FinTech Products Market Survey

FinTech Products Market Survey, Technical Updates

Technology Needs of a Payment Bank and Small Finance Banks, Fintech firms and Their Banking Solutions

/

Banks and Technology In Part One of our Bank and Technology series we spoke about the technologies needed by Public Sector Banks, Private Sector Banks, and Foreign Banks and in Part two we narrated technologies desirable by Regional Rural Banks [RRB’s] and Cooperative Banks [ State and Urban Cooperative Banks]. Now in the final and concluding part of our Bank and Technology series would talk about the technology needs of Payment Banks and Small Finance Banks. We would also discuss the fintech firms in India, their product offerings and the banks they are helping to enable Digital Banking for their customers. Technologies Needed by Payment Banks Although the Payments Banks in India are newly launched[in principle in 2015 and first payment bank was Airtel started in 2016] and the need of the hour, yet they need to adapt to some of the latest technologies to stand tall against their competitors. Banks Examples of Bank Who is the Target Audience What Technology They Should Adopt to How a Technology Would Help the Banks Payment Banks 1.Airtel Payment Bank 2. Paytm Payment Bank 3. Vodafone M-Pesa They came into existence to serve – 1. Small businesses 2.Unorganized sector 3.Low-income households 4.Farmers and migrant workforce 1. Mobile App Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe. 2. e-KYC acceptance Reducing carbon footprints would help the mother earth but also would speed up the process of essential services like Opening Account or Loan Reimbursements 3. Use of Biometrics Biometrics would help in reducing fraud and identifying potential security threats. 4. Digital Wallets/e-wallets Paying for monthly bills or shopping online, e-wallets could be handy for quick money needs to the customer. Technologies Needed by Small Finance Banks Small Finance banks that were launched to support the small business units, farmers and most importantly the unorganized sector of the economy for their empowerment and financial inclusion. Some of the essential technologies that could help Small Finance banks in attaching these individuals to Bank System are – Banks Examples of Bank Who is the Target Audience What Technology They Should Adopt to How a Technology Would Help the Banks Small Finance Banks 1.Janalakshmi Small Finance Bank 2.Capital Lab Small Finance Bank 3.Disha Small Finance Bank They are not allowed to lend but would eagerly accept the deposits. Hence the target audience for them is 1.Small farmers 2.Unorganised workers 3.Small business units 1. Mobile App Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe 2. e-KYC acceptance Reducing carbon footprints would help the mother earth but also would speed up the process of essential services like Opening Account or Loan Reimbursements 3. Use of Biometrics Biometrics would assist in reducing fraud and identifying potential security threats 4. Agent Banking Solutions With remote areas/rural areas not having enough bank branches services like Agent Banking, ATM, PoS or e-corners could add to get more customer satisfaction and business to banks FinTech Firms Helping Different Banks as Technology Partners We had a glimpse of different banks and their technology needs, let’s also look at the fintech firms in India that are trying to build a comprehensive banking solution to support the digital wave in India. While the list here mainly focuses on firms offering products to banks of rural areas, it also has firms providing crime surveillance solutions for fraud and thefts. Fintech Firms What They Offer Partners Novopay Mobile Payment App to set up bank account and structure finances RBL Bank, Bank of India, IDFC Bank VAYA Finserv Offers core banking to rural areas. Loans to women and self-help groups. YES Bank, The Ratnakar Bank Vortex Engineering Private Limited Offers the lowest power consuming ATM’s Set up 545 ATM’s that includes 300 solar powered ATM’s for State Bank of India Eko India Financial Services Offers no-frills bank accounts and deposit, withdrawals and remittance services to unbanked migrants via a mobile device State Bank of India, Yes Bank, ICICI Bank Finacus Offers Core banking solutions, aadhaar based solutions, Payments via Mobile, Tablet, Agent Banking, etc Bharat bank, Apna Sahkari Bank, Mahesh bank SesameIndia Offers Core banking, Agent banking, Mobile Banking, Business Intelligence, Different modes of payment solutions and Risk and Recovery Management KUC Bank, Thenjipalam Cooperative Urban Bank, Malapurram Service Cooperative Bank InfrasoftTech Offers Core banking, AML compliance and financial crime surveillance, Lending management, and microfinance solution 450 clients across 36 countries over 300 banks Sarvatra Offers cloud-based Mobile Banking, IMPS services, and switch, Aadhar enabled payment eKYC, etc Nilambur Urban cooperative bank Teknospire Offers Agent Banking and Payment Solution, Mobile Money Suite and Payment Switch . They also have solutions to Health tech for the rural population. Oakfin Finance, Ebazara, Mannapuram, Mandeshi Bank References: Payments BankList of banks in India Grameen_BankWhat are Payment Banks? Why India Needs Payment Banks? All you need to know about small finance banks What are small finance banks and payment banks? How are they different from commercial banks? Here’s how top 5 Indian banks use technology Banks collaborate with new age fintech companies for rural banking Impact of financial inclusion drive through co-operative banks – a study with special reference to chavara block Performance Evaluation of Regional Rural Banks in India

FinTech Products Market Survey, Technical Updates

Which Technologies Should Be Adopted By Regional Rural Bank And Cooperative Banks ?

/

Banks and Technology In our Part One of the Banks and Technology Series we spoke about the technologies needed by Public Sector Banks, Private Sector Banks, and Foreign Banks. This post is part 2 of the same series, and we would continue our discussion on technologies desirable by Regional Rural Banks [RRB’s] and Cooperative Banks [ State and Urban Cooperative Banks] Technologies to Be adopted by Regional Rural Banks[RRBs] As per a report the RRB’s with their formation on October 2, 1975, have attained a unique place in providing agricultural rural credit. With their initiatives, they have managed to provide banking services to the unbanked population Banks Examples of Bank Who is the Target Audience What Technology They Should Adopt to How a Technology Would Help the Banks Regional Rural banks 1.Chhattisgarh Rajya Gramin Bank 2.Karnataka Vikas Grameena Bank 3.Vidarbha Kokan Gramin Bank Started with a simple motive to help the rural/BPL individuals, they mainly target – 1.People living in rural/remote areas 2. In need of loans without collateral 1. Mobile App Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe. 2. e-KYC acceptance Reducing carbon footprints would assist the mother earth but also would speed up the process of essential services like Opening Account or Loan Reimbursements 3. e-banking Enabling Banking services via the internet would help customers accessing banking from anywhere anytime. 4. Use of Biometrics Biometrics would assist in reducing fraud and identifying potential security threats 5. Branchless Banking DIY Banking corners like e-corners launched by SBI or e-hut by IDBI bank to access banking anytime. 6. Agent Banking Solution With remote areas/rural areas not having enough bank branches services like Agent Banking, ATM, PoS or e-corners could add to get more customer satisfaction and business to banks Technologies to Be adopted by State Cooperative Banks[SSBs] As stated by Academia in a study – The state cooperative bank is a federation of the central cooperative bank and acts as a watchdog of the co-operative banking structure in the state. Its funds are obtained from share capital, deposits, loans and overdrafts from the Reserve Bank of India. The state co-operative banks lend money to central co-operative banks and primary societies and not directly to the farmers. Banks Examples of Bank Who is the Target Audience What Technology They Should Adopt to How a Technology Would Help the Banks State Cooperative Banks 1.Andhra Pradesh State Co-operative Bank 2.Karnataka State Co-operative Apex Bank 3.Delhi State Co-operative Bank Owned by State, its open to all individuals residing in a particular state. It usually targets – -People at state/district level like small scale industries or local businessmen 1. Mobile App Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe 2. e-KYC acceptance Reducing carbon footprints would help the mother earth but also would speed up the process of essential services like Opening Account or Loan Reimbursements 3. e-banking Enabling Banking services via the internet would help customers accessing banking from anywhere anytime. 4. Use of Biometrics Biometrics would assist in reducing fraud and identifying potential security threats 5. Branchless Banking DIY Banking corners like e-corners launched by SBI or e-hut by IDBI bank to access banking anytime. Technologies to Be adopted by Urban Cooperative Banks[UCBs] As stated by Academia in a study – The term Urban Co-operative Banks (UCBs), though not formally defined, refers to primary cooperative banks located in urban and semi-urban areas. These banks, till 1996, were allowed to lend money only for non-agricultural purposes. This distinction does not hold today. These banks were traditionally centered on communities, localities, workplace groups. They primarily lend to small borrowers and businesses. Today, their scope of operations has widened considerably. Banks Examples of Bank Who is the Target Audience What Technology They Should Adopt to How a Technology Would Help the Banks Urban Cooperative Banks 1.Apna Sahakari Co-Op Bank Ltd. 2.Ahmedabad Mercantile Co-Op Bank. 3.Kalupur Commercial Coop. Bank Owned by State is open to all individuals but is a preferred choice by – -Small scale sectors – Local people in business operating within state or semi-urban area 1. Mobile App Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe 2. e-KYC acceptance Reducing carbon footprints would assist the mother earth but also would speed up the process of essential services like Opening Account or Loan Reimbursements 3. e-banking Enabling Banking services via the internet would help customers accessing banking from anywhere anytime. 4. Use of Biometrics Biometrics would assist in reducing fraud and identifying potential security threats 5. Branchless Banking DIY Banking corners like e-corners launched by SBI or e-hut by IDBI bank to access banking anytime. This post is an effort to streamline the efforts put in by Banks, Fintech firms and NGO’s to make Banking accessible to one an all. If the RRBs and Cooperative banks adapt to these technologies, it would not only help the providers in maintaining transparency but also would make banking reachable to remote and rural areas. This post is part 2 of banks, and their technology needs series, in case you have missed our part one. Here is the link to part One Article – Which Technology Do Public Private Sector And Foreign Bank Need to Adopt The next part of the series would talk about technologies to be adopted by Payments Banks, Small Finance Banks and the fintech providers in India with their banking solutions. Stay Tuned! References: Payments Bank List of banks in India Grameen_Bank What are Payment Banks? Why India Needs Payment Banks? All you need to know about small finance banks What are small finance banks and payment banks? How are they different from commercial banks? Here’s how top 5 Indian banks use technology Banks collaborate with new age fintech companies for rural banking Impact of financial inclusion drive through co-operative banks – a study with special reference

BanksandTech
FinTech Products Market Survey, Technical Updates

Which Technologies Do Public, Private Sector and Foreign Banks Need to Adopt ?

/

What could be the list of financial services for a child? Well, hypothetically he could use all, but necessarily he just needs a bank account/fixed deposits for his savings. Hence, most of the banks offer a minor account that allows parents to open in the same bank. Well, this may be a marketing strategy for a bank but it needs to offer what customers need. In a similar fashion could we be optimistic for rural banks that are struggling to lure customers to offer AI or IoT solutions? Indeed not, hence @Teknospire we bring to you specific innovations that are needed by a bank based on their categorization. Types of Banks in India During my adolescent days, I assumed any word that has “bank” suffixed to it, is a bank with similar features. Until recently my perception about them changed. Do you guys know we have seven different types of banks operating in India. Well, take a look – Banks and Technology Technologies Needed by Public Sector Banks Banks Examples of Bank Who is the Target Audience What Technology They Should Adopt to How a Technology Would Help the Banks Public Sector Banks 1. State Bank of India 2. Punjab National Bank 3. Bank of Baroda Open to all, varies from urban to rural people Tech-savvy to technotard HNI to BPL individuals 1. Branchless Banking DIY Banking corners like e-corners launched by SBI or e-hut by IDBI bank to access banking anytime. 2. Mobile App Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe 3. Data Analytics and Business Intelligence Structuring and organizing the data with intelligent algorithms could help customers in planning their financial portfolio or could get a better picture of their spending’s. 4. e-KYC acceptance Reducing carbon footprints would help the mother earth but also would speed up the process of basic services like Opening Account or Loan Reimbursements 5. Quick Funds Transfer via IMPS, NEFT, RTGS With technology advancement like UPI based payments or IMPS, funds transfer is instantaneous and could be accessed from anywhere anytime. 6. Use of Biometrics Biometrics would help in reducing fraud and identifying potential security threats. 7. Cloud Technology With data increasing at an exponential rate, physical servers may not be enough to handle them. Hence cloud technology could help users in providing flexibility with no compromise in security. 8. Robotics to enable DIY banking/Improved Customer Service How about Robotics helping in mundane jobs like segregating and assign numbers to customer who come to banks? Could help in basic queries like My account balance? Or mini-statements? 9. e-banking Enabling Banking services via internet would help customers accessing banking from anywhere anytime. 10. Plastic Money Issuing of credit cards/debits cards could enhance digitization and a way to go cashless. 11. Remote Banking With remote areas/rural areas not having enough bank branches services like Agent Banking, ATM, PoS or e-corners could add to get more customer satisfaction and business to banks Technologies Needed by Private Sector Banks Banks Examples of Bank Who is the Target Audience What Technology They Should Adopt to How a Technology Would Help the Banks Private Sector Banks 1.ICICI Bank 2. HDFC Bank 3.Axis Bank Open to all but is a preferred choice to individuals – – From corporate sector – Looking for customer oriented services 1. Mobile App Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe 2. Video Conferencing Enabling Video conferencing to your customer could help in building trust and they could get quick query resolution. 3. Data Analytics and Business Intelligence Structuring and organizing the data with intelligent algorithms could help customers in planning their financial portfolio or could get a better picture of their spending’s. 4. e-KYC acceptance Reducing carbon footprints would help the mother earth but also would speed up the process of basic services like Opening Account or Loan Reimbursements 5. Quick Funds Transfer via IMPS, NEFT, RTGS With technology advancement like UPI based payments or IMPS, funds transfer is instantaneous and could be accessed from anywhere anytime. 6. Use of Biometrics Biometrics would help in reducing fraud and identifying potential security threats. 7. Cloud Technology With data increasing at an exponential rate, physical servers may not be enough to handle them. Hence cloud technology could help users in providing flexibility with no compromise in security. 8. Robotics to enable DIY banking/Improved Customer Service How about Robotics helping in mundane jobs like segregating and assign numbers to customer who come to banks? Could help in basic queries like My account balance? Or mini-statements? 9. Plastic Money Enabling Banking services via internet would help customers accessing banking from anywhere anytime. Issuing of credit cards/debits cards could enhance digitization and a way to go cashless. Technologies Needed by Foreign Banks Banks Examples of Bank Who is the Target Audience What Technology They Should Adopt to How a Technology Would Help the Banks Foreign Banks 1.HSBC Bank 2.Citibank 3.Commerzbank The Target audience for these banks are – 1. Corporate Firms 2. HNI individuals having operation overseas 3. NRI individuals 1. Wearable Devices With a wearable device, banks could get information in real-time. Just for example if you went to a car dealer, the banks could help you in choosing the best financing options. 2. Mobile App Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe 3. Video Conferencing Intelligence Enabling Video conferencing to your customer could help in building trust and they could get quick query resolution. 4. Data Analytics and Business Intelligence Structuring and organizing the data with intelligent algorithms could help customers in planning their financial portfolio or could get a better picture of their spending’s. 5. Cloud Technology With data increasing at an exponential rate, physical servers may not be enough to handle them. Hence cloud technology could help users in providing flexibility with no compromise in security.

CBIInsights
FinTech Products Market Survey, Technical Updates

Artificial Intelligence in Fintech and Payments – The Impact and Challenges

/

Artificial Intelligence [AI] storm is here, enterprises working hard to deliver the best of the solutions. Fintech firms are strategizing their approach and research firms calculating the impact and its reach. No one is spared. Be it the big investment banks like Wells Fargo or Morgan Stanley or the fintech start-ups like Numerai and Alphasense . But do we have a clear path for our sail? Is there a need? Or is it just a bubble? To answer all these questions, please read on – Impact of AI on Fintech and Payments Artificial Intelligence is all about capturing data, recognizing behaviors and patterns and acting accordingly. Just for example when someone knocks at the door the predictive behavior is to open it. Or as soon as you receive a call you either lift it or hung it based on the caller name & number. Thanks to data storing capacity, data is abundant. What researchers and technical team are now focussing is making sense of behavior. Quite recently, one of my acquaintance while communicating with Google Home told him – You are useless to which the machine replied – I will convey this to my engineer so that they could refine me and make me more useful. My acquaintance and I were shocked by such a meaningful reply from a machine. So talking about the impact of AI in fintech sector is all about making sense of the data. To answer all such questions as – Could my spending patterns provide me my credit rating on my mobile app? Could closing this debt fund balance my portfolio? Could I get loan processed based on balance of digital wallet? Could opening a Fixed Deposit help me save for my kids’ education? What payment option suits me when I online shop for ABC product? How could I get best deals from Agents via Agent banking solution? When they need insurance? How much? On what basis? Could a machine detect fraud? Could it serve as a regulatory authority? What affects my credit score? What effects my firm’s rating? In fact, as per CBInsights report , AI has made an enormous impact on the fintech world. There are firms under different categories trying to deliver an intelligent solution. Take a look in above diagram. With each vertical of Finance and Banking under development with AI, we could probably witness a hurricane of products in the market. But it’s not the AI that would drive people towards it, it’s the enhanced accessibility to various banking products, convenience ,customized services, speed and above all security that would make an impact in the fintech world. Challenges of AI in Fintech and Payments World There is no linear path growth; experts believe we are at a tipping point of the technology breach. So, either it gets sink-in or would burst depending on how we process the data. Another aspect that would decide the AI growth chart in fintech world is the access, as pointed out by Linden Tibbets , the CEO of IFTTT. With an abundance of data how do we access it and how do we make sense of it? These are the two-vital question that needs to be answered and would see a breakthrough in future to decide fintech growth with AI. Sample this – For AI to work it needs to study pattern and know the behaviour of humans to make a predictive guess on what action should be performed. But how to we conduct the study unless we have the data to access? Agent Banking solution, Digital Wallets or Analytics they cannot make an informed decision unless we program them to do it. A rural person is facing short of cash, he needs to get his roof repaired as rains are approaching, but also need to pay for his kid’s college fees. He has following options – Take a loan Divide the surplus into half for repair and fees Pay the fees and make temporary arrangements to the roof Pay for roof and make temporary arrangements to the fees The answer suggested by AI would need a through reality check before making an informed decision. The above example was quite straight forward, but the point is that the information is scattered and to make sense of that information we need access to it. Lastly, comes another challenge to let people adopt it. Money matters are close to people’s heart. So, could the fintech firms and payment channels with their innovations in Artificial Intelligence domain make clients use their technology? An interconnected network that has studied my spending patterns advise me to stop buying that costly attire or process a personal loan from ABC options. Would I listen to it? While fintech firms focus area is to adopt AI into digital banking, they could leverage the technology to aid in decision making, offering customized products and building end-to-end data products. Welcome to the future! References: AI is About Access, Not Interface Artificial Intelligence and You: Demystifying the Technology Landscape The impact of AI on fintech’s future 5 ways how Artificial Intelligence (AI) is impacting consumer FinTech Human-Level Intelligence or Animal-Like Abilities?

Country wise Mobile banking penetration for the period ending Jan2017
FinTech Products Market Survey, Technical Updates

10 Desirable Wallet Features Post UPI

/

Countries across the world especially India have envisioned digitalization across all its sectors including the BFSI sector. Accomplishing this mission would involve a series of transformations especially in the banking sector. However, in the last decade, the BFSI sector has taken long strides towards digitization. Online banking started the chain of banking transformations and was soon followed by mobile banking, digital wallets, UPI apps. Though Online banking paved way for digitization, it failed to become as popular as mobile banking due to non -friendly payment experiences. Picture Courtesy: Google Growth of mobile bankingPicture Courtesy: Google The world- wide mobile banking penetration and apps launched figures have been moving upwards year on year. The above statistics are a clear indication of mobile banking’s popularity in the last decade. With startups entering the fintech arena, digital wallets soon followed mobile banking. Digital wallets being user-friendly and easy to use, customers have taken a liking to it in a short period. Digital wallets Picture Courtesy: Google Though wallets are a popular choice when compared to the traditional lengthier forms of banking, they have a few painstaking activities associated with it. Some of the activities are :- Setting up a wallet Providing account details such as IFSC, Card No, CVV no, Account no for carrying out transaction Transferring of amount from an account to the wallet KYC validation for set cap of Rs 10000-1lakhs Now to overcome these barriers and make mobile banking hassle free and more secured UPI was launched by the NPCI in India. UPI is a payment platform that allows instant money transfer without providing account details. UPIPicture Courtesy: readaddict.com With the likes of UPI making an appearance in the payments space, mobile wallets usage has taken a dip. However, in my view, the implementation of the below factors could still boost wallet usage post -UPI launch. Providing an optional provision to link wallets to a bank account. Excluding few of redundant steps before transacting. For eg instead of making KYC validation must make it mandatory to provide the Aadhar no KYC validation would be taken care of. Wallets being a tool, currently, it is not mandatory for them to provide interest on the money transferred however if wallet companies provide interest it would improve user stickiness. Presently wallets users mostly rely on the phone lock for their security. Also, as per RBI rules, wallet transactions require only one-factor authentication. Only some wallets provide two-factor authentication and hence security is a matter of concern when there is a loss or theft of the phone. However, if two-factor or multifactor authentication is made mandatory wallet can be made more secure and user shift can be decreased. Making inter wallet transactions, regulating explicit inter wallet transactions, inter wallet usage of the generated QR codes feasible. Increasing the per transaction limit as currently wallets per transaction limit is Rs5000. Providing facilities such as reminders for collecting cash and making payment, checking account balance where account has been linked, transfer of cashback to account. Scrapping of the service charge of 1-4% currently being applied for a wallet to bank transfer. Conversion of wallet companies to payment banks which would be UPI enabled like Paytm. Moving towards UPI system and interconnection of wallets using National Financial Switch (as in the case of present- day Indian Banking context ) The financial sector has moved from online banking to wallets to UPI. Wallets are a stop gap arrangement till India achieves complete digitalization. Being a better way to access accounts, UPI has no doubt become “go to app” within the short period after its launch but however, wallets score some points in below aspects. When it comes to unbanked and the rural people not using bank accounts. Wallets being a tool wallet users as well as a third party can top it up. This is a big advantage for the students and the poor who do not have a bank account. Where technological costs are lower. For eg, the technological costs are lower while doing grants and donations transactions through wallets rather than doing over a banking infra. Where companies giving loans or micro loans can dispense this money into their stand alone wallets for the gains on float within their own bank accounts for eg Manapurram dispensing loans to MAkash wallet. With or without the desirable features being implemented (few of them depending on RBI) Wallets will continue to be in India’s financial arena and contribute to the financial inclusion. As in the case of Teknospire’s MAkash. Having helped Valapad village to become an e-wallet-literate village, it has become a source of inspiration to other wallets and represents the existence of stand alone wallet post-UPI launch. References: Mobile wallets beware, UPI is here Is there a similar system in the world such as Unified Payment Interface launched in India? Can we transfer the cash back earned in a Paytm wallet back to a bank?Which wallets do not charge for wallet to bank transfer? The Cyber-frauds: How secure are Aadhar, UPI, mobile wallets? 11 Benefits of UPI | How UPI is Better Method of Fund Transfer ! How safe are your mobile wallets? How is BHIM app different from mobile wallets? Going cashless after demonetisation? Compare eWallets and UPI apps for what suits you bestBHIM app vs Paytm: Which is a better payment app? How different is the Unified Payment Interface(UPI) from mobile wallets?

Compliance and Technology
FinTech Products Market Survey, Technical Updates

How Cloud Computing is helping FinTech Firms in being #GloballyCompliant

/

Compliance and Technology One of my colleague who is a dire fan of #cashless and #Digitization, while packing his bags asked me – Will I be able to pay with Amazon Pay during my onsite visit to Germany? You should be, they have their operations in Germany. But your account is in INR so maybe that needs to be changed to EURO? Then his next question was – The fintech firms in a country how do they manage cross country compliance? Even I wasn’t sure and assuring him to provide him with an answer before his landing, I started exploring, and the result is this blog post – Are the #Compliance Standards same for all firms dealing with Money ? Not really! All entities dealing with payments and money matters, need to follow standards from PCI [Payment Card Industry] or ISO [International Organization for Standardization]. While PCI is a mandatory for plastic cards issuer’s ISO is voluntary. Here are some of the key differences worth noting –. Parameter ISO PSI Compliance Voluntary Mandated Scope Firm Level Process Level Flexibility Offered High low Depth of Compliance Voluntarily Standards Must meet all the standards   What are the Specific Standards Followed by Financial institutions ? PCI and ISO both have a set of regulations to be followed by firms concerning information security management. Specifically, for money matters PCI DSS, ISO 27001 and ISO 20022 are adopted and followed. Although the goal is the same, the method differs in the way to protect and control customer data. Both need audits and regular checks to show compliance readiness with these standards. A big similarity that exists is one could use PCI DSS as a part of becoming ISO 27001 compliant. Let’s take a closer look at the specific compliances standards – PCI DSS Any merchant or service provider that handles, processes, stores or transmits credit card data. ISO 27001 ISO 27001 has been developed to “provide a model for establishing, implementing, operating, monitoring, reviewing, maintaining and improving an information security management system.” Many organizations have implemented the standard(s) without going for the certification – one obvious example is banks and other financial institutions. Regulations in most countries are such that they had to implement very strict information security and business continuity procedures and safeguards, and most did that that using ISO 27001. ISO 20022 Most financial institutions that want to streamline their communication infrastructure and associated costs by opting for a single, common “language” for all financial communications, whatever the business domain, the communication network and the counterparty (other financial institutions, clients, suppliers and market infrastructures). ISO 20022 – Universal financial industry message scheme (which used to be also called “UNIFI”) is the international standard that defines the ISO platform for the development of financial message standards. Now we know the standards followed by different entities depending on whether they store the customer data or just use it for processing using a third-party API or need to use it for online transactions. But how these compliances are followed in different countries? Or Traditional Banks had a set of regulation and compliance to be followed, with fintech firms evolving signing customers at the global level, even compliance methods need to meet the current requirement. Let’s take an example of Digital Payments, in India Cashless Payments increased by 22% in 2016 but has the compliance seen that growth? Compliance standards need to be automated with the help of technology to meet the needs of modern customers. One of the technology keen on helping Fintech firm is Cloud Computing! Thanks to cloud computing that Payment Banks, Financial Institutions and NBFC’s are expanding their horizons and going global! How FinTech Firms are utilizing RegTech with Cloud Computing ?   Image Credit – Thomson Reuters RegTech [or an amalgamation of Regulation +Technology] is the new buzzword to address the regulatory requirements and comes with exciting feature like – Speed Automated Seamless Integration with technologies like Analytics, Big Data, etc. Many of the RegTech firms like London-based FundApps or Vizor in their design feature have considered Cloud based solutions. Using cloud computing loads these solutions with advantages like remote maintenance, cost effective, flexible in data sharing, secured and scalable. A cloud architecture is comprising of virtual routers and firewalls, multi-redundant environments could help in creating an enhanced setup for disaster recovery scenarios. Cloud computing could assist in automating the audits and check process thereby allowing Fintech engineers to work on product enhancement. Cloud set up helps in offering solutions at a global level providing access to data 24*7*365. Cloud computing allows you to keep up the performance even during those peak hours or end of month queues, by giving access to high-performance servers and data storage. Cloud helps in making the production cycle continuously thereby reducing time-to-market of a product/solution. Most of the Cloud based solution are now one-click solutions that could also be accessed via a smartphone. Financial Institutions and regulations had been two faces of the same coin, with banking that has moved out to other entities even regulation need to venture out. Thanks to technologies that compliance is still maintained and customer data are secured and protected. References: PCI vs. ISO Payment Card Industry Data Security Standard – Wikipidea Who Needs to be PCI Compliant? 12 Reasons why you should be considering ISO27001 ISO 27001/ISO 22301 Knowledge base ISO 20022 Universal financial industry message scheme

Agency Banking
FinTech Products Market Survey, Technical Updates

Agency Banking and Bitcoin

/

#An Agency banking stand Pic courtesy:Teknospire Emerging markets are witnessing the rise of two banking forms that cater to its unbanked segment: Agency Banking and Bitcoins. For persons not belonging to the banking and the tech fraternity, these words are nothing but Greek and Latin. Questions like What do they mean? Are they the same? pop up in their minds whenever they come across these terms. To help this fraternity understand these terms better here are the answers to some FAQs. What do Agency Banking and Bitcoin mean ? Agency Banking can be explained as retail or postal outlet contracted by the financial institution or a mobile network operator to process client transactions. While Bitcoin is a Cryptocurrency and electronic payment system. In other words, it is a decentralized digital currency. #Bitcoin Image Pic courtesy: Google Is Agency banking and Bitcoin different from each other ? Though both cater to the unbanked segment in the emerging markets yet they are different from other. How are they different ? The below points differentiate them from each. Basis Agency Banking Bitcoin Ownership Agency is owned by a particular person contracted from a financial institution. It is an electronic value transfer network owned by no one. Transaction happening Agent Transactions takes place on centralized ledger on a central server. Bitcoin transaction takes place on decentralized ledger on a distributed network. Identity Sharing A Customer and the agents need to share their identity Identity sharing not required for bitcoin users Transaction Viewing Third party cannot view customer’s transaction Third party can view customer transactions on the Bitcoin public ledger System downtime System downtime is not uncommon System downtime is rare. Bitcoins are transferred by scanning a QR code. Technology basis It is the backbone of mobile banking. Agents make use of cellular networks combining SMS and USSD functions. Distributed network layer on top of the internet is the basis for Bitcoin. Geographical limitation Agents are available in geographical locations where the financial institution is present. Bitcoins work globally Currency exchange model Uses physical exchange model Uses online exchange models such as online centralized and decentralized exchanges, P2P exchanges Regulated by The central authority. Agents need to meet certain requirements before they are given the agency No one. Bitcoin being a digital currency no requirements need to be met for holding them. Currency Valuation Agents deal in local currency which is inflationary by nature. Bitcoin is a global currency and is deflationary. Security Customers and agents are vulnerable to thefts and frauds. Users are more secured. Agent commission Agents get a certain %of the transaction value as commission Users need not pay any commission Transaction limit Agents have per day per transaction limit.For large amounts, customer needs to visit banks Large amounts can be transferred. Transactions history More than 6 months statement is physically provided and is chargeable. More than 6 months statement can be viewed online.   Does Agency Banking and Bitcoin enrich the Banking Experience ? The bank has come to the unbanked in the form of agency banking and bitcoin. They can walk up to the agent or do the transaction from home using bitcoins and not go all the way to the bank. Both enrich the banking experience as they complement each other. Their best benefits are derived when used together. Bitcoins fill the void where agency banking falls short. Such as online transactions and cross- border transactions. Will Agency banking converge into mainstream banking ? At present, the services provided by both are enough to meet the needs of the unbanked. However newer customer requirements such as : loan requirements Instant loan transfers More than 6 months transaction statement Higher transaction limit Would require banks to empower agent bankers with more facilities. Empowering the agent bankers with solutions that would cater to above customers needs can help agency banking converging into mainstream banking later. Teknospire’s Finx- Agency &Payment Banking suite is a solution that agent bankers can be empowered with. With this blog answering the FAQS our next blog would throw light on “How Teknospire can help agency banking converge into mainstream banking ? References: 10 differences between Mpesa and Bitcoin Bitcoin vs. Electronic Money: Digital But Different Banking agent – Wikipidea  

Analytics - Visualize the Data
FinTech Products Market Survey, Technical Updates

Data and Analytics are Ruling the Fintech World

/

Data is no longer measured in terabytes (a thousand gigabytes) but in zettabytes (a billion terabytes). Data is lifeless unless you have a tool to analyze and visualize it! In simple terms, an Analytical tool could prove to be a drop of water to barren unstructured, raw amorphous data. Visualize a rural village equipped with #AgentBanking, as the #Fintech #Agent visits his customer with a smartphone and shows a bar chart about his spending’s, the interest he earned on his savings and the liabilities he owns. He then moves to next graph that lets him visualize how much each month he needs to save to afford his child’s higher education and new farming equipment. Or how about an #HealthTech tool that conveys the #Rural customer from where he can buy low price medicines and how much he can save! Welcome to the world of Analytics! How much #Fintech firms are spending on analytical tools ? IDC predicts that the Analytics and Big Data market is expected to continue at a compound annual growth rate (CAGR) of 11.7% through 2020. Another study by Accenture indicates that globally 71 percent of firms are exploring Big Data and predictive analytics. Over half (54 percent) of firms in the industry have appointed a chief data officer How is #Analytics Helping #Fintech Firms and Banks ? Structuring the raw data and putting it in fancy graphs or pictures could be more appealing than going through an excel for a customer. That’s one of driving factors for Banks or Fintech firms to adopt to analytical tool. Some of the other reasons being – Acquiring New Customer – With Traditional methods like #AgentBanking connected with the #Digital world, banking-as-a-service [BaaS] is offered to many remote places, allowing banks to get new clients. Know Your Score – Interconnection of liabilities, assets, and earnings depicts a clear picture of an individual’s credit score, thereby helping banks in making an informed decision. Loyalty Programs – Every time you pay the bill via particular card, it adds some points to your rewards that could either be used to get a gift or could also be converted to cash, making customers loyal to you. Streamlines Investment Options – With options like Robo-advisors individuals could work out on their financial planning without external help, analytics help people to realign their financial goals and manage risk for the financial portfolio.   How @Teknospire We are Using #Analytics to Help Our Customers Our Analytics and Business Intelligence solutions would empower Agents, Fintech firms, and Banks in making an informed decision and strike out inefficiencies. Our solution @Teknospire comes with the benefits of collecting the data, visualizing, collaborating and ability to share with the different stakeholders. Let’s take a sneak peek – Discover In need of some critical data points, let the Discover tab help you. Just type in the search criteria and hit the button, all the data points for that range would be on your screen within seconds. Just for example when we queried for Agents, their commission and other fields here is what we received . The visualization could be extended to know :- How many Agents are deployed in a area To create a gender base equality – know what is the ratio of male:female agents in a particular area What are the statistics for an area in terms of revenue earned Visualize Create the visualization pattern that you wish for- select from wide range of charts, feed the data set pick the order and color codes, and you are all set for a vibrant visualization. Dashboard As the user logins into the Analytics tool, he would land by default on Dashboard Page, the dashboard page displays the different data set combination pre-defined by a user. Just for example, if the firm is keen to know the Transactions Status over a period, he could set a filter in Visualize tab with the kind of chart, parameters for X and Y axis and the order of display and save it. And what you see on Dashboard is a colorful bar chart displaying the transaction status. Dev Tools and Management Tab Dev tools are for individuals who would like to customize their visualization. A user could use the Console to query for relevant data and produce the results in a lively format. Management tab provides the user with tweaking in the advanced options or indexing the pattern; you could also save or delete your objects. Based on various roles like Admin, Agent, Customer or Firm access rights of the dashboard could be controlled. A user can be restricted or full access be granted for a dashboard. Data, the backbone of any firm, is playing a crucial role in aligning the business goals to profit margins. Many have already made the transition and reaping benefits out of it. Have you? References: Analytics, ML and Data Science Help FinTech Offer Better Services Cutting through the noise around financial technology Banks lead big data analytics spend through 2020 After Accenture Next Generation Financial.pdf Data Analytics Critical to Success in Banking

FinTech Products Market Survey

Fintech Products Launched In The Indian Market After Demonetization

/

Diagrammatic Representation Of UPI System POST NOV 8th The Nov 8th demonetization announcement has given the Indian Fintech segment a lift. Newer apps being introduced to help the people tide over the current situation and digitize the economy.The recently launched apps are mainly payment solutions catering to the UPI payment system. To our nontech readers,United payment Interface or UPI is nothing but a smart-phone based money transfer system integrated on any banking app.The major highlights of this system are Instant money transfers irrespective of bank holidays and working hours, Recipient bank account or IIFSC code is also not required. Transactions on multiple bank accounts through single UPI app No waiting period after adding a new payee Post client approval bills can be sent and money can be received Cash on Delivery facility can be used without paying actual cash to the delivery boy .Only bill needs to be approved . How UPI System Works  Sending Money on UPI The Top 5 popular appslaunched after Demonetization With so many UPI apps being launched, it is a bit trying deciding on the most suitable and appropriate app ,so no doubt our readers also would be finding it difficult choosing the best app. Did some research and we have come up with a ready reckoner of the top 5 recently launched apps for our readers.The apps are   TOP 5 APPS About The Popular Apps SBI PAY APP   SBI PAY SBI pay is SBI ‘S Unified Payment App. Some of its highlights are Meant for NonMerchant User NonSBI account holders who are a part of the UPI can also use this app Only Virtual payment address detail is entered Merchant payments and enhanced transaction limits features is not available at the moment Only Android users can use EASY PAY APP EASY PAY Easy Pay is ICICI Banks mobile app for its current account holders. Some of its features are Meant for merchants retailers and professional This app helps merchants to accept instant cashless payments on mobile phones from customers through different digital means. App is available for mainly for Android users Merchants can receive payments via SMS link or a QR code. SMS link for making payment is sent to the customer on his mobile phone. Merchant will be notified once Customer responds to the collection requests Merchants can view the older collection request raised, status of the collection recently raised, re-raise a failed transaction Nil transaction charges Sub merchant option to enable employees to collect on merchant’s behalf BHIM APP BHIM APP BHIM app is National Payments Corporation of India brainchild and functions on UPI.Some of its Key highlights are Supports all Indian Banks using the UPI platform and money is instantly transferred or received. Can be used on all mobile devices Users can transfer money to those who do not have a UPI -based bank accounts Users can check their account balances at a given time and chose any one account they want to do their transactions Facility of creating Personalized QR account for a fixed amount especially in the case of merchant seller -buyer transactions. Currently Available in two languages Hindi English Aadhar Card based Payment App Aadhar Card Payment app Aadhar card based payment app is a government app. Some of its features are Payments is made by scanning fingerprints at biometric machine and providing only the Aadhar number Internet is not required Simpler and safer than other apps Only Merchants need to install this app Aadhar is linked to KYC verified bank account Available for Android,IOS,Windows users Currently No charges and instant transfer PhonePe UPI app for IOS PHONEPE Phonepe is the first fintech firm to launch a UPI app for IOS users. Its backed by Yes Bank some of its highlights are Users can transact up to 1lakh per day No third party wallet top up Zero fees for all transaction Apart from preparing the ready reckoner, we have compared the above products on a few basic points. This comparison would make it easier for our readers in app choosing   Table comparing the products SBI PAY, EASY PAY, BHIM, AADHAR PAY, PhonePe Features SBI PAY EASY PAY BHIM AADHAR PAY PhonePe Operating System Android Android All All IOS Internet Required Yes Yes Yes No * Yes Merchant Payment available No Yes No Yes No Uses UPI Platform Yes No Yes No yes Languages available in English English English , Hindi English English Should Users install the app Yes Yes Yes Only Merchants to install it yes Charges NIL Nil NIL,however the user’s bank may levy nominal charge Nil Nil *Biometric Machine required Assuming that this blog has helped in deciding on the best payment app we are signing off and would be catching up with our readers in our next blog “Review of Fintech Products Launched after the Demo and Products in pipeline” where we would be discussing the recently launched most downloaded app and the apps ready for launch PICTURE COURTESY Google SBI Finally Launches UPI Powered SBI Pay App; Even Non-SBI Customers Can Register

Scroll to Top