo’s careers page showed that they are actually hiring, not looking to hire nine automation focused executives. So definitely trying to boost the bench strength, if you will, from that, from that point of view, all online postings have been posted in the last month. It’s interesting when we when we’ve spoken to Wells Fargo in the past, they’ve broken down how their automation team or effort is kind of organized within the bank and the executive broke it down from on the left side and the light on the right side of the brain. So the left side kind of deals with strategy, roadmap, oversight, governance, business operations. The right side is the coding side, the software engineering, talent, implementation and tech support. And all of the most, if not all, of the job postings currently up are looking for engineers. So they’re definitely trying to beef up their their tech talent from that point of view.JJ Hornblass 3:47
That’s interesting, because one of the one of the driving themes in wells, his most recent earnings was their shortcoming in their efficiency ratio versus other large financial institutions. I mean, are developers going to yield better efficiencies internally? That’s not they’re not necessarily known as a drag on efficiency for large corporates. Right? Well,Bianca Chan 4:19
I think the idea is maybe the RPA program as it’s being built out and invested in will hopefully help lift that efficiency or at least boosted by some degree. Lorraine’s reporting, last week of new data from automation, anywhere found that organizations have seen like a 50% to 150% return on investment within the first 12 months of of implementing RPA. And the measurable returns amount to an average of two and a half times the RPA investments overall costs. So I think in building out this program in the next few years, that should helpJJ Hornblass 5:00
I mean, it would seem that it would seem that I mean, Wells is top four bank in the country, one of the four largest banks in the nation. So if they’re the ones with the lagging efficiency ratio, this sort of 300 or so a slate of automation efforts, this is probably like the maximum that you would see at a large institution these days. I mean, I can imagine that there would be an initiative at another financial institution that will be larger right now, or is that not really the case is just that wells is sort of playing catch up to the other large institutions?Bianca Chan 5:49
Well, I guess the 300 pluses in addition to whatever existing RPA the bank already has, they started their automation project around whether their automation, I guess, like endeavour, about two and a half years ago, when most other big banks sort of gotten to the same game. So I think, based on timelines, it should be relatively competitive, I think, comparable?JJ Hornblass 6:13
Yes. Like, like a comp to the other. Yeah. Okay. And also, this week, there was news from plaid that they introduced a new product. Lorraine, what’s the good please share with us some background on that new product or tool that they introduced?Loraine Lawson 6:32
Yes, it’s a new tool called deposit switch. And it’s in beta, actually. But what it’s designed to do is to automate onboarding and account funding by allowing people to automatically switch their paycheck to an account. And that’ll be offered through the banks. And then it will use plaids API to connect that stuff.JJ Hornblass 6:56
And do you think that this is, I mean, banks witching historically has been pretty low? Is this the sort of grease that might eventually that might finally, you know, get those skids moving?Loraine Lawson 7:11
Well, that’s what plaid thinks. And that’s exactly why they wanted to introduce this product is that they thought it was a to paper heavy process. And a lot of banks have had problems with people starting accounts and banning them or not funding them, because they simply don’t want to fool with the paperwork.JJ Hornblass 7:29
I wonder whether this is like something that they can only introduce now that the visa deal fell apart? Because I mean, what were they going to do, they were going to have, they were going to introduce this product that effectively would allow visas customers to lose their customers to other banks.Loraine Lawson 7:52
They have been at it was, it’s 18 months in the, in the process, building this and then actually had two banks. Well, one bank and one app, try out the product. They said in the blog post Lily, which is a a bait for freelance writers has tried it out and liked it. And then a company called Yoda, which promotes savings and works with banks to promote savings, customer savings. Yes. AndBianca Chan 8:19
if it sounds familiar, JJ, we’ve also when we spoke with green dot, when they launched their new go to bank app, they actually spoke about the the plaid integration to help automate the switching of direct deposits, or at least the setting up direct deposit. So it seems as though green.is also leveragingJJ Hornblass 8:36
was also one of the Yeah, I mean, it’s it you can’t help but notice these like initiatives that start after the deal falls through but I mean, there’s you can’t you equally can’t, you know, make a connection, although I guess our our listeners can make their own deductions. And what about at MasterCard? What did we learn about at MasterCard this week?Loraine Lawson 8:59
So to two news items for MasterCard, the first is that they stopped $20 billion worth of fraud with their AI automation. So that really paid off for them. But they also said that hackers are now starting to use am bots, which puts companies at more risk of being targeted by automated attacks. SoJJ Hornblass 9:24
do you have a feeling for how that works?

Loraine Lawson 9:27
how that works?

JJ Hornblass 9:28
Like, how would they do that?

Loraine Lawson 9:30
They would use the cloud, I’m sure. Using AWS services. I mean, if you’re in another country, you log on and upload your bots and go to work. Right? I don’t know. I don’t know that they would use AWS but there are clouds out there that they could use.

JJ Hornblass 9:46
Right, right, right. Sorry. What’s interesting

Bianca Chan 9:48
was in the MasterCard story that you wrote Lorraine was that they’ve kind of seen this trend of of SM a fraud among SMEs or small medium sized businesses. And when we start To fraud analysts and experts back at the beginning of PPP, we heard that fraud is a common sort of like, I guess, symptom of government relief programs. And so maybe that’s sort of what’s helping to drive this. Like concentration on on SMEs specifically. Yeah.

JJ Hornblass 10:20
They said and I, sorry, go ahead. Sorry.

Loraine Lawson 10:23
They said that they estimated the two thirds of SMBs have been targeted now.

JJ Hornblass 10:29
By by fraud, and but where is but their savings in, you know, that that sort of $20 billion number, is that coming? Is that preventing fraud among SMBs? Is that we are No,

Loraine Lawson 10:45
I mean, that would be over their networks. So that’s where that savings would be found. And I guess in so far as SMBs use their networks, there would be a savings there.

Bianca Chan 10:58
Right? So it’s a portion of the of the 20 billion. But MasterCard also did just launched their their Trust Center specifically geared for SMBs. Correct?

Loraine Lawson 11:08
Yes, they have a trust center that as best practices on it, but it also has a free tool that you can use to you can apply to have them automatically evaluate your website for risk. And they do sort of vet that we applied to have our site of editing, I still haven’t heard from them, interestingly enough, but I think that’s actually a good thing. Because it means that hackers couldn’t use the tool to find out what they could exploit on your

JJ Hornblass 11:36
site. Or maybe it means that the tool is not as automated as, as we would expect. It also may be that Yes, right. Right. Coming up next week on our coverage, what’s happening on the news front? And then also, in the center of excellence, what are we? What are we expecting to produce the center of excellence is our our best practices, corner of the site. So what do we have coming down? in those two? in on those two sides of the of the site? Yeah, we’re

Bianca Chan 12:11
gonna continue to look at RPA trends. From from data from automation anywhere, maybe feature a podcast if, if we’re into the multimedia thing, and then also checking out what what’s in store for lockstep, which is a new automation, FinTech with some interesting plans coming down the pipe. And then of course, taking another look at a couple of big banks job postings to try to glean where they are investing their least their hiring budget for automation projects.

JJ Hornblass 12:42
And in the end, and we’ve been doing a series on like, how to automate. So what’s the what’s the most recent one that we’ve done?

Bianca Chan 12:53
Ah, it’s actually going up. It went up yesterday. It’s Lorraine wrote it on how to automate PPP. And it’s actually quite interesting. We’re seeing a lot of smaller financial institutions or have kind of used PPP as a gateway to automation. And and so it’s basically a how to step by step on how they’ve gotten into the game.

JJ Hornblass 13:13
Right. So that offers a bit of a bit of help on a protocol and how to implement automation and very so. Okay, great. Well, thank you both so much. And thank you everyone for visiting with us at the buzz. We’ll see you next time. Visit us at Bank automation news.com and of course on Twitter and LinkedIn. We’ll see you next time.