October 11

A whopping 89% of small-to-medium businesses feel underserved by their primary banks, according to a recent Capgemini study, but personalized, value-add tools can help buck the trend. 

US Bank just added a new tool to its arsenal as it aims to become a one-stop-shop for business owners. 

The tool draws on customers’ bank data as well as any external sources they connect, like accounting software, to forecast cash flow, and will eventually include the ability to calculate predictions for different “what if?” scenarios.  

Providing business customers “with a more comprehensive view of the health of their business” is a “differentiator” for US Bank, chief digital officer for small business, Irv Henderson, told Insights Distilled, and fits into its mission to help SMBs “run their business operations more efficiently.”  

US Bank created the tool through a “close partnership” between its in-house development team and a fintech partner, Henderson said, a model which enables its strategy of “bringing innovative new solutions and tools to our customers.”  

Ultimately, US Bank’s Business Essentials suite allows it to add value and build stronger relationships with small businesses customers at a time when competition (between rival banks and between banks and fintechs) is hotter than ever.  

By creating a true destination for mortgage customers, Santander UK wants to set itself apart from competitors (and win incremental business).

Santander wants to help its mortgage customers manage all aspects of their home, from finding a handyman to picking an internet provider. 

While most banks provide mortgage dashboards that include equity summaries, neighborhood trends, or refinancing offers, Santander aims to go above-and-beyond to give customers a more holistic view of their home and finances. Homes are typically people’s biggest financial investments and this platform-approach ultimately serves as a selling point for mortgage reps trying to differentiate Santander and as a way for the bank to deeply enmesh itself in its customers’ lives, which creates stronger relationships and greater usage.  

Its new in-app dashboard features a smorgasbord of add-ons, including valuation updates, tips on improving energy ratings, estimated costs (and funding options) for home improvements, deal comparisons, and articles about interior design.  

“We think My Home Manager provides a unique service for homeowners,” chief customer officer Tracie Pearce, said, “And its development has been driven by what our customers have told us they’d like to see.” 

As financial institutions seek to stand out in the small-business market and avoid losing business to fintechs, quick-and-simple cash advances are a draw. Machine learning makes it easier to provide this revenue-based financing fairly and safely.  

Barclays is partnering with UK fintech Liberis to offer revenue-based financing to its small business customers, wherein merchants receive a cash advance that they can pay back on a flexible schedule, plus a pre-agreed fee. Liberis uses machine learning to understand customers’ risk profiles and maximum funding options, allowing it to offer faster turnaround times for underwriting than what legacy banks can traditionally provide.  

By helping assess risk more accurately and quickly, Liberis allows partners like Barclays to make faster, better decisions, leading to higher origination volumes.  

Barclays has invested tens of millions in Liberis, including a new infusion at the end of September. Liberis is a veteran in the revenue-based financing space: Newer entrants include Booste, Karmen, and Clearco, which provide financing to businesses directly. Using AI for underwriting in general is also a hot market: Insight portfolio company Zest.AI has signed on clients like Fifth Third Bank, FNBO, and a slew of credit unions. 

By moving threat modeling into the initial phases of software development, organizations can save time and ultimately reduce risk. 

When Netherlands-based ABN Amro embarked on its journey to move from private data centers to the cloud, it realized that it needed to revamp its ad-hoc and manual threat modeling system so that it wasn’t relying on security teams to identify software risks after-the-fact.  

Enter IriusRisk.  

The bank rolled out the platform – which embeds automated threat modeling into existing development workflows – to over 200 teams. This helped put individual projects into the context of big-picture risk and security. 

“It’s granular: It tells the engineer that by changing this part of an application, these are the threats you need to address, and this is how to address it,” ABN Amro’s global head of security engineering said. “It’s a valuable toolkit for teams to use before, during, and after a build.”  

ABN Amro estimates that using IriusRisk versus manual threat modeling saved its hundreds of engineers at least 11 months. IriusRisk just raised $29 million and said that six of the 30 globally systemically important banks are its customers. 

Automation makes workers more efficient, but it can also help them feel fulfilled and create better products.

Capital One leans on automation to help its engineers enjoy their jobs.  

Uninteresting, manual, and repetitive work that doesn’t add value can be a major source of burnout for engineers, Marty Andolino, a VP of engineering at Capital One, said in a recent podcast interview. That’s why he spends time thinking about how to integrate automation into the bank’s processes, enabling employees to focus on impactful work. 

For example, Capital One uses automation for detecting, diagnosing, and fixing app issues, as well as for standardizing governance, security, and compliance. 

By reducing the amount of “keep the lights on” activities that devs spend time on, automation also allows them to “work on the most customer-focused areas,” Andolino said. That’s a boon for both employees and the bank overall, which benefits from being able to put more resources towards building differentiating features. 

“We see automation as such a key to unlock our associates’ talents,” Andolino said. 

Capital One employs around 12,000 technologists, 85% of whom are developers and Andolino’s comments come at a time when competition for engineers in the financial world is fierce: JPMorgan just announced plans to hire 2,000 engineers by the end of the year, while AmEx is searching for 1,500 new tech workers.  

Listen to the rest of Andolino’s thoughts on productivity here.