JJ Hornblass
Hi, everyone. I’m JJ Hornblass. Welcome to FinTech on filter from banking innovation, the leading news source on financial technology and FinTech. This is our weekly wrap for what’s happening in banking innovation this week. Before we get into it, I want to thank bank innovation advertisers Mambu, Biz2Credit and Acuant for their support. So thank you to them. And I am so pleased to be joined by Bianca Chen of the bank innovation team. Hi Bianca. It is Friday, December 11. On Wednesday, this week, US COVID daily deaths hit a record 3100. This Thursday, Airbnb shares more than doubled in their market debut, with the opening trade, giving the company a market cap of $101.6 billion new vehicle sales in China event advanced 11% in November new data shows Starbucks appointed investor Mellody Hobson as its next Chairwoman, positioning it to be among the largest US companies with a black person leading its board. payment card processing giant t CES suffered a ransomware attack earlier this month. Since then, reams of data stolen from the company have been posted online, and the attackers are promising to publish more in the coming days. The company says that malware did not jeopardize card data, and that the incident was limited to administrative areas of its business thesis is one of the nation’s largest merchant processing companies in the nation. And finally, a humpback whale paid a visit to the Hudson River in New York City, and was seen surfacing and spouting water in front of the Statue of Liberty and other landmarks. Witnesses first reported spotting a well off New York Harbor at about 4:15pm on Monday, and the gigantic ocean mammal was spotted again the following day in banking. Meanwhile, we found this week that the lack of automation is really plaguing banks. 32% of us in financial institution employees surveyed in a recent study said that business processes make them want to leave their jobs. And 44% said these processes waste their time. Is it all bad news for financial institutions? On the automation front? Bianca?Bianca Chan
No, no. Obviously, I mean, it’s hard enough to work from home during the pandemic with everything that’s going on, throw in some time wasting banking processes, and you’re not going to be in a horrible situation. But it has prompted, you know, we’ve seen this trend of banks also adding new technologies during the pandemic so that it seems like there is some some response there to the you know, the dissatisfaction or the dissent among among banking employees, but pretty shocking. That’s, that’s almost one third of bank employees surveyed by Abby in this report. SoJJ Hornblass
but yet there seems to be significant investment going on. We also wrote a story about how robotic process automation that spending on robotic Process Automation within financial institutions are at least within the finance departments of financial institutions expected to increase at 40% of financial institutions or in 2021. It is it is the 40%. Now, do you think of the 40% number as a Is that a good number or not a good number meaning, like on the one that you could look at it like, you know, pretty significant because that proud that number was probably a single digit number a couple of years ago, but is 40% enough when RPA has the potential to so vastly revolutionize financial institution, processes and profitability?

Bianca Chan
Yeah, well, I definitely RPA helps with, you know, with some of those time wasting processes that we saw in the other report, I think like from from our reporting or recent reporting, and also, as we learned that being automation summit RPA, might not be all that it’s set out to be, in the sense that it it, it does help with, you know, very structured, repetitive processes. But when you’re thinking about and, and automation, which many of these financial institutions are, it’s seen as a band aid solution. And you know, the other thing with RPA, since it’s not, it’s not such a dynamic solution is every single time there is a code or a software change that is deployed, you know, on the bank’s core system, or really in any on any platform or system, any corresponding robotic Process Automation needs to be updated along with that. So you’re seeing with, with the addition of automation tech throat banks, it’s also adding some complexity where they need to now scale up these maintenance teams to make sure that all the different facets, all the different systems that touch that, that the automation touches, is updated, along with the actual system. So

JJ Hornblass
So you’re saying so there’s like an issue. On the one hand, it solves some processes, issues around but there’s some added tech, technical complexity that it that comes with it?

Bianca Chan
Mm hmm. Yeah, exactly. So we’re seeing a lot of the leading banks stand up maintenance teams, though, that overlook or that, you know, oversee the RPA systems, you see a lot of like robotic process automation, excellent centers, and teams and whatnot. And they’re really like this natural extension of the the operational and the risk and the resilience. It teams that already and processes that already exist, what is

JJ Hornblass
the net net benefit to the financial institution?

Bianca Chan
I think so i think so. I mean, you never really see, I think, like the best uses of RPA, or the most optimal ones are never RPA alone. And it’s really audit, like that type of automation use in concert with other kinds of automation, like automation infrastructure, where it’s like software that, you know, takes the human out of the IP system process or like, intelligent document processing. So I think like using concert with other types of automation and other types of technologies, it probably does help for sure. But you need to be prepared to make like the full investment. It’s not just, you know, oh, let’s add this RPA system into here, and it’s a one and done.

JJ Hornblass
And we should say that some of that data came from the Deloitte Center for Financial Services. So speaking of automation, finastra debuted some automation technology this week. This is for onboarding. And specifically, they’re looking to streamline the onboarding, onboarding experience, through a new partnership with AI, which is a Tel Aviv based FinTech that automates the document collection and verification process, maybe explain a little bit what what that’s all about. Bianca? And, and and maybe, if you have some perspective on why exactly they’re doing this, and what they hope to gain.

Bianca Chan
Mm hmm. Yeah. So it’s basically new technology on finastra is like App Store. For banks. It’s like their internal platform, where banks can plug into new technologies via API’s, and like a single integration, a aios technology is super interesting. And it kind of harkens back to what we were talking about where it’s automated workflows, used in concert with machine learning algorithm that basically looks at metadata on the documents that are uploaded, by like business customers, onto their platform. And they’re able to make sure that the source of the document is correct and what it needs to be but then also looking at sort of the structured inputs, and automatically monitoring and double checking that the information matches what is the bank, basically like what financial systems are seeing, because financial systems are integrated into the bank lending processes, so basically mitigates the whole scenario where you have a business bank and customer walk into your branch, and then you have you send them back and you say, here’s your checklist of documents, you need to send them to me, and then they come back, you know, a week later, and then you have that branch employees kind of cross checking the documents with, with what’s the information that’s in their system. So huge time and cost savings, i o said and I mean, it makes sense were the other industry like bank executives that we’ve spoken to have have said that, you know, the KYC, the onboarding process is right for automation technology, because it is such a structured process. And also, the fact that everything is logged helps satisfy compliance and regulation requirements as well.

JJ Hornblass
Well, also, because so much more of it is becoming digitized as well. You know, it’s a, it’s a circular dynamic, you know, the more automated is the process, the more you can digitize it, I would think as well. And that makes for kind of a virtuous circle that I mean, did it get a sense for like, how how avidly finastra expects a CIO to be deployed? Or, or even just, you know, like, you know, it well also, is this like national, global for finastra. Which is a more of a global IT provider, or is it just in in the US?

Bianca Chan
It’s global and AI? rg. It’s white label. So and it’s also a global company.

Unknown Speaker
They’re sure that’s a word.

Bianca Chan
They’re working with them in pilots currently, with global banks in the US and Europe and Asia Pacific. So it’s pretty interesting. In terms of the demand. Yeah, I mean, we spoke with finastra. They said that among among their financial institution customers, especially the smaller ones, let’s say that, like, we’re really jumpstart in their digitization processes, like in the past year or two, maybe like 10 to 15% were kind of asking or requesting for automation technology, and within like the commercial lending space, and now that’s doubled, or tripled, even post pandemic, and the AI Oh, folks, so that the the big and the big global banks that they work with, they’re currently piloting with. Also, they don’t have much automation introduced into this onboarding process. So it really seems like demand kind of, regardless of size that a lot of institutions are kind of struggling with.

JJ Hornblass
Yeah, I saw some number from finastra that they’re estimating 300% year over year spike in demand for automated solutions within the commercial lending operations, financial, why the commercial lending? Is it something in particular around commercial lending, that where the demand has spiked so much?

Bianca Chan
Well, a lot of it comes down to the executive We spoke with, oversees the commercial lending operations, specifically to that. But you know, it’s kind of funny because we hear a lot about your reporting that retail is kind of like the leading space in terms of innovation. But and commercial for that, and then SMB to follow that so I think there is some catch up in terms of the the number of automated and digital services offered in commercial and SMB lending. But I think also it comes down to the adoption on the customer side. Only now you’re really seeing like SMB customer, banking customers and commercial customers start to adopt digit even just like digital processes. And so and have like, you know, like online portals or like websites, so it’s, I think that’s the other part of it.

JJ Hornblass
Are you gonna Bianca? What, what’s on the slate for next week? Yo, so

Bianca Chan
we’re attending the UI paths, automation virtual conference next week, and we’re also going to be exploring the use of automation technology within some banks cybersecurity strategies as well and how that can help strengthen. Yeah,

JJ Hornblass
resignedly considering the thesis news.

Unknown Speaker
Yes.

JJ Hornblass
Okay. Well, that sounds great. Thank you. And thank you all so much for joining us for this episode of FinTech unfiltered. We hope to see you again next time. And please visit us at Bank innovation dotnet and on Twitter and LinkedIn, and and of course, rate us on your podcast platform. Thanks again. We’ll see you next time.

JJ Hornblass
Hi, everyone. I’m JJ Hornblass. Welcome to FinTech on filter from banking innovation, the leading news source on financial technology and FinTech. This is our weekly wrap for what’s happening in banking innovation this week. Before we get into it, I want to thank bank innovation advertisers Mambu, Biz2Credit and Acuant for their support. So thank you to them. And I am so pleased to be joined by Bianca Chen of the bank innovation team. Hi Bianca. It is Friday, December 11. On Wednesday, this week, US COVID daily deaths hit a record 3100. This Thursday, Airbnb shares more than doubled in their market debut, with the opening trade, giving the company a market cap of $101.6 billion new vehicle sales in China event advanced 11% in November new data shows Starbucks appointed investor Mellody Hobson as its next Chairwoman, positioning it to be among the largest US companies with a black person leading its board. payment card processing giant t CES suffered a ransomware attack earlier this month. Since then, reams of data stolen from the company have been posted online, and the attackers are promising to publish more in the coming days. The company says that malware did not jeopardize card data, and that the incident was limited to administrative areas of its business thesis is one of the nation’s largest merchant processing companies in the nation. And finally, a humpback whale paid a visit to the Hudson River in New York City, and was seen surfacing and spouting water in front of the Statue of Liberty and other landmarks. Witnesses first reported spotting a well off New York Harbor at about 4:15pm on Monday, and the gigantic ocean mammal was spotted again the following day in banking. Meanwhile, we found this week that the lack of automation is really plaguing banks. 32% of us in financial institution employees surveyed in a recent study said that business processes make them want to leave their jobs. And 44% said these processes waste their time. Is it all bad news for financial institutions? On the automation front? Bianca?Bianca Chan
No, no. Obviously, I mean, it’s hard enough to work from home during the pandemic with everything that’s going on, throw in some time wasting banking processes, and you’re not going to be in a horrible situation. But it has prompted, you know, we’ve seen this trend of banks also adding new technologies during the pandemic so that it seems like there is some some response there to the you know, the dissatisfaction or the dissent among among banking employees, but pretty shocking. That’s, that’s almost one third of bank employees surveyed by Abby in this report. SoJJ Hornblass
but yet there seems to be significant investment going on. We also wrote a story about how robotic process automation that spending on robotic Process Automation within financial institutions are at least within the finance departments of financial institutions expected to increase at 40% of financial institutions or in 2021. It is it is the 40%. Now, do you think of the 40% number as a Is that a good number or not a good number meaning, like on the one that you could look at it like, you know, pretty significant because that proud that number was probably a single digit number a couple of years ago, but is 40% enough when RPA has the potential to so vastly revolutionize financial institution, processes and profitability?

Bianca Chan
Yeah, well, I definitely RPA helps with, you know, with some of those time wasting processes that we saw in the other report, I think like from from our reporting or recent reporting, and also, as we learned that being automation summit RPA, might not be all that it’s set out to be, in the sense that it it, it does help with, you know, very structured, repetitive processes. But when you’re thinking about and, and automation, which many of these financial institutions are, it’s seen as a band aid solution. And you know, the other thing with RPA, since it’s not, it’s not such a dynamic solution is every single time there is a code or a software change that is deployed, you know, on the bank’s core system, or really in any on any platform or system, any corresponding robotic Process Automation needs to be updated along with that. So you’re seeing with, with the addition of automation tech throat banks, it’s also adding some complexity where they need to now scale up these maintenance teams to make sure that all the different facets, all the different systems that touch that, that the automation touches, is updated, along with the actual system. So

JJ Hornblass
So you’re saying so there’s like an issue. On the one hand, it solves some processes, issues around but there’s some added tech, technical complexity that it that comes with it?

Bianca Chan
Mm hmm. Yeah, exactly. So we’re seeing a lot of the leading banks stand up maintenance teams, though, that overlook or that, you know, oversee the RPA systems, you see a lot of like robotic process automation, excellent centers, and teams and whatnot. And they’re really like this natural extension of the the operational and the risk and the resilience. It teams that already and processes that already exist, what is

JJ Hornblass
the net net benefit to the financial institution?

Bianca Chan
I think so i think so. I mean, you never really see, I think, like the best uses of RPA, or the most optimal ones are never RPA alone. And it’s really audit, like that type of automation use in concert with other kinds of automation, like automation infrastructure, where it’s like software that, you know, takes the human out of the IP system process or like, intelligent document processing. So I think like using concert with other types of automation and other types of technologies, it probably does help for sure. But you need to be prepared to make like the full investment. It’s not just, you know, oh, let’s add this RPA system into here, and it’s a one and done.

JJ Hornblass
And we should say that some of that data came from the Deloitte Center for Financial Services. So speaking of automation, finastra debuted some automation technology this week. This is for onboarding. And specifically, they’re looking to streamline the onboarding, onboarding experience, through a new partnership with AI, which is a Tel Aviv based FinTech that automates the document collection and verification process, maybe explain a little bit what what that’s all about. Bianca? And, and and maybe, if you have some perspective on why exactly they’re doing this, and what they hope to gain.

Bianca Chan
Mm hmm. Yeah. So it’s basically new technology on finastra is like App Store. For banks. It’s like their internal platform, where banks can plug into new technologies via API’s, and like a single integration, a aios technology is super interesting. And it kind of harkens back to what we were talking about where it’s automated workflows, used in concert with machine learning algorithm that basically looks at metadata on the documents that are uploaded, by like business customers, onto their platform. And they’re able to make sure that the source of the document is correct and what it needs to be but then also looking at sort of the structured inputs, and automatically monitoring and double checking that the information matches what is the bank, basically like what financial systems are seeing, because financial systems are integrated into the bank lending processes, so basically mitigates the whole scenario where you have a business bank and customer walk into your branch, and then you have you send them back and you say, here’s your checklist of documents, you need to send them to me, and then they come back, you know, a week later, and then you have that branch employees kind of cross checking the documents with, with what’s the information that’s in their system. So huge time and cost savings, i o said and I mean, it makes sense were the other industry like bank executives that we’ve spoken to have have said that, you know, the KYC, the onboarding process is right for automation technology, because it is such a structured process. And also, the fact that everything is logged helps satisfy compliance and regulation requirements as well.

JJ Hornblass
Well, also, because so much more of it is becoming digitized as well. You know, it’s a, it’s a circular dynamic, you know, the more automated is the process, the more you can digitize it, I would think as well. And that makes for kind of a virtuous circle that I mean, did it get a sense for like, how how avidly finastra expects a CIO to be deployed? Or, or even just, you know, like, you know, it well also, is this like national, global for finastra. Which is a more of a global IT provider, or is it just in in the US?

Bianca Chan
It’s global and AI? rg. It’s white label. So and it’s also a global company.

Unknown Speaker
They’re sure that’s a word.

Bianca Chan
They’re working with them in pilots currently, with global banks in the US and Europe and Asia Pacific. So it’s pretty interesting. In terms of the demand. Yeah, I mean, we spoke with finastra. They said that among among their financial institution customers, especially the smaller ones, let’s say that, like, we’re really jumpstart in their digitization processes, like in the past year or two, maybe like 10 to 15% were kind of asking or requesting for automation technology, and within like the commercial lending space, and now that’s doubled, or tripled, even post pandemic, and the AI Oh, folks, so that the the big and the big global banks that they work with, they’re currently piloting with. Also, they don’t have much automation introduced into this onboarding process. So it really seems like demand kind of, regardless of size that a lot of institutions are kind of struggling with.

JJ Hornblass
Yeah, I saw some number from finastra that they’re estimating 300% year over year spike in demand for automated solutions within the commercial lending operations, financial, why the commercial lending? Is it something in particular around commercial lending, that where the demand has spiked so much?

Bianca Chan
Well, a lot of it comes down to the executive We spoke with, oversees the commercial lending operations, specifically to that. But you know, it’s kind of funny because we hear a lot about your reporting that retail is kind of like the leading space in terms of innovation. But and commercial for that, and then SMB to follow that so I think there is some catch up in terms of the the number of automated and digital services offered in commercial and SMB lending. But I think also it comes down to the adoption on the customer side. Only now you’re really seeing like SMB customer, banking customers and commercial customers start to adopt digit even just like digital processes. And so and have like, you know, like online portals or like websites, so it’s, I think that’s the other part of it.

JJ Hornblass
Are you gonna Bianca? What, what’s on the slate for next week? Yo, so

Bianca Chan
we’re attending the UI paths, automation virtual conference next week, and we’re also going to be exploring the use of automation technology within some banks cybersecurity strategies as well and how that can help strengthen. Yeah,

JJ Hornblass
resignedly considering the thesis news.

Unknown Speaker
Yes.

JJ Hornblass
Okay. Well, that sounds great. Thank you. And thank you all so much for joining us for this episode of FinTech unfiltered. We hope to see you again next time. And please visit us at Bank innovation dotnet and on Twitter and LinkedIn, and and of course, rate us on your podcast platform. Thanks again. We’ll see you next time.