Open Banking Implications for Bank Fintech Partnerships

Transcription:

Tim O'Shea (00:08):

Hi everyone. I'm Tim O'Shea, Senior Director with Klaros Group. We're an advisory firm that specializes in the interaction of banks and fintech's, particularly in the bass space. Really excited to moderate this panel with my friends, Jairo, Allison and Matt, let y'all introduce yourselves.

Jairo Riveros (00:27):

Wonderful. Welcome and good morning. How are you guys Doing? good?, guys. Excellent. I want to hear some noise.

(00:38):

Hi, Rivero Space in America. I'm kind of the adopted child here because I'm not a bank, I'm not a consultant. We are a payments platform. We are a cross border payments platform, but I'm very honored to be here and join Japan with such an experts.

Allison Shonerd (00:53):

Fantastic. Well, I am with the bank, so I guess I'm a little bit less of a cheerleader up here, but I'm Alison Shonerd with Bank of America. I'm a Product Executive leading a suite of business to consumer payout solutions where we are enabling the ability to connect with very consumer friendly rails and helping our corporate and commercial clients make payments globally.

Matt Friend (01:19):

Great. Good morning you all. Matt friend JP Morgan Chase. I spend most of my time on the retail side of the bank focusing on new payment rails, which means T-C-H-R-T-P Fed now aggregator based ACH payments and as Zelle continues to evolve, looking forward to today. Thank you.

Tim O'Shea (01:39):

So to get us started, can we have a show of hands? The topic of the panel, obviously open banking and its interaction with bank FinTech partnerships. Show of hands, who in the room uses open banking in their day-to-day lives

Jairo Riveros (02:01):

One third.

Tim O'Shea (02:02):

That's pretty good. Yeah, that's really good. Now what if we ask the question differently, who in the crowd links their bank account to an app for the purposes of payments, visibility into your overall spending across accounts, things along those lines.

Jairo Riveros (02:24):

Some conservatives in the room.

Tim O'Shea (02:26):

There's a little bit more, a little bit more. Well, before we dive in and we're going to talk about strategies and use cases, this by the way is not the panel for 45 minutes on the CFPB proposed rule. If you want to dig into those details, you can find us later at the coffee or later on the adult beverage bars. Can we go down the line? Jairo? Explain to us what is open banking?

Jairo Riveros (02:56):

Well, one way to say it, it's not a destination I consider an enabler. I consider an opportunity to be able to bring together traditional players to bring together fintech's like Paysend to bring together consumers and within that, create a framework that would allow for information sharing.

Allison Shonerd (03:20):

And I would say to put it simply, it is standardized permissioned access to consumer financial information using APIs.

Matt Friend (03:32):

Yeah, I think I'd go a lot with what Allison said. It's that permissioned access that consumers give to their bank account for fintech's to provide new and different services.

Tim O'Shea (03:43):

And so Matt, can you tell us your part of Chase? Can you talk about the open banking strategy and in particular, I'd love to hear kind of how it might've evolved over the past five to 10 years as open banking has emerged, really taken root overseas and we've seen the emergence of regulatory and industry frameworks to support it.

Matt Friend (04:06):

Sure. So I'll keep it as tight as possible on that because that's a pretty big question. I'd say it's evolved pretty rapidly. I mean it's really focused first on consumer choice. How are we making sure we're giving consumers choice and making sure that the access that they give to their account is then really focused on safety and security. Open banking first started with a lot of screen scraping. We've been very proactive in moving that to again, a more API based structure where you have more controls, you have more safety and security and you're not giving out consumer credentials. So that's been I think a very big focus for us. And we've also done a couple other things that have been unique. Whenever we give a customer's account number out, we give out a tokenized account number. And I say that because we've really tried to focus on applying and being proactive on the hard lessons learned in the card world. The more that we can use that tokenized account number and share that and make it discreet for whatever merchant has that account number, should there be a breach? Right? We've also taken as many steps as we can. That's not a perfect answer, but good steps to try and protect that account number as we focused on. So a lot on account information access as you talk about Europe and now we see a lot of movement into that payment initiation side and I know that's some of what we're going to focus on today.

Tim O'Shea (05:34):

And we're going to come back to that later. Allison, can you tell us what is the global digital disbursements business and strategy and how is open banking fitting into it?

Allison Shonerd (05:45):

Yeah, so I think I'll take a lot of what Matt was saying and maybe turn it around With global digital disbursements, we're looking to enable solutions for corporates. Our corporates have lots of reasons to pay consumers to receive payments from consumers or to interact with them in lots of interesting ways across the financial spectrum. And so where in markets open banking has been in place for some time and capabilities and services are being unlocked. Because of that, we are looking at ways that we can then incorporate those capabilities into the products that we build for our commercial clients. And then I think similarly to some of what Matt was saying, we're very focused on the API infrastructure that enables open banking. And so even outside of my products that I think across the bank, that makes it very important to have a modernized tech stack that can support APIs where we can build nimbly and be able to achieve the requirements that are set out as a part of open banking. So from a broader sort of technology standpoint, that's also a big focus.

Tim O'Shea (07:02):

Got it. Now Jairo, you are wearing a T-shirt, so you're clearly not with a global bank. Absolutely. Tell us about Paysend and what is it and how does open banking fit into that strategy?

Jairo Riveros (07:14):

So we are in South Florida a little lessons on Spanish, simple, simple money transfers for all. That's exactly what Paysend does. To make it very simple, about 10 million consumers download the app and make a transfer to over 170 countries. And we also API a platform to offer it to the banks to be able to leverage what we have developed. Now in our case, simplicity comes with our ability to make it easy to connect to fund the transactions. We don't touch cash, which means we want to link to the banks to be able the transaction to flow from the bank account into our platform and be paid out in less than 30 seconds. That's part of our commitment. So open banking is critical and open banking works quite well when there is no problem because customers love it. The issue comes when they finally find that, oops, what happened to my money did not arrive. So the ability for us to collaborate is key in making it possible. Yes, regulation is coming, but at the same time we need to be able to be ahead and find the most possible way to it for open banking also allowed us to work on the payouts. When you think about 170 countries, we have very good examples like Australia, we have very bad examples, which I'm going to avoid mentioning who, but obviously you might know.

Tim O'Shea (08:38):

Well, I want to come back to Australia and the international comparative perspective, but so are you competing with banks or attempting to become a bank or are you collaborating with banks?

Jairo Riveros (08:51):

I appreciate that question very much. Let's make it clear. Paysend has since our seven years in market inception decided that we are not a bank. We are not going to become a bank. Some of our cousins have driven that direction. We have not. While UK base with presence around the world, we want to collaborate with the financial institutions, banks, and other providers that need to pay or be paid. The way we do it is we have developed a platform that allows alternative payment rails to be grouped and then offer to those who know our customers one something else that against transfers, they are asking for savings, they're asking for loans, they're asking for mortgages, but we don't know how to do that and we're not intended ever to do that. What we want to offer, and hopefully they will become my clients after this conference, is we have an alternative, offer it to your clients, simple, fast and low cost.

Allison Shonerd (09:56):

If I can just add to that please, because I think those are some really great points. I think that we like to talk a lot about the technology and the way that things work, but really with open banking, as with so many of the other hot tech topics that we have been talking about in the payment space, it's more about what it enables and the capabilities that open banking can unlock the solutions that we can then build for our customers. And so I think that means that there is a great opportunity for us as banks to leverage the capabilities to build great solutions and then also to find the right partnerships based on a trusted secured framework that we've all agreed upon.

Matt Friend (10:43):

And I'd love to pick up on that partnership piece because that's the key to making open banking successful, right? Finding the right partnerships that work to innovate and collaborate for customers and finding partners and making sure they understand what do you need this information for, how are you using it and make it available, making it available in a safe and secure environment. But then finding partners also who are taking those same steps when it comes to safety and security of customers' money and particular as we're talking about customers' information. So making sure that while there's what we call sometimes that regulatory perimeter that we have to have and abide by working with partners that really follow a lot of those same rules and approaches is that all gets back to focusing on the customer, enabling them and protecting them. And as Jairo said, when something goes bump in the night, how do we make sure there's an avenue for them to address and be served? That's the focus.

Tim O'Shea (11:41):

So we will not pull the crowd on who has boned up on the updated third party risk management guidance for banks. But let's stipulate that there remains a bit of a cultural divide between some tech organizations and banks, and that's almost as simple as venture-backed startups are incentivized to rapidly burn through capital in order to get a minimally viable product out to market as fast as they can. And that is in fact not consistent in all cases with the safe and sound operation of a bank and compliance with federal banking law. I'd love to hear, particularly from Matt and Allison, how are your organizations thinking about, there are so many fintech's and SaaS providers that would love to be working with you in all kinds of ways. How is you as a business leader, how do you think about what are the sort of attributes, strategies, et cetera that you want to see in a partner that even makes you interested in working with them in the first place?

Matt Friend (12:55):

And I'm happy to start if that's okay. Yeah, so I think it really starts in going back to some of that partnership and focus on the same type of data security and data protection. Again, to make sure that customer's information when it leaves that bank control is handled in that same way. But then it really gets to two other points that we are really focused on. And then the first one really being consumer protections. So making sure that as open banking enables all these different capabilities and all these different ways to pay consumer expectations are met when it comes to protections, when those expectations are not met, whether it's again by a financial institution, a FinTech or a merchant is when challenges occur. So for us, it's really trying to uplift and make consistent in what those protections are and what some of those obligations are so that consumers understand that they're going to be protected and meeting their expectations overall.

(13:59):

That is really I think the fundamental principle that we all agree on of trying to make sure that those protections are there. And then second is making sure that the data that co mes through with any transaction is something that we can use for risk management purposes, that we can use for a reporting and making sure that when a customer calls, our customer service representatives know what that transaction was for so that they can provide better services. And this is an area that I think the card world focusing on consumers addressed a long time ago, but making that a consistent data access and available in the non card world for where open banking is enabling a lot of transactions been really where we're focused.

Allison Shonerd (14:47):

Yeah, no, I mean I completely agree with those points. I think we have a very similar perspective. The data security piece is extraordinarily important and I think we will often hold fintech's to our standards when it comes to security transmission maintenance of consumer data. And so that means it can be a fairly long and arduous path to partnership in a lot of cases. But we were just talking yesterday that I think especially when it comes to the work that we do with consumers, we're in the trust business and at the end of the day when we're enabling these capabilities and working with partners to build solutions that add value to our customers, they have to be able to trust them. And so that is really at the heart of everything that we're doing.

Jairo Riveros (15:45):

May I have a couple of comments.

Tim O'Shea (15:46):

First before I want to get, because you are a stand-in for many members of our who here is representing an organization that would like to be selling to or partnering with Chase or Bank of America, whether it's a RegTech or a sponsored program, Jairo tell these members of the audience what is Paysend doing to react to the pressure that banks are facing, the risk management standards that they're applying to make yourself your organization an easier partner for those banks to say yes to?

Jairo Riveros (16:22):

Excellent question. Well, first of all, I don't know how the agenda was put together, but amazing. We had a conversation yesterday about partnerships, FinTech and traditional's. We also had conversations about the good, bad and the ugly of Eastern Payments. We had conversations earlier about regulation and now we are sort of bringing open payments which kind of bring all these together. I have met a number of you throughout the last two days, just like us, we want to work with the banks, we want to be partner of banks, we want to be also partnered with you. So one of the things that does at Paysend, we have first of all decided what we're good about and we were not good and decided that we are not going to try to develop everything for everyone. We are excellent in building a new rails globally for payouts. And that's what we do, 170 countries and we have packed a package that platform in certain user cases where we see an opportunity to bring value.

(17:25):

Number one payroll companies, why payroll companies while Powering Now Deal, which is one of the largest modern payroll companies because people want to get paid on salary or Sunday and that doesn't work in the traditional banks. So obviously they want to why? Because they might be on the gig economy but also powering remittances companies who wants to pay in different rails rather than the cash pickup option. So we offer our rails to be able to send it to cards accounts or as yesterday in a session we were saying wallets account to account wallet to wallet payments. But to be able to do those and to talk to banks as well, it should be able to be flexible and to be able to listen. There is a little bit of sensitivity that fintech's know it all. We want to disrupt. No, we want to create co-create. So one of the things that I do when I meet with financial institution is to sit down and say let's co-create. I'm not coming here to do it differently. I'm coming here to work with you and do it better. There's a lot of risk. There is a lot of framework that we don't know. My chief compliant officer, Anna is here and she always reminds me, these institutions like Bank of America or Chase or others have always been there because they have global presence and global knowledge, something that we don't.

Tim O'Shea (18:50):

So now I'd like to pivot to some use cases and maybe really try and tease out where we think the most exciting recent developments and near term opportunities are. Allison, is this a good time for us to talk about requests for payments and the experience you've been on? We saw a rollout in Canada.

Allison Shonerd (19:12):

Yeah, absolutely. I think request for payments, the capability that unlocks, it's interesting because it brings together what many of our corporate and commercial clients are looking for, which is ubiquity the ability to reach all of the consumers that they're looking to pay or receive payments from. They want operational efficiency. They want in many cases to reduce the burden on them for having to maintain and store and secure things like sensitive consumer bank account details. So request for pay is great for them because it offers the ability to do exactly that to ask for a payment from a consumer through an authenticated payment channel. But then on the consumer side, I think what we're seeing in Canada with Interact that is exciting is that that network has very broad adoption across the market and it gives the ability for a consumer to answer that request for payment with an alias. So they're able to use the registered token that they have set up within the interact network to authorize the payment to the corporate. And so it brings together values for both the consumer and the corporate, which I think are fairly exciting.

Tim O'Shea (20:40):

Matt, we've talked about a lot of use cases in the last day. What is top of mind for you, the most exciting space that you're working on in open banking at Chase?

Matt Friend (20:51):

It's really understanding, I'd say the difference between what has been traditional pay by bank and bill pay, which we classify as paying your electricity, water bill, mortgage, rent, car loan, which are all payments or pay by bank for goods or services already rendered. And understanding that history to what we see now as more emerging transfers or even commercial pay by bank purchases. And those are funding a digital wallet and whether it's then paying to another a broker dealer account and that digital wallet could be for crypto cross border gambling or just funding for purchase transactions and really looking at these two side by side. And so we've spent a lot of time looking in and understanding that the risk that we see on these emerging use cases ends up being about three times the amount that we see on those traditional use cases because these are use cases for these emerging ones where services or goods have not yet been rendered.

(21:58):

And so then you get to some of, I think what I was talking about going back to the consumer protections and consumer expectations. When this good or service, then it comes right back to the consumer. Their consumer expectation is ultimately, again, certainly try and work it out with a merchant, but they expect when they do have a problem that their bank has their back, that we are there to work with them in addressing some of these issues and the way that a lot of the structure is currently set up, we're very limited in what we can do of serving customers. So our focus is in how can we harmonize some of these protections along expectations for certain use cases and then again, making sure we have the information to service customers when these occur. So we're really looking at what's been done traditionally and where these first steps are, how can we get that information? How can we work more with our partners to understand them but ultimately serve customers in the end?

Tim O'Shea (23:02):

Now the CFPB proposed rule will include payment initiation information among the data that is to be made available by the data providers. How does the proliferation of that information, which is intended to enable downstream users to initiate payments, how does that complicate the bank's ability to manage the expectation of its customers that the bank will be running down in the sort of last line of defense in resolving a dispute or an error?

Matt Friend (23:44):

It's interesting that you said the last line of defense, right, for banks, because I think that's how consumers really think about it. The CFPB has done a number of good things, right, and 1033 of focusing on limiting secondary data use so that it's only permissioned by consumers. But our perspective is payments should not be included in 1033 at all. It's not written in Dodd-Frank. And we welcome partnering with the CFPB and working with the industry to again address some of the issues and challenges that are out there because again, really support consumer choice and progressive innovation that this is set up to allow. But making sure then the corresponding protections and data availability are set up there also to meet what customers expect. So it's one of the things we've been saying is let's go a little bit slower so that we can go further together and really trying to spend the time to work together with the CFPB and the rest of the industry to push this forward has been a primary focus of ours.

Tim O'Shea (24:52):

It's an interesting potential lesson learned from other jurisdictions that have really cleanly delineated, as you've said, between the availability of account information versus the availability of payment initiation information. Allison, we spoke yesterday about some other jurisdictions that have seen open banking progress in fits and starts sometimes very exciting breakthroughs but also some hiccups. Can you tell us what's most interested you about some lessons learned from other jurisdictions that you'd like to see that US learn from?

Allison Shonerd (25:34):

Yeah, it's fun to be able to sit back and learn from others. Certainly I think that there were two markets that we were really talking about yesterday, one of which being the UK and then the second being Australia. And I think what we've seen in the UK is really interesting because they were very fast to move into this space and to mandate open banking and to require banks and other providers to become a part of it. And I think much of what they were looking to drive was competition and to say, okay, now we're putting these regulations in place, go innovate. And so it was a little bit of a backwards equation and I think it can be very challenging to mandate innovation and to mandate competition. And so I think what we're starting to see here in the US by contrast is that even though we don't have broadly regulated open banking, we're doing it but it's being driven by use cases and consumer needs that are best met through open banking.

(26:50):

And we're doing it in a bit of a thoughtful, methodical approach. I think it's really a fantastic example to say at the beginning of this session, most of us don't know that we're actually engaging in some kind of an open banking interaction on the day-to-day basis because what we're doing is we're meeting our needs. I'm linking my bank account to a digital wallet so that I can pay my rent or so that I can share the cost of a dinner bill with my friend and consumers demanded that sort of capability. And so we had to meet it and essentially establish our own limited open banking framework in order to accommodate. And that I think by contrast, Australia has come out to say very broadly, consumers have a data, right? It's going to be not just something that is true for banking data, but across the economy, this is how banks and providers will need to be. These are the standards for providing the data and this is how fintech's and others can connect in order to use the data. And so they've really set out that very broad, straightforward framework, which I think is really interesting. And now it's a matter of saying, okay, how is that going to then be adopted and what are the solutions that are going to be built on top of it that actually have meaning for consumers and that will be adopted.

Jairo Riveros (28:29):

I'm quite curious to see what Europe does. We know Europe has a very strong data protection and privacy act, and I've also put into see Canada, which is another one that wants or needs competition, but have learned or have seen the UK and probably is thinking carefully,

Tim O'Shea (28:47):

Jairo, you see across 170 countries, you are based in the US Sometimes when I'm following podcasts and articles that are observing the US open banking scene, there's a sense that maybe the US has been held back and maybe it's lagging behind. Is that your take?

Jairo Riveros (29:09):

It's quite interesting. It really depends on the use case and especially for those who come to the US and one example that happens very often, our offices headquarters is in London. When they come to the US many of my colleagues don't carry a wallet because they want to pay with their phone and they go to a restaurant and they realize that it doesn't take it or they have to walk all the way to the office to be able to tap or they ask for the car and it gives them a scare. And immediately they say, oh, the US is not doing open banking. The US is completely behind the US is completely a dinosaur. No, it's not. What I have seen around is that there is a momentum for it. How many banks the US has, I mean thousand, 10,000. Just imagine what that requires for it and that interaction within it.

(30:03):

There are opportunities. How do you interconnect all these wallets to be able to speak to each other, not just sell or other, but in reality that they actually work together. We have good examples. I have one that I would like to highlight how Mexico is thinking about the ability to use requests to pay. So the remittance that someone sends from the US to Mexico can go to pay the electricity bill of my aunt or can go to pay for the hospital bill of my uncle rather than just send the money. I don't know if Monogram is here. We're talking yesterday, we're trying to partner quite well to be able to find opportunities to develop something called a remittance with the meaning. And for that we need some kind of framework to be able to do that.

Tim O'Shea (30:50):

Is that an area that we'd like to see more granularity in the regulation in order to create a safe harbor say or is that an area where we'd like to see the regulation creating space for industry standard setters?

Jairo Riveros (31:08):

Well, you guys think, I mean.

Tim O'Shea (31:11):

Matt, it's been a while.

Jairo Riveros (31:12):

You want the big heaters. If I go to the regulator, they will say, oh, here we go.

Matt Friend (31:17):

No, it's a great question because I think the regulatory questions are right in front of us and so many different actions are being taken. It's really taking more of a risk-based approach and providing that framework within which expectations are set, but gives that freedom to innovate and grow and taking that risk-based approach is really one of the great strengths of what the US has done versus as Allison was giving a great example of what Europe has done while they've done some right things in creating, recognizing the difference between data account information, service provider and payments, payment information service provider because they're so different, they've also gone so far and tried to create a regulated competitive structure, which hasn't worked. So in our particular focus and would be to carry on I think the US tradition of taking that risk-based approach to make sure that all sides of the equation are property taken care of, but in particular, again, consumer money and consumer data is properly protected.

Tim O'Shea (32:22):

Allison, what types of customer segments are you seeing most excited for open banking solutions?

Allison Shonerd (32:31):

Yeah, so again, I am dealing most directly with corporate and commercial clients. I think in that space we see insurance as being a huge opportunity. Insurance companies are both receiving funds from consumers to pay for premiums and things of that nature. And then they're also having to pay out claims. So in addition to just the need to be able to move money in and out, they also really want to offer benefits to their consumers. So payment choice, great seamless, low friction experiences. So I think that's where we definitely hear that the ability to enhance the payment journey using the capabilities that open banking can offer have potentially great benefit. I think the healthcare space is another one where a lot of those payments and financial experiences maybe exist outside of the traditional merchant infrastructure as well. And so being again able to leverage capabilities to offer more choice to meet more consumers where they're living and working and wanting to interact with the business for payments and other data sharing needs is a great opportunity. So it's some of those larger use cases that, as I said, sit often outside of the merchant framework.

Tim O'Shea (34:07):

And Jairo, you all really specialize in the payroll space you were saying. Can you elaborate a little on that?

Jairo Riveros (34:14):

Yes. So in addition to those two, the payroll space has transformed and we have to recognize that Covid had a lot to play with it. Suddenly an employee said, I'm going to work from Oaxaca where I'm going to go, I'm being Portugal and I'm going to continue being employed. At the beginning, you were still being paid whatever you were paid in one of these two banks or another one, but at the time went and you decided to stay there. Suddenly you want to be paid locally or eventually you work somewhere else, like it happens between Bangladesh and Dubai. You want to be paid a little bit in Dubai and most of the salary to your family in Bangladesh so they can afford to live. Well. This created a complexity. New companies emerge and they had to adapt. So we actually customize our platform to be able to serve those needs.

(35:03):

How you could pay whenever you want, whatever you want in the way that you want it. Piece of your salary goes into a bank account piece of your salary going into my wallet, which I'm going to use in the day-to-day operations. I want to be paid on a salary, I want to work an extra day and I want be paid for that extra day now because I have a particular need, I'm going to have to buy something or pay for something, so I'm going to add a few more hours. We've been doing that and it has created another complexity, which is not just the payment of your salary, but it's also now you employment information, your benefits within touches on what you just said, your healthcare eventually your insurance that goes with it. All this creates complexities on the restriction that it does. So we work with the partners again, we know what we don't do well, so we are focusing precisely on the cross-border payment and making sure that these companies embrace others who know how to do the other pieces to be able to generate, but it's working fantastically. And now the traditional ones, the big one, everybody knows the three letters of the big one. It's actually in conversations to be able to embrace that global payroll capabilities as well.

Tim O'Shea (36:16):

So insurance, healthcare, and payroll. This is a lot more important than splitting the check at dinner when I go out with my friends. Matt, what can we learn from earlier today there was some talk of, I think fraud rates on the clearinghouse. Maybe what can we learn from some recent experiences that we've seen in some other recent innovations that we ought to take forward as we start moving open banking into more and more sensitive types of information and more important parts of our daily lives?

Matt Friend (36:55):

I mean, I think that is the central question, Tim, because we're really at the end of the beginning of a lot of payments 2.0, right, and payments 2.0 now that we have a lot of the infrastructure in place and we're starting to bring some of these use cases on. No doubt what TCH has been able to do with our TP has been great so far. But as we see and witness more and more consumer payments when they begin to go over these new rails is when a lot of what we're talking about really comes into play, right? There's a reason that consumer protections are very heavy in the card industry right now, and it's not that that's what we want to emulate, but I think it's just in recognition that a lot of consumer protections for purchase of goods and services are there, and that's not quite there yet.

(37:42):

On the clearing house, we see our volume going accelerating rapidly for open banking transactions because we're able to track them based on the tokenized account numbers. So we see this, and I've been in lots of call listening, hearing consumers who do have a problem when there's a pay by bank transaction where consumer expectations want the bank to be there to help to be their partner, to work through and solve these things. And when the bank can't be there, that's when problems begin to emerge. So I think it's a great question, Tim, and really how can we as an industry and as stakeholders across it, begin to take some of those steps to get ahead of some of those problems and challenges before they really rise to become a much bigger issue.

Tim O'Shea (38:31):

And before we move on from you, can you talk a minute about EWS where I think we're seeing some really exciting partnership that's really targeting some of the risks that we're talking about here, particularly in the fraud space? Sure.

Matt Friend (38:46):

EWS and consortium, right? And it's certainly in partnership with Bank of American. There's 2000 other banks out there, and it covers about I think 97 or 98% of all the eligible individuals out there to do transactions. They've brought together quickly a lot of the learnings of I think first in a shared risk toll that everybody has a followed governance structure that they have to contribute to making sure that if there's suspicion of fraud or scam, that that gets reported in less than 24 hours and not until after an investigation occurs, because we've all learned that the velocity is really important in these areas. So bringing together those lessons learned, but then even more so balancing the characteristics of the transaction, Tim, it won't have private information about you PII, but it would be what's the age of the account? What's the velocity of transactions, what's the average transaction amount? Using some of those characteristics to make smarter, more informed, timely choices for partners on both sides of the transaction to understand should we take steps to allow this or go? Because it's tough when you're dealing on this scam side because it's authorized and you want to protect your customers, but our job is to enable them to access their finances safely and securely. So all we striking that balance is where it comes in and they've put a lot of great tools in place that I know we can continue to build off of.

Allison Shonerd (40:19):

Yeah, I mean, if I can just add, I agree. It's a great example of where structured data sharing that is permissioned across the ecosystem can really add value and help to improve and augment the consumer experience. And I think especially as we're working through dealing with scams and fraud across the network, finding ways to actually introduce the right amount of friction into the process so that it's still a delightful experience to be able to send and receive money peer to peer and otherwise through these networks. But there are some protections in place and as banks, certainly we are more enabled to help and to take action when needed. Definitely.

Tim O'Shea (41:10):

I'm really glad you used the word friction and we're coming up on five minutes. So Jairo, I do want you to react to something Allison just said. Does your user base trust a truly frictionless experience or are we now conditioned to expect some degree of friction in the really important financial transactions that you're servicing?

Jairo Riveros (41:36):

Well, let's put it this way. They want frictionless, simple, as long as it works. And that's what the problem comes, because there are so many elements that make it for not work friendly fraud, as I call it. Suddenly I typed the 16 digit card of my grandmother, I'm going to be sending money, but I missed a number or confusing number, or the card that she gave me has expired. Oops, the transaction didn't work. What's going on? It was supposed to be simple. That's friendly. The unfriendly is when you start getting into situations where you don't have enough funds or eventually you made too many transactions, so on and so forth. So I believe that that there is middle ground into that. There is a way in which the more than you do, you want some protection and we're trying to educate our customers in that way. Now, this is for the consumer side. We have about 10 million for the enterprise where we offer a platform. This is a different story because it's the banks, the payroll company, the payroll, the payout institution that basically wants this to work well. It's their endpoint to the customers where they want to protect in some way.

Tim O'Shea (42:59):

Folks, we have two minutes left. Allison, what are you most excited to see in the next year in the open banking space?

Allison Shonerd (43:09):

I'm excited to see more traction, more ubiquity across the space in the US so that we can build more capabilities that help to reach the broad base of consumers.

Tim O'Shea (43:27):

Matt, you have one minute left. To create a spicy new soundbite.

Matt Friend (43:33):

I think a lot of the protections coming to fruition, right? A strong partnership across the industry, regardless of how money is moved, regardless of the use case, to make sure that we're really thinking about what are the right protections for each use case, how do we move these forward? It's going to be hard to advance, I think, to the degree that everybody wants to without making sure that that end consumers protected, but also that end merchant is protected, that both sides know the rights and obligations that they have, and if they play by the rules in this open banking, new payments world side, that everybody understands that and everybody's properly protected if they follow the rules.

Tim O'Shea (44:15):

Jairo.

Jairo Riveros (44:18):

Into operational of all the payment rails, the way that traditional did it with being able to accept and send checks and payments and bond banks, think about all the hundreds of wallets that exist out there that don't talk to each other. We serve 70 of them and they still cannot talk to each other. So if that news happens, we'll be here talking about,

Tim O'Shea (44:40):

You heard it here first, next year, Jairo speaking on that topic.

(44:46):

Alright, well I think that's it. Thank you everyone.

Jairo Riveros (44:50):

Thank you everyone. Thanks.