Tag Archive for: FinTech

From Fintech to Regtech… from potentially disruptive to leaner compliance opportunities

| 31-5-2017 | François de Witte |

On 18/5/2017, I attended a seminar covering the topic “From Fintech to Regtech… from potentially disruptive to leaner compliance opportunities” organized by The Finance Club of Brussels, the Free University of Brussels (ULB), the Solvay Finance Society and Thomson Reuters.

Introduction

Fintech describes a wide range of innovation in financial technology, going from payment systems to lending and trading platforms.
Fintechs are seen in many cases as potential disruptors of the traditional intermediation of heavily regulated banks and other financial institutions See also my articles on PSD2 further down.
However Fintechs can also be enablers, helping banks and financial institutions to streamline their regulatory reporting and compliance, or help the disruptors in coping more easily with compliance in the future.

Setting the scene

Fintechs are playing an increasing role. The investments in Fintechs exceeded EUR 25 billion in 2016, and they bring a real digital revolution. Fintechs are perceived to foster the Digital Revolution, but equally to increase the digital divide in our society between the skilled and/or wealthy and those who are not.

Regulatory compliance is time-consuming and expensive for both financial institutions and regulators. The volume of information that parties must monitor and evaluate is enormous. The rules are often complex and difficult to understand and apply. There is a lot of data to be analyzed. Much of the process remains highly labor-intensive, or still depends heavily on manual inputs.

The Regtechs can be considered as an outgrowth of Fintec. Regtech use digital technologies— including big data analytics, cloud computing, robotics, behavioral analysis, blockchain technology and machine learning to facilitate regulatory compliance. Amongst  other things, Regtech applications automate risk management and compliance processes, enable companies to stay aware of regulatory changes around the world, facilitate regulatory reporting and support strategic planning.

In recent years banks have seen opportunities to ask Fintechs to solve their large regulation and compliance issues. They can change the paradigm of banks from heavy IT releases to agile sprints, from integration to standardizing protocols, from static functions to workflows.

Hence financial institutions are more willing to consider using Fintechs for getting more efficiency. During the seminar, somebody of the panel mentioned: “Collaboration is the best innovation”. Banks can also help Fintechs thanks to their experience in managing large databases, managing risks and providing the required critical mass.

We have seen some applications recently in areas such as the KYC (Know Your Customer) domain.

Regtech – some other considerations

However, as mentioned during the seminar by Antonio Garcia Del Riego, Head of EU Corporate Affairs at Banco Santander, in Europe there remain obstacles in using Fintechs. The Bank Regulators in Europe expect the banks to deduct the goodwill from the core capital of the banks. This implies that software investments cannot be capitalized and need to be written off immediately in the P&L. A second challenge is the ability to attract digital talent, given the fact that the regulators limit the way in which the remuneration can be paid, whilst startups can be very creative here.
For the regulators, there also remain challenges. Once banks will have automated their reporting, the regulators will have to follow. They also will have to attract digital talent, to treat all these data in an automated way. If they do not succeed in this, they might challenge the use of Regtechs, and this is not what we want.

Regtechs can potentially offer similar benefits to regulators as they do to financial institutions. We recently observed that some (quite few) Regtech providers have emerged to serve the significant needs of regulators. There have seen recently some examples in Fintechs bringing behavioral models to the regulators, or new cognitive technology or the use of Blockchain technology (smart contracts), to trigger automatic alerts for the regulators when the banks exceed some thresholds.

Some regulators are taking initiatives to foster innovation. In 2016, the FCA (US) created its “regulatory sandbox,” a space where financial services companies are encouraged to test new products without regulatory consequences. Recently the Australian Securities and Investment Commission also created its regulatory sandbox, suggested to establish a new regtech liaison group, comprising industry, technology firms, academics, consultancies, regulators and consumer bodies, and announced that it would host a Regtech hackathon later in 2017.

Other countries have also taken steps to support Fintech and Regtech innovation. The Monetary Authority of Singapore is in the process of developing a regulatory sandbox. We might expect other regulators to also take similar initiatives.

Conclusion

Thanks to their digital technology, Regtechs enable banks and other financial institutions to reduce the burden of compliance. However some steps need to be taken to create a level playing field and some topics will have to be clarified.
One can ask oneself the question how far these innovations can become game changers, awakenings for the banks, or even force them to more transparency and predictability towards regulators.

 

François de Witte – Founder & Senior Consultant at FDW Consult

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More articles on this subject:

PSD 2: A lot of opportunities but also big challenges (Part I)

PSD 2 : The implementation of PSD 2: A lot of opportunities but also big challenges (Part II)

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“Systems om je bank buitenspel te zetten” – Verslag van mijn Financial Systems presentatie

| 23-5-2017 | Pieter de Kiewit |

Dit is een verslag en korte samenvatting van mijn presentatie die ik mocht houden op het Financial Systems evenement. Afgezien van een gênante vertraging door mijn gebrekkige Powerpoint skills was het een prettige sessie afgerond met een pittige discussie tussen experts in de zaal. Eerst een korte samenvatting:

Als Feyenoord fan ben ik dit jaar gelukkig en weet veel van voetbal, ook al speel ik het niet. Daarin ligt een parallel in mijn werk als treasury recruiter. Maandelijks krijg ik van circa 100 experts persoonlijk college en zie een veelvoud aan cv’s. Ik denk dat ik hierdoor inzicht heb in systemen die worden gebruikt om treasury processen te managen en ik zie de afgelopen decennia interessante ontwikkelingen die de laatste jaren in een versnelling zijn geraakt.

Zonder namen te noemen van leveranciers, ik doe geen software sales, heb ik een lijst gemaakt van diensten en producten die de gereedschapskist van de treasurer kunnen vergroten en afhankelijkheid van zijn bank verkleinen. Toen ik deze lijst opstelde, viel me op dat er tussen de vakgebieden cash & werkkapitaal management enerzijds en funding anderzijds interessante ontwikkelingen zijn zoals bankonafhankelijke betaalplatforms, crowdfunding en het bankkosten inzichtelijk maken. In het managen van risk zie je bijvoorbeeld trade finance in blockchain en partijen die FX transacties tegen ongebruikelijk lage marges bieden.

Banken daadwerkelijk buitenspel wordt lastig en is volgens mij ook niet het streven. Banken bashen vind ik een zeer onsympathieke hobby. Daarbij is de Fintech wereld ook nog niet volwassen met alle bijbehorende consequenties. Voor de drukbezette treasurer, voor de DGA en CFO die maar incidenteel te maken hebben met het vakgebied kunnen deze ontwikkelingen nogal onoverzichtelijk zijn. Helaas is er geen oplossing die snel inzicht verschaft. Wel denk ik dat er mooie kansen liggen voor degene die vooraan wil meelopen in ontwikkelingen.

De discussie die zich ontspon tussen financiële lijnmanagers en treasury experts ging, onder andere, over de vraag of bankkosten daadwerkelijk inzichtelijk zijn en wat de toekomstige rol van de banken zal zijn. De Powerpoint presentatie is onder dit artikel opgenomen. Ik verheug me op verdere events waar discussie rond dit thema kan worden verder gevoerd.

Pieter de Kiewit

 

 

Pieter de Kiewit
Owner Treasurer Search

 

 

Klik hier als je de presentatie van de sessie wilt bekijken.

 

 

 

 

Better Decisions through real-time Reporting: Business Intelligence about Cash Flows & Cash Positions

|17-5-2017 | Joerg Wiemer | TIS | Sponsored content |

How do strategic professionals decide on the best path to success for their company? The key is in transparency and real-time reporting. If it comes to the responsibility of the treasurer or financial professional this means deciding about company-wide cash flow and liquidity levels, bank, customer and supplier relations and working capital.

When cash flow visibility is the lifeblood of your company, you want full control and knowledge. Direct access to insights on profitability and potential business risks allow users to drive better decisions based on solid business intelligence, accessible anytime and anywhere.

 SCENARIO

Better decisions: Companies now have the power of the Business Discovery Manager – a business intelligence module within the TIS cloud platform. Supplier, salary and treasury payments can be easily analyzed along with cash flows, liquidity and working capital via easy-to-use dashboards and reports. The tool, enhanced through state-of-the-art BI technology, enables users to access all strategic insights in a single, flexible, web-based and multi-bank, multi-ERP capable platform available 24 hours a day from anywhere in the world.

 

Source: TIS Treasury Intelligence Solutions GmbH

Challenges

You can’t manage what you don’t measure

  • A lack of visibility over liquidity, working capital and cash flows at the C-level, in treasury, controlling, accounting, Sales and
    purchasing departments.
  • No transparency regarding bank relationships, liquidity positions and account turnover
  • No transparency regarding customer and supplier relationships, as well as incoming and outgoing cash flow

TIS Business Discovery Manager

Company-wide unified automated analysis of cash flow, liquidity and working capital in various departments of Corporate headquarters and in local subsidiaries

  • Multi-bank capable
  • SAP ERP integration via certified plug-in; connection to any ERP, HR and treasury system
  • State-of-the-art BI technology and functionality in a single SaaS solution
  • Support of customer-specific BI tools; support of self-service BI functionality
  • Business Intelligence as a Service: Ready for use throughout the company within seconds without any complex IT projects
  • No changes to bank or system landscape required; the solution is flexible and easily adaptable
  • ISO 27001 certified for data security

 Customer value

  • Better decisions based on complete visibility of liquidity, working capital and cash flows
  • Ability to quickly answer essential questions without the need for any extensive IT projects

Your benefits

C-Level executives:

  • Instant reports about cash flow performances (total of all inflows and payments) of the various local subsidiaries compared to one another over a specific time period
  • Identification of corporate risks and value-adding activities to drive future growth
  • Tangible insights to support internal and external audits
  • Power and data to provide strategic advice to sales and procurement departments

Treasury and controlling teams:

  • Answers to key questions, such as: How much liquidity is available at which bank? What is the net cash flow for a specific currency over a specific time period for a group of companies (natural hedge)? How much working capital does a local subsidiary require in a specific time period?
  • Increased compliance, transparency, and more efficient processes paired with reduced costs

Accounting teams:

  • Visibility of when a supplier was paid, or when a customer paid a local subsidiary over a certain time period
  • Insight into the value of inflows made by customers via various bank accounts and ERP systems over a specific time period

Sales teams:

  • Insight into the value of inflows made by customers and the overall payment behavior of the customer base

Purchasing teams:

  • Transparency across values of overall payments to a supplier via various bank accounts and ERP systems over a specific time period

Source: TIS Treasury Intelligence Solutions GmbH

Business Discovery Manager: never struggle to answer any of these business-critical questions again

 

joerg wiemer

Joerg Wiemer

CSO and Co-Founder of TIS

 

Financial Systems 2017 – Event with a Treasury Twist

| 12-5-2017 | Pieter de Kiewit | treasuryXL | Sponsored content |

In 2016 Treasurer Search, as a sponsor partner, was a guest at our booth during the annual event “Financial Systems” in Nieuwegein and they will be present again this year. The event will open its doors on May 18th, and you can read more about this event on https://financial-systems.nl/. We asked our expert Pieter de Kiewit, owner of Treasurer Search to look back on last year’s event and tell us what to expect this year.

Looking back on last year

Last year, we as Treasurer Search (together with treasuryXL) were able to give part of the event a treasury twist by organizing a workshop that was well appreciated. Four interim managers presented their top tips about treasury software selection and implementation (see https://www.treasuryxl.com/news-articles/treasury-technologie-impact-het-kwadraat).

Looking forward to the 18th of May

Everything is prepared and ready to go.This is what we have planned this year.

We will be present again on the stand and information market of treasuryXL. Their stand will be the meeting point for the treasury community. We will again facilitate knowledge exchange and networking. We believe that, between all ERP, bookkeeping, credit management and other systems, there should be room for treasury management systems, cash forecasting software, payment and other software. A treasury pavilion, together with a Fintech component must be worth a visit.

Parallel session together with treasuryXL

As to our parallel session, we were contemplating various topics. Last year’s operational approach was well appreciated, so we will again present the practical aspects of newest technology. This year’s parallel session has the topic “Systems om je bank buitenspel te zetten” (Technology to put your bank at the side-line)
‘Until recently the banker was an indisputed advisor and bank fees were not open for discussion. But times change and technology contributes to this development. It creates possibilities to re-arrange funding, cash and risk management. Costs are safed, risks are limited and information becomes more comprehensible. As specialised recruiter and active member of the treasury community I will share my vision on contemporary, relevant technology with you in an interactive session. What will your next conversation with your bank be about?’

Free registration with code

Admission to the event is free. We do appreciate your visit. When registering via https://financial-systems.nl/aanmelden/, choose the option ‘gratis registreren met code’ and use the following registration code: TXL2017
This will help us analyzing the visitor population and adjust the program to your background.

I look forward to seeing you at Financial Systems, together with treasuryXL,

 

Pieter de Kiewit

 

 

Pieter de Kiewit
Owner Treasurer Search

 

 

Guide to Treasury Technlogy by ACT & AFP

| 1-5-2017| treasuryXL | ACT | AFP |

ACT and AFP have published a Guide to Treasury Technology sponsored by Bloomberg, which might be interesting for you.
Managing treasury tasks has become more complex due to globalization of markets and increasing uncertainty in business since the first AFP edition appeared in 2011. Since then treasurers faced multiple challenges to exercise control of treasury activities, especially group activities.

Managing treasury has become more complex during the years in the face of global change and increasingly uncertain markets. Treasury practitioners face magnified challenges, as they try to gain more visibility and exercise more control over group activities. Treasury technology developed quickly to help them to operate more efficiently and answer compliance requests with ever more stringent regulation. Automate processes was one of the biggest challenges. Technology can help treasury play a more strategic role, automate routines and be compliant with regulatory environment.

Joint AFP/ACT publication, sponsored by Bloomberg

This guide is the first joint AFP/ACT publication and aims to help practitioners to identify a cost-efficient solution.

The first chapter starts with a detailed introduction of the development of treasury technology, expectations towards this technology and how the evolution of the Corporate Treasurer took place. This chapter illustrates how the technology available to treasurers has developed over the last 15 years. A brief explanation of how dedicated treasury technology was first developed is followed by details of how a series of factors have moulded the treasury technology market into the one we see today. Three points are highlighted: that the treasury technology market has matured, tremendous improvements in the quality of connectivity and what the changes brought with them for Corporate Treasurers.

Why review technology?

In Chapter 2 the drivers for reviewing the technology and a case study are presented.
With the rapid changes in available technology, the increased opportunity for treasury centralization and the need for treasurers to be able to demonstrate control over activities, treasurers were reviewing how best to deploy technology in order to help them perform their various roles effectively. Given the different environments in which companies operate, the potential benefits from the deployment of a new technology solution can vary significantly. This chapter outlines some of the key drivers that are encouraging treasury practitioners to review their use of technology.

Purpose of technology

Chapter 3 deals with the purpose of technology and identifies the core roles of the treasury department. Also how treasury structure can affect the use of technology. When assessing a deployment of technology, treasurers need to determine their requirements of the technology. This chapter includes a series of questions to help treasurers clarify their existing operations and also identify how structures and processes might change with the adoption of new technology. A case study shows how a company uses a certain technology to improve process quality.

Technology solutions

Chapter 4 presents treasury technology solutions.
A wide range of technology solutions is available to support treasurers. Treasury management systems are able to support the majority of the work of most treasury departments. However, it is also possible to develop a technology solution that supports treasury departments, including those with complex operations, without adopting a treasury management system. This can be achieved by developing in-house solutions or by using tools offered by banks and other vendors. A range of potential solutions available to support treasurers is presented in this chapter.

Evaluation and building a business case

Chapter 5 is about the evaluation process and how building a business case can help to evaluate which technology fits best. How to build a business case and then how to develop a requirements definition is explained in detail. The requirements definition is a critical part of the process: it helps to set the scope for the project and is the core document in the selection process. The process of developing the requirements definition also helps to build support for, and awareness of, the project throughout the rest of the organization.

Selection, implementation and maintaining the solution

Chapter 6, 7 deal with the selection and implementation process, while chapter 9 tells you more about maintaining the solution over time.

Trends

Chapter 10, the final chapter describes some of the current trends in treasury technology and lines out how they might impact treasurers over the coming years. Some of the key areas of development in technology and also some of the market changes which might require a technological response are presented.

In the appendix of the guide you will find information on how to develop a request for proposal (RFP) , a checking list for this RFP and a very detailed country reports list.

Source: © Association for Financial Professionals, ACT (Administration) Limited and WWCP Limited (except articles by Bloomberg LP), 2016, ISBN 978 1 899518 47 0 book 978 1 899518 48 7 CD ROM, for the articles  Bloomberg LP, 2016 | TMI

Our conclusion

A very detailed, valuable guide for all who want to learn more about treasury technology, want to find out more on how to select the best technology solution that meets the specific requirements of their company and what to focus on during the purchase and implementation process. You can find the guide on tmi, after registering for free.

 

Review Dutch Fintech Awards: I’ll be back next year!

| 28-4-2017 |  Pieter de Kiewit |

Last Friday I had the pleasure of visiting the Dutch Fintech Awards. Diversity, technology, marketing and entrepreneurship are the key words that in my opinion describe the event best. Both contenders as well as audience were mainly Dutch. Although the language used was English, the communication style, also due to the moderator, was very “Dutch direct”. This kept the program entertaining during the pitches of companies of less relevance for me.

Dutch Fintech Awards

The event was not about parallel sessions or handing out brochures between presentations. One large, very representative room at the headquarter of Rabobank, a moderator who used interactive technology (on my smartphone!), a number of categories where three contenders pitched, an expert giving his opinion and a jury. At the end of the day the winners got awards and one of them won the event over all.

Pitches with various approaches

In comparison to previous versions of the event, I liked that there were no parallel sessions. There was plenty of time to network, people did not feel the need to skip presentations. One could notice that the pitches had various approaches: some of them were purely focused on the product or solutions as if to land extra clients. Others pitched as if to land extra funding. That made the task for jurors harder. Perhaps by coincidence, the less professional pitches were in the same categories.

The overall winner: BUX

The categories catered various target groups. Private persons could learn about financial planning tools & innovative on-line banking, SMEs about expenses management & crowd funding and large corporates about internet fraud & credit rating. I will not go into details about specific company pitches, you can read about them on www.fintech.nl. The only company I want to mention is the winner: Bux. The pitch had flair, a clear target group, a structured & smart approach and success was described in numbers. Both the proposition as well as the business case (funding!) were presented and questions were being answered with confidence.

I left later than planned, inspired, made new connections and met old friends. I will be back next year.

Pieter de Kiewit

 

 

Pieter de Kiewit
Owner Treasurer Search

 

 

More articles of this author:

Fintech recruitment considerations

Consider a treasury intern!

Financial Systems 2017- Smart technology for smart professionals

| 25-4-2017 | treasuryXL

 

Op 18 mei is het weer zo ver. Dan opent de Financial Systems voor de 7e keer haar deuren in Nieuwegein. Deze vakbeurs brengt ieder jaar opnieuw aanbieders van IT toepassingen en professionals uit de diverse financiële vakgebieden bij elkaar en is daarmee het grootste  kennis- en netwerk-evenement op dit snijvlak.

Wat kunt u verwachten?

Financial Systems is een vakbeurs in combinatie met een kwalitatief hoogwaardig programma. De bezoeker krijgt een compleet overzicht van de Nederlandse markt voor IT-toepassingen en diensten die bestemd zijn voor financiële professionals, zij het in banking, corporate treasury of andere financiële dienstverlening. Sinds 2011 wordt de vakbeurs jaarlijks georganiseerd door Alex van Groningen in samenwerking met Next Level Academy. Meer dan 1000 finance professionals bezochten de beurs in 2016.

Honderden vakgenoten onder een dak

Wij nodigen je namens Alex van Groningen en Next Level Academy uit om de Financial Systems gratis te bezoeken, je kennis & ervaringen te delen met honderden vakgenoten en je te laten bijpraten over de laatste marktontwikkelingen op het gebied van IT en Finance. In diverse hoogwaardige sessies worden relevante topics besproken door toonaangevende experts. Denk daarbij aan ontwikkelingen op het gebied van robotica, kunstmatige intelligentie, big data en analytics.
‘Een dag vol ‘tips and tricks’ om je business naar een hoger plan te tillen’,

Programma

Het programma begint om 11 uur met diverse netwerk activiteiten op de beursvloer van het NBC Congrescentrum en verschillende parallelsessies in de diverse zalen. treasuryXL is aanwezig met een stand en zal ook een parallelsessie organiseren met de titel ‘Systems om je bank buitenspel te zetten” Een korte beschrijving die daarover in de beursgids zal verschijnen is als volgt:
Tot voor kort was een bankier, als een arts, de onbetwiste adviseur en zijn kosten waren grotendeels onbespreekbaar. Tijden veranderen en technologie draagt daar aan bij. Dit levert de mogelijkheid financieringen, cash en risk management anders in te richten. Kosten worden bespaard, risico’s beperkt en informatie wordt inzichtelijk. Pieter de Kiewit is gespecialiseerd recruiter en actief lid van de treasury community. Graag deelt hij met u in een interactieve sessie zijn visie op huidige relevante technologie. Waar gaat uw volgende gesprek met uw bank over?

Programma informatie is te vinden via deze link.

Locatie

Financial Systems wordt gehouden in het NBC Congrescentrum in Nieuwegein. Deze centraal gelegen locatie is voorzien van alle moderne faciliteiten om het evenement tot een groot succes te maken. Bovendien beschikt het NBC over 1.200 openbare parkeerplaatsen. Het NBC is vanaf station Utrecht CS in slechts 15 minuten te bereiken met de sneltram.

Partner worden of exposeren

U kunt ook partner worden of exposeren. Meer informatie is te vinden op de website.

treasuryXL biedt u ook mogelijkheden om uw bedrijf of diensten te promoten. Voor meer informatie kunt u contact opnemen met Annette Gillhart, Community Manager treasuryXL.

[icon icon=”envelope” color=”” size=”tiny” with_circle=”0″ link=””] [email protected]
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Blockchain and the Ripple effect: did it ripple?

|24-4-2017 | Carlo de Meijer | treasuryXL

Our expert Carlo de Meijer has published an interesting article about a blockchain initiative that we want to share with you. We have slightly shortened the original article about Ripple.

 

Who is Ripple?

Have you ever thrown a stone in still water of a river or a lake. I did! The effect is rippling the water in a way that can be followed outwards incrementally. It might be this effect that the founders of Ripple, the payments blockchain network had in mind when choosing the name for their project. Did it ripple?

San Francisco based Ripple is seen as one of the most advanced distributed ledger technology (DLT) companies in the industry, which focuses on the using of blockchain-like technology for payments.

In just four years, Ripple has established itself as a key player in the fast-growing distributed ledger technology world. Since 2013, the Ripple Protocol has been adopted by an increasing number of financial institutions to “[offer] an alternative remittance option” to consumers. Especially the years 2015 and 2016 marked the expansion of Ripple, with the opening of an office in Sydney (April 2015) and the opening of European offices in London (March 2016 ) and in Luxembourg (June 2016).
In June last year, Ripple obtained a virtual currency license from the New York State Department of Financial Services, making it the fourth company with a BitLicense. As of 2017, Ripple is the third-largest cryptocurrency by market capitalisation, after Bitcoin and Ether.

What is Ripple?

Ripple is a financial real-time gross settlement solution, currrency exchange and remittance network using distributed ledger technology. Released in 2012, it purports to enable “secure, instant and nearly free global financial transactions of any size with no chargebacks”.
Ripple is built upon a distributed open source Internet protocol, consensus ledger and native currency called XRP (ripples) enabling (cross-border) payments for retail customers, corporations, and other banks.
The Ripple Protocol, described as “basic (settlement) infrastructure technology for interbank transactions”, enables the interoperation of different ledgers and payment networks and brings together three aspects of modern payment solutions: messaging, settlement and FX management. It allows banks and non-bank financial services companies to incorporate the Ripple Protocol into their own systems, and therefore allow their customers to use the service.

The protocol enables the instant and direct transfer of money between two parties. As such the protocol can circumvent the fees and wait times of the traditional correspondent banking system. Any type of currency can be exchanged including USD, euros, RMB, yen, gold, airline miles, and rupees.
“Ripple simplifies the [exchange] process by creating point-to-point and transparent transfers in which banks do not have to pay corresponding bank fees.” Chris Larssen, former CEO Ripple

The Ripple company also created its own form of digital currency dubbed XRP in a manner similar to bitcoin, using the currency to allow financial institutions to transfer money with “negligible fees and wait-time. One of the specific functions of XRP is as a bridge currency, which can be necessary if no direct exchange is available between two currencies at a specific time. For example when transacting between two rarely traded currency pairs. Within the network’s currency exchange, XRP are traded freely against other currencies, and its market price fluctuates against dollars, euros, yen, bitcoin etc.

Did it Ripple?

Growing adoption by banks
Ripple has experienced a growing adoption by banks. Many financial companies have subsequently announced experimenting and integrations with Ripple. The first bank to use Ripple was the online-only Fidor Bank in Munich, which announced the partnership early 2014. Fidor Bank would be using the Ripple protocol to implement a new real-time international money transfer network.
Since then a host of major banks have adopted Ripple to improve their cross-border payments, and many have completed trial blockchain projects. These banking institutions – including Santander, UniCredit, UBS, Royal Bank of Canada, Westpac Banking Corporation, CIBC, and National Bank of Abu Dhabi, among others – view Ripple’s payment protocol and exchange network as a valid mechanism for offering real-time affordable money transfers.

Some recent developments in the Ripple network

The real uptake of Ripple however started to take place in 2016 and continued during the first quarter of 2017.

National Bank of Abu Dhabi (February 2017), Axis Bank (January 2017), SEB (November 2016), Standard Chartered (September 2016), and National Australia Bank (September 2016) are the latest banks to join Ripple’s blockchain-powered network for cross-border payments. And more banks will get on the Ripple bandwagon during 2017. Ripple says its network now includes 12 of the top 50 global banks, ten banks in commercial deal phases, and over 30 bank pilots completed.
“Banks and their customers have been hearing about the promise of blockchain technology to enable real-time cross-border payments. Now, some of the most innovative and successful banks like NBAD are making this a reality by offering Ripple-enabled payments to their entire customer base, and in doing so, paving the way to make 2017 the year we see broad commercialization of blockchain take hold globally.” Brad Garlinghouse, CEO of Ripple

Further Rippling: enlarging the network

Global Payments Steering Group
Last year September Ripple created the “first: interbank group for global payments based on distributed financial technology. Bank of America Merrill Lynch, Santander, UniCredit, Standard Chartered, Westpac, and Royal Bank of Canada have joined as founding members of the network, known as the Global Payments Steering Group (GPSG). CIBC will also join the GPSG as a new member.
“The creation of GPSG is significant because this represents the first time that major banks have formulated policies to govern the transfer of money across borders using blockchain,” Donald Donahue, GPSG chairman.

GPSG aims to use Ripple’s technology to slash the time and cost of settlement while enabling new types of high-volume, low-value global transactions. The group will oversee the creation and maintenance of Ripple payment transaction rules, formalised standards for activity using Ripple, and other actions to support the implementation of Ripple payment capabilities.

R3CEV
Last year October R3 and twelve of its blockchain consortium member banks – including Barclays, NAB, Nordea, Royal Bank of Canada, Santander – have trialled Ripple’s Digital Asset XRP, to tackle the costs and inefficiencies of interbank cross-border payments. Ripple says XRP has the “fastest” settlement speed, settling in about five seconds or less.
“The prototype paves the way for a major overhaul of how banks process and settle cross border payments”. David Rutter, CEO of R3

Banks traditionally provision liquidity for cross-border payments by holding various currencies in local accounts with correspondent banks around the world. But these ‘nostro’ accounts are costly because banks have to fund them, trapping capital. Ripple argues that this can be fixed by instead using a digital asset – such as its XRP – which provides liquidity on demand.
Ripple’s network was trialled in R3’s lab and research centre, making markets for fiat currencies using XRP and then completing authenticated payments without multiple nostro accounts. The trial introduced XRP to test the feasibility of reducing or retiring the use of current nostro accounts for local currency payouts.

Ripple Innovations

In the meantime a number of important innovations were announced in the Ripple offering.

Ripple Validator Node
Global IT company CGI announced it is the first commercial enterprise to implement the Ripple Validator Node. Ripple validators are servers that confirm Ripple’s distributed financial technology transactions on the network. The CGI-hosted Ripple Validator Node provides banking clients with a trusted network partner for Ripple’s distributed financial technology that settles international and domestic transactions in real-time.

Smart Token Chain
Smart Token Chain (STC), a blockchain specialist in the FinTech sector, has completed its first full Smart Token transaction across the Ripple Network. Using Ripple gives STC universal access to a wide range of partners and customers without having to physically craft a digital relationship with each one. STC is leveraging Ripple’s open, neutral platform, called “Interledger Protocol” to move payments globally across different ledgers and networks.
Leveraging the Ripple platform with new Smart Token solutions is accelerating the move toward the launch of a truly useful blockchain and smart contract implementation, which has great potential for making global exchanges of value fast, affordable and highly secure. It also provides a well-documented audit trail that will make dispute resolutions more efficient and less frequent.

Ripple’s new cost model

Ripple created a cost model, designed specifically to help banks understand their cost structure and how Ripple can help them overcome current inefficiencies. With Ripple’s new cost model, banks can easily enter transaction volume and operational metrics to receive a custom cost analysis. The cost analysis breaks down cost to a per-payment level, for both a bank’s current system and if it were to use Ripple. By using this model banks can easily estimate the efficiency gains it could achieve using Ripple for international payments.
XRP Incentive Program

The XRP incentive program is designed to accelerate the use of XRP as a universal bridge currency by creating deep and liquid markets at the outset of being listed on digital exchanges. The program is funded by Ripple and will be operationally managed by exchanges for their liquidity providers.

Global financial institutions are increasingly looking for solutions to consolidate the liquidity tied up with the nostro accounts required to fund their overseas payments. Digital assets such as XRP allow for banks to fund their payments in real-time, and in the process, cut down their dependency on nostro accounts.
As a bridge currency, it can enable liquidity concentration around fewer currency pairs, making cross-border payments more efficient. As evidenced by R3’s trial with XRP for interbank cross-border payments, the use of Ripple and XRP can enable both cost-cutting and revenue opportunities for participating institutions.

BitGo makes XRP more accessible
Ripple’s efforts to build an active ecosystem around its XRP digital asset has been boosted by a deal with virtual currency processor BitGo. Under the programme, BitGo will provide multi-signature security, advanced treasury management and additional enterprise functionality for XRP, which will be integrated into the BitGo platform this year.

The Rippling goes on!

Ripple plans to enlarge the number of exchanges trading XRP. Working with a greater number of exchanges to list XRP is an important step to serve the growing demand for global payments in major and exotic currency corridors. Ripple has previously commented that by using its network and XRP as a bridge asset, banks can save up to 42% on interbank international payments.

“This cost-saving frees up capital to generate revenue opportunities, including new product offerings for high-volume, low-value payments and access to new corridors”, claims Ripple.

The Ripple effect goes on!

 

Carlo de Meijer

Economist and researcher

 

Interesting apples and oranges a.k.a. the Dutch Fintech Awards

|18-4-2017 | Pieter de Kiewit

One of my friends who works in human capital development and is a psychologist, explained me once how we can increase our creative output. One of the elements he mentioned was mixing up the way information comes to you and how you digest it. For example, if you are used to create business plans  sitting behind your desk and writing, a multi-person brainstorm session might tap into your undiscovered creative potential. And the other way around: if you are talker/listener, try writing for a change.

Bearing this in mind, I always try to combine personal meetings, with calls, with reading, events and so on. For the people who know me: I am always behind on my reading. So much to read, so little time! Events and personal meetings get my creative juices flowing. Today I trained MBA students of RSM in their labour market approach, very inspiring. And I look forward to the Dutch Fintech Awards that are organized shortly.

Dutch FinTech Awards

Being a recruiter with a focus on corporate treasury, I have tried to find the Fintech Awards contenders with a relevance for the corporate treasury community. This is not as obvious as it seems, only a few are. I do not envy the jury of this event. Categorizing the contenders is almost impossible, let alone judging them. Comparing blokchain insurance with video financial services sales and a crowdfunding platform with easy on-line payments, is comparing apples with oranges. One thing is clear: some of the potential award winners are very good at attracting social media attention.

Despite their diversity, each of the companies tells a different inspiring story. Some of them are about cutting edge technology, some of them are about understanding potential clients, others are about smart entrepreneurship. One thing I am sure of is that the level of creativity of the entrepreneurs will be extremely high. I am ready to be inspired and will inform you in my review blog afterwards.

On 21 April the Dutch FinTech Awards will take place in Utrecht. A day with many international keynote speakers, provoking master classes and pitches by the Dutch FinTech 50. Make sure you register today and join this unique opportunity to meet 300 International FinTech stakeholders. Via treasuryXL you can get a discount on the regular ticket. More information

Pieter de Kiewit

 

 

Pieter de Kiewit
Owner Treasurer Search

 

Dutch FinTech Awards (21 April): discount via treasuryXL

| 12-4-2017 | treasuryXL |

On 21 April the Dutch FinTech Awards will take place in Utrecht. A day with many international keynote speakers, provoking master classes and pitches by the Dutch FinTech 50. Make sure you register today and join this unique opportunity to meet 300 International FinTech stakeholders. Via treasuryXL you can get a discount on the regular ticket. Read the article for more information about the event and to discover the discount code.

​Dutch FinTech Awards & Conference

You are more than welcome to join the Dutch FinTech Awards and Conference of 2017 where innovative and disruptive FinTech companies are awarded. Meet 400 hand picked entrepreneurs, bankers, investors and advisors, demonstrate thought leadership, extend your network and develop business. Join the festive award ceremony on 21 April 2017.

What is happening?

Tens of thousands of finance jobs are vanishing. Google, Apple, Facebook and countless FinTech startups are disrupting the financial sector. Innovative companies are eager to please millions of frustrated banking customers. Investors are fascinated by the phenomenal profits made by banks struggling with outdated technology.

Get your ticket with discount

We have the opportunity to give you a 150 EUR discount on a regular ticket.

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We hope to meet you at the Dutch Fintech Awards 2017 at the Rabobank HQ in Utrecht on 21 April.
If you have any questions please do not hesitate to contact me.

Annette Gillhart – Community Manager treasuryXL

[icon icon=”envelope” color=”” size=”tiny” with_circle=”0″ link=””] [email protected]
[icon icon=”phone” color=”” size=”tiny” with_circle=”0″ link=””] 06-21303744

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