The past quarter has proved to be one of our busiest to date. We’ve forged new global partnerships, welcomed new clients, met with industry analysts, spoken to many publications, and been invited as speakers to industry events.
The past quarter has proved to be one of our busiest to date. We’ve forged new global partnerships, welcomed new clients, met with industry analysts, spoken to many publications, and been invited as speakers to industry events. Ongoing conversations with clients and industry participants continue to be a key focus for the whole of the Volante team. Whether these discussions are around real-time payment initiatives in the US, accelerated corporate on-boarding to banks or PSD2 and Open Banking APIs in the UK - the output from our discussions form the basis of our evolving roadmap. By way of example, we have been creating a new innovative extension to our VolPay Channel product that simplifies payments through a beneficiary self-service portal offering significant benefits to corporates, banks and beneficiaries. Please watch this space for further news on this in due course. We have also recently provided a critical component for the implementation of a RTGS (Real-Time Gross Settlement System) at a Central Bank in the Asia Pacific region. You can read more about this in the Volante News section below. Finally, Sibos and AFP were both huge successes for Volante this year, and the many interactions we had will prove to be valuable in the development of our 2017 product roadmap.
As always, we very much value input from our clients and industry participants to learn what challenges you face within your organization. This information is central in building out Volante products to serve the financial services industry, so please do get in touch to arrange a time to speak to your local representative.
We very much hope your last quarter has been as busy and productive as ours and that you enjoy our Q3 newsletter. May I also take this opportunity to wish you a very successful 2017 and a restful and serene holiday period as we approach year end.
The biggest development of late in payments has seen the publication of the Regulatory Technical Standards (RTS) for the implementation of PSD2.
This framework document has come into criticism from banks and the payment service provider community for not going far enough in defining how key areas such as Secure Customer Authentication (SCA) will work, how Third Party Providers (TPPs) will be certificated and who will manage the registration of potentially hundreds of such entities, and in particular the definitions of the APIs themselves. Unless there is clear guidance on the data standards (use of ISO 20022 data elements have been proposed in the RTS), many fear that there will be divergence of the APIs that banks will publish, causing major interoperability challenges for the TPPs - many of which will in fact be the servicing banks.
In the UK, where Open Banking is on the agenda and with a more aggressive timeline than PSD2, an Implementation Entity has been created to try and prevent the challenges noted above. In Europe we have also seen a number of industry groups created looking to define their own rules/frameworks for PSD2 implementation. These include the Berlin Group (well known for its work in the Consumer cards domain), the German Banking Industry Committee (GBIC) and the Convenient Access to PSD2 Services (CAPS) group. Indeed, successful suppliers of such services such as the very successful IDEAL in Holland, are promoting a design for PSD2 – no doubt concerned with not having to reinvent the wheel.
Finally, on the topic of Open Banking, November saw the Australian Government announce steps to move forward with open data sharing in its reports on the four major banks in the country.
Other developments have seen the EBA issue its design for a pan-European real-time payments platform which will be compliant with the SCTInst scheme. Coupled with PSD2, there is a real shakeup in the retail payments domain on its way very soon.
Blockchain and Distributed Ledgers of course remain in the news with significant moves by Goldman Sachs and Santander to pull out of the high profile R3 Consortium.
As R3 looks to raise further funding to continue its development of solutions, and plans to publish its Corda platform as open source technology to the Hyperledger project with such high profile departures, whether this ambitious project succeeds remains to be seen. Other significant blockchain news sees the established banking cooperative SWIFT join the party, with a POC demonstration of its Eris-based blockchain solution for the full lifecycle of a bond trade. Bitcoin value increased to a recent high of $750, and despite a number of hard forks to the platform in recent months, Ethereum remains a popular permissioned ledger of choice.
In the correspondent banking world, the SIBOS event in Geneva at the end of September saw heavy promotion of the Global Payments Initiative which now boasts an impressive 73 members. This scheme, with its aim of increasing efficiency and speed for cross border payment transactions in the B2B space will launch in 2017. In part, this could be viewed as a defensive measure by SWIFT against some of the new payments technologies such as Ripple, who were quite vocal in their opinions of the new scheme at the SIBOS Geneva event.
And finally, no report on the industry would be complete without some mention of regulation - one directive to note due to come into force in May 2018, is the EU General Data Protection Regulation (GDPR). It will be interesting to see how it will impact the implementation of PSD2, particularly the newer TPPs (of course banks will be making specific plans to cover this regulation, which potentially carries huge fines for non-compliance - up to 4% of global turnover). This regulation includes the potential for the so-called “right to be forgotten” (or data erasure to be precise). My question is, how will this work with solutions that have employed blockchains with immutable records?
As a customer of Volante, or thinking of becoming one, you will be aware that we have spent the past 15 years providing message-based financial integration solutions to some of the world’s largest financial institutions, including banks, buy and sell-side participants, stock exchanges, central counterparties, utilities and corporate enterprises. Our technology has enabled organizations the world over to accelerate the adoption of both domestic and international message standards across asset classes, and importantly, keep up to date with changes with ease thanks to our vast maintained library of standards plugins and transformations.
Over the past two years we have created new software products directly aimed at alleviating pain points for our customers in the payments domain, which is undergoing rapid change in the areas of real-time payments, open APIs, and migration of ACHs to ISO 20022. These applications, branded under the VolPay suite of products, fully leverage the underlying proven power of our core Volante Designer product.
We also work closely with customers and the wider industry to understand the pain points outside of the payments domain in order to leverage our expertise in those domains and create solutions to address those challenges - both from a technological and regulatory perspective. As an example, we are involved in conversations with standards bodies such as the FIX Trading Community and ISITC to see how we can help accelerate the adoption of blockchain/distributed ledger technology (DLT) while simultaneously insulating firms from the risks associated with DLT.
DLT and regulation are just two emerging trends outside of payments that we have identified as being significant current pain points in the industry, but we want to continue delving deeper into the challenges our customers face.
We also continue to closely monitor new and changing regulation such as MiFID II, EMIR, CSDR, SFTR and BCBS 239 so we can better understand the pressures our customers face with reporting under many different jurisdictions. For example, data will have a big impact on impending regulation - in total there are around 700 data elements that will have to be reported across the current regulations, and these elements will need to be reported to many regulators in different formats in a timely manner with the threat of fines if not.
DLT and regulation are just two emerging trends outside of payments that we have identified as being significant current pain points in the industry, but we want to continue delving deeper into the challenges our customers face. As such, Volante would very much appreciate an opportunity to discuss your views on what the challenges of both your organization and the market in general are in these areas, or indeed any others you feel would be relevant. We pride ourselves in being customer and market driven, and it is only by having dialogue that we can achieve that. So don’t be shy!
After operating successfully in the US and Europe for over 12 years at the time, and having understood the Middle East and Africa regional challenges around financial message standards and data integration, Volante established an office in Dubai in 2013. The initial focus was to build Volante’s brand in the region and support regional and local standards and services for the regions.
Having spent many years working across the local financial markets, one thing I have learned is that local partnerships are key to having a successful business in such a large and dispersed region. With that in mind, our approach was to initially focus on growing a network of regional partners who are well connected and understand the local industry, placing them in a perfect position to help us, and our clients, address the challenges around integration, payments and securities processing.
As a result of our focus on developing local partnerships, there has been fast expansion in the MEA region; we now have licensed customers in 13 countries including Saudi Arabia, Nigeria, Jordan, South Africa, Malawi, Swaziland, Namibia, Lesotho, Mozambique and Uganda. Furthermore, due to this success, we have been able to expand the regional office in Dubai and by the end of 2016 we are looking to gain an additional 5 new clients in 3 new countries. We have also established ourselves as integral players in the local market through event sponsorship and speaking opportunities at industry events such as MEFTEC in UAE and SWIFT ARC in various African countries. We augment our event participation through regular article contributions to publications such as The Banker Middle East and The Banker Africa.
From our work in the region we have found that banks and corporates experience many of the same integration and payment processing challenges as faced in other financial markets. There is a real appetite for improving the speed with which payments are on-boarded from customers as well as a desire for increased agility in the orchestration and processing of payments inside the banks. However, in addition to these global themes, for the Middle East and Africa, the digital payments age has drastically changed the nature of the bank’s customer base and the ways that it must interact with these dynamic and ambitious consumers. There are increased numbers in the banked population, massive increases in payment volumes and flows of remittances, and more demanding and reactive customers.
Volante, and our regional partners, have a great opportunity to help the banks in the region to radically improve their time to market for new services and their internal cost of change. It is exciting times for the Middle East and African regions and the groundwork that Volante and our partners have carried out in growing our brand and profile in the market over the last three years, is now starting to deliver significantly increased engagements and opportunities. We’re looking forward to next three years as we continue to grow by delivering value and excellence to our customers.
There is a worldwide drive to improve settlement capabilities within Central Banks. In September Volante announced its partnership with Finexus to help build new Real-Time Gross Settlement (RTGS) Systems for financial institutions across the Asia Pacific region. There is a worldwide drive to improve settlement capabilities within Central Banks the world over, and the release announced a key partnership that Volante has secured with the Malaysian-based provider to provide critical components for a Central Bank's new RTGS implementation in the region. Furthermore, it serves as a potential springboard for Volante's further growth in the APAC region. This implementation is anticipated to be the first of many other projects within this important region.
There is a worldwide drive to improve settlement capabilities within Central Banks
In October Volante released a new certified connector for the global financial services industry created on MuleSoft’s Anypoint Platform. This allows MuleSoft customers to benefit from access to Volante’s messaging capabilities via API. Benefits include access to an ever-expanding library of message standards, message transformation, validation and integration etc. By way of example, if a MuleSoft customer wishes to send a payment in a proprietary format, Volante can be invoked within the MuleSoft environment to pick this payment file up for Volante to validate, enrich and return the payment file in the desired format for further processing by the other systems involved in the process.
In June, Fiona Hamilton, VP Europe and Asia, participated in a Blockchain - is it overhyped? VidChat with ISS-Mag and in September, Fiona subsequently participated in a virtual roundtable on the future of the ISO 20022 standard. The full transcript can be found here.
In August, Neil Clarke talked about the race towards open banking in a blog for Finextra. In the wake of Brexit, the implications in terms of EU regulation are pretty clear, with the FCA stating that while the UK remains in the EU, then planned initiatives remain in place. In his blog, Neil explores what this means for the UK financial services industry.
As financial firms are compelled to deploy Blockchain technologies to satisfy client demand and to participate in market initiatives, many questions arise. In his blog for Finextra, Kevin Cullen, Business Development Director - Americas, addresses these questions and makes the case for standardization in blockchain.
As financial firms are compelled to deploy Blockchain technologies to satisfy client demand and to participate in market initiatives, many questions arise
Cross-border payments continue to be a real headache for the industry, particularly around standards. In this article, FX-MM’s Eleanor Hill speaks to Allan Spalding, EMEA Partners Director, on how the industry is responding to these challenges against a backdrop of FinTech innovation and instant payments regulation.
In an article for PaymentsSource, Douglas Green, Sales Director, North America and Canada, addresses why multiple models are threatening 'real-time' payments in the U.S.
Host-to-Host (H2H) connectivity between a bank’s corporate customer and the bank is no longer restricted to just the largest businesses; firms today want to reap the benefits of automated connectivity to their bank for payments - regardless of size. In this article for Bobsguide, Mick Fennell, General Manager Middle East & Africa, explores what this means for banks.
Revisiting this theme again in October, Mick Fennell wrote an article for CTMFile (Cash & Treasury Management file) on the next generation of H2H on-boarding benefits, features and what banks need to do to better serve their clients in this digital payments age.
Also in October, Volante contributed to a FinOps Report article on AML Compliance and how European banks and their U.S. counterparts making cross-border and domestic payments of over €1,000 can easily verify that they have the right data about the originators of the payments and the payees or beneficiaries.
In November Rick Salk, Global Head of Sales, Volante, wrote an article for GTNews on the key themes from AFP, including what firms can do to reduce the expensive, time-consuming task of processing checks, and how to streamline the technical aspects of the AML/KYC due diligence process.
At Sibos this year we had several video interviews, including an interview with Fintech Finance and Mick Fennell around SIBOS 2016, industry themes, such as blockchain, open APIs, and ISO 20022, and how Volante helps clients to overcome their integration challenges.
Financial IT spoke to Fiona Hamilton around the current challenges facing capital markets today and describes what RegTech means. In another video interview, Chris Stares, Volante’s Principal Technical Consultant, discusses the issues and challenges that businesses have from a technical viewpoint when implementing payment transformation projects and what is the ideal approach to overcome these challenges. In a third video interview with FinancialIT, Nadish Lad, Head of Payments Product, speaks about innovations in payments and how Volante helps customers take advantage of the digital payments age.
In the past few months, Volante has continued to publish several new executive briefings, with the aim of exploring problem areas in the industry, and what can be done to address these challenges. In the first briefing we explore the topic of data management within the corporate enterprise and the challenge of on-boarding corporates quickly and efficiently. In another executive briefing we outline a list of factors that banks must consider to successfully on-board corporate customer payment flows. In a third executive briefing, we take a look at achieving risk regulatory compliance – overcoming the data integration challenges.
While the summer months tend to be a bit quieter for conferences, we prepared for a very busy and successful industry event schedule in the autumn
In September this year we once again returned to SIBOS, this time held in Geneva. The consensus was that SIBOS Singapore in 2015 was the most successful SIBOS ever attended, and this year surpassed that sentiment in terms of interest in Volante and the volume of people that visited the Volante stand – we estimate more than 550 delegates stopped by to speak with us about our latest our developments.
The most common challenge regarding cost proved to be implementation and in particular, the payments and financial message integration aspect
The Volante Sibos team, comprised of 11 people including our CEO, was extremely busy meeting with members of the community including clients, prospects, consultants, analysts and the press. We gave multiple demonstrations for our VolPay Suite of payment products and of course our core Volante Designer product as well. In most of these conversations, a common theme recurred many times: the headache of financial message and payments integration in system implementations. When it comes to executing payment transformation projects - be that payment on-boarding from corporates to banks or new payments channels or implementing new payment hubs - the most common challenge regarding cost proved to be implementation and, in particular, the payments and financial message integration aspect.
Traditionally, integration has been a very manually intensive job that requires many man-hours to define, design, develop, test and implement. Even once the integration has been completed, firms must also then stay on top of changing standards, new regulation and innovations in technology, and the manual processes continue to cost in terms of both time and money. This is where we believe Volante adds true value, as we automate the integration process and provide access to a vast maintained library of more than 330 standards plugins and transformations that help financial institutions and enterprises to readily adapt to change, leaving them to focus on maintaining and growing their business.
At this year’s SIBOS, we once again put up the #VolanteReactionWall to gauge the sentiment of most of those we spoke to and passers-by. The responses reinforced the conversations we were having around the challenges of integration. Approximately 350 people cast their votes over the course of the week, with some interesting results (including 3 people who didn’t know what blockchain was!).
Volante once again returned to the US-based AFP (Association of Financial Professionals) Annual Conference, this year in Orlando, as an exhibitor and sponsor, which was filled with insightful speakers, thoughtful panel sessions and valuable dialogue among attendees. The conference was attended by more than 5,500 delegates from the US corporate treasury and finance world, corporate banks and technology providers.
There were some key themes we took away from the conference. The first was what firms can do to reduce the expensive, time-consuming task of processing checks. It would seem that the best approach would be to look into automating these processes through a self-service portal. Integrating automated solutions that reduce cost and labor not only benefits companies, but companies’ employees as well. Automation is a boon to corporates and treasurers alike. This was good news for Volante as it validated our view and continues to shape the product roadmap for our VolPay Channel product. In particular, the VolPay Channel Beneficiary Self-service Portal product which is designed to tackle this challenge directly.
To ensure that on-boarding is profitable for banks, the process needs to be rapid, reliable, systematic and easily and economically maintained.
Corporate on-boarding for banks was another key theme at AFP, namely how to streamline the AML/KYC due diligence process and the actual technical on-boarding of payments and data flows. To ensure that on-boarding is profitable for banks, the process needs to be rapid, reliable, systematic and easily and economically maintained. If the process can be streamlined and automated, this will create an on-boarding experience that is business-led rather than IT project-led. It would also mean that banks can profitably on-board corporates of all sizes every time, achieving faster time to market and revenue. Again, this too was good news for Volante as it reinforced the applicability of our VolPay Channel product for the rapid technical on-boarding of corporate payment flows to banks.
The future of treasury and finance is perpetually transforming. However, with the right tools and strategy, companies can arm themselves to handle any of these transformations in ways that were not previously possible. It is critical to embrace the technology and processes that are available - otherwise you can risk falling behind.
Other notable industry events we sponsored and exhibited at include:
We are a product company first and foremost, and our software development team lies at the heart of Volante. Maintaining and caring for the energy and commitment needed for the creation of IP through excellence and innovation is central to the building of products that directly compete and win against companies many times our size. So to this end, lifestyle plays an important part in creating the ideal environment. We always encourage a work-life balance, time for families … and injecting fun into the workplace!
In September 2016, Volante held a family fun day at our at the Chennai office premises. Our excellent development staff work incredibly hard and it was great to have the families and children around for a fun day of games, dance, gifts and lunch.
Family entertainment both well rehearsed… and not so well rehearsed!... and all in the colourful local culture.
In November, Volante was proud to sponsor the Streets Consulting City Comedy Night in aid of Children in Crisis. We took 10 clients to the event for an evening of great stand-up comedy, networking and drinks. The event raised a total of £16,700 for the charity!