Banks have begun to implement new technologies to help verify who the customer is, though the new GDPR rules in Europe could complicate usage; the General Data Protection Regulation, which will restrict how companies collect and store data, allows for customers to ask for their data to be removed and non compliance results in huge fines; banks have started to slowly add new technology but they are still figuring out where to limit storage; new companies are trying to sell services into bank that allow them to collect information but store it in a certain way to be compliant; with new technology being developed so rapidly, governments need to ensure they keep up with innovation and clearly tell the market how to comply. Source.
News Roundup
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Tencent and Alibaba have built firms that enable them to write significant checks and have crowded out private equity and venture capital firms; SoftBank is the only other regional player on a similar level; they are not always driven by returns like traditional investors and this allows them to define success differently; some private equity firms are beginning to wonder if they are beginning to abuse their power; if a company receives investment from one of these giants they are also not held to the same pressures of a traditional investor like going public; these giants are helping to push innovation across the region and globe, but many are starting to ask at what cost. Source.
David Lin, Head of Credit at PayU gives his take on expanding credit and how this looks in practice with their investment in Kreditech. Source
Coinbase announced they will add support for ERC20 tokens, the technical standard behind ethereum blockchain tokens; they don’t have plans to add any new token yet but is building out their technology to do so; "This is an infrastructure upgrade that will enable us to support many more assets in the future," a Coinbase representative told Business Insider.; the company did caution that they will wait regulatory clarity before adding any assets. Source.
Petal’s new credit card will focus on the 65 million people who lack credit history for a traditional card; they have been working for three years on their product which uses AI to predict a consumer’s creditworthiness; the company raised a $3.6 million seed round last September and followed with a $13 million Series A in January of 2018; the partnership with WebBank will allow Petal to make the card available nationwide which they anticipate will happen over the next few months. Source
American Banker reported on the mixed results of a SourceMedia survey of individuals in the banking, payments and mortgage sectors about the MeToo movement; most respondents said it would impact their industry in some capacity, though they were split on whether the impact would be positive or negative; there was a clear divide on gender lines as most women thought changes would be positive, men respondents mentioned false accusations and some brushed it off as not a big issue; there is some concern that this could force men to hire less women and not mentor women in the workplace for fear of being accused; clear workplace guidelines and a more diverse executive team could bring about real positive change; the MeToo movement is clearly forcing a lot of industries to rethink how they structure their workplace for all employees. Source.
Jack Henry & Associates banking division recently signed up their seventh community bank in as many months; the banks have contracted the company to use their Windows-based banking platform; Jack Briner, president and CEO California International Bank, tells Banking Technology: “When evaluating core providers, we could tell that Jack Henry & Associates would be the best partner for our bank. The advanced technology and forward momentum that Jack Henry Banking provides will give our bank the integrated and robust capabilities needed to get ahead.” Source.
There is a new trend occurring at big banks, CMOs are becoming the driving force behind the change in marketing and a cleanup in digital media ads; most people still use and trust banks, even after the financial crisis and the recent bad news of big fines or scandals; recently the focus in banking has shifted to customer experience and marketers have become as big a part of the product teams as they are of the marketing teams; customers are starting to expect their experience to be more personalized, focused and more impactful to their lives; marketers have moved beyond their role of storytelling and moved into a more active role on how to drive the best experience for the different customers. Source.
Lennar Corp. is the largest homebuilder in the United States; they will leverage technology built by Blend to allow their customers to apply for mortgages online and through mobile devices; this will cut down significantly on the time to apply for a mortgage and Lennar hopes it will also help attract millennial buyers. Source