#Bank #Innovation #Israel #2016 #registration has #officially opened today. The only Western #fintech event in Startup Nation, the 2016 Bank Innovation Israel will take place 1-3 November at the Dan Tel Aviv. The event is presented by Bank Innovation, one of the world’s leading fintech blogs.
Bank Innovation
Researchers from the Massachusetts Institute of #Technology, therefore, have developed a guaranteed privacy system based on #blockchain, in which #data can be stored, verified and shared without ever being revealed to any of the network’s parties. ‘Enigma’, which is powered by the blockchain, is essentially “different computers that are talking to each other, but they don’t do mining, they just provide resources to the network, bandwidth, some of their hard drives, some of their CPU power”, according to co-founder Oz Nathan, a technology entrepreneur with experience working with the Counter Terror Unit of the Israeli Defence Forces. This will purportedly allow #banks, for instance, to confidently sign up to private blockchains, knowing that sensitive #client data will remain private.
Enigma’s founders are also speaking to medical companies, particularly those who are unable to put huge swathes of client medical #information onto the blockchain. As a solution, Enigma breaks down data into smaller pieces, and rather than performing conventional encryption, a “secret sharing” method is used, according to co-founder Guy Zyskind where the system “guarantees mathematically that each of these pieces are completely masked, completely random and completely #secure&8221;.
Moreover, there does not appear to be a limitation to the magnitude of projects that can be put onto the blockchain. The UK government is now looking to blockchain technology to protect itself against data breaches within some of its biggest industries. Guardtime, which provides cyber-security services and uses blockchain to secure sensitive data, recently announced it will be in charge of protecting the UK’s nuclear power stations, flood defence systems and electricity grids from cyberattacks.
According to a recent report by think tank Chatham House, a ‘culture of denial’ currently exists in the UK’s nuclear power industry with regards to the risk of cyberattacks. Blockchain’s permitted ledger, however, can be used by Guardtime to boost the security of some of the largest systems of UK infrastructure. The system uses hash-function cryptography that is based on ‘signature’ authorization, known as Keyless Signature Infrastructure (KSI). Ultimately, the technology allows all data across the system to be securely authorized, while allowing for independent verification of the records, without the need for centralized authorities.
Although blockchain’s technology has been synonymous with the rise of #Bitcoin, Guardtime has been using similar technology for the purpose of security prior to Bitcoin’s emergence. The company employs cybersecurity experts who have experience in the US military, as well as state-level digital security experts from Estonia, who resolutely defended the country from a comprehensive cyberattack by Russia in 2007. Indeed, Estonian innovations in addressing confidentiality and data integrity have been deemed by the US as cutting-edge, which has in turn led to the formation of the #FinTech partnership.
Defence systems, telecommunications companies and financial-services firms are all looking at the technology, according to CTO Matt Johnson, who also believes that Guardtime&8217;s permitted blockchain can provide proof of time, identity and authenticity, while preserving confidentiality of the data, on an industrial scale.
The post Blockchain to Optimize and Secure Client Data Information &8211; Part 3 appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
Let’s assume #Brexit will happen. How will the the UK #FinTech community react? We already know that more than a few financial services firms – mostly #banks I believe &8211; have drawn plans to relocate some of their staff away from London and scale back operations in the UK. Will FinTech firms follow suit? Have some started planning for Brexit? Are Brexit responses being hatched as we speak? Will moves out of the UK be sudden and immediate or gradual? All are questions worthy of an answer.
With the demise of its offshore business, London needed to reinvent itself to retain financial services relevance. Fintech, while maybe not being THE answer, was one of the answers. In the past years we have seen the City of London, the Bank of England, the Financial Conduct Authority and Government signaling they were all opened for FinTech business, launching initiatives and making it altogether easier, relatively speaking, for FinTech entrepreneurs to choose London as their home base.
The attractiveness of the UK as a homogenous market (think South East England with a concentration of tech savvy and affluent individuals in one time zone), a skilled workforce, the lure of a flexible UK economy and labor laws all helped. The relative strength of venture capital funding (both in terms of quantity and quality) compared to Europe should not be discounted.
There has also been a fair bit of regulatory arbitrage going on. There is no question many entrepreneurs will chose a country where the regulator is more sophisticated, enjoys a positive reputation globally, is “open for business” and easier to deal with than in one&8217;s home country; especially when this choice will result in a FCA approved license that is recognized across the European Union, thereby providing optionality around a bigger addressable market. In other words, resisting the allure of London as a FinTech hub while noting all what you build can and will be applicable all over the EU is very difficult to do.
What happens if the EU link is altered? I doubt an FCA license would be recognized across Europe then, which means increased licensing and compliance costs, presumably. Further, as mentioned above, some financial services firms will reduce their operations in the UK and relocate &8211; to continental Europe, to the US… Plus there is the rising uncertainty of how #life will be #after Brexit &8211; financial services life, business life, how removed the UK will be from EU, the types of barriers that will exist.
If you are a Fintech startup thinking of moving to the UK you are going to think twice. The decision will not be as easy as it was.
If you are a Fintech startup already in the UK, in the early stages of of building your operations you will start thinking whether a move is the right decision.
If you are a d2c Fintech startup with aspirations for European roll out you may decide to relocate some of your operations to continental Europe sooner than you had planned or more than you had planned.
If you are a b2b Fintech startup you will tend to follow your clients and their operations wherever they go.
Additionally, if Brexit results in a less opened environment for foreign workers, the tech community might see a net outward flux of engineers out of the UK which may sway Fintech startups to follow talent.
All in all, these trends are not net positives for UK Fintech dominance.
Where would Fintech startups move? There is no obvious FinTech hub that can immediately challenge London. None of the potential contenders are ideal candidates.
Berlin has a strong pool of tech talent and a vibrant startup scene and Frankfurt is the financial services center of Germany. Fintech startups relocating to either would deal with Bafin, the German regulator which is a strong and very well regarded regulator. Yet, language is an issue and the German market is not that easy to crack for a non German entity. Bafin would also have to show a tad more forward looking intent a la FCA.
Paris enjoys great infrastructure and a deep pool of tech talent, but the language is also an issue and the local regulator is not well known for its international and forward looking bent.
Stockholm, Amsterdam, Zurich/Geneva are also interesting candidates.
New York might even be a candidate &8211; same language, much larger market, strong financial services hub.
I tend to think there will not be one clear winner among the above mentioned candidates. Most if not all will benefit. Although this might not be a good thing from a geopolitical point if view for Europe &8211; as London&8217;s Fintech star wanes relatively speaking compared to its global competitors and as no clear European city emerges as the clear leader &8211; there may be a silver lining. Indeed, sensing an opportunity to gain market share, Euro regulators may become more open and forward minded &8211; sandboxes, friendliness and collaboration with startups &8211; thereby creating a healthy competitive environment across the continent towards tech innovation; Euro legislators in Brussels and Strasbourg may help with that process; City Councils may jockey for position with local laws and initiatives to attract startups. Further, UK Fintech VCs may allocate more funds to continental Europe. I can think of many intended and unintended positive consequences and far from putting a damper on Fintech in Europe we may see a revitalization of Fintech across Europe.
If you are a UK based Fintech, I am curious what your current thinking is. Or maybe Brexit will not happen.
Although not as large as in the US, London has a burgeoning startup ecosystem that leads the European market. In the field of #fintech, though, London is the world’s number #one.
The UK, which employs some 61,000 people in the financial #technology sector, ranks ahead of other competitors. In 2015, fintech generated £6.6 billion (US$ 9.41 billion) in revenue, and accounted for 32% of all revenues generated across in-scope regions.
Image credit: Tower Bridge in London by Mapics, via Shutterstock.com
In a report commissioned by the UK&8217;s HM Treasury released earlier this year, EY argues that the UK&8217;s strong fintech ecosystem could be in part explained by its world-leading fintech policy environment. This prosperous environment includes supportive regulatory initiatives, tax incentives, and government programs designed to promote competition and innovation.
London in particular has a number of very successful fintech startups which grew on to become unicorns. These billion-dollar ventures include Skrill, the popular e-commerce business providing online payments and money transfers services; Wonga, a payday loan company offering “short-term, high-cost credit;” TransferWise, a peer-to-peer money transfer service; Funding Circle, a peer-to-peer lending marketplace; and Markit Group, which provides independent data, trade processing of derivatives, foreign exchange and loans, customized technology platforms and managed services.
Powa Technologies, once valued at US$ 2.7 billion, collapsed into administration in February this year after blowing through more than US$ 200 million of investors&8217; money. Powa Technologies, which provides mobile commerce and e-commerce services, was struggling to sign clients, struggling with management dysfunction and a demoralized workshop, according to a report by Business Insider.
Powa, which appointed Deloitte as administrators following its failure, was eventually broken up and two of its units, namely PowaWeb and PowaTag, were sold to separate groups of investors.
Like anywhere else, there are winners and losers, but today, we will focus on London&8217;s top 10 #rising #stars:
Founded in 2009, WorldRemit offers much cheaper international money transfer services than traditional players and further allows users to send money to and from smartphones.
WorldRemit has raised over US$ 145 million so far and was valued at US$ 500 million in a US$ 100 million funding round last year, according to the Financial Times.
RateSetter is a peer-to-peer lender that lets users lend their savings out to individual borrowers. The platform has lent over £1.2 billion (US$ 1.72 billion) since launching in 2009.
RateSetter has raised over US$ 10 million in funding so far. The company is known for having introduced the concept of a &8220;provision fund&8221; into peer-to-peer lending and has recently announced plans to broaden its client list to include small and middle-sized enterprises.
Founded in 2011, Crowdcube is an equity crowdfunding platform that lets companies raise money by selling shares online, and people to purchase equity in unlisted, UK-registered, businesses.
The platform has helped 400 businesses raise over £160 million (US$ 228 million) from over 280,000 investors since it launched in 2011. Crowdcube has raised US$ 18.6 million in funding so far.
Founded in 2005, Zopa is the world&8217;s oldest and Europe&8217;s largest peer-to-peer lending platform service that lets users lend money to others. Zopa, an award-winning loan provider, has lent over £1.53 billion (US$ 2.19 billion).
Zopa is also a founding member of the Peer 2 Peer Finance Association industry group. The company has recently branched into the car loan refinance market and phone finance.
Zopa has raised over US$ 55 million in funding.
Seedrs is an equity crowdfunding platform for investing in startups and later-stage businesses throughout Europe. Founded in 2012, the platform lets users invest as little as £10 or €10 into the businesses.
Seedrs has allowed £130 million to be invested in over 350 deals since the platform launched. In 2015 alone, 38,000 individual investments were made on Seedrs worth £64 million (US$ 91.5 million).
Seedrs has raised over US$ 21 million in funding so far.
iwoca is an award-winning finance provider for small businesses in the UK, Poland, Spain and Germany. iwoca offers flexible credit, allowing businesses to get up to £100,000 in credit facility. The company is partnered with Alibaba to offer a trade finance product, e-Credit Line, to businesses purchasing from Chinese suppliers.
iwoca has raised US$ 31 million in funding. The company was founded in 2011 by two ex-investment bankers from Goldman Sachs and Deutsche Bank.
Atom Bank is what we call a &8220;neo-bank,&8221; a branchless, app-only bank. Founded in 2014, Atom Bank received its banking license in June 2015 and launched its app in April 2016.
Atom Bank is backed by Spanish bank BBVA, Woodford Investment Management and Toscafund Asset, and has raised over US$ 196 million so far. Atom Bank is targeted at the millennial generation.
Currency Cloud provides &8220;cross-border payments as a service.&8221; The company&8217;s platform leverages the cloud to provide access to and optimize across a multitude of payment networks and exchange rate providers, and at cheaper costs. Currency Cloud&8217;s technology powers some of the industry&8217;s biggest names including WorldRemit and TransferWise.
Founded in 2012, Currency Cloud has raised US$ 35 million in funding.
Founded in 2014, Tandem is an app-only bank which made headlines earlier this year when it successfully raised £1 million (US$ 1.43 million) in its first crowdfunding round in just 15 minutes.
Tandem, which has yet to launch, has already been granted a banking license and has been valued at £65 million (US$ 92.9 million), according to Business Insider.
Founded in 2015, SETL develops and provides #blockchain infrastructure for finance firms.
SETL has launched earlier this month the OpenCSD, a blockchain powered platform that enables market participants to run permissioned registry service for payments, settlement and clearing of cash and other financial instruments.
If you are interested in learning more about London&8217;s fintech scene and emerging trends in digital finance, two events will take place in London in the coming months.
London Fintech Week, which will take place between July 15 and 22, 2016, will dive into the city&8217;s thriving fintech community. The week-long event will tackle anything from blockchain tech, payments technologies, to capital markets and insurtech.
Special Offer: Sign up now with code FTSW to get 15% discount for event registration!
Another event, the Global Expansion Summit, will cover the broader digital economy on October 17 and 18.
Special Offer: Sign up now with code FINTECHNEWS to get 20% discount for event registration!
Featured image: Millennium Bridge in London, by Songquan Deng, via Shutterstock.com.
The post London&8217;s Fintechs: Top 10 Rising Stars appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
The financial services industry is another major area in which #client #information must be securely protected to prevent market manipulation. At the same time, however, compliance divisions must be aware of the identity of trading counterparties in order to mitigate potential money-laundering activity. As such, a system which balances both compliance requirements and trading anonymity is required.
Indeed, regulators may find the anonymity of #blockchain a challenge to wholly approve, as it makes it difficult for them to conduct their ‘know your customer’ (KYC) checks to prevent money laundering. Blockchain’s close association with #Bitcoin, moreover, hasn’t helped matters, especially as the #cryptocurrency has been notoriously used in criminal activity, and even funding for terrorist activity.
In November, Israeli start-up Polycoin showcased its blockchain-based compliance service, which will provide a verification system for financial transactions. This will help compliance officers to handle their anti-money laundering (AML) and KYC requirements. Polycoin’s platform scrutinizes financial transactions to try and identify who they are from, and they are then placed into a ranking system. Those transactions deemed as being suspicious – such as an AML breach – will be identified by Polycoin’s platform, which will then send an alert to compliance for further investigation.
Polycoin CEO Alfred Shaffir thinks his firm can provide a complete solution for blockchain compliance, and considers Polycoin’s innovations could have as profound an impact as digital financial crime prevention tool ‘NICE Actimize’ had in the late 1990s. As such, Shaffir is of the opinion that for any bank working with blockchain, transformation of compliance systems and procedures will be their first priority.
Indeed, #banks have already responded positively to Polycoin’s proposals, with the start-up participating in the innovation accelerator project in Israel conducted by financial services giant Citi, while also being chosen as one of 10 participants out of 170 applicants for Finnish bank Nordea’s accelerator in Helsinki. Shaffir has stated that Polycoin has received much interest from those banks that are interested in integrating blockchain into their businesses in the future.
Blockchain compliance specialist Tradle is simplifying the KYC process even further. Last August saw London’s Startupbootcamp #FinTech accelerator take place, where Tradle CEO Gene Vayngrib explained how blockchain #technology could ease the costly pain of compliance for banks. The company is creating a user-friendly smartphone interface that will allow documentation to be sent electronically, thus eliminating the need for inefficient paper-based communication. Furthermore, within each bank currently, separate KYC checks are conducted across products, divisions, locations and subsidiaries &8211; this lack of sharing elevates KYC costs unnecessarily.
Vayngrib instead proposes a blockchain-based app called Trust in Motion which stores KYC #data on a permitted ledger and which all authorized parties can access when required. He calls it the Instagram for KYC, as clients can snap a picture of their ID documents (their passport, for example) and send it directly to the bank. Once the compliance officer verifies the pictures using authentication processes, the documents are digitally signed and put onto the blockchain which, assuming the appropriate authorizations have been granted, can be co-managed by the bank and the client for updates and reverifications.
The technology could also be extended to include AML rules, whereby instead of having to prove to regulators that AML checks have been conducted by sending them mounds of data, automatic procedures can be established that perform AML duties such as the reporting of suspicious transactions. According to Vayngrib, the blockchain method wholly preserves the privacy of the data, while the regulator “could get information about suspicious transactions without banks sharing a lot of raw, private data with them”.
While regulators will like the fact that blockchain’s verification process involves a network of users providing authentication and security, bankers on the other hand will not like this lack of privacy, particularly when it comes to sensitive trading data. Furthermore, financial institutions (and other companies) have suffered numerous data breaches in recent years that have cost them dearly.
Even if several banks are operating on a shared private ledger (with only a limited number of network users), each bank will still want to keep data from every other user in the network. Banks are extremely secretive about the business they transact, as well as the clients with whom they conduct business, meaning that this information can’t be disclosed to competitors, even on a private blockchain.
The post Blockchain to Optimize and Secure Client Data Information &8211; Part 2 appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
The #Bank of #England is continuing to explore distributed ledger #technology as part of a wider embrace of financial technology.
fintech techcrunch
#ClearTax, which helps Indians file their tax returns online with minimum stress, is on a roll this year. The Bengaluru-based company, which graduated Y Combinator two years ago, announced a $ 12 million Series A round today, just one month after closing a $ 2 million seed round following an initial $ 1.3 million raise. Read More
As #data becomes increasingly powerful, meaningful and valuable, concerns over its security are on the rise. Indeed, ‘big data’ has become the recent buzz-term to describe the ever-expanding, often-unstructured nature of important #information, and has opened extensive discussions over how to approach ensuring data integrity is maintained.
One of the primary appeals of #blockchain is the security it provides, which prevents such data from being hacked. The data is fed into the system, where an encrypted code – known as a ‘hash’ value – is created for each initial transaction. Unique hashes are then combined (which allows large amounts of data to be processed), before being placed onto the block’s header along with a timestamp. At this point, the header becomes #part of a cryptographic puzzle which must be solved by the blockchain’s network of users – through a trial and error process, from trillions of possibilities – before it is finally added to the blockchain. This layered system of security, therefore, is being sought after by industries in which #client information is of a highly personal and/or valuable nature.
One of the most eagerly anticipated applications of blockchain is in healthcare, an industry which has long needed to undergo data optimization. In late January 2015, US health insurance provider Anthem learned of a massive cyberattack to its IT system, which ended up compromising a staggering 80 million patient and employee records. Because only one entity was being used to keep records of sensitive client health information, all data became readily available to the hackers from this single source.
The blockchain, however, uses cryptography to enable security in record-keeping, as well as sometimes using a system of ‘multi-signatures’, whereby gaining approval to the blockchain – and access to client data – requires the approval of several authorised users. Moreover, this can apply to all client data. Given the intensely private nature of such information, it requires the utmost protection, which blockchain can provide. Information relating to the client’s identity, medical history, specific diagnoses, treatments undergone and much more can thus be protected.
The US is currently leading the way in much of the early explorations, although the Dutch health giant Philips Healthcare is also investigating blockchain’s scope for use in the health industry. Little has been revealed about Philips’ project, other than it is in collaboration with Tierion, a start-up which is facilitating the collection and storage of big data on the blockchain. Tierion uses a system called chainpoint to ensure that all the data can be verified by blockchain receipts and timestamps. Meanwhile, California-based blockchain company Gem is also examining blockchain’s healthcare potential.
Gem CEO Micah Winkelspecht believes blockchain’s true benefit will be realized once independent parties within the health industry can be connected to the ledger to manage the lifecycle of a hospital bill. The blockchain, therefore, could be used to manage payments for numerous parties, including “insurance companies, hospital billing departments, lenders, and patients”, and Winkelspecht is now in discussion with relevant stakeholders within the health industry to explore this possibility. From there, Winkelspecht attests that blockchain can then be used “to manage the lifecycle of a patient’s medical record”, among other uses.
US blockchain company Factom, which is currently working with the Honduran government to provide greater security for the country’s land registry data, has also partnered with medical records and services solutions provider, HealthNautica, whose clients include hospitals and physicians, in order to use blockchain to enhance the security of medical records and achieve efficiency in claims processing. HealthNautica’s data, ranging from medical bills and client-physician communications to claims and disputes, will be cryptographically encoded by Factom, which produces a digital fingerprint of the data which is time-stamped and verified.
Patient confidentiality is maintained throughout because at no point is client data seen by third parties, Factom included. HealthNautica president Shailesh Bhobe calls Factom’s blockchain #technology the “perfect fit” for improving the security of its data, while board member Andrew Yaschuk believes that if health insurance companies are also educated on the merits of blockchain, all parties can be involved in verifying claims data while still protecting client confidentiality.
The post Blockchain To Optimize and Secure Client Data Information &8211; Part 1 appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
It’s anticipated that there will be more than 4.8 billion individuals using a #mobile phone by the end of 2016. Because of this enormous growth, we can expect to see the mobile payments industry and startups in the space evolve to meet the growing demands of users. To understand how big this industry is going to be, you need to understand the history of mobile payments and their… Read More
The price of #ether, the native digital asset powering the ethereum #blockchain, surpassed $ 20 for the #first time ever yesterday.
fintech techcrunch
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