What’s Next for the Fintech Sector in 2017?

David E. MickeyFinancial technology has historically moved slowly, but a number of new trends are breathing life into what many view as an uninteresting segment of the tech sector. Here are a few exciting fintech developments to watch out for in 2017.

A Credit Card for the 21st Century

Many data breaches have highlighted the fragility of our credit card system. While the slow expansion of chip-and-pin readers address some of its issues, there are many areas in which fintech can change the face of credit card transactions and processing.

One example of such innovation is Final, a credit card built for the 21st century. Final cards support creation of one-time or limited-use numbers, limits on charges, and other features that minimize the frustrations caused by data breaches or nefarious merchants. As credit cards become easier to obtain and use, financial technology must address the risks posed by a single set of credentials that give merchants access to a consumer’s finances. We are sure to see more companies like Final attempt to address this pain in 2017 and beyond.

Faster Processes

While technological innovation advances at an ever-increasing pace, much of fintech thrives on standards not updated in decades. This is understandable from the perspective of regulation and bureaucracy, but the sluggishness of financial processing propagates across many layers of business, causing delays that become increasingly difficult to justify.

Thankfully, large financial institutions are beginning to develop interfaces and services that speed up common interactions. American Express recently opened up some aspects of its platform to developers While these changes may seem small when taken individually, they will ultimately pave the way for a more open and programmatic way to move money between individuals and businesses.

Blockchains in the Back Office

Pioneered by the popular Bitcoin digital currency, blockchains are methods by which groups of users who do not trust each other can agree on an outcome. Blockchains can clear transactions, track ownership of assets, and record agreements in a way that does not depend on a single entity or server.

Though Bitcoin itself has many challenges that make adoption risky, the underlying blockchain technology has broader uses. Microsoft laid the foundations for its adoption with Blockchain as a Service, a platform that simplifies experimenting with and deploying blockchains for custom purposes. Instead of driving entire currencies, we’re beginning to see blockchain technology used to move and quantify assets between small groups of financial institutions. The full usefulness of blockchains has yet to be explored, but they are likely to play a crucial and growing role in the future of finance on both large and small scales.


The future of financial technology is defined by openness, speed, and greater consumer protection. As innovation becomes easier, we are likely to see more interest and excitement in an area of business that has to date been dull, uninteresting, and slow to evolve.

Swedish Bank SEB Backing its First Bitcoin Business, Coinify

seb_416x416Swedish Bank SEB (Skandinaviska Enskilda Banken), headquartered in Stockholm, has long been interested in venture capitalism, evident by their active investment in “deep technology” for 20+ years. Now, SEB will be backing its first bitcoin business.

The investment branch of SEB, SEB Venture Capital, has involved itself with investment into a wide range of startups since 1995.

Post-trade securities startup Information Mosaic and management app Tink are among the many startups SEB has funded over the years. CA Technologies purchased SEB investment Arcot for $200 million in 2010, and four years later Cisco purchased SEB investment-funded Tail-f for $175 million.

SEB’s team of nine investors assigned $250m (2bn SEK) from SEB Group to Coinify,  with early-age Danish venture capital firm, SEED Capital Denmark, contributing support as well. SEB Venture Capital, which reportedly has a voting share of between 5 percent to 9.99 percent in the company, acknowledged the investment is “purely financial,” but insists that Coinify’s presence in its portfolio is about far more than an exit strategy.

“Coinify has developed a unique platform for blockchain payments and fits perfectly in our portfolio of FinTech investments,” David Sonnek, SEB’s head of venture capital, said of the new investment. “We, at SEB Venture Capital, really look forward to contributing to Coinify’s future development.” He added, “This kind of platform really unleashes the innovation of us all, and that may be the most important aspect.”

Coinify launched in 2014, benefitting from a multi-million dollar deal with SEED. Coinify supports payment in 15 digital currencies, and it plans to expand its payment and trade services throughout Europe and Asia. Coinify offers payment solutions for the digital payment (ex. Bitcoin and digital currencies). SEB’s Stefan Olofsson and SEED Capital’s Lars Andersen  joined Coinify’s board of directors, and SEB investment manager Filip Petersson is acting as the deputy director for Coinify.
While SEB will take on roles outside of their $4m investment, Sonneck has said that his team isn’t expected to become involved with Coinify’s day-to-day operations, but will focus on larger strategy. SEB intends to help grow the company and become a “more tech savvy bank.”

Did Bitfinex Security Breach Prompt Bitcoin Dip, Expose the Digital Currency’s Vulnerabilities?

11297241203_453f1342a6_bBitcoin, the digital currency, took a dip on Wednesday following the hacking of Bitfinex, which is a Hong Kong-based exchange. During the hacking, funds were stolen.

In reaction to the event, the exchange has been paused. Also, withdrawals and deposits are being investigated. Consequently, Bitcoin’s trading value plummeted about 20 percent during early hours in Hong Kong, according to the New York Times. However, by early afternoon, it had recovered about half of its loss. Director of Community and Product Development Zane Tackett didn’t respond to NYTimes request for a comment, but he did indicate via a Reddit post that 119,756 Bitcoins had been stolen.

Prior to the public announcement about the hacking, the loss was was equivalent to $72 million. That loss has lessened, bringing the figure closer to a still astounding $65 million. The Hong Kong exchange, which is one of the world’s largest, said the following in a blog post, ““As we account for individualized customer losses, we may need to settle open margin positions, associated financing, and/or collateral affected by the breach.” Additionally, Bitfinex  indicated that any customer’s losses would be investigated and acknowledged in the future.

The viability of Bitcoin has been questioned thanks to security breaches such as this one. Just two years ago, in 2014, Mt. Gox, an exchange based in Tokyo, was targeted. Hundreds of thousands of Bitcoins were stolen in a heist that still has law enforcement officials and experts baffled. More than $50 million worth of Ether, another form of digital currency was nabbed by a hacker during June of this year. The funds were taken from the Decentralized Autonomous Organization experimental virtual currency project.

While some exchanges may be shaken by these recent events, others are unruffled. Chief strategy officer at the large digital currency exchange OKCoin, Jack Liu, indicated he wasn’t concerned about his company’s security because he’s using a different system. He believes there should more conversations launched about best practices. If hackers are getting better and adapting that isn’t safe for the industry overall.

The Bitcoin community views the digital currency as the future of finance, ensuring faster and transactions, but there’s internalized competition and debates surrounding technology that could potentially permit vulnerability. Part of the coding that underlies the currency is known as the blockchain ledger, and it’s gaining traction as banks see the benefit of using technology to speed up trade. Nonetheless, they all exchange and trade to be secure.

Bitfinex has reported the crime.

5 Ways Banks Can Use FinTech to Build Trust, Support Customers

online-banking-advantagesBanks can use fintech to build trust, believe it not. When catering to a consumer base that expects nothing less than instant gratification, fintech companies, and partnerships can offer traditional banks tools that guarantee convenience and seamless customer service.

Wasteful and cumbersome, physical pieces of paper aren’t convenient and can challenge customer service for many in the banking institution. For that reason alone, many people refrain from using banks, expecting that it’ll be time-consuming –that’s on top of a preexisting distrust of the traditional banking system. However, banks are demonstrated that they’re interested in address distrust and negativity. They’re willing to take on public perception by using digital tools to move products that are customer-centric. They’re interested in doing a number of things in order to better satisfy the communities they service, and among those things are the following:

  1. Demonstrate that they’re customer-center: Since the birth of the banking industry, the focus has been on the products, but technology has offered an opportunity to focus on customers first and foremost. Through engagement via social media and other platforms, banks can inquire about customers’ specific needs, their desires, and concerns about wealth management. In order to do this, banks must be able to focus on internal data analytics, which fintech can assist with. Fintech has made data more comprehensive and palatable. It also eases customization, automation, and tailored bank offerings.
  2. Develop seamless banking systems: Among the numerous things fintech companies are able to do, they’re great at helping banks to implement solutions, which makes it easier for customers to access necessary services and they help with customer interaction with banks at every level. Ultimately this leads to greater satisfaction.
  3. Offer targeted service offerings: Data analytics are another specialty offered by fintech companies. They’re able to provide targeted insight, incentives, and opportunities to clients. Based on needs or desires of certain clients, companies can accurately suggest services or products after gauging after gauging requests made by clients in similar situations.
  4. Correct and address any concerns faced by the underbanked and unbanked: Fintech can be used to serve an important, overlooked segment: the underbanked and unbanked. Financial technology can equip banks with easy and inexpensive mechanisms to educate and equip customers, facilitating access to convenient options that make digital payment, mobile payment, and online banking possible for those in the U.S. and abroad.
  5. Broaden a prospective client base: Those banks with enough foresight to employ the expertise of fintech companies, they’ve gained access to a wider variety of customers. Fintech companies can provide low-cost insights on upscale and as well as those with lower net worth. Data analytics and robo-advisory advancements are making wealth management attainable. Incorporating fintech innovations into organizations will help banks to reach a greater collection of customers.

Fintech is easily improving the relationship between customers and banking institutions. Connectivity, convenience, and customer-specific interactions have emboldened the banking population.

Paymency, API-driven Platform for Banking, Delivers “Banking-As-A-Platform” Service to US

paymencylogo_transparentWhile numerous European startups have succeeded in transforming banks into app stores, only the California-based Paymency has managed to do the same in the U.S. According to the American Banker, the API-driven platform for finance and banking delivers “banking-as-a-platform” service to U.S. banks.

Paymency founder Gary Lewis Evans predicts that application program interfaces will power banking. With the use of APIs –known to ease the outsourced software app creation process when building for customers — users will benefit revolutionary impact that’s akin to the emergence of credit cards or internet banking.

“We are going to be an API-driven platform for finance and banking the way Amazon is a platform for retail,” said the fintech veteran, Lewis. “Banks will have the ability to interface easily with products and services and use it as a way to create a virtual bank and get out of the legacy branch structure.”

Banks will have access to Paymency’s edition of an an app store, where they’ll offer budgeting, mobile payments, personal financial budgeting, as well as services a tad more sophisticated (P-to-P lending, insurance, and investing). Numerous fintech companies and their partners will be able to offer up products in the store. What’s more, Paymency may seek out a bank charter, making it possible for nonbank entities (ex. Walmart) or digital bank startups to connect and offer their customer base full-scale banking services. Microsoft Azure cloud computing platform is used as the base technology for Paymency.

According to Lewis, the company soon plans to unveil its text-based mobile payments product and network Groovy Pay, which resembles Kenya’s M-Pesa mobile payments system.

“I describe it as something very similar to when Amazon first launched as a bookseller, and then they expanded their platform at a later date,” said Lewis, who co-founded Bofl Federal Bank, once known as Bank of Internet USA. “So we’re going to launch with mobile payments and build our base that way before expanding.”

With more than four decades of experience under his belt, Lewis has a long history of digital innovation. He spearheaded California’s early venture into internet banking in 1995 when he was serving as president of La Jolla Bank, which was one of the first in the nation to do so. Lewis left La Jolla Bank in 1996 to launch Bank of Internet USA, starting out in a computer center at the University of California-Santa Barbara. He stayed on as president until 2010, leaving to pursue his next project, Paymency.

A “soft launch” of Paymency with GroovyPay is expected within the next six months. Lewis believes it may take up to three years for Paymency’s app-store-like platform to be fully formed and formally launched. The API-based model provides more flexibility, with regards to services and products, making it far more attractive to banks. To do this the right way, Paymency will have to appeal to banks’ core vendors, and banks’ will require core systems that could facilitate API-based banking. Core vendors tend to wank banks to buy all or most of their ancillary products from them, rather than another party. However, many believe core vendors are becoming more flexible and more willing to under consumers’ attraction to API-powered banking.

Banks are also more drawn to the idea of partnering with outside firms, so they’re able to offer more services and products. These fintech partnerships are changing with the market, becoming more fluid and more dynamic, offering solutions and becoming provocative for the sake of expectant consumers. The API banking-as-a-platform services are natural progress, as that’s the way technology is moving. Technology is moving so rapidly, that this is API banking-as-a-platform services are fixed part of banking reality, according to Lewis.

Federal Regulators Rein in Unregulated FinTech Sector

fintechFinTech has proven to be a disruptive and effective tool within the financial sector. For that reason, federal financial regulators have been introduced policies in order to handle the unregulated subsector, in the name of customer protection.

The new technologies’ interaction with the financial service industry has improved consumer and operational engagement capabilities by leveraging digital functions, analytics, and data management. FinTech has made it easier to create opportunities that allow for industries to address issues  with poverty, financial inclusion and access to capital, and it’s doing so at an accelerated speed.

Startups that center around FinTech provide alternative lending solutions and mobile payments. This has upset the status quo, regarding traditional financial firms because patrons are granted access to financial alternatives, and cheaper and more accessible venues to make payments and obtain capital. The public no longer has to be tied to banks and other regulated financial institutions. For a long time, FinTech operated alongside the traditional financial sector but was some divergence. The unregulated subsector has introduced benefits and harm to the marketplace, which is why the government developed federal financial regulations and policies to address issues within the unregulated Fintech sector.

For some time, there has been a push from financial regulators to develop policies that help to foster financial innovation while providing protections for consumers. Earlier this month, the Treasury Department published its  white paper on online marketplace lending industry, which promises to establish robust borrower protections, effective oversight, support for the expansion of safe and affordable credit, and the promotion of a transparent marketplace.

The innovation within the financial sector could act as a double-edged sword within the financial sector, due to the possibility of abusive practices. Recently developed regulation should help to foster productive balance, consumer protection, and innovation.

Altfi is a FinTech segment, offering finance portals for equity and debt, which helps businesses access capital from private equity groups, venture capitalist, bypassing banks, and individual investors. This financial market was opened up because capital raising was reading change following the collapse of U.S. and worldwide markets.

RegTech is crucial for Fintech B2B and has changed the way accounts are opened with ID verification. The traditional pillars rely on regulatory bodies to protect them, which is an issue will each segment in FinTech. The evolution of RegTech makes it easier for companies to reach their goals.

Each segment of FinTech is changing, which has helped to gather each aspect on one platform, aligning itself with the needs of businesses, which has allowed Fintech growth. There are individuals staffed in the FinTech industry, whose entire job is committed to due diligence, the prevention of fraud, and building credibility for the investor base. Investors from the investor and private equity sectors rely on measures being met before they commit to any deals.
The portals are changing the way that businesses access capital. However, portals are facing on-boarding and post-transaction compliance that’s related to business. The Fintech sector norms will soon grow antiquated in the face of rapid industry evolution. There’s a great deal of work to do, and leaders in this sector, such as Microsoft, Alibaba, and Alphabet are making being more pronounced, and many others step onto the scene.

So, how does one influence FinTech buyers?

fintechConsumer behavior has tooled and enabled the FinTech market, and vice versa. Because of this, the market has changed to become far more competitive, challenging nontraditional and traditional entrants. Investment in technology by financial institutions has led to reduced costs, enhanced security, the introduction of new products, improved customer services, and compliance with new and complex regulations. Globally, bank spending on information technology is expected to hit $150 billion in 2018, rising approximately 19.9 percent.

This fast-paced growth has led to numerous challenges for FinTech vendors, including enrollment in an oversaturated market, a lengthier and more complex sales process, and failure to gain marketing support. Also, for those wishing to interact with financial institutions and vendors during the sales process, it may be difficult to know what influences FinTech buyers.

So, how does one influence FinTech buyers?

Well, the easiest way to learn how to influence FinTech buyers is to understand who they are and how they function. Fifty-two percent of information technology decisions involved ten or more individuals, with the average being 36 people. Approximately 15 percent of decisions made involved 50 or more people. To get on a buyer’s radar, being able to provide trusted advice is critical, which is normally made possible through communication with industry consultants, peer relations, industry analysts, and internal business analyst. Also, content and SEO ranking has been identified for “long list influencers,” who look to vendor webinars, trade shows, vendor led events, direct marketing, trade media, business media, and web searches for valuable insight. They’re least likely to deem advertising or national media as credible sources as a key influence.

Also, those interested in FinTech buyers should have an understanding of how to meet buyer needs, which can be met through thought leadership, delivering unique insights, building credibility through third parties, delivering cutting edge technology and identifying why a particular vendor is different than any other. It’s not at all surprising that value because a significant fact for buyers, who prefer hard numbers and deliverable, and require evidence that vendor can do what they advertise they can do.

There is information not being made available to FinTech buyers, such as prominently being evidence-based data. Buyers want evidence that vendors have experience delivering deliverables and hard numbers to similar companies. They also would like access to industry feedback, customer references and case studies, and demonstrable track records. Ultimately, they want guarantees in regards to visibility, differentiation, and evidence –which can be provided via a number of channels and approaches, whether through analysts, trade media, or influencers. Internal business analysts, reputation, unique insight, credibility, and hard evidence are more important than social media, national media, and advertising.

Fintech Startups Aren’t Going Anywhere & They’re Changing the Way We Do Business

23273130005_f8c800bcfe_oThe sizzling hot buzzword, fintech, an amalgamation of finance and technology, has appeared within the pages of countless publications. This term packs power because of  its disruptive abilities. In fact, Netflix, Apple, and Facebook are prime examples of companies that have disrupted industries and sparked new initiatives and startups. Fintech is impacting every modern industry.

Apple and the other companies understand that fintech plays an active role within their industry, altering the way money is invested and managed. Also, it alters the way people get loans and do financial research. For this reason, fintech will only get bigger. Last year, global investment into fintech companies reached nearly $20 billion, with most of that backing coming from venture capitalists. Within just two years, the number of venture capitalists acting as investors increased by 106 percent in 2014.

OurCrowd is a company that allows the public to invest alongside angel investors and venture capitalists, with funds directed toward pre-vetted startups. Platforms, such as Slingshot Insight, is revolutionary. It brings crowdfunding to research, enabling the public to pool money in order to access analysis and interviews from industry experts. This can be helpful for those who seek advice from doctors about digital medicine and biotech stock. The platform TipRanks is now a go-to source for those researching analyst ratings. This particular platform makes it easier to select the right select the correct stock while the application Quantcha makes it easier to search through trade options.

When it comes to finding information about an active return on an investment or the performance of an investment against a market index, Prattle, Running Alpha, Metricle, and HedgeSPA are valuable companies, offering investors unique data points for investors. Also, for those interested in ways to organize and analyze new data, companies like uxMarketFlow, Ormsby Street,  and Alpha Hat are incomparable resources. SeedFeed is valuable for those interested in a comprehensive platform that has aggregated crowdfunded real estate investments.

All of this is to say that fintech is more than investing, it’s responsible for alternatives in lending and financing. Credibly and similar companies are responsible for helping to rescue smaller businesses, and Financial lends a hand by helping businesses connect with the best possible lenders to provide owners with personal loans. Once a business owner has secured a loan and found that they’re struggling with repayment, they can turn to CommonBond, which helps them to refinance.

While fintech is about far more than investing, it has made investing easier for those without the time or energy to do their own research, or they require recommendations or direct stock picks. Tradespoon, Trade Ideas, Stockal, and Vetr are some of the companies responsible for educating men and women about investing and trading.

While fintech is relatively new, it’s already changing. Traditional institutions are bending to adapt to new competition, proving to be better for investors. The fintech realm will only expand. The aforementioned companies are just a small chunk of the industry, and what’s happened barely hints at what’s to come. Traditional brokerages and banks will introduce their own fintech product, which will be better for investors looking to keep their funds attached to brick and mortar institutions.


David E. Mickey is a financial executive based in Buffalo, New York, and he’s an Enterprise Sales Executive at Docupace Technologies. Please visit his websites to learn more: http://davidemickey.com; http://davidemickey.net/; and http://davidemickey.org/.

4 New Fintech Startups Primed to Take on the Finance Industry

18293552513_e473df2764_oThere were four new fintech startups recently fingered at London’s O2 arena, where companies pitched to investors and enthusiasts. The event was hosted by Barclays and Techstars, which is one of the world’s largest startup accelerators.


One of those fintech startups happens to be Cuvva, which is a British startup that permits users to purchase car insurance for someone else’s vehicle by the hour. This is done via a smartphone app. This enables friends to use another’s car legally, equipping them with flexible insurance. The iPhone app (the Android app is still underway) verifies users by taking a photo of an individual’s driver’s license and a selfie. A number of metrics are taken into account to calculate the cost of hourly insurance. The developer hopes to want to maneuver the app into a marketplace platform, and he’s in major car insurer to purchase hourly coverage of their own car.


Zighra, another selected startup, has devised a method by which a user’s behavioral traits, rather than eye scan or fingerprint is used as a way to gain entrance to one’s smartphone. The pressure applied to the screen of the phone and the angle in which they hold their phone. This tool is used as an application for other institutions, and will not be a separate app. This proposes an invisible layer of security that reacts to interaction with the screen. Interaction with the screen generates an individualized score by the user, which differs from anyone else. Presently, Zighra is working with one of the nation’s top insurance companies and Canada’s top two banks to integrate solutions into their program.


Helm is yet another incredible fintech startup, which was founded by an ex-JPMorgan compliance chief. The app can inform businesses when they aren’t meeting regulations and laws. The software stands as a database that houses rules, and it notifies compliance managers at firms. This removes the need for lawyers and eases steps toward compliance. Additionally, Helm enables regulators to consult institutions via the platform forthcoming regulations.


Co-founded by Terrie Smith, one of the developers of Apple Pay, is DigiSEq, a platform that allows companies producing devices with devices with near-field communication technology, removing the complexities of security and delivering secure application data. The company partners with a number of manufacturers to make sure they offer a complete array of services.

Fintech will truly bring forward a future where consumers can feel secure, protected, and informed.

David E. Mickey is a financial executive based in Buffalo, New York, and he’s an Enterprise Sales Executive at Docupace Technologies. Please visit his websites to learn more: http://davidemickey.comhttp://davidemickey.net/; and http://davidemickey.org/.


Green Finance Becoming a Reality

Palm with a plant growng from pile of coins

The European economy is recovering – albeit slowly – and sustainable finance may just be a major component of growth. The urgent need that exists to invest capital into sustainable infrastructure and technology may contribute to driving job growth in European nations. Individual investors, as well as national institutions, are prioritizing the need to invest in sustainability. The new movement is sure to become a contributing factor in Europe’s overall economic growth.

Individuals, companies, and central banks are supporting the transition to a greener economy. Surprisingly, Europeans are putting more of their savings in assets supportive of sustainability, while European financial institutions recognize the importance of sustainability in their business models. According to Achim Steiner, Executive Director of the United Nations Environment Program, the transition has been underway for sometime but has quickened since Europe’s major climate agreement. This and other international agreements have signaled to global markets the importance of sustainability and environmental concerns on future global developments.

Some major European institutions are already attempting to influence financial policymakers. The Bank of England has delivered an assessment of what climate change can mean for the insurance sector. France has introduced new labels to help consumers choose financial products that are sustainable, or at least, sustainability-oriented. Other countries like Spain, Germany, and Portugal have undertaken similar policies. Sweden, on the other hand, has enacted policy to link the financial world with sustainable development.

According to Steiner’s article, the European Fund for Strategic Investment approved 42 new projects, of which more than half of those are sustainability-related. Climate action, resource efficiency, and sustainable development are some of the included components. The Capital Markets Union even provides easier access to sustainable finance through financial instruments like green bonds, which facilitate financing of renewable energy and energy efficiency projects. Major European companies like Allianz, and Amundi are committing themselves to these greener initiatives by aligning their portfolios with carbon-reducing assets.

Key elements of these efforts include an array of other financial strategies. These include: “reallocating capital, assessing risk, clarifying responsibility, and improving reporting. ” The movement is becoming global as well. China is hoping to raise 400 billion in green investments every year for five years, mainly from financial and capital markets.

Green finance is becoming a reality, and as global concerns of climate change continue to rise, so will the need for financing in sustainable projects. If you liked this post and would like to read more about global finance, check out my twitter @DavidEMickey for more.

David E. Mickey is a financial executive based in Buffalo, New York, and he’s an Enterprise Sales Executive at Docupace Technologies. Please visit his websites to learn more: http://davidemickey.comhttp://davidemickey.net/; and http://davidemickey.org/.