GoldenSource, the leading independent provider of Enterprise Data Management (EDM) and Master Data Management (MDM), has announced the appointment of Xavier Gerardin as Global Head of its OnDemand solution.

Based in London, Gerardin, formerly ION’s hosted services lead, will lead the Global OnDemand managed service – which provides clients with dedicated hosting and technical and business assistance services for GoldenSource’s EDM clients utilizing both private and public clouds – as the business continues to evolve. A 20-year veteran, with experience that includes managing over 100 financial software programmes, Gerardin will be tasked with bringing global clients new levels of efficiency to their data management lifecycle.

Commenting on his appointment, Gerardin said: “GoldenSource is well placed to support financial institutions as they continue to adapt to technological change. In this new, more complex environment, our OnDemand offering enables clients to reduce fixed costs and complexity, while increasing the scope and quality of the services they receive.”

John Eley, CEO of GoldenSource added: “Xavier’s appointment is a prime example of our continued investment in our world class managed services offering in the EDM space. Almost 50% of our clients currently use our OnDemand services. We expect this to grow significantly over the next few years. In line with the rapid advancements seen in the use of cloud and managed services, to focus on our investment objectives, Xavier will offer unrivalled expertise in running complex technology projects.”

Leading fintech company, AutoRek, is delighted to have been recognised at the Systems in the City Financial Technology Awards 2021 in both the ‘Best CASS Solution’ and ‘Best Wealth Management Solution’ categories and are excited to have achieved the accolade ‘Best CASS Solution’ for the second consecutive year. 

Lyn Canavan, Head of Marketing at AutoRek, commented: “We are delighted to have won this prestigious award and to be recognised again as a provider of the ‘Best CASS Solution’ by the Systems in the City Financial Technology Awards judging panel. The AutoRek team are pleased to have all their hard work and dedication to providing an innovative automation solution recognised and awarded year after year.” 

Organised by Goodacre, a specialist business and technology consultancy, the awards are an endorsement for suppliers of services and systems to the regulated financial services sector. Based on an independent and factual annual accreditation process, the selection process is overseen by three independent judges.

The Awards provide an important point of reference for user firms assessing the suitability of their operational infrastructure.

AutoRek would like to congratulate all other winners and nominations and we hope to be back again next year.

USA home to a third of the world’s teller cash recyclers

RBR’s Branch Transformation 2021 reveals that the migration of cash away from the teller, declining footfall in branches, and a wider shift towards cashless payments led to a slight fall in teller assist units (TAUs) in 2020. However, the number of teller cash recyclers (TCRs), which account for the majority of TAUs, increased, and it is recycling technology which will drive growth over the coming years. 

The number of recyclers rose in half of the 24 markets covered in the study. RBR’s research shows that the USA is the largest market for recyclers, accounting for a third of installations worldwide. Spain and Italy also stand out for having large numbers of TCRs.

Recyclers are credited for their capacity to boost efficiency at the teller line, as they allow for the automation of cash handling at the teller counter, drive up the speed at which tellers can serve customers and reduce the number of cash-handling mistakes. The research shows that such technology has also proven a key enabler of branch transformation strategies, particularly the increasingly common open-plan format. By providing safe storage for cash, they allow banks to remove the protective screen from the teller counter, and thus facilitate a more welcoming atmosphere for customers. 

Number of teller assist units by type, 2016-2025 (thousands)

Source: Branch Transformation 2021 (RBR)

Number of recyclers to increase by 8% by 2025

TAUs will continue to be valued for their efficiency gains, branch transformation potential and high security and RBR forecasts that the TAU market will return to overall growth. This growth will be driven by recyclers, which are forecast to increase by 8% by 2025.

In some countries where cash use is relatively high, such as the USA, Brazil and Indonesia, banks will continue investing in TAU technology to improve their teller operations. Of particular note is the USA, where TAU numbers are expected to increase by 21% over the next five years. US credit unions and regional banks are beginning to deploy TAUs, while the larger US banks carry on rolling out units.

Emily Beeby, who led RBR’s Branch Transformation 2021 research, commented: “Despite rising competition from other channels, it is interesting to observe how banks feel it is necessary to provide a secure and fast service at the teller line to complement self-service within the branch, with the aim of providing customers with a choice of where and how they can conduct transactions”.

Northern Trust has launched a machine learning-powered document capture capability as the foundation of a multi-year investment to digitize alternative asset servicing and enhance the experience for asset owner clients that invest in complex private market and unlisted assets.

Digital document capture enables Northern Trust to streamline historically manual workflows by automating the receipt and processing of alternative asset documents and fund manager reports on holdings and performance of hedge funds, private equity and other alternative assets. Northern Trust’s proprietary solution combines robotic process automation and cloud-based technology to provide transparency and data standardization that enables greater understanding of portfolio risk and performance.

“As alternative asset classes continue to grow in importance to institutional investors, Northern Trust is committed to driving efficiency and reducing operational risk through the use of emerging technologies,” said Pete Cherecwich, President of Corporate & Institutional Services at Northern Trust. “Digital document capture is a huge step forward, and only the start of our larger plan to enhance alternative asset servicing for the benefit of our clients.”

Northern Trust has more than US$1.6 trillion in alternative assets under custody and administration (as of December 31, 2020) and processes more than 1.5 million alternative asset documents each year. The intelligent document capture solution deploys custom-built robotic process automation that enables self-service operations to collect documents from emails, whether in the form of download link or within the email text. Documents are stored on a cloud-based drive where intelligent tools extract identifying details such as the type of document (e.g., statements, capital call notices, and distribution notices) and the name of the fund company, tasks previously performed manually. 

Automated document capture enables Northern Trust’s alternative asset servicing teams to focus on more strategic aspects of the process and reduces the need for manual intervention when coordinating saving, storage and categorization. Since alternative assets are often valued on only a monthly or quarterly basis, asset owners can also benefit from faster servicing of their assets and deeper data insight provided through artificial intelligence. 

The proprietary document capture tool is the first in a series of releases supporting Northern Trust’s strategy to harness emerging technologies to digitize alternative asset servicing, a growing sector of its asset servicing business.

Finastra has named HCL ‘Partner of the Year’ at its annual Partner Day, held virtually on June 29, 2021. The firm is being honored for its initiative in conceptualizing a highly repeatable, cost-effective Treasury-as-a-Service offering, built on Fusion Opics, and underpinned by Microsoft Azure, for small- and mid-tier financial institutions. HCL not only demonstrated a deep understanding of industry pain points, but of how Finastra’s technology could be applied in a new and impactful way. Additionally, HCL has invested in selected countries in APAC to serve a joint customer base with Finastra’s Fusion Summit and Fusion Cash Management solutions.

“HCL demonstrated a visionary instinct to tackle an unaddressed business segment,” said Denise Parker, Senior Vice President, Partners and Ecosystem, Finastra. “Taking the reins, HCL built a dedicated team to deliver sales, marketing, implementation, and support resources. Within eight weeks of initial sales activity, HCL created in excess of 20 opportunities representing an impressive revenue stream. This partnership serves as a blueprint for further digital-sales-driven partnerships.”

Other partners were also honored for the significant roles they played - not only in driving business, but in collaborating with Finastra to make a meaningful impact on the banking industry through innovative projects and product implementations. These include:

·       Excellence in Enablement: DXC Luxoft

DXC Luxoft has onboarded teams across all of Finastra’s business lines and solutions, consuming more than 3,000 hours of training. Onboarding was completed in a record time of four months, with the highest scores for certifications across the board. As a part of the graduation from the Finastra partner program, DXC Luxoft developed an impressive solution demo video, showing that the team was ready to meet market opportunity head on, and begin promoting the quality and breadth of the Finastra portfolio.

·       Trailblazer: Accenture

Accenture, which was named Partner of the Year in 2020, has again proven that they are always a step ahead of the market, identifying new ways to reimagine the status quo and deliver innovative and exciting solutions. In the past year, Accenture has brought Finastra services into new customer segments, including positioning Business Process Outsourcing (BPO) for lending to mid-tier banks. They also developed SME Banking Insights – an app to help SMEs monitor and manage their finances with cutting edge analytics – on Finastra’s FusionFabric.cloud open developer platform.

·       Emerging Markets Partner: TCM Partners

TCM Partners brings Finastra a deep footprint in emerging markets, with strong growth potential. TCM Partners has unmatched local knowledge in Latin America, making them highly regarded in the market by a loyal customer base. As well as being highly technically skilled and savvy sellers, TCM Partners has embraced the partner journey with Finastra.

“At Finastra, partnerships play an essential role in how we approach the market,” Parker added. “The pace at which the industry is transforming, and the rate at which customers’ demands are changing, means that partnering is, quite simply, a necessity. As part of Finastra’s Fusion Orbit partner program, partners play multiple roles within the business opportunities that we drive together. Finastra’s mission is to develop the world’s most successful, dynamic and engaging partner ecosystem.”

To learn more about Finastra’s partner program, please visit the website.

KX, a worldwide leader in real-time streaming analytics, has today announced enhancements to KX Flow, its white-label foreign exchange trading platform. The enhancements help financial institutions better manage market risk, with a new automated capability to optimise position and hedging strategies. Additional pricing and connectivity improvements further optimize pricing streams and enhance flexibility.

New auto hedging capabilities extend hedging logic based on trade and position size, as well as on realised, unrealised and total P&L per book. Risk can now be organized into multiple books, each with their own positions and hedging rules. These rules can be configured in real-time using a range of order types and smart order routing for optimized execution and profitability.

“With the new KX Flow auto hedging capabilities, financial institutions can better control their risk through comprehensive rules-based position management tools that allow them to dynamically analyse and update pricing and risk profiles in real-time,” said Rich Kiel, Global Head of FX Solutions, KX. “Aligning this with KX’s market leading pre and post trade analytics provides real-time, intelligent insights enabling our clients to achieve better execution while reducing risk and optimising their profitability.”

Today’s announcement also includes support for Rolling Books, Settled Books, new order types such as TWAP, Peg and Stop orders and a function to close all workflows at any point in time. Additional pricing and connectivity improvements include:

• New tier spot pricing allows for different mark-ups depending on which multi-bank portal (e.g. 360T, FXall and BBG FXGo) is utilized, while support for Request for Stream (RFS) and Executable Streaming Pricing (ESP) optimizes transactions for these trading styles. Additionally, taker markup enhancements add flexibility to how financial institutions can electronically add margin to client pricing requests.
• Increased 3rd party connectivity gives financial institutions access to a range of Multi Bank Platforms (MBPs) such as LSEG FXAll, Bloomberg FXGO and Deutsche Börse 360T. No matter which channels banks need to reach their clients through in the increasingly fragmented FX marketplace, KX Flow provides a one-stop-shop to enable client connectivity via MBP’s, direct API, or white-label HTML5 GUI, across banks, non-bank LPs and leading ECNs.

For more information on KX Flow and its recent enhancements, please visit: https://bit.ly/3qBTeCt

Cryptocurrencies remain extremely volatile. Bitcoin is consistently on track for topping their biggest monthly increase and decline. It faced one of their record-highs of 37.5% decline just this May 2021, and frequently sees drops like 37% drop seen in November 2018 and 40% slide in September 2011. Most recently, the price of bitcoin climbed to $34,805.19 Monday 28th June 2021, up 8% from where it stood at 5 p.m. ET Friday, after Mexican billionaire Ricardo Salinas Pliego encouraged its purchase. This volatility serves as a double-edged sword, both as an exciting asset choice for some investors and apprehension for others, preventing widespread adoption.

One contributing factor to volatility is that the crypto markets have an abundance of whales – a term given to someone who holds a significant amount of a particular asset; someone who holds a minimum of 1,000 Bitcoin is considered to be a whale. The sheer size of their holdings means that, when they decide to sell, the market is suddenly flooded with this asset, causing big price movements.

These powerful investors exist across all asset classes, but cryptocurrencies are particularly vulnerable because there are more whales, but much smaller volumes and less liquidity across a fragmented sea of exchanges. Without sufficient liquidity, these whales are trapped in a proverbial swimming pool, destined to send huge waves through the market as soon as they move. Because each exchange is segregated into their small swimming pools of liquidity, they are incredibly susceptible to whale movements.

For that reason, we need to solve the liquidity problem by joining all these segregated small swimming pools into one big ocean. The trading technology of the crypto market has not yet caught up to the maturity and stability of forex, which employs OTC trading, which is how it minimizes the effects of large buy and sell orders that can drastically move the market. If the crypto market integrates that, this can dramatically improve crypto exchange liquidity and stabilise pricing as a result. It’s time to deepen the liquidity pool.

The influence of whales 

Cryptocurrency assets are still fundamentally very concentrated. The sudden growth of Bitcoin means that a large portion of the market is owned by a small majority of traders who were fortunate enough to buy lots of Bitcoin when the price was low. Currently, around 40% of Bitcoin is held in around 2,500 accounts. 

The same is true of altcoins. For example, it was revealed in February this year that one person holds 28% of Dogecoin, which has soared by almost 1,400% since the start of the year. An individual in possession of that large a proportion of the market has a huge effect on the price.

And the effects of these whales are visible. When whales are selling, the prices of cryptocurrencies are on a downward spiral. On April 18^th, for example, one trader moved 58,814 BTC – worth more than $3.3 billion at the time – from Binance to a private wallet at the same time as the prices slid to a low of $51,541 per unit.

Shortly after, on April 20^th, there was a significant amount of whale movement fluctuating the price and leading analysts at Whalemap to argue there is a threshold, at around $55,000, whereby whales often stop adding to their positions and move their assets to wallets.[ASP1] 

While whales are clearly affecting the price of Bitcoin, their influence is greater among altcoins, which have lower market caps and are less liquid. Not long ago, the price of Ethereum plummeted by more than 50% on the Kraken Exchange, plunging from $1,628 to $700 within the space of minutes. 

The CEO of Kraken attributed this to single sell, saying "it could be that a single whale just decided to dump his life savings." For Ethereum to drop $1000 dollars in three minutes is extraordinary and it proves that even the biggest exchanges with large volumes can be rocked by big whale movements. 

Shrinking liquidity 

Considering price swings are compounded by fragmented liquidity, the market must pay attention to the fact that liquidity is getting worse, not better. The amount of Bitcoin on exchanges isdown 20% over the last 12 months. Slowly but surely, liquidity is drying up and the pool is getting smaller.

The bullish cryptocurrency market means people are holding the asset, simply watching the price tick up. Evidence suggests that there is a growing number of whales, with the number of individual holders of over 1,000 Bitcoin at an all-time high of 2,334. So, despite growing popularity, there is still only a very limited amount and diminishing amount of cryptos changing hands.

Contributing to these problems, big investors are entering the crypto market in swathes. Institutional investors, hedge funds, high-net worth individuals, and companies – most famously Tesla – are all looking to hold and trade crypto assets. And with more buying power, it is likely to increase order sizes and add to the influence of whales.

We cannot prevent these big players from influencing crypto trading, but solutions for the underlying lack of liquidity that exacerbates price swings exists. 

Unifying the pool

To combat whale-induced price swings, the market is slowly adopting tactics from other asset classes. For example, many OTC brokers are targeting crypto whales to trade digital currencies over the counter because they can access more liquidity than exchanges. 

However, for a lasting solution that can cushion large orders and prevent sudden and drastic price changes, exchanges should turn to trading technology that has been mastered in other markets. For example, the FX markets have long provided Straight-Through-Processing capabilities on a global liquidity network, where orders are aggregated and processed using Smart Order Routing. This infrastructure allows global price discovery, where the best bid and ask prices are presented to all market participants, regardless of trading avenue. 

Effectively, it allows exchanges to leverage the liquidity of other exchanges, including from the biggest in the industry. Using this model, exchanges can consistently provide traders the best prices and absorb the impact of big whale splashes by drawing on liquidity from the wider market. The multiple individual pools join to become an ocean.

Only once these issues are addressed will cryptocurrencies be free of the volatility that comes with so many big fish in a market lacking depth.

Aliaswire, a provider of digital payment and credit solutions for businesses and financial institutions, today announced $6 million in new funding. The round, led by Stage 1 Ventures, is the company’s first institutional investment in its 13-year history. 

As part of the funding, Stage 1 Ventures Operating Partner Scott Carmel will join the Aliaswire board of directors. “Aliaswire has built a profitable, high-growth business with an extensive portfolio of innovative products, patents, and intellectual property,” said Carmel. “We see a strong team and tremendous opportunity to accelerate the pace of innovation to open up new markets and revenue streams.”

The company has also made two additions to its leadership team. Fintech veteran Chris Gardner has joined Aliaswire’s board as an individual member. Gardner has spent the better part of three decades as an entrepreneur, founder, and product and marketing executive at Boston-area venture-backed companies including PayPal, Paydiant, Extend Media, m-Qube, and edocs. 

In addition, Kristen Pulkkinen has joined Aliaswire’s executive team as Chief Marketing Officer to lead the company’s branding, positioning and go-to-market efforts. Pulkkinen’s 20+ years of leadership experience span marketing, sales, business intelligence, and customer engagement for both B2B and B2C companies. She joins Aliaswire from PDI Software, a leader in enterprise management software for the convenience retail and petroleum wholesale markets. Previously, she was Chief Marketing Officer for alternative payments company Zipline. 

Aliaswire, which has tripled its headcount in the last 18 months and is on track to double its revenue in 2021, is focused on two market opportunities.  

• DirectBiller® is a cloud-based electronic bill presentment and payment solution. Offered as a white-label solution, DirectBiller is sold through financial institutions’ treasury management and commercial banking units to facilitate both B2B and B2C payments for banks’ business customers. New billers on the platform increased by 40% in 2020. 
• PayVus® is an innovative credit offering for the small business market, providing business owners with tools to improve cash flow and credit to reinvest in their business, without building more debt. The solution is adding new customers at a growth rate of 100% month over month.

The venture investment will support the expansion of both solutions and be used primarily for hiring in the areas of product engineering, customer care, account management, and business development.

“We’re really pleased to have the support of Scott Carmel and Stage 1 Ventures,” said Aliaswire CEO Jed Rice. “The team here has had tremendous success to date, and we believe adding the discipline, experience and insight of an investor like Stage 1 will be invaluable as we build on our momentum and navigate the next stage of our growth.”

John Dobson, CEO at SmartSearch, says: “The European Banking Authority (EBA) has this week highlighted a key issue in RegTech, which is the wide variability of quality and services in the market. This may well be hampering further adoption of the technology in the sector.

“We may have left the EU but of course we’re still doing business with the bloc and any moves they make towards increased regulatory standards will have to be reflected in the UK.

“The EBA has also recognised the need for greater knowledge and awareness of the solutions on the market by the regulator.

“This all goes to the heart of the challenge facing RegTech when it comes to the banking sector, which is a lack of understanding of the advances in the solutions available. Added to that an unwillingness, or inability, to change outdated methods of customer verification for AML purposes.  

“Thumbing through endless copies of hard documents which are now so easily forged is not an infallible way to verify the identification of your new customer.  In addition, as they race to save cost closing down thousands of their local branches they are removing the ability for customers to present their identity papers at a local branch, and this will impact the retention of existing customers and their ability to recruit new ones.  Therefore, the move to electronic verification is inevitable unless they want to see churn increasing as new tech banks thrive.  

“The Financial Conduct Authority should perhaps take note that the EBA is trying create an environment for greater adoption of systems which are more efficient, secure and accurate.

“There doesn’t seem to be the same willingness in the UK and in fact, in April the FCA said it’s not their place to promote the use of AML technology to financial services in the UK.

“This, despite the fact a new report by the City of London Corporation said compliance for Britain's top five banks could be cut by at least £523 million combined, through increased use of automated systems.

“Instead, what we see is that the new banks and financial services businesses coming into the market are much more alive to the benefits of RegTech when it comes to due diligence processes. As such they now have a competitive edge over the more established institutions.

“If the FCA and the banking sector are serious about addressing the huge cost of compliance it currently faces, it needs to act now to make digital solutions the standard for all AML processes.”