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CODAT PARTNERS WITH VISA TO GIVE EUROPEAN BANKS ACCESS TO SME FINANCIAL DATA

Codat – a London-based technology company that connects the internal systems of small businesses to banks, fintechs and other financial institutions, allowing business data to flow back and forth in real time – has formed a strategic partnership with Visa.

 

Via a single API, Codat enables financial service organisations to integrate with a wide and growing range of accounting, banking, and commerce integrations platforms. It means banks and lenders can get a holistic financial profile of a small business in a matter of minutes rather than days, allowing credit risk to be assessed faster and more accurately, and speeding up time to decision for the applicant.

 

The partnership agreement is tied to the launch of the Visa Fintech Partner Connect program in Europe – a new marketplace where Visa is partnering with a roster of carefully selected fintech businesses. It will provide Visa’s clients with access to a suite of next-generation digital banking solutions and capabilities from across the financial services spectrum, helping them to quickly bring new solutions to market.

 

Working with Codat, Visa’s clients will be able to create a fully digital journey for their SME customers, from onboarding, to underwriting, to account and portfolio management, with a single point of connectivity between their customers’ accounting platforms and data sources. Codat’s connectivity to an SME’s financial data will form the most up-to-date picture of a business’s financial health.

 

Through its commitment to integrating with a wide range of data sources, Codat ensures Visa and Codat clients will always be offered the broadest and richest access to key business financial data.

 

“This is a major stamp of approval and validation of the quality, security and scalability of the platform our team has built,” said Pete Lord, CEO at Codat. “Visa has recognised that we address a universal pain point in SME financial services: the manual, slow, and limited exchange of financial data between businesses and their service providers. Our modern API technology provides the means to do this better, giving Visa’s clients the ability to offer SMEs a suite of improved and more agile products and services, as well as reduce their own operating costs.”

 

Banking

MODERN BANK HEISTS: FINANCIAL INSTITUTIONS ARE BEING HELD HOSTAGE

By Tom Kellermann, Head of Cybersecurity Strategy, VMware Security Business Unit, @TAKellermann

 

The modern bank heist has escalated to a hostage situation over the past year. The new goal of attackers is now to hijack a financial institution’s digital infrastructure and to leverage that infrastructure against a bank’s constituents. As the world shifted to an anywhere workforce amid the pandemic, we witnessed attacker strategy evolve, becoming much more destructive and sophisticated than ever before.

In the fourth annual Modern Bank Heists report, we interviewed 126 CISOs, representing some of the world’s largest financial institutions, regarding their experiences with cybercrime campaigns. Given the nature of its business, the financial sector has established robust security postures and fraud prevention practices. However, they are facing an onslaught of sophisticated cybercrime conspiracies. Attacks against financial institutions more than tripled last year. This stark reality can be attributed to the organized nature of cybercrime cartels and the dramatic increase in sophisticated cyberattacks. The goal of this year’s report was to understand how offense should inform the financial sector’s defense.

 

Here’s an overview of some key findings:

  • From heist to hostage: 38%* of financial institutions experienced an increase in island hopping, escalating a heist to a hostage situation. Cybercrime cartels understand the interdependencies of the sector and recognize that they can hijack the digital transformation of the financial institution to attack their customers. They use brand trust (often times trust that’s been built up over hundreds of years) against the bank’s constituents by commandeering its assets. *Note: This excludes SolarWinds.
  • Increased geopolitical tension and counter IR triggering destructive attacks: There’s been a 118% increase in destructive attacks as we see geopolitical tension play out in cyberspace. Russia, China and the U.S. underground posed the greatest concern to financial institutions. It is also worth noting that cybercriminals in the financial sector will typically only leverage destructive attacks as an escalation to burn the evidence as part of a counter incident response.
  • The digitization of insider trading: 51% of financial institutions experienced attacks targeting market strategies. This allows for the digitization of insider trading and ability to front-run the market, which aligns with the strategies of economic espionage.
  • Cybercriminals launch Chronos attacks: 41% of financial institutions observed the manipulation of time stamps. This is occurring within a sector that’s incredibly dependent on time given the nature of its business. Because there’s no way to insulate the integrity of time once deployed in a time stamp fashion, this Chronos attack is quite pernicious.

As the threat landscape evolves, so will the tactics, techniques and procedures of cybercrime cartels, as seen in the above findings.

These groups have become national assets for the nation-states who offer them protection and power. In tandem with this, we’ve seen traditional crime groups digitize over the past year as the pandemic hampered them from conducting business as usual. This has popularized the industry of services provided by the dark web, increased collaboration between cybercrime groups, and ensured cyber cartels are now more powerful than their traditional organized crime counterparts.

 

So, how should the financial industry respond? To start, here are a few strategies for security teams:

  • Conduct weekly threat hunting and normalize it as a best practice to fuel threat intelligence. We were happy to hear from the CISOs we spoke with that 48% already conduct weekly threat hunts.
  • Integrate your network detection and response with your end-point protection platforms.
  • Apply “Just in time” administration.
  • Deploy workload security.

The game has changed, and so must the financial sector’s security strategy. Safety and soundness will only be maintained by empowering the CISO. 2021 should be the year that CISOs report directly to the CEO and be given greater authority and resources.

Bob Parisi, Head of Cyber Solutions – North America, Munich Re, echoed the importance of up leveling the role of the CISO as cyberattacks surge: “The report’s findings around an increased level of destructive attacks and island hopping makes it clear that financial institutions remain in the crosshairs. VMware’s recommendation that CISOs should be elevated to C-level aligns with the fact that cyber risk is an operational risk that needs to be managed across a spectrum of technology, process and people, including the use of financial instruments like cyber insurance.”

It’s no longer a matter of if, but when “the next SolarWinds” will occur. As a result, cybersecurity must be viewed as a functionality of business versus an expense. Trust and confidence in the safety and soundness in the financial sector will depend on it.

To learn more, download the full report.

 

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Banking

HOW IS FINTECH AFFECTING BANKS?

Introduction

Fintech technology is booming and shaping the global financial system. The finance world will no longer be investment firms working off in-person advice and as financial innovators race to reach the market demands. Many fledgling businesses continue to shape the future of fintech trends and products in the industry. With the digital transformation approach, not only fintech created innovative ideas for interacting with potential customers but also emerged as an upgraded lifestyle for most millennials today.

Fintech is no longer jargon for the banking sector but now it is a relative term in technology in general. More than 70% of bank executives recognize customer banking as one of the most likely to be deranged by Fintech.

But have you ever wondered, what if the fintech sector continues to develop at breakneck speed? Does it mean the traditional banking ends here?

In this blog, we’re going to know how do financial services impact the bank sectors. So, without any further ado, let’s get started!

How does Fintech Affect Banks?

Biometric Sensors

Fintech in the banking industry addresses many innovations and one of them is biometric sensors. Biometric sensors and Iris scanners both are technological advancements that automated teller machines are observing. Besides, these tech advancements are ground-breaking since they would simply eradicate the requirement to carry your plastic card. Moreover, you’re not required to remember your pin.

Apart from providing convenience and ease of working, these technological advancements will also create ATMs more securely and it will allow you to access your own account without entering a password. These biometric censored ATMs use desegregated mobile appliances, fingerprint scanners, and eye recognition to identify the owner of the account.

Utilizing biometric technology introduces a huge sigh of relief for all the consumers who lost their ATM cards because now they can access their funds even when they don’t have their card.

Customer service chatbots

In recent years, fintech also introduced customer service chatbots that are bits of software created using machine learning that allows them to constantly learn from human interventions. Chatbots are efficiently used to streamline customer interactions such as handling queries and guiding customers to the required departments. They can perform various tasks which provide investment advice to their customers.

The rapidly growing technological advancements and innovation, chatbots have become an integral part of the banking industry that improves customer satisfaction and call agents to focus on additional value.

Mobile Banking

The usage of smartphones is rapidly increasing and it forces the banking sectors to come up with mobile applications that provide Fintech services to its customers. Many banks have their own mobile applications which have a user-friendly interface. These mobile apps also have fingerprint recognition features for the user and the application functions without any biometric hardware.

You can quickly access funds using a mobile application and perform various banking functions such as checking account balance, check deposit, pay bills, and much more.

Artificial Intelligence

Undoubtedly, Artificial intelligence and digital transformation are booming in traditional business. It has become an integral part of the financial-banking sector. The software solutions that banking industry uses for fraud detection generates alerts when any fraudulent transaction is done in the system. After generating alerts, it is backed up by the investigation and determines whether the attack was real or fake. To prevent customer data and cookies, banks are now adopting AI technology.

McKinsey says that adopting machine learning-driven statistical modeling and process automation can transform the AML tasks by implementing new efficiencies and innovations.

For instance, various data aggregation platforms can manage data and unstructured transactions for offering a 360-degree customer view. By implementing machine learning algorithms, banking sectors can leverage historical data and determine patterns of a fraud attack which will reduce human interventional up to 50%.

Branchless Banking

Fintech services are transforming the entire banking industry from a branching process to digital channels which reduces the bank’s dependency and affected mortar branches to function.

We can see that many banks are reducing their branches by adopting omnichannel banking services. You’ll be surprised to know that more than 9000 bank branches were shut down only in the European Union by the end of 2016.

Is FinTech worth the investment?

There comes various challenges that should be taken into account while implementing fintech services. But undoubtedly, it offers excellent potential to the banking industry to lower their operating costs and offer better services to their customers. If you’re not walking with the tech trends and the rising demand for fintech, you might lack behind the advances of your competitors. The fintech industry is affecting the banking sector is imminent, it depends on the bank to decide how they’ll evolve in the advances to meet their customer needs.

Businesses specializing platform in fintechs technology are incumbents in the financial industry in many ways. Various advantages enable more innovation and deliver service to their customers more quickly compared to traditional banking sectors do.

The Bottom Line

The advances in innovations and the cutting-edge digital technologies coupled with customers’ demand for user-friendly banking experiences leads financial services to readily grasp the fintech technology. Today, fintech includes everything that we just mentioned in this blog. In the future, fintech is all set to become even bigger with retail banking software and other components coming under it. Only time can predict how fintech will affect the banking sector and the world in the future, but soon technology will rule finance. If you’re still unaware of the impact on the banking sector by fintech development, then you’re probably lagging.

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