How MasterCard Labs fosters a culture of payments innovation
nTrust’s Rod Hsu on differentiating in the competitive payments space
Rod Hsu is the president of nTrust.
What is nTrust?
We’re here to help people access, move, and use their money — instantly. Whether you’re squaring up with a friend, or supporting loved ones overseas, you can use nTrust to transfer money through your mobile phone, tablet or desktop to anyone, anywhere. Send money across the table or around the world, without expensive fees or inconvenient delays. It’s about leveraging technology to liberate money and create a world of connections between friends, families, and businesses.
Payments is getting really competitive. How do you differentiate versus other players?
The retail payment space is certainly crowded and competitive. We play in a different space of payments; we focus on person-to-person transfers. Without being tied to any financial institution or instrument, nTrust provides an agnostic means to move money to others, which extends to 20 countries globally. In practice, you could have a Canadian, Australian and United Kingdom bank account linked to your nTrust Cloud and move money easily between them, which is a completely different model than other players on the market.
While the funding side is ubiquitous and flexible, the beauty comes from being able to freely, securely and instantly move money (even micro amounts) to others. The platform is built on a social premise and elements are incorporated to bridge the gap between finances and social media. A product is only as good as the experience it offers, which is why we prioritize UX as the forefront of every feature we implement. As an example, traditional account statements provide a load of filtering and search capabilities but in reality, only a fraction of those are used on a frequent basis. So we’ve taken a different approach in using custom hashtags for transactions, which not only leverages the social aspect but can also quickly filter the important activities that mean something to you.
Moving money should feel seamless and easy so you can focus on other things in your life.
Why is the space attracting so many entrepreneurs and VC money?
I think there are two parts to this – the generation gap and access to technologies. The movement of a new generation of consumers is forcing a shift in the way money and payments are viewed in the financial sector. Things aren’t what they use to be and the need to keep pace with this change in financial interactions isn’t happening fast enough in the incumbent system. That’s why we are seeing more initiatives being taken in this space by entrepreneurs, leaders and VCs. As the cost of entry is becoming more and more affordable, there is less risk to start an initiative. Seeing disruptions happen in other industries, like hospitality (AirBnB) and transportation (Uber), creates a new wave of seekers that know changing the way the world thinks isn’t something that requires loads of overhead and capital. As more startups sprout up, it becomes increasingly difficult to ignore this movement.
What’s it like building a global fintech platform from Canada? What do you think are its strengths and challenges?
Canada has a great talent pool, financial and regulatory infrastructure, and an environment that helps foster innovative thinking. These provide a strong backbone in creating great standards when looking at growing out globally. While these are fantastic ingredients for a start up, this also has challenges in keeping pace with change. As much as we wish to push the boundaries of what our product could become, we need to ensure it plays nicely in the regulatory environment as well. This extends beyond just regulations; it means involving industry players big or small, like FIs, the private sector, and local partners. We want to align and amplify the innovation output. This also means established companies looking to support this movement must be open-minded about collaborating and executing innovation more quickly in order to stay ahead of the curve.
What should we expect to see from nTrust in 2016?
As we continue to push forward on the P2P Canadian market, we are working with various providers in the space to further tune an end-to-end, seamless experience. Concurrently, we are in discussions on an international scale to provide a greater reach and access points for consumers in other markets. With the world feeling smaller and border lines becoming less visible, nTrust is poised to become a leader in connecting people financially no matter where they are.
Photo credit: itsmeritesh via VisualHunt / CC BY-SA
Wayerz has a creative solution for a last holdout of old banking: interbank wire transfer
Menny Shalom is CEO of Wayerz.
What are the core challenges in transferring money between financial institutions?
Today using the banking system to wire money is almost unrealistic – as it represents the old-banking world – very expensive service for very poor service. Both parties (the sender and the receiver) don’t know when the wire will complete, what would be the total cost and how it is going to be divided between them. The “surprising” part is that even the banks involved – the sender’s bank and the receiver’s – don’t know that.
Further, the banks today send the money between them in random paths. They just move the money to the next bank – hoping it will find the beneficiary – while they are somewhat indifferent as to the cost, time and risks associated with the executed route. We believe that could and should be different.
How does Wayerz solve or fix these problems? Does the crowd play a role?
Wayerz provides a GPS-like solution that calculates the optimal route for each and every wire, in real time. Optimal could mean the cheapest route, the fastest route, the least riskier route and so on. On top of the ability to provide those routes we allow every bank to determine what is optimal for it — based on its policies, internal considerations and commercial preferences. We are enterprise software, optimizing the benefits for our clients (the banks) so the general crowd is being “counted” through the banks’ interests. We do however monitor the routes and get statistical insights as to the global payment map.
Where did you come up with the idea for Wayerz?
Reality is always the best motivation for innovation. I was approached by a bank who asked me to source similar software for them. I then approached 25 banks worldwide and asked what software they use. They all gave me the same 2 answers: (a) we don’t have it and (b) if you create it, we’ll be happy to buy it from you.
After realizing there is a need and an opportunity, I sat down and for 9 months, wrote 130 pages of a research document – covering the whole bank-to-bank lifecycle. It covered the human factor, technology, commercial aspects, IT, privacy, risks and many other aspects. I was surprised to learn that it’s a HUGE industry but very old and traditional, with relatively few people involved (mainly for relationships) and almost no technology. The most sophisticated banks are using an amazing technology called . . . .Excel to manage their correspondent banking relationships, services, and billing.
That phase also helped me to learn about additional needs in that arena – on top of the wiring optimization, like intra bank billing and financial institutions onboarding. Banks receive hundreds of invoices and statements from other banks – every month. They come in many different file formats, different currencies, and different languages. Even two English-written statements would not be comparable as they have different design layout and use different financial terminology to describe similar banking services.
Wayerz has built a proprietary billing engine that unifies ALL those bank-to-bank invoices into a unified and simplified format – allowing the banks now to compare invoices (and service providers . . . ), to group them, to match them and so on. They can now see all those invoices grouped by logos (counter-bank), country, currency, business unit, or service (cash, securities, trade finance and more). They can then reconcile them (so they can see if they were charged correctly by the counter-bank) and open an investigation – all through the Wayerz platform.
Why create an optimization engine for an existing process? Why not take on SWIFT head on with a better model?
Well, we do both 🙂
First you need to understand – SWIFT is used for messaging. Banks are using it to send each other financial messages. Separate from that there is bank-to-bank settling – where banks actually settle the amounts, wires, and funds between them. Wayerz was created because there are significant gaps between the messaging and the settlement.
As to messaging, I believe SWIFT is, and would remain, the trusteed logo by name for financial messaging. It is not realistic to expect banks would move away from it tomorrow. SWIFT is owned by the banks and it services them and those tight relationships are probably here to stay. However, one (like Wayerz . . . :-)) can improve and optimize it and that is what we are doing. By the way – we also do it directly with SWIFT, as we have advanced and detailed discussions as to how we can add the Wayerz functionality to their existing platforms.
As to reinventing the financial messaging world – we are developing our own blockchain-based financial messaging platform. We are NOT using it for value transfer (ie settlements) like most blockchain application do, but merely to improve financial messaging between multiple parties
What’s next for Wayerz in 2016? What should we expect to see from you and your team?
Many (Menny’s) good things –
- We expect to keep growing – doubling our team every quarter. After NY, we expect to open offices in London, Frankfurt and Singapore
- We expect to announce 3 global partnerships with tier-1 tech behemoths
- We’ll rollout 4 new bank-to-bank solutions
- We’ll keep having fun and harvesting our olive trees
- We believe in colorful shirts
Photo credit: brizzle born and bred / VisualHunt.com / CC BY-ND
[podcast] Why a 164 year old payments giant partnered with the hottest social media tool on the planet
One of the themes we’re tracking here at Tradestreaming is the confluence of incumbent financial institutions with new technologies, platforms, and tools. When you look at some of the largest and oldest financial institutions, some are indeed embracing the future.
Western Union is one of those firms. You’re probably familiar with the fact that Western Union provides consumers and businesses with a variety of ways to send and receive money around the world. Through multiple brands , the company, which is 164 years old, has built a combined network of over 500,000 agent locations in 200 countries and territories and over 100,000 ATMs and kiosks, giving it the capability to send money to hundreds of millions of accounts. In 2014, The Western Union Company completed 255 million consumer-to-consumer transactions worldwide, moving $85 billion of principal between consumers, and 484 million business payments.
The scale is pretty staggering and what’s interesting is how the firm is embracing some of the same tools its customers are using. A recent study by McKinsey estimated that by 2020, 12% of global remittances will be initiated via social media and communications platforms. To this end, earlier in the fall, Western Union launched the WUConnect service, which opens Western Union’s internal transaction processing network to platforms that want to offer social and text payment capabilities to their own customers.
The company created application programming interfaces and a software developer’s kit to let social networks, like Facebook, access the service. And just a couple of weeks ago, the company announced that WeChat, the Chinese communications platform, is rolling out an integration that would enable its 650M active users to send money to one another over the WU Connect service.
David Thompson, Western Union’s Chief Information Officer, joins us today on the Tradestreaming Podcast to discuss how his firm views the convergence of social, technology, and finance and how he’s helped manage the internal processes to ensure Western Union stays competitive and relevant throughout the evolution of today’s technology.
Listen to the FULL episode
What you’ll hear in this week’s podcast:
- The inherent socialness of payments and why it makes sense for apps/social platforms to offer peer to peer payments
- WUConnect, Western Union’s API / SDK suite to integrate cross-border payments into social media networks
- What’s driving the partnership with WeChat, China’s leading social media communications platform with 650M monthly users
- How payments can drive additional stickiness to large social platforms
- Strategy drill-down on Western Union’s global leadership in cross-border and digital payments
- How Western Union’s competitiveness is driven by a large investment in regulatory compliance in 200 countries around the world
- David’s view on the challenges in cross-border, cross-currency money transfer and what he and Western Union have done to solve for these
- Why McKinsey believes that by 2020, 12% of global remittances will be initiated via social media and messaging platforms
- What David has planned for new types of partnerships in 2016 as well as new functionality slated to be launched as part of WUConnect
THIS WEEK’S SPONSOR
This week’s episode of the Tradestreaming Podcast was sponsored by Collective2 — automated trading for humans.
Choose one of the thousands of automated trading strategies at Collective2, and trade it in your brokerage account.
To learn more, go to www.collective2.com/tradestreaming and as a Tradestreaming listener, you will get $55 off the first strategy you publish to Collective2.
MORE RESOURCES
- Western Union (website)
- Western Union launches WUConnect Expanding Cross-Border Money Transfer via Mobile and Social Media (Press Release)
EVEN MORE RESOURCES
Photo credit: sandklef / Visual Hunt / CC BY-SA
List of the top CEOs in the Payments industry
With incumbents and startups alike fighting tooth and nail over control of our transactions, the payments industry is undergoing massive change. From digital wallets to payments getting embedded in our mobile operating systems, there is a lot of disruption underway in the payments industry.
Entrepreneurs in payments have come from all over — some young CEOs have cut their teeth working for incumbent payment providers and credit card companies. Others have found their path to disruption from the outside, providing different perspectives to their payments offerings.
Here’s a list of some of the top CEOs in the payments industry that we’ve compiled here at Tradestreaming. Feel free to upvote your favorites and to nominate those who maybe weren’t included in the first go.
View more lists from Zack Miller
7 top blogs to read if you’re serious about payments
The payments space is on fire and it’s not just about the recently-filed Square IPO. The payments space is seeing a lot of interest by investors and partners in the larger financial industry.
Payments isn’t a pure-bred space anymore. Instead of payment-focused companies, you’re finding companies entering the payment space from all kinds of angles. Apple, Google, and Amazon may all going to be powerhouses over the long-term in the payment space.
But, what if you’re new to the space? Where would you begin to learn about payments: from new payment technologies to news in the space to analysis of what to look for coming down the pike for payments?
1. Let’s Talk Payments
Let’s Talk Payments: Let’s Talk Payments was launched in August of 2013 and hasn’t looked back. LTP is one of the most active sites in the payments space, publishing a handful of articles on the space every day. The site relaunched in 2015, bringing more data, analysis, and collaboration tools to the industry.
Published by: Co-founders Amit Goel and Aditya Khurjekar.
2. PYMNTS.com
PYMNTS.com: . Readers of the site are treated to daily news and opinion on payments and the content is particularly good when it comes to payments as they relate to ecommerce and social commerce. According to the site, “This powerful B2B platform is the #1 site for the payments industry by traffic and the premier source of information about “what’s next” in payments. C-suite and VP level executives turn to it daily for these insights, making the PYMNTS.com audience the most valuable in the industry.”
Published by: PYMNTS.com is published by 1st in Media, LCC, a joint venture between two leaders in the online media and payments space: Business Wire and Market Platform Dynamics
3. Payments Views
Payments Views: This isn’t a blog to check daily — it’s longer-form opinion pieces are published more on a weekly frequency. The thought pieces are more in-depth than many of the articles you’ll find on other payments sites and are a great way to get smart on the industry. There’s a whole education section (typically offering workshops for industry participants) and a podcast called, Payments on Fire, that’s definitely worth listening to (POF).
Published by: Glenbrook is a payments industry strategy consulting and research firm. We bring to our clients a unique combination of our specialized skills in payments, many years of hands-on experience in the field, and our network of professional relationships.
Follow: Twitter
4. Mobile Payments Today
Mobile Payments Today: Mobile Payments Today is really an industry portal for payments, sporting everything from daily news and opinion articles to a supplier directory to industry whitepapers. There’s a lot of content here to get started with and some live events like webinars as opportunities for learning. There are job listings as well on MPT.
Published by: Networld Media Group and Will Hernandez. Before becoming Editor of Mobile Payments Today, Will spent two years as the content manager for PaymentsJournal.com, a leading payments industry news aggregator. He spent four years covering the payments industry as an associate editor for multiple publications in SourceMedia’s Payments Group including ATM&Debit News, CardLine, PaymentsSource.com, ISO&Agent Weekly and American Banker.
5. Accepting Payments
Accepting Payments: Brian Roemmele’s blog hosted on Q&A site, Quora, is an amazing treasure trove of on-the-ground insights from a leader in the payments industry. Accepting Payments spills a lot of ink dissecting new payment offerings like Apple Pay and Android Pay and has had good coverage of the Square IPO. There are few in the industry who rival Roemmele’s personal insights into the future of the payments industry and how the different competitive offerings in the industry stack up against each other.
Published by: Brian Roemmele (though Accepting Payments does take outside submissions). Brian is Founder and CEO of 1st American Card Service and President at Multiplex Media Corporation.
Follow: Twitter
6. Finextra
Finextra: Finextra is a great go-to source for the entire fintech industry and does a good job covering payments, in particular. The news is covered with a little opinion sprinkled in. Finextra does a better job than most covering the global payments industry and highlights a lot of the data and information coming out of the space.
Published by: Finextra is the leading independent newswire and information source for the worldwide financial technology community. The publisher claims it has over 25,000 members signed up for the site with almost 10,000 posts published to date.
Follow: Twitter
7. [BONUS] Navigator Monthly Newsletter
Navigator Monthly Newsletter: This monthly newsletter, basically an aggregation of the articles published monthly by payments consulting group, First Annapolis, is a great read (and free, too). Archives of this monthly publication are available on the site dating back to 2012. Particularly good looking at the moves of the largest incumbents in the industry.
Published by: First Annapolis, an M&A and consulting group servicing the payments industry.
What payments blogs do you follow? Let us know in the comments…
Readers Top Picks
@newrulesinvest @BrianRoemmele add @noyesclt and @cherian_abraham to the mix. Fantastic writers.
— Mike Dudas (@mdudas) October 18, 2015
@mdudas@newrulesinvest@BrianRoemmele@noyesclt Thank you Mike. I would also add @dgwbirch. — Cherian Abraham (@cherian_abraham) October 18, 2015
Recommend @leimer a banker who 100% understands the #CustomerExperience practical, real world analysis #payments https://t.co/Xox3E7vr0l — diana berman (@thedianaberman) October 18, 2015
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