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Green Dot is leaning on tech innovation while keeping a close eye on evolving regulations. The $4.8 billion entity has “the agility of a fintech,” and is FDIC-insured, Chief Technology Officer Dave Harden told Bank Automation News. This allows it “to innovate quickly while offering the trust and compliance of a traditional financial institution.” Harden, […]
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Chase for Business is innovating to meet the evolving needs of its small- to medium-sized business clients, John Frerichs, head of global SMB payments at JPMorgan Chase, told Bank Automation News.
“One of the biggest changes in small business that we are continually adapting to is the need for a digital-centric ecosystem of payments products,” Frerichs said. “Customers want to onboard with Chase once, as seamlessly as possible, and then gain access to multiple payments products across mobile, web browser and physical hardware.”
To keep up with the digital demands of its clients, the bank rolled out its data-driven business decisioning tool, Customer Insights, to nearly 5 million small-business clients at the end of October.
In an interview with Bank Automation News, Frerichs discussed how he approaches demand for innovation through client feedback and what payments trends he is closely monitoring. What follows is an edited version of that conversation.
Bank Automation News: What digital payments trends do you have your eye on as you look ahead to 2025?
John Frerichs: As we head into 2025, the financial sector continues to embrace digitization, and digital payments have become a business staple. I’m keeping my eye on the following:
BAN: When it comes to payments, what are Chase for Business small-business clients most concerned about?
JF: Each month, we closely track what small-business owners are thinking and the big economic factors impacting this. This year, their top concerns have been cash flow, staffing and revenue growth. That’s why Chase has introduced new services to make payments easier. We’ve got tools to help businesses create and send invoices electronically, speed up payments, and gain useful and actionable insights from their payment data.
Running a small business means juggling a lot, from managing operations, to paying employees and tracking inventory. Understanding customer needs is crucial, but making sense of all that payment data can be overwhelming. Determining the where, when and how of collecting insights can be time-consuming and costly.
BAN: Chase for Business has launched several new digital solutions recently. Is there a standout product you helped bring to market?
JF: Within the past year we have rolled out a series of new product innovations — including Tap to Pay, a new Chase Card Reader, a set of new Chase Point of Sale terminals, a digital invoicing tool, faster payment capabilities and payroll partnership with Gusto.
Most recently, Chase for Business expanded access to its Customer Insights tool, now available at no additional cost to nearly 5 million business checking clients. This powerful platform offers simple, actionable insights to help business owners connect with their customers, run their business more efficiently and make smarter strategic decisions.
It provides them with data-backed intelligence to boost marketing, optimize staffing during peak hours and suggest expansion based on their customer location.
BAN: How does Chase for Business stay ahead of small-business owners’ changing needs and expectations? Where does innovation fit in?
JF: We are always thinking about and talking to our customers. For example, we regularly survey small-business owners and use their input to design business solutions that can address their greatest pain points.
We also spend significant amounts of time talking directly to our customers. Chase for Business hosts several events throughout the year that give us the opportunity to hear from hundreds, if not thousands, of small-business customers at once. I also invite small-business customers to our All Hands meetings. We talk to owners about the story of their businesses, what Chase does well as their banking partner and what we could be doing better.
All of this input, as well as our original design and product thinking, serves as the foundation for our innovation agenda.
BAN: As the needs of small-business owners change, how do you lead your team to adapt to changing needs?
JF: Change is a constant, both in the small-business operating environment as well as the internal environment at Chase for Business. We are always thinking of how we can adapt and evolve to serve our customers better.
Leading through change is not a perfect science, but I have a few principles that I consistently use to be as effective as possible. The first principle is to gather and acknowledge the facts in a changing environment — whether those facts paint an unsettling picture or not. Next, I try to create a limited set of priorities that the team can rally around. Simplifying focus increases the likelihood of delivery. Finally, I aim to provide the maximum amount of transparency into how the team is doing through quantifiable metrics. With clear yardsticks, we know where we are hitting the mark for our customers — and where we need to change course.
Register here for early-bird pricing for Bank Automation Summit U.S. 2025, taking place March 3-4 in Nashville, Tenn. View the full event agenda here.
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Citi Retail Services monitors client feedback to drive innovation efforts, Terry O’Neil, head of connected commerce and strategic growth for Citi Retail Services, told Bank Automation News.
In a 2023 Citi survey, 85% of respondents agreed that retailers need flexible payment options at checkout, O’Neil told BAN. To meet that need, the $2.4 trillion Citi launched Citi Pay in 2023.
“The use of our Citi Pay offerings support this finding that consumers are looking for greater flexibility at checkout,” he said.
In an interview with Bank Automation News, O’Neil discussed the growth of Citi Pay, innovation efforts within Citi Retail Services and how he leads his team with ongoing consumer feedback in mind. What follows is an edited version of that conversation.
Bank Automation News: How do insights help your team innovate around client needs?
Terry O’Neil: The needs of our merchant partners and consumers are at the core of every Citi Pay innovation and we’re committed to ongoing dialogue with partners and customers to ensure our products continually evolve to meet their dynamic needs. This means that during the development of Citi Pay, countless hours were spent talking to merchants and consumers to ensure their needs were being understood and delivered on. Research found that both merchants and consumers were looking for three key things in payment products: flexibility, security, and ease of use. Citi Pay products meet all of these criteria.
While we launched Citi Pay in 2023, we continue to listen to customer and merchant feedback to enhance our products. With a deliberate focus on flexibility, we designed the Citi Pay products and platform to be very nimble.
For example, in response to feedback from distributors seeking flexibility to support secondary lending options to their merchants (with Citi being the primary lender), our team implemented an Open API concept. This approach separated the user experience from the APIs, enabling distributors to host customer acquisition experiences on their end.
BAN: How has Citi Pay grown since its launch a year ago?
TO: This fall marked the one-year anniversary of Citi Pay, Citi’s suite of pay-over-time offerings, including Citi Pay Credit, a digital-only credit card and dedicated line of credit, and Citi Pay Installment Loan, a monthly merchant installment loan. Since its launch, Citi Pay has seen notable growth establishing relationships with new merchant and payment platform partners. For example, Citi Pay has announced new partnerships with payment platforms like FreedomPay and ChargeAfter.
Today, Citi Pay products are available with over 150 of our merchant partners, and this number continues to grow as we continue toward our goal of bringing the Citi Pay suite of products to consumers at scale both in-store and online.
BAN: What does the adoption of Citi Pay say about the future of digital payments?
TO: Point-of-sale lending products — like Citi Pay Credit and Citi Pay Installment Loan — increase the number of payment options available to consumers at checkout, and this added flexibility will be a defining feature of the future of digital payments.
Citi Pay products are used by merchants of all sizes thanks to availability through a set of APIs or via an application, which highlights the democratization of point-of-sale lending in terms of merchant availability. This indicates that the future of digital payments and the flexibility offered by pay-over-time payment products won’t be limited to larger merchants but will extend to merchants of all sizes and industries.
Citi Pay’s suite of pay-over-time offerings provide consumers with a simple, intuitive checkout process. In fact, a crucial component when developing Citi Pay was ensuring consumers could apply and check out with the items in their basket in a single session. This real-time and fully automated decisioning application experience is representative of the frictionless experience that stands at the core of the future of digital payments.
BAN: Are there any innovations in the pipeline your team is working on that you are excited about?
TO: We are always working to expand the Citi Pay family of partners on both the merchant side and with payment and commerce platforms. The Citi Retail Services team is consistently exploring opportunities to facilitate greater integration of our offerings amongst our existing partners. We have some exciting developments on the horizon that we’ll be excited to share when the time comes.
BAN: How would you describe your leadership style?
TO: My personal view is that the best type of leader is one who leads by example and that is the mindset I strive to come to work with every day. Throughout my career, my roles have been intrapreneurial in nature — working to build new capabilities and businesses within large, well-established financial service leaders. This type of experience has led me to define my leadership style.
I encourage the teams that I lead to be self-starters and go-getters and come to the table with a solution when asking a question. None of us know the answers 100% of the time and that’s OK, but being able to workshop a proposed solution together can often lead to the best outcome. I find that this approach also instills confidence in my talented team when a similar situation arises in the future.
Register here for early-bird pricing for Bank Automation Summit U.S. 2025, taking place March 3-4 in Nashville, Tenn. View the full event agenda here.
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As JPMorgan Chase leans into AI-driven products, Jameson Troutman, head of product for small business, is dedicated to innovating based on client need.
To determine where to invest, Troutman consults the bank’s monthly survey of 500 small business owners to track their needs amid evolving market conditions, Troutman told Bank Automation News. Some of the biggest pain points small business owners expressed this summer were:
“These needs guide our product innovation strategy,” he said during a recent interview with BAN.
Troutman discussed his approach to innovation, recent product launches he has worked on and how he leads his team with client need at the forefront. What follows is an edited version of that conversation.
Bank Automation News: How does your team approach the product pipeline?
Jameson Troutman: At Chase for Business, we rely on customer and employee feedback to address small business owners’ pain points and identify the most impactful initiatives that will help them grow their businesses. With a focus on robust, agile roadmap planning and prioritization, we gather feedback from internal stakeholders, speak with customers and prospects, and look at the data we are seeing on complaints, digital engagement/usage and call center reasons to make informed decisions on priorities.
Lastly, sometimes we need to prioritize items for risk or control reasons. We reevaluate our priorities regularly to ensure the market hasn’t shifted in a way that requires us to adjust.
BAN: What are recent products that have launched under your leadership:
JT: Faster payments: A recently launched online payment center that gives business owners the flexibility to choose different payment options to pay vendors and employees quickly.
Invoicing: A digital invoicing solution that gives small businesses an easier way to create invoices and bill their customers so they can get paid faster.
Customer Insights: A powerful business intelligence platform that provides simple, actionable insights to help business owners more effectively reach their customers, run more efficiently and make strategic decisions. With Customer Insights, Chase for Business customers will have complimentary access to aggregated, anonymized data about businesses like theirs, such as average customer profile, average ticket amount and busiest shopping times.
Payroll: A solution for our Chase Payment Solutions customers that allows them to automate and simplify the way they pay their employees, giving them time back in their day.
BAN: Where is innovation most necessary for small business clients today?
JT: Small businesses are currently navigating the higher costs of doing business — whether they pass them along to consumers, cut costs within their business, or reduce their business expenses. Innovation is key to helping small businesses tackle these challenges and keeping them thriving in the ever-changing economic landscape.
Cash-flow management remains a critical area of focus but small business owners are also learning how to adapt to new digital technologies, such as artificial intelligence, and figuring out what works for their business.
From another recent survey we conducted, AI was described as the most popular technology to add in the next year. Our recent Business Leaders Outlook survey found that AI applications (48%), cryptocurrency (30%) and virtual reality/Metaverse (25%) are the top technologies small business owners plan to adopt. New technologies, especially AI, will be a game-changer for business owners — saving time, reducing costs and improving efficiency.
From what we’ve seen, technology and artificial intelligence is here, and it’s here to stay. We expect it will have a great impact on the services we provide as a bank.
BAN: How long does it take to get a product from idea to launch?
JT: Our innovation timeline can vary greatly based on a number of factors — from a few months to a few quarters — based on the complexity of the build and the impact it has on our business operations. We strive to be as quick as possible to market, but given we serve over 6 million small businesses, we also need to ensure that when we launch something, it is going to work well and do the job that our customers need it to do.
As part of this evaluation of speed to market, we will decide whether we need to test the feature with a smaller set of customers before we make it generally available to a majority of customers. For some smaller changes, we may be okay with launching it to everybody right away. For larger product launches, we follow a rigorous process that lets us test the product with a small set of customers first. Then, we slowly ramp up the roll-out to ensure our banker and operational teams are ready to properly support the launch.
BAN: How would you describe your leadership style?
JT: I am a people-oriented leader who mentors my teams to understand the “why” behind what we are doing. I enjoy coaching and helping individuals on my team succeed at their job and in their career. It’s in my DNA to really enjoy being in the details of the work, but I give my team the space and time to do proper discovery, understand the facts and define requirements. I trust them to deliver best-in-class products.
Register for the complimentary webinar presented by Bank Automation News: “The future of open banking: Payments meet data,” on Tuesday, Sept. 17, at 11 a.m. ET. Register for the webinar here.
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Carl Slabicki, managing director and co-head of global payments at BNY treasury services, is focused on keeping up with client demand by monitoring industry trends, innovating with the latest tech and prioritizing client engagement with products.
To support these efforts, BNY has recently rolled out:
During the second quarter, BNY continued to aggregate its products, bringing all its investment capabilities to one place for clients, according to its June 12 earnings report.
In an interview with Bank Automation News, Slabicki discussed his approach to leadership as well as how his team tackles projects and innovation. What follows is an edited version of that interview:
Bank Automation News: BNY offers its automated smart routing solutions. What other solutions is your team working on?
Carl Slabicki: Our team is focused on enhancing smart routing capabilities to provide a seamless experience for our clients across various segments such as banks, corporations and fintechs. We continually invest in global partnerships, leveraging 2,500 correspondent banking partners to enable cross-border payments and address market gaps. As the global landscape evolves, we are actively working to bridge together high-value, low-value and instant capabilities across this network into key markets, helping optimize the end-to-end experience of payment processing in a fragmented market.
We are also prioritizing risk and fraud mitigation services for both domestic and international payments. By integrating various data points and pre-payment controls, we have enhanced our risk management framework and can now offer these tools to our clients for improved payment predictability.
To bring together such capabilities in a simplified manner for our clients, we often collaborate with fintech partners to integrate best-in-class solutions for niche industry challenges. For instance, our partnership with Verituity enables us to offer BNY’s Vaia platform which is a comprehensive corporate-to-consumer payment solution, streamlining authentication, validation and payment choices. Our goal is to integrate the latest technology and capabilities available in the market with end-to-end workflow solutions, often through partnerships, that simplify and enhance client operations.
BAN: How does your team approach innovation?
CS: Our approach to innovation involves balancing three key factors in parallel. Firstly, we maintain active engagement with the industry by participating in organizations such as Swift, Nacha, The Clearing House, the U.S. Faster Payments Council and others. We take leading positions to shape industry direction by incorporating feedback from both banks and clients, thereby driving industry progress.
Secondly, we align our development strategy with industry trends and market infrastructure advancements. By staying ahead of industry directions and demonstrating proof points such as being the first bank on instant payment rails such as The Clearing House’s Real Time Payments and FedNow, and certain new capabilities enabled by SWIFT, we ensure our readiness to meet future demands.
Lastly, we prioritize client engagement, transparently sharing industry insights and aligning our innovations with client needs. This alignment of industry engagement, development strategy and client collaboration is critical to our innovation approach.
BAN: What are clients asking for from treasury services?
CS: Clients increasingly expect elevated industry standards, especially in financial services where the gap between capability and adoption is widening. RTP, FedNow and risk and fraud detection capabilities are yet to be fully integrated into daily business processes. Clients seek education on these available solutions and look to us for a consultative approach to ease their adoption.
We focus on embedding new capabilities into existing client processes without requiring significant changes from them. For instance, when real-time payment capabilities are introduced, we integrate them on the back end, allowing clients to benefit from these advancements seamlessly.
BAN: What global payment trends are you closely following?
CS: We are closely monitoring several global payment trends, with three being front of mind:
BAN: How would you describe your leadership style?
CS: My leadership style emphasizes active participation and vocal leadership within the industry paired with real-life solutions and client collaboration. By ensuring that we are at the table with industry partners and taking leadership roles, we strive to align BNY, our clients and the industry towards a common direction. Our leadership in first-in-market pilot projects exemplifies our commitment to innovation and leading by example.
Early-bird registration is now available for the inaugural Bank Automation Summit Europe in Frankfurt, Germany, on Oct. 7-8! Discover the latest advancements in AI and automation in banking. Register here and apply to speak here.
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EverBank is selecting third-party vendors and updating manual processes throughout the bank, according to Lindsay Lawrence, executive vice president and chief operating officer.
“We’re cramming about five years of change in two years,” Lawrence told Bank Automation News.
The nearly $40 billion, Jacksonville, Fla.-based bank, formerly TIAA Bank, continuously updates its platforms and strategies as it invests in digital capabilities and efficiencies, she said.
In fact, the bank is adopting tech provider FIS’ Digital One consumer platform, which will go live later this summer, and in May announced it had selected Finzly as its payments processor.
Lawrence recently sat down with BAN to discuss EverBank’s latest digital efforts. What follows is an edited version of that conversation:
Bank Automation News: How would you describe the digital strategy at EverBank?
Lindsay Lawrence: We want everything to be very technology-forward. A lot of it is building things with new technology, but API first so that we can build something with rails that can help us with our scalability and efficiency down the road.
As we look at our technology partners related to our digital strategy, it’s very customer-first. We want to create that personalized, customer-centric kind of experience for our clients. We looked for that same mindset in our partners when we selected our payment hub and commercial treasury management provider.
BAN: What is your approach to buy versus build?
LL: I am a big fan of buy. You can’t be good at everything, so it’s important to find other people or companies that have a great skill set and leverage them.
When we’re looking for fintechs, it’s important for us to lay out our own strategy and road map and also understand their strategy and road map as well.
For example, the bank selected European fintech Backbase as its commercial treasury management provider because they wanted to break into the U.S. market and wanted a bank that would grow with them. It’s been great because on some level, we can help each other. We both want something out of the relationship and it’s important in a partnership that there is a good, healthy challenge on both sides.
BAN: What are some recent technology projects you have spearheaded?
LL: Our biggest one is Digital One. That’s our new consumer platform with FIS. Previously, when we were TIAA-owned, we were on their online banking system. We will launch Digital One later this summer. This platform will be for online banking, online account opening and branch account opening platforms.
BAN: Can you quantify how automation has improved the customer experience for EverBank clients?
LL: We have capacity models that we look at to see how long it takes to open an account, monitor manual reviews and fraud alerts. What will be exciting is as we deploy new technology, especially FIS’ Digital One, it’s going to be great because we’re going to use those same capacity models that we were using before to see how much more push-through we get and how much less fraud we get.
With those insights, we probably don’t need to add as many full-time employees down the road to support those efforts. That’s where scalability and efficiency come into play. It’s hard at the beginning, but when you look at how much time it takes in all of these different areas of operations, saving five minutes here or three minutes there starts to add up. This is an opportunity to put people who have been doing manual tasks into other roles.
BAN: How would you describe your leadership style?
LL: Transparency for me is always important. Getting in front of the team and explaining where we are headed. Also, the humility, recognizing I don’t have all the answers today. I spend time in the branches and ask about frustrations and work to identify areas for improvement. I’m listening to what the pain points are, sharing the ultimate vision for the bank, and communicating along the way.
Early-bird registration is now available for the inaugural Bank Automation Summit Europe in Frankfurt, Germany, on Oct. 7-8! Discover the latest advancements in AI and automation in banking. Register here and apply to speak here.
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Morgan Stanley’s Jeff McMillan, head of firmwide artificial intelligence, is focused on developing and deploying AI throughout the operations of the $212 billion financial institution.
The New York-based FI appointed McMillan to the newly created position March 14, he told Bank Automation News. McMillan previously served as chief data and analytics officer for eight years at the FI, according to his LinkedIn profile.
“Morgan Stanley created this role to ensure the appropriate AI strategy and governance are in place,” McMillan told BAN.
In an interview with Bank Automation News, McMillan discussed his priorities, where Morgan Stanley aims to deploy AI and the potential impact of gen AI on the financial services industry. What follows is an edited version of the conversation:
Bank Automation News: What is the overall strategy at Morgan Stanley?
Jeff McMillan: Through our unique partnership with OpenAI, Morgan Stanley has early access to their new products and AI experts to create a solution unique to our needs. Our first use case in our wealth management division, the AI at Morgan Stanley Assistant, brings Morgan Stanley’s expansive intellectual capital to the hands of our advisers in seconds and in an easily digestible format. Think of it as having our chief investment strategist, chief global economist and global equities strategist on call — 24 hours a day.
We have successfully deployed the AI Morgan Stanley Assistant to our financial advisers — fully rolled out in September 2023.
BAN: What are some use cases being explored?
JM: To optimize efficiency, we will roll out AI in Morgan Stanley Debrief, a tool that acts as an AI-enabled assistant taking notes on an adviser’s behalf in meetings with clients, summarizing key discussion topics and surfacing action items. The tool works by transcribing client meetings, provided the client gives their explicit prior consent. After the meeting, it summarizes key points, creates an email for the financial adviser to edit and send, and then saves a note into Salesforce. It’s important to note that Debrief does not share any information with third parties and every client will have the opportunity to consent to the technology prior to use. If a client does not feel comfortable, the technology will not be used for the meeting.
BAN: What are your short- and long-term goals for AI at Morgan Stanley?
JM: We are identifying near-term use cases that every business area can engage with, learn and deliver value. To this end we are also planning on developing and deploying a series of firmwide training modules customized to different roles. Much of this is about demonstrating the value and challenges these tools present to all employees and getting them thinking creatively about the future.
In the long term, AI at Morgan Stanley is going to be an interaction layer that sits between our employees (advisers, bankers, sales force, etc.) and all the tools and information they currently have access to. The goal is to reduce the complexity of our platform and make everything more seamless by using language to get what you need as opposed to the historical forms of menus, search and a lot of clicking around.
Ultimately, you’ll be able to use just your voice. The AI can create proposals, evaluate alternative market scenarios, rebalance portfolios, build financial spreadsheets, and help in a variety of repetitive operational or administrative tasks. And I want to reiterate the value here is about helping people do a better job for their clients by making them smarter and more efficient.
I am hopeful that AI will free up more time to do the things we enjoy which are working with our clients to help them solve their complex challenges and to be engaged, as opposed to less. It’s not going to happen immediately. But we’ve been very deliberate about mapping out the different building blocks.
BAN: How is Morgan Stanley looking to implement generative AI?
JM: As part of my new role, I’ll work closely with teams across Morgan Stanley to leverage gen AI in a control-forward, scalable way. To that, their use cases are best served if they fall under one of five buckets:
BAN: What impact will generative AI have on financial services?
JM: Generative AI marks a new era of innovation, with the promise to unlock new business capabilities, pioneer methods of value delivery, and potentially broaden companies’ range of products and services. It empowers organizations to create new products and technologies with significantly less friction. Further, companies will be increasingly rated and valued by their ability to leverage and integrate AI to drive operational efficiency and productivity.
Early-bird registration is now available for the inaugural Bank Automation Summit Europe 2024 in Frankfurt, Germany on Oct. 7-8! Discover the latest advancements in AI and automation in banking. Register now.
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Lia Cao, global head of embedded finance and solutions at J.P. Morgan Payments, is focused on meeting consumers where they want to be met through integrated banking services.
“Consumer demand is driving significant interest in embedded banking and alternative payment methods,” Cao told Bank Automation News.
To keep up with demand, J.P. Morgan Payments offers solutions that offer API connections and simplified digital onboarding processes, she said.
In an interview with BAN, Cao discussed embedded finance adoption and how her team approaches innovation. What follows is an edited version of that conversation:
Bank Automation News: Where does the industry stand on the adoption of embedded banking?
Lia Cao: There is a lot of momentum. Over the years, we’ve witnessed a growing number of clients seeking to digitize their ecosystem and monetize the transaction flows through it, but without the resources needed to be successful, most struggle to do it alone.
Businesses across industries are embracing embedded banking as they realize its potential to create seamless and sticky customer experiences natively within their platforms, simplify financial processes and generate additional revenue streams. Witnessing this shift toward more integrated and seamless financial solutions is exciting, and it’s only getting started.
BAN: Why is embedded banking an essential piece of the payments ecosystem?
LC: Embedded banking is the glue that binds the payments ecosystem together. It allows businesses to offer a full suite of financial services directly within their platforms, making transactions more frictionless and convenient for all parties.
Today, merchants and platforms are embracing the marketplace business model, aiming to offer a seamless experience for their small and medium-sized business customers. They want to streamline processes like onboarding, accepting payments, managing cash flow and making payments, all within their own platform. Embedded banking solutions empower clients to achieve this unified experience, transforming the way businesses interact with financial services so they can focus on the consumer.
BAN: What technology is your team working on in the embedded finance space?
LC: We continue advancing embedded banking solutions that create exceptional experiences for all parties. These solutions encompass cutting-edge APIs to partially or fully hosted portals and simplified digital onboarding processes designed specifically for small and medium-sized customers. We’re also seeing increased demand for user-friendly Demand Deposit Account setups being tailored to meet the requirements of embedded payments. With our differentiated approach, we’re reshaping the landscape of embedded banking, driving efficiency, and fostering growth for our clients.
As our clients’ commerce needs evolve, there’s a growing demand for integrating comprehensive financial services directly into their ecosystems.
From banking services to more sophisticated offerings like insights and fraud prevention, clients seek end-to-end solutions. Our Embedded Banking and Solutions team addresses these evolving needs through a software-as-a-service offering that delivers agile and innovative solutions for merchants.
BAN: Where is the embedded finance industry headed overall?
LC: We’re heading toward deeper collaboration and innovation. Banks, fintechs and non-banking platforms are coming together to develop solutions catering to the evolving needs of businesses and consumers. It’s an exciting journey as we pave the way for more accessible and tailored financial services.
BAN: How would you describe your approach to innovation? How is that reflected in your tech innovation pipeline?
LC: It is core to everything we do. Every company says that, but our success to date backs that statement. While fostering a culture of collaboration among our development and engineering teams, we are also constantly exploring new technologies and methodologies to ensure we stay ahead of the curve for our clients as the digitalization of the payments ecosystem continues to evolve at an exponential pace.
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Allison Shonerd, managing director and head of Global Digital Disbursements in the Global Payments organization of Global Transactions Services at Bank of America, is focused on meeting the growing demand for payment solutions through innovation.
The $3.2 trillion bank’s noninterest expenses in the fourth quarter of 2023, which include technology spend, increased 14% year over year to $17.7 billion, according to the bank’s Q4 earnings release.
With the growth in tech spend and focus on digital strategies, the Global Digital Disbursements payments solution continues to grow. In fact, the solution was launched in Canada on the bank’s CashPro platform in August 2023.
In this interview with Bank Automation News, Shonerd discusses her approach to innovation and the roadmap for Global Digital Disbursements. What follows is an edited version of that conversation.
Bank Automation News: Global Digital Disbursements is an emerging payment solution. How has the demand for and adoption of this digital capability grown?
Allison Shonerd: The demand for digital business-to-consumer payment solutions has surged as companies face growing challenges with legacy paper-based processes — notably the proliferation of fraud — and as consumer payments are increasingly viewed as a way to compete and retain customer relationships. Global Digital Disbursements addresses these challenges and opportunities, leading to consistent growth year after year in client adoption, volume of payments disbursed and in use cases.
The increased adoption in peer-to-peer payments is driving the pace of change in the B2C space, with the greatest adoption in the insurance, energy, and education industries, as a way of replacing costly checks that have faced increasing fraud.
BAN: How does Bank of America approach innovation on Global Digital Disbursements Technology?
AS: We will often start with a “proof of concept,” where we partner with our technology team to experiment and ideally prove our hypothesis that a solution is feasible and will address the customer need we’re trying to solve.
Soon we’ll begin a proof of concept around identity as a means to enhance platform access and streamline payee payment experiences without adding unnecessary friction.
Making things easier for our clients is a perennial objective of our innovation strategy, and this led to us embedding Global Digital Disbursements into CashPro, Bank of America’s platform that clients use for their transaction banking needs. Now Global Digital Disbursements clients have access to other innovations such as our self-service tool CashPro Chat with Erica, and the cash forecasting solution, CashPro Forecasting.
BAN: What is Bank of America’s product development roadmap?
AS: For the team that I support, the product roadmap is focused on three outcomes: to enable popular payment rails, to expand our global reach, and to offer value-add overlay services that mask the underlying complexity of digital consumer payments. For example, we’re planning to add to Global Digital Disbursements more real-time and alias-based payment schemes, such as international Pay to Card so that companies can make high-volume, low-value payments to customers’ enabled debit cards globally.
Our clients play a crucial role in prioritizing what we develop since everything we do is driven by a desire to solve their needs. In recent times, those needs have included solutions that address security, transparency and ease of integration.
BAN: Where does Bank of America stand in terms of Global Disbursements capabilities today, and where do you aim to be?
AS: Global Digital Disbursements offers a robust suite of digital payment solutions to clients operating in the U.S. with disbursements through Zelle and PayPal, and internationally through PayPal wallets in more than 90 countries. In Canada, our solution is connected to the Canadian payments rail Interac, which also supports request for payment.
In 2024, we’ll continue to advise our clients on best practices for transitioning to digital payments, and in the first quarter, we’ll introduce another disbursement option for payments in the U.S.
BAN: How does your industry experience help guide your overall strategy and leadership style?
AS: My team continuously evaluates industry trends and brings digital payment experiences to life for our customers, which requires foresight and discipline to deliver on both short- and long-term strategic initiatives. This has helped me to develop a leadership style that emphasizes professional curiosity and openness to new ideas, underscored by a focus on execution.
I firmly believe that regular dialogue with customers and focusing on solving their challenges is key to staying on track in such an innovative time, and I couldn’t feel more fortunate to be part of the exciting evolution of payments in an increasingly digital world.
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Allison Shonerd, managing director and head of Global Digital Disbursements in the Global Payments organization of Global Transactions Services at Bank of America, is focused on meeting the growing demand for payment solutions through innovation.
The $3.2 trillion bank’s noninterest expenses in the fourth quarter of 2023, which include technology spend, increased 14% year over year to $17.7 billion, according to the bank’s Q4 earnings release.
With the growth in tech spend and focus on digital strategies, the Global Digital Disbursements payments solution continues to grow. In fact, the solution was launched in Canada on the bank’s CashPro platform in August 2023.
In this interview with Bank Automation News, Shonerd discusses her approach to innovation and the roadmap for Global Digital Disbursements. What follows is an edited version of that conversation.
Bank Automation News: Global Digital Disbursements is an emerging payment solution. How has the demand for and adoption of this digital capability grown?
Allison Shonerd: The demand for digital business-to-consumer payment solutions has surged as companies face growing challenges with legacy paper-based processes — notably the proliferation of fraud — and as consumer payments are increasingly viewed as a way to compete and retain customer relationships. Global Digital Disbursements addresses these challenges and opportunities, leading to consistent growth year after year in client adoption, volume of payments disbursed and in use cases.
The increased adoption in peer-to-peer payments is driving the pace of change in the B2C space, with the greatest adoption in the insurance, energy, and education industries, as a way of replacing costly checks that have faced increasing fraud.
BAN: How does Bank of America approach innovation on Global Digital Disbursements Technology?
AS: We will often start with a “proof of concept,” where we partner with our technology team to experiment and ideally prove our hypothesis that a solution is feasible and will address the customer need we’re trying to solve.
Soon we’ll begin a proof of concept around identity as a means to enhance platform access and streamline payee payment experiences without adding unnecessary friction.
Making things easier for our clients is a perennial objective of our innovation strategy, and this led to us embedding Global Digital Disbursements into CashPro, Bank of America’s platform that clients use for their transaction banking needs. Now Global Digital Disbursements clients have access to other innovations such as our self-service tool CashPro Chat with Erica, and the cash forecasting solution, CashPro Forecasting.
BAN: What is Bank of America’s product development roadmap?
AS: For the team that I support, the product roadmap is focused on three outcomes: to enable popular payment rails, to expand our global reach, and to offer value-add overlay services that mask the underlying complexity of digital consumer payments. For example, we’re planning to add to Global Digital Disbursements more real-time and alias-based payment schemes, such as international Pay to Card so that companies can make high-volume, low-value payments to customers’ enabled debit cards globally.
Our clients play a crucial role in prioritizing what we develop since everything we do is driven by a desire to solve their needs. In recent times, those needs have included solutions that address security, transparency and ease of integration.
BAN: Where does Bank of America stand in terms of Global Disbursements capabilities today, and where do you aim to be?
AS: Global Digital Disbursements offers a robust suite of digital payment solutions to clients operating in the U.S. with disbursements through Zelle and PayPal, and internationally through PayPal wallets in more than 90 countries. In Canada, our solution is connected to the Canadian payments rail Interac, which also supports request for payment.
In 2024, we’ll continue to advise our clients on best practices for transitioning to digital payments, and in the first quarter, we’ll introduce another disbursement option for payments in the U.S.
BAN: How does your industry experience help guide your overall strategy and leadership style?
AS: My team continuously evaluates industry trends and brings digital payment experiences to life for our customers, which requires foresight and discipline to deliver on both short- and long-term strategic initiatives. This has helped me to develop a leadership style that emphasizes professional curiosity and openness to new ideas, underscored by a focus on execution.
I firmly believe that regular dialogue with customers and focusing on solving their challenges is key to staying on track in such an innovative time, and I couldn’t feel more fortunate to be part of the exciting evolution of payments in an increasingly digital world.
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Stephanie Schultz, vice president and head of partnerships at Amex Digital Labs at American Express, is focused on building out digital client experiences as part of her innovation and product development strategy heading into 2024.
Throughout 2023, American Express prioritized technology spend, according to the card giant’s third-quarter earnings. Its expenses for the quarter increased 7% year over year to $11 billion, driven by higher technology and personnel-related costs.
As tech spend grew, American Express looked to increase product offerings in tune with client needs and new technological capabilities. For example, Amex explored uses for Web3, teamed up with Square and enhanced digital payment offerings.
In an interview with Bank Automation News, Schultz discussed her development plans for 2024, the Digital Labs product strategy and her approach to leadership. What follows is an edited version of that conversation:
Bank Automation News: What is your focus for product development and strategy for the remainder of 2023?
Stephanie Schultz: As we move through 2023 and into 2024, I am focusing on finding ways to make American Express a more essential part of our customers’ digital lives. We’re dedicated to creating seamless digital payment solutions, elevating membership experiences and actively addressing the emerging needs of our customers.
In today’s dynamic digital landscape, technology is advancing rapidly, and customer expectations continue to evolve. We adopt an ‘outside-in’ approach to guide our strategy and use new technology that solves meaningful problems for our customers to make their lives easier, not harder.
My team specializes in developing innovative products and enhancing membership experiences through strategic collaborations with leading tech companies and startups. Our efforts are concentrated across six critical focus areas including digital payments, e-commerce, future of membership, artificial intelligence, Web3 and other emerging tech.
BAN: What is the AmEx Digital Labs product roadmap journey?
SS: At Amex Digital Labs, our approach to new product development revolves around an inclusive and open forum designed to foster innovation and bring impactful ideas to life. We’ve established a platform where anyone on the team, regardless of their position, can pitch an idea “Shark Tank”-style to our leadership team.
This democratized approach to idea generation has led to more high-quality innovation. We are constantly bringing new products to market, and this open forum acts as a tool to help team members iterate and improve on their ideas and obtain the necessary resources for progression — from a viable business idea to a proof-of-concept, and eventually to a pilot phase, whether that’s with customers or internally across our Amex teams.
Throughout this process, our card members’ needs remain at the center of our learning agenda. We meticulously assess at each stage, evaluating for product market fit and scalability to determine which pilots can evolve into full-fledged product launches.
BAN: How do you determine what fintechs are the right fit for partnerships?
SS: Our team partners with a wide range of companies from fintechs to big tech companies. When considering partnership opportunities, we try to identify distinct offerings that can complement or augment Amex’s existing capabilities within our strategic focus areas.
Equally important is the alignment of core values and priorities. At Amex, our unwavering focus is around our customers. We prioritize partners who share our commitment to creating customer-centric products and are dedicated to delivering exceptional customer experiences consistently.
By fostering partnerships that align not only in technological innovation but also in shared values and customer-centric approaches, we aim to create mutually beneficial collaborations that elevate the experiences of our card members.
BAN: What emerging technologies do you have your eye on?
SS: There are several emerging technologies I am keeping an eye on right now, but one that has particularly captured my attention is Web3. We’ve been actively exploring this space, notable during this year’s U.S. Open Tennis tournament, where we introduced our latest Member Collectibles experience.
This experience allowed attendees to collect a total of three free, digital collectibles designed by illustrator Vero Escalante and issued in collaboration with POAP. This marked the first time card members were able to connect their NFT wallet of choice to their Amex account. This linkage enabled card members to unlock exclusive discounts with event sponsor La Roche-Posay, as well as transit and rideshare offers.
Our journey with on-site digital collectibles started at Austin City Limits (Music Festival) in 2022 with collectibles designed by a local artist, Zuzu. We also had an NBA 2K activation in December 2022 which let fans and card members unlock the video game’s digital currency. Additionally, at the U.S. Open golf tournament this past June, we let fans use their digital collectibles to access a website selling custom merchandise from a Metalwood x Hypebeast collaboration.
As we delve deeper into the realm of digital collectibles, we are excited about the potential of Web3 technology to evolve our loyalty and membership experiences.
BAN: How would you describe your leadership style?
SS: Throughout my career journey, I’ve aimed to lead authentically, emphasizing the human aspects that can sometimes get overlooked in a corporate environment. Being genuine and approachable has been fundamental in how I lead. I prioritize creating an environment where each team member feels comfortable coming to me with any challenge, ensuring they know they have my support, no matter what.
Authentic leadership, to me, also means being adaptable. Rather than imposing my personal leadership style, I invest time in understanding each team member’s unique working style and how best to support them. This deep understanding has allowed me to tailor my guidance and coaching. I have figured out what they each need to be successful and how to motivate them individually. This personalized approach has also fostered a tight-knit culture amongst the Labs team, which has been instrumental in enhancing collaboration and driving better outcomes.
Get ready for the Bank Automation Summit U.S. 2024 in Nashville on March 18-19! Discover the latest advancements in AI and automation in banking. Register now.
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ConnectOne Bank Senior Vice President and Chief Brand and Innovation Officer Siya Vansia is focused on aligning the bank’s digital and business strategies.
During the third quarter, the Englewood Cliffs, N.J.-based, $9.7 billion bank invested in its people and technology, Chief Executive Frank Sorrentino said during the bank’s October Q3 earnings call.
In an interview with Bank Automation News, Vansia discussed how ConnectOne approaches innovation, how to prioritize projects and how to determine when to buy and when to build. What follows is an edited version of that conversation:
Bank Automation News: How does ConnectOne Bank prioritize its digital strategy?
Siya Vansia: Our investments in tech and digital are all an effort to support ConnectOne’s core business. We were founded to be a leading commercial bank built around the needs of entrepreneurs and business leaders and solve for the ecosystem of their banking needs. For example, we understand that business owners want a balance of self-serve solutions coupled with a people-first client experience. To that end, some of our investments have been on the client-facing side, and the others on the employee-facing side.
BAN: How does the bank decide on an innovation project to pursue?
SV: My North Star in innovation is that my effort should support the bank’s value proposition. We are a high-performing, growth-oriented commercial bank. My efforts should always be in alignment with that, while also supporting the company’s scale and our world’s evolving trends.
Additionally, there’s a lot of opportunity with legacy technology. I typically try to find opportunities to utilize modern tools to reimagine processes. There’s a lot we unpack before pursuing an opportunity — alignment with the business, business case, efficiency creation and scalability, for example.
BAN: What is the bank’s approach to innovation when balancing third-party vendors and in-house projects?
SV: Two years ago, we were much more dependent on third-party vendors. Today, we’ve brought on incredible tech talent, which presents new opportunities to us. Really, the build-versus-buy conversation comes down to whether there is a company on the market that we could partner with and, if we choose to build, whether we have the subject matter expertise in the business unit. We’ve also taken the hybrid approach, where we‘ve partnered with a vendor to build together.
BAN: What recent tech-forward projects have you been working on?
SV: We’re in the final phases of a deposit origination project with our partner MANTL. This wasn’t just a new system. We are overhauling our deposit onboarding infrastructure and building an omnichannel approach that connects digital and in-branch experience.
We’ve also been members of the USDF Consortium, where we work alongside about a dozen other banks to explore opportunities to bring blockchain technology into the regulatory perimeter.
BAN: How would you describe your leadership style?
SV: I like to take a collaborative, open and communicative approach to leadership. Much of the work we are trying to do is fairly new, and I believe strongly that bringing different perspectives to the table is key to success. I also believe that change is iterative, so I try to move quickly to meet incremental goals so that we can continuously improve as we go. I am personally not a fan of overengineered processes or project plans, but rather playbooks that give teams flexibility.
Get ready for the Bank Automation Summit U.S. 2024 in Nashville on March 18-19! Discover the latest advancements in AI and automation in banking. Register now.
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Lloyds Bank Head of Data and AI Ethics Paul Dongha is focused on developing AI use cases to generate trustworthy and responsible outcomes for the bank’s customers.
In March, the Edinburgh, U.K.-based bank invested an undisclosed amount into Ocula Technologies, an AI-driven e-commerce company, to help improve customer experience and drive sales.
Meanwhile, the $1.7 trillion bank is also increasing its tech spend to generate revenue while reducing operating costs, according to the bank’s first-half 2023 earnings report published on June 26.
The bank reported operating costs of $5.7 billion, up 6% year over year, partly driven by investments in technology and tech talent, as the bank hired 1,000 people in technology and data roles in the quarter, according to bank’s earning supplements.
Prior to joining Lloyds in 2022, Dongha held technology roles at Credit Suisse and HSBC.
In an interview with Bank Automation News, Dongha discussed the challenges of implementing AI in financial services, how the U.K.’s regulatory approach toward AI could give it an edge over the European Union and what Lloyds has in store for the use of AI. What follows is an edited version of the conversation:
Bank Automation News: What will AI bring to the financial services industry?
Paul Dongha: AI is going to be impactful, but I don’t think it’s going to change the world. One of the reasons it will be impactful, but not absolutely huge, is that AI has limited capabilities. These systems are not capable of explaining how they arrive at results. We have to put in a lot of guardrails to ensure that the behavior is what we want it to be.
There are some use cases where it’s easy to implement the technology. For example, summarizing large corpora of text, searching large corpora of text and surfacing personalized information from large textual documents. We can use this kind of AI to get to results and recommendations, which really could be very beneficial.
There are cases where we can supplement what people do in banks. These technologies enable human resources to do what they already do, but more efficiently, more quickly and sometimes more accurately.
The key thing is that we should always bear in mind that these technologies should augment what employees do. They should be used to help them rather than replace them.
BAN: How will AI use cases expand in financial services once traceability and explainability are improved?
PD: If people can develop techniques that give us confidence in how the system worked and why the system behaved in the way that it did, then we will have far more trust in them. We could have these AI systems having more control, more freedom, and potentially with less human intervention. I must say the way these large language models have developed … they’ve gotten better.
As they’ve gotten bigger, they’ve gotten more complex, and complexity means transparency is harder to achieve. Putting in guardrails on the technology alongside these large language models to make them do the right thing is actually a huge piece of work. And technology companies are working on that and they’re taking steps in the right direction and financial services firms will do the same.
BAN: What is the greatest hurdle for the mass adoption of AI?
PD: One of the biggest obstacles is going to be employees within the firm and people whose jobs are affected by the technology. They’re going to be very vocal. We are always somewhat concerned when a new technology wave hits us.
Secondly, the work that we’re doing demonstrates that AI makes bad decisions and affects people. The government needs to step in and our democratic institutions need to take a stance and I believe they will. Whether they do it quick enough is yet to be seen. And there’s always a tension there between the kind of interference of regulatory powers versus freedom of firms to do exactly what they want.
Financial services are heavily regulated and a lot of firms are very aware of that.
BAN: What edge does the U.K. have over the EU when it comes to AI tech development?
PD: The EU AI Act is going through a process to get put into law; that process is likely to set in in the next 12 to 24 months.
The EU AI Act categorizes AI into four categories, irrespective of industries: prohibited, high-risk, medium-risk and low-risk.
This approach could create innovation hurdles. The U.K. approach is very pro-innovation. Businesses are getting the go-ahead to use the technology, and each industry’s regulators will be responsible for monitoring compliance. That’s going to take time to enact, to enforce, and it’s not clear how various different industry regulators will coordinate to ensure synergy and consistency in approaches.
I think firms will be really glad because they’ll say “OK, my sector regulator knows more about my work than anyone else. So, they understand the nuances of what we do, how we work and how we operate.” I think they will be received quite favorably.
BAN: What do FIs need to keep in mind when implementing AI?
PD: Definitely the impact to their consumers. Are decisions made by AI systems going to discriminate against certain sectors? Are our customers going to think, “Hold on, everything’s being automated here. What exactly is going on? And what’s happening with my data? Are banks able to find things out about me through my spending patterns?”
People’s perception of the intrusion of these technologies, whether or not that intrusion actually happens, is a fear amongst consumers of what it could achieve, and how releasing their data could bring something about that is unexpected. There’s a general nervousness there amongst customers.
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Citizens Bank Chief Information Officer Michael Ruttledge is focused on AI, training and employee retention as the bank continues its digitalization.
In the second quarter, the $222 billion bank explored use cases for generative AI to identify added efficiencies, Ruttledge previously told Bank Automation News.
As Citizens implements AI, the bank is also training its team through its engineering academy, which focuses on building internal capabilities to support the bank’s technology transformation, he said.
In an interview with Bank Automation News, Ruttledge discussed AI use cases, developments in technology and training techniques throughout the bank. What follows is an edited version of the conversation:
Bank Automation News: What AI trend in finance are you focused on?
Michael Ruttledge: Generative AI has the potential for great efficiencies and countless ways to improve overall customer experience. This is an exciting time for the industry. We have an opportunity to truly reset the productivity curve for the bank.
AI has the potential to help us learn about our customers at an accelerated pace and constantly update, improve and adapt priorities as conditions change over time. Citizens has a number of AI use cases that we are actively exploring, and those use cases are to benefit customer engagement, customer and colleague insights, and streamlined operations.
Additional implementation includes safety and security, legal and compliance, fairness and bias, and performance and accuracy. We are working to assess where existing capabilities can be leveraged and built out.
BAN: What other projects are you working on this year?
MR: For the remainder of 2023 and as we look ahead, we will accelerate to deliver differentiating, market-leading capabilities beyond our next-gen technology strategy. Citizens is focused on three areas:
Through 2026, we will position Citizens’ technology to have leading capabilities to drive continued business value.
BAN: How do you approach new technology with your team?
MR: To prioritize innovation to the extent we do, we need not only financial, but top talent resources to dedicate to it. At Citizens, we are constantly looking to the new digital frontiers, and we prioritize a healthy organization and view each employee as a whole person beyond the figurative four walls of our office.
Our talent is what keeps us future-ready, cultivating our strategic partnerships, exploring new technology and ensuring we and our customers are protecting against any risk.
The key is a strong focus on engineering skills, diversity, early career talent and retention. Since 2019, we have hired more than 550 full-stack engineers, reduced contractors and have increased our organization’s diversity and internal mobility.
BAN: What technology are you monitoring closely?
MR: Like everyone else, we are monitoring generative AI closely. We think it has great potential, especially when it comes to improving the customer experience.
Banks can introduce future-proof technologies and processes to keep up with customers by empowering their CIOs and IT teams to help build deeper relationships with customers and focus the shift from transactions to relationships through automation and automating tasks and transactions. This would allow branch colleagues and relationship managers to have the time to build relationships and serve in a more advisory manner.
It goes without saying that a digital transformation and the customer experience should be always at the forefront. At Citizens, we focus on using data to improve our customers’ experience and help them achieve their financial goals and reach their potential.
BAN: How do you lead your team?
MR: I strive to lead by example while at the same time empowering my team to make decisions and motivating them to reach their full potential. I also hold my team accountable as it not only helps them to grow in their roles but also as leaders.
Our Employee Value Plan (EVP) is an example of my leadership in action — I have empowered my leadership team to help deliver and drive this program for our colleagues. Through EVP, we have improved our hiring model, provided training opportunities and focused on diversity and early career talent.
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FV Bank focuses on emerging trends and nimble technology as it invests in digital.
Head of Core Banking and Cards Madhu Balasubramanian told Bank Automation News that the San Juan, Puerto Rico-based bank considers customer needs first and technology needs second, with regard to product and service implementation.
The digital bank, founded in 2019, has invested in technology and compliance in recent months, adding cross-border payment capabilities in February and appointing a new chief risk officer and compliance officer, Luz Mabel del Valle, in April. FV Bank has raised $15.5 million since 2021, according to Crunchbase.
Balasubramanian told BAN the bank looks to market trends, client needs and automation when approaching digital efforts. What follows is an edited version of the conversation:
Bank Automation News: How does FV Bank prioritize its digitization strategy?
Madhu Balasubramanian: At FV Bank, we are on a unique journey. We consciously decided not to tie ourselves to decades-old core systems or processing platforms. We have chosen and will continue to choose flexible, nimble and cutting-edge tools and technologies to fulfill our business needs.
What is interesting is that most organizations would define “digitization” as replacing legacy software with newer software and services to improve usability and gain efficiency. The outlook of digitization is different for us — we recognize digitization is a journey and not a destination. Hence the digitization strategy is to look at market trends and be a front-running early adopter while ensuring the products and services we bring to market are compliant and within regulatory frameworks. Our prioritization is based on market needs and emerging trends.
A great analogy for this space is whether you buy an old house and choose to upgrade the interior and/or exterior, or you choose to build new on a piece of land (green field). I am so glad we chose the green field approach and hence our improvements are not limited by an existing solution.
BAN: What role does automation play in your approach to digitization?
MB: Automation plays a key role in scaling and improving our solution. However, automation is Step three. Step one is understanding the need. Step two is implementing a robust solution. Then comes automation of repeatable tasks. The level of automation depends on the nature of the workflow being automated. In a complex solution blueprint with multiple systems and multiple integrations, a well understood and robust process is key before automation is brought in to improve efficiency. Automation without a well understood and robust process often results in roadblocks when it comes to evolving and improving the solution. A solution that cannot evolve cannot stand the test of time and keep up with market trends.
BAN: How does the bank decide what products and services to implement?
MB: In one word: needs. In practice, it’s a bit more than a single word. We classify our needs in two categories: Customer and business, and technology.
Customer and business: All customer experience, business plan, compliance and security falls into this category. We give these items in this category a healthy 70% weight and priority.
Technology: Engineering tools, version upgrades and general maintenance falls into this category. We give items in this category a balanced 30% weight and priority. Despite popular belief, security and infrastructure don’t fall into this category, they are major business constructs.
All the needs from different stakeholders are categorized as above and we strive to hit the ratio of 70/30.
BAN: What is the bank’s fintech partnership strategy?
MB: Having extensive experience in this space — “FV” represents Fintech Ventures — we prefer partners with existing capabilities and products over partners with solely the ability to build products. Our strategy is to leverage and improve with our partners rather than partner up and build from scratch.
BAN: What technologies are you excited about in the industry?
MB: The improved maturity of low-code/no-code frameworks, especially the ones that could deliver output in multiple tech stacks, is one of the topics I am excited about in the year ahead. The other topic I am excited about is the availability of consumable pre-trained AI/ML algorithms, with the results getting better and the focus on Explainable AI.
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Bank of America’s Amanda Sorensen, senior vice president of the Business Information Security Office, is focused on risk mitigation, staying ahead of cybercriminals and monitoring cyberattacks at the $3.1 trillion bank.
The Charlotte, N.C.-based bank announced that it had increased its projected technology spend by $400 million for 2023 to $3.8 billion at a conference hosted by wealth management firm Bernstein this month. That spend is geared toward generative AI and payment development, Chief Executive Brian Moynihan said at the event.
Additionally, the bank was granted 608 patents in 2022, a 19% increase year over year, about 27% of which were related to information security, according to Bank of America.
In an interview with Bank Automation News, Sorensen discussed cybersecurity efforts throughout the bank, including monitoring ransomware, staying ahead of cybercriminals and using a threat-led approach. What follows is an edited version of the conversation:
Bank Automation News: What cybersecurity trends are you following in 2023?
Amanda Sorensen: At Bank of America, we continue to make investments in our people and technology to keep clients’ information secure. The cyber landscape continues to evolve. Ransomware is a common tactic of cybercriminals, so I’m definitely following the nuances of these attacks.
There have been headlines lately on generative AI and what that may mean for cybercriminals, as well as cybersecurity teams, and I think it will be interesting to see how that develops.
We continue to invest in partnerships to build a trusted community among banks for cyberthreat information sharing and to keep an open dialogue and debate on cybersecurity. We also offer educational tools and resources to our clients so they can stay current with trends.
BAN: What is your role on Bank of America’s cybersecurity team?
AS: I lead the BISO team at Bank of America. The team enables the cybersecurity organization and the technology teams, as well as the frontline business units by advising on cybersecurity matters and driving reduction of cybersecurity risk.
I would describe my leadership style as very hands on. I like to understand the work that I’m leading in the organization, and I enjoy getting to know my teammates. Through a working relationship with my team, we establish a mutual level of transparency, which is effective in solving potential issues early.
BAN: What technologies are at the forefront for innovative cybersecurity teams?
AS: By using a threat-led approach to cybersecurity, you’re continuously monitoring for anything new or changing in the landscape and adapting your defenses accordingly. Understanding how controls perform against known threats gives security teams visibility into where evolution is needed to defend against the threat.
BAN: How do you plan and stay ahead of cybersecurity for the future?
AS: The Business Information Security Office (BISO) team partners effectively across the broader company to solve problems and share current information, allowing the bank to be nimble in its response to the evolving threat landscape. We’re part of the bank’s nearly 3,000 cyber experts located across 17 countries operating around the clock and around the world to identify, prevent and mitigate information security risks.
BAN: What is the best leadership advice you’ve received? How do you relay that advice to your team?
AS: When I was a new manager, it was difficult for me to give feedback. Then, someone suggested that I change my perspective, reframing feedback from a negative experience to one that helps the recipient. So now when I have to give uncomfortable or difficult feedback, I follow that advice and really think about it as something that I owe this person. Feedback provides opportunities for improvement and potential career advancement at all levels.
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Wells Fargo Head of Global Treasury Management Payments and Transaction Services John Hunter is focused on simplifying the bank’s experiences with cloud, AI and machine learning.
The San Francisco-based bank invested $9.4 billion in technology in Q1, launched Wells Fargo Vantage digital banking platform and continues to look to AI for opportunities within the bank.
Hunter discussed the $1.8 trillion Wells Fargo’s recent efforts on its payments strategy, digital banking platform solution and use of AI and ML within its platforms. What follows in an edited version of the conversation:
Bank Automation News: What technology has Wells Fargo been working on in the treasury management space?
John Hunter: We are thinking a lot about creating new solutions that simplify overcomplicated banking experiences while leaning into emerging technologies such as cloud, artificial intelligence and machine learnings to modernize our payments platforms. We want to help clients make payments simpler, faster and easier. One of my priorities has always been to help clients transform at their speed — it’s great that we can provide a banking platform with the same goals.
It has also been exciting to see our clients begin to use Wells Fargo’s Vantage platform, a digital banking platform for our wholesale clients that aggregates all their banking needs — even beyond Treasury — into one solution. The system’s AI will be able to provide recommendations tailored to each client’s specific needs while the ML continually learns how to best provide personalized experiences that help clients grow their businesses.
BAN: How have you worked to bring together Wells Fargo’s Treasury Management and Global Payment Solutions product teams? What has that entailed?
JH: It starts at the top with the head of Global Treasury Management for Wells Fargo, Paul Camp. Paul brought me in to lead payment products relatively soon after he started at Wells Fargo, in the fall of 2021. He was bringing together the legacy treasury group and the Global Payment Solutions (GPS) business that was a separate line of business, focused on providing payment and liquidity services to financial institutions.
What we have done with the GPS business is the same as what we have implemented in areas like commercial real estate, healthcare and technology. It starts by using traditional product management disciplines that maximize returns and efficiency. And, specifically, you need people who have a deep understanding of the business segments they are supporting and can work with partners across the firm to develop the payment solutions that our clients need to grow and transform their businesses.
BAN: What innovations in the treasury management space, or payments space, are you excited about?
JH: Technology moves extremely fast, and, even from the inside of the payments world, we can’t always predict where things are headed. For example, see how fast AI has become part of the conversation across industries. We need to be able to support our clients by providing holistic solutions that will not only support them where they are today, but where they want to be going forward.
I mentioned how we are using AI and ML in our digital banking platform to create personalized banking experiences. We also think that automation will go a long way in solving challenges that we have in the payments business. The system has too much friction from different payment types and different channels, which creates manual work to reconcile payments. ML and AI can be used to address those issues and help produce significant operational cost savings for our clients.
Looking farther into the future, I’m excited about open banking and event invisible banking. I see a future where banking will be behind the scenes, embedded in everyday activities. Even phones as payment conduits may become obsolete as emerging technology enables seamless, automated payments — what you might call an invisible experience.
BAN: What are your plans for the treasury management payment product team for the rest of 2023?
JH: We have a lot going on! We are involved in a couple of promising POCs. One is around on-us services. These are payments where we are the bank on both sides of the transaction. The POC is helping us learn how to better leverage our scale around 24/7 settlements. We also are working on a distributed ledger (DLT) pilot, exploring how to simplify settlements and reduce risk.
ISO 20022 [an open global standard for sending digital payment messages and data between financial institutions] is also a focus for the rest of the year. We are always trying to unlock value for clients. And I think the way we use data can be a real differentiator. There is a huge opportunity to unlock the potential of the rich data that will be exchanged with the industry transition to ISO 20022. It can be a foundational data layer that enhances new products and provides new client insights.
Finally, we are working on a new payments engine for our core products that will be able to provide specific, value-added services to clients in a broad range of market segments. It’s exciting work that we hope will pay huge dividends for our clients going forward.
BAN: What is the best leadership advice you’ve received?
JH: I was once told, as a leader, you should always give your team credit for the successes but take the blame for the mistakes. It’s important to celebrate the wins and give recognition to the team that helped you get there, while also providing cover and understanding that “the buck stops here” when things go wrong.
I try to always remember that as a leader. No one can do it alone, but, ultimately, it’s my responsibility to ensure things go well. I think this instills trust with your team and helps them feel supported to do their best.
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Whitney McDonald
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Southern Bancorp Chief Innovation Officer Vance Smiley focuses on in-house innovation to solve client friction within wealth management and access to capital.
“We’re focused on identifying problems first and then being methodical about looking for solutions,” Smiley told Bank Automation News. “Some of those can and will be found externally, but only after determining our exact needs. Of course, with an innovation team on hand … we can tinker around solving these problems ourselves and have a little fun doing it.”
The $2.5 billion, Arkadelphia, Ark.-based bank’s innovation lab, TeamWALT, has introduced new digital services for Southern Bancorp clients, including automated savings app Wealthable and savings game Envie Envelope Challenge, each of which launched in fewer than 120 days.
BAN caught up with Smiley to discuss Southern Bancorp’s innovation lab strategy and how automation plays into innovation. What follows is an edited version of that conversation.
Bank Automation News: How does Southern Bancorp prioritize its digital strategy?
Vance Smiley: It’s a high priority, but it’s also running parallel to the needs of the traditional, geographically focused side of the business, which is what made us what we are today and continues to be a strong growth driver, so we continue to look for innovative ways to grow.
However, much like within our traditional markets, there are individuals, families and small businesses across the country experiencing challenges to their own wealth-building journeys, and a digitalization strategy focused on those problems and addressed with purpose-driven mobile apps is how we’re working to scale.
BAN: How does the bank decide on an innovation project to pursue?
VS: We do a lot of prototyping and testing, both internally and in our markets. We talk to our staff on the ground, who are working with people to overcome challenges, and then we design solutions with their input to test.
A large focus of ours lately is working to get capital safely into the hands of those who aren’t using the traditional financial system. Either because of a bad experience or a general mistrust of banks, these folks have opted to utilize what we call the alternative financial system, which is high cost and often predatory. Our mission is to develop alternative solutions that are affordable, trustworthy and easy to use and access.
BAN: What role does automation play in your approach to digitalization?
VS: In the process of innovation, we learn, then build process improvements that make sense to share with the traditional bank, which doesn’t always have the time to stop and determine them for itself. Automation is one of those areas that can result in valuable enough process improvements that you could actually pay for an entire innovation department’s budget with the savings.
BAN: What is the bank’s approach to in-house innovation?
VS: While I’m certainly not opposed to developing partnerships, especially when it comes to improving efficiencies and scalability, I do come from the school of thought that says the main parts of innovation can’t be outsourced, and I don’t believe that we as banks can buy our way into innovation.
It takes smart, creative thinkers who deeply understand the mission and operations to imagine solutions for the problems we face. Once we do that, assembling the technology is the easy part, and we’ll often look for partners to assist with that.
BAN: What is your best leadership advice?
VS: The first is that we can’t outsource what makes us … us. If we do, then we might as well get out of the way and let someone else do it. Another piece of advice I strongly believe in is to go get good at something. I think too many banks seek to be generalists when focusing on serving specific groups and types of customers. Finally, recognizing that the customer relationship is moving from in-person to online, whether we like it or not. So, we better prepare accordingly.
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Brian Stone
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