We caught up with Uri Rivner, co-founder and Chief Cyber Officer of BioCatch, a leading cybersecurity firm that provides behavior-based authentication and threat detection solutions to banks, e-commerce platforms, as well as mobile and web applications.
We wanted to learn how the company, founded in 2011 and headquartered in Israel and New York, has fared in the wake of its major $145 million spring fundraising. We also wanted to hear about the new cybersecurity environment brought on by the global public health crisis and what BioCatch is doing to help institutions manage this challenge.
Finovate: You are one of the founders of BioCatch, and your current role with the company is Chief Cyber Officer? What does this role entail within the company?
Uri Rivner: I was actually head of new technologies at security giant RSA when, in 2011, a foreign state hacked into RSA. It was one of the most famous hacking incidents in history, and following that I was on the look for new technologies that can help the industry against cyber attacks and online fraud. BioCatch, then a very young company, came to us at RSA to present the tech, which sounded really sci-fi. I was impressed and introduced them to industry players who all said that if this was working as advertised, this is a game-changing technology.
At some point the founders of BioCatch asked me to join as a co-founder and help them build the business. I joined mid-2012 as VP of Cyber Strategy. My current role as Chief Cyber Officer is to identify new cybercrime business problems the technology can address, and provide internal and external thought leadership on the role of behavioral biometrics in digital transformation and fighting online fraud.
Finovate: When we last shared BioCatch news with our readers, it was in April on the heels of the company’s $145 million fundraising. How big of a moment was that for BioCatch?
Rivner: It was a major milestone. A vote of confidence that showed us how well the market appreciates what we have accomplished. We’ve taken a scientific field in cognitive studies, something that was working in the lab, and made it extremely practical for use in solving the biggest issues in online fraud across dozens of banks, credit card issuers and companies outside the financial sector, protecting over 100 million online and mobile users. We’ve tackled issues that were initially deemed impossible to solve. And we’ve done all of that with very happy customers and a highly scalable product. It was a proud moment, but at the same time also a commitment to work very hard to justify the trust of our new investors!
Finovate: What has BioCatch been up to in the weeks since then – specifically, how has the COVID-19 crisis impacted the work your company does?
Rivner: Our team has shifted to a work from home model; it was done quite efficiently, and we experienced no issues in continuing to serve customers. We run in the cloud, and there was no interruption to the service. The customers also moved to the same mode of operation.
Finovate: Let’s talk about some of the new security challenges that have developed during the pandemic. It seems like there are fraud “hotspots” everywhere: COVID aid/relief fraud, the security issues of Work From Home, and the potential for identity crime in any track and trace program. Can you talk a little about the cybersecurity landscape in the era of COVID-19?
Rivner: If I had to pick one community that is definitely going to thrive during a global virus outbreak, it’s online fraudsters. They have a golden opportunity to scale their operations while entire companies move their fraud operations and analytics teams to a work from home model, which is not an easy process for, say, a major bank. Here are some of the trends to watch for:
American taxpayers get a direct deposit to their bank account using the information included in the last tax return they filed. If they haven’t filed a tax return for 2019 yet, it’s then a race with the fraudsters, who will try to beat them to it and provide a falsified tax return including a bank account that they control. This means the stimulus deposit will go to the bad guys. There are many people who do not file tax returns and go to a website where their information is validated and a check is sent to their address. That’s an easy venue for identity thieves who can obtain full identity records for all U.S. citizens in the dark web. Fraudsters are also impersonating small businesses to apply for stimulus loans using similar methods. In short, it’s a fraudster’s heaven.
Account Opening Fraud
The most scalable fraud operation is opening credit card or personal loan accounts. All you need is to buy a bigger list of stolen identity records, and have a team of people opening accounts in other people’s names. Identity theft is reported to sky-rocket, and it can be quite dangerous, especially if it’s a new digital service that is launching these days. If a new digital service is targeted by a massive campaign, there will be more fraud applications than real applications – that’s disastrous. Traditional defenses such as checking KYC (know your customer) data and device recognition no longer hold, and new technologies such as behavioral biometrics are used to stop such fraud campaigns and reduce false rejections due to high security bars.
Corona Tracker Rogue Apps
Cyber space is teeming with coronavirus scams. The most dangerous scams are the ones that manage to trick users into downloading rogue apps onto their mobile device. They’ll look like useful tools that alert you when a coronavirus carrier is in your immediate vicinity or providing CDC-approved virus contagion maps. But, in reality, they’re after your mobile banking app and mobile e-commerce purchases.
Social Engineering… From ‘Your Bank’
“Hey, we’re your bank, and wanted to reach out! The branch is closed, so we’re the friendly help desk. We’ve noticed some issues in your account, and would like to help you sort it out. Can you please install this utility to help us run some tests remotely?” You know the rest of this story.
Uri Rivner demonstrating BioCatch’s Passive Biometrics/Invisible Challenges technology at the company’s Finovate debut in 2014.
Finovate: Earlier this year you were part of a conference presentation that highlighted the importance of machine learning and AI in fighting fraud. What about these enabling technologies is so beneficial when it comes to cybersecurity?
Rivner: My lecture talked about how Sherlock Holmes managed in A Case of Identity to identify an imposter based on a dozen or so “features” related to the typewriter they used to type love letters. Machine Learning can instantly look at thousands of features, resulting in an extremely accurate model that predicts fraud and can adapt itself when cyber criminals change their strategy. At BioCatch we have over 2,000 such features – and not even good old Sherlock could have managed that many in his identity model!
An important consideration though is that some machine learning models are a black box and don’t really provide insights into why a certain action is risky. BioCatch, for example, uses Explainable AI models to make sure customers can get the reasons why a score was high, as well as many negative and positive behavioral factors observed during a session.
Finovate: What can we expect from BioCatch over the balance of 2020? Has the global health crisis made it more difficult to have visibility into the second half of the year?
Rivner: Fraud isn’t going away and, in fact, we anticipate a surge in account takeover activity as criminals scale up their cash-out operations. They already have the data they need to steal more money, but they need to scale their infrastructure. Think of mule accounts for moving money out of victim’s account. The crisis makes it easy to recruit mules in work-from-home scams, and to open bogus bank accounts to which stolen money can be moved. Right now criminals are busy doing just that, preparing for a big wave of attacks that is likely to focus on real-time payments such as the relatively new Zelle infrastructure in the U.S., or similar services elsewhere. So demand for a frictionless control that stops fraud and highlights genuine behavior is going to increase.
NextGen.Net integration expertise gives Finsure strategic advantage
Finsure’s cloud-based broker CRM platform Infynity currently requires brokers to first upload, then re-download documents before they can upload and attach them to an application in ApplyOnline.
“This new piece of technology will enable the documents to be sent concurrently – similar to email attachments – and appear automatically in ApplyOnline,” says Simon Bednar, General Manager of Finsure Finance & Insurance and LoanKit Aggregation.
The solution will also integrate with their new customer portal.
“That’s where NextGen.Net and Finsure work really well together,” says Bednar.
“Our customer portal will allow customers to upload their documents on behalf of the broker. The broker will immediately see the documents in Infynity, confirm they’re correct and hit a button to send them to ApplyOnline along with the application data.”
Bednar estimates a 50 percent time saving, explaining “as part of that process we have a tax file number and sensitive data reduction piece of technology”.
“NextGen.Net work collaboratively with Finsure to ensure our systems talk to each other in a highly sophisticated manner to eliminate double handling and streamline the process from Point of Sale all the way to the lender’s approval,” says NextGen.Net national Customer Account Executive Greg Phillips.
“NextGen.Net and Finsure share the same vision to digitise and streamline the entire mortgage lending process,” says Phillips.
He adds that the seamless integration of ApplyOnline with Infynity, is “a holistic solution for Finsure’s brokers”.
Keen to take advantage of what open banking and NextGen.Net’s acquisition of Frollo might mean for their business, Bednar is excited about brokers being able to access borrower’s data directly from banks to inform an application.
“That’s exactly what I’m looking for, to have as little third-party integration and interaction as possible. It was great to see that NextGen.Net had that breadth of knowledge outside of submissions,” he says.
Bednar relies on NextGen.Net’s ApplyOnline platform to cover off on ‘efficiencies and accuracy’.
“That’s a huge piece of work in itself,” he exclaims, adding “we keep our platform open to allow brokers to be a little bit more fluid in how they collect the data; and the idea of them sending it to NextGen.Net is great for me because they effectively become the quality insurer and checker that allows our system to be efficient and accurate – so when it goes to the lender the data is complete.
“From a strategic partnership perspective that’s powerful.”
TrueLayer raises US$70m to build the world’s most valuable Open Banking network
TrueLayer, Europe’s leading open banking platform, today announced it has secured a US$70m Series D investment round led by new investor Addition. The latest raise reflects the growing demand for its open banking-based services and marks another significant milestone for TrueLayer on its mission to open up finance, building an open banking network that brings together payments, financial data, and identity to redefine how people spend, save, and transact online.
Existing investors, including Anthemis Group, Connect Ventures, Mouro Capital, Northzone, and Temasek, also participated, with a significant increase to the company’s valuation. Additional investors in the round include Visionaries Club, Surojit Chatterjee (CPO Coinbase), Zack Kanter (CEO Stedi), Daniel Graf (ex-Uber, Google, Twitter) and David Avgi (ex-CEO SafeCharge, CEO UniPaaS). It brings the total investment to date in TrueLayer to US$142m.
The new funding will be used to fuel global expansion and accelerate the development of premium open banking-based services that will continue to drive innovation and revenue growth for clients. It will also be used to expand TrueLayer’s engineering, product and commercial teams to meet the increasing global demand for its open banking platform.
TrueLayer’s API-first platform accounts for more than half of all open banking traffic in the UK, Ireland and Spain, processing billions of pounds in payments. It powers services for some of Europe’s fastest-growing brands, including Revolut, Trading 212 and Payoneer.
TrueLayer has a market-leading payment conversion rate that is 22% higher than other providers, according to OpenBanking UK and other bank sources, and up to 40% higher than cards. Merchants offering TrueLayer as a payment method in their checkout have found that on average, 1 in 3 consumers chose to pay via TrueLayer. As a result, open banking is displacing other payment methods, such as cards, as the default payment option online.
Over the past 12 months, TrueLayer has expanded its services across 12 European markets, growing payment volumes by 600x, and adding hundreds of new customers across digital banking, eCommerce, trading and investment, wealth management, crypto and iGaming. It has continued to innovate, for example, with the recent launch of PayDirect, combining instant pay-in capabilities with instant pay-outs, to deliver a higher converting, lower fraud method for online payments.
“When Luca and I started TrueLayer in 2016, we imagined open banking becoming a new digital channel for solving cost and complexities around payments, digital identity, credit data and much more. We wanted to open up this newly built infrastructure to many businesses and consumers. It is such a joy to see our vision coming alive and open banking based payments quickly becoming the new normal,” commented Francesco Simoneschi, CEO and Co-Founder at TrueLayer.
TrueLayer is rapidly expanding as demand for its open banking platform increases, largely driven by consumer demand for digital financial services that work better for them, and give them more control over their financial lives.
“We have achieved this milestone thanks to the hard work of our stellar team. Bringing radical new products into the hands of consumers and businesses is incredibly exciting,” explained Luca Martinetti, Co-Founder and CTO at TrueLayer. “This new financial network we are building on top of open architectures has massive long term implications for the whole fintech ecosystem and we won’t compromise our vision in any way.”
“That is why it is so important to select investors that can help you to plan for the next 15 years, not the next 15 months,” added Simoneschi. “The Addition team thinks very long term and it has been such a pleasure working together. They complement the incredibly strong group of experienced backers who align with our vision of how financial services are evolving.”
Lee Fixel, Founder of Addition, commented, “TrueLayer is ideally positioned to benefit from the trends shaping the future of financial services as more and more companies embed digitally native payments into their platforms. We look forward to supporting the TrueLayer team as they scale their offering and drive continued innovation.”
Novatti’s Ripple partnership live to The Philippines
Leading Australian digital banking and payments company Novatti, reports that its recently signed partnership with global payments disrupter Ripple, is now live with revenue-generating transactions taking place.
Ripple uses its decentralised, global financial network, RippleNet, to provide its partners with the ability to process global payments instantly, as well as providing access to emerging, high-growth capabilities, such as blockchain and the digital asset, XRP, a top five global cryptocurrency currently valued at more than USD$40 billion.
The initial focus of the partnership was to target cross-border transactions between Australia and the South- East Asia region, particularly the Philippines. This focus is delivering new customers, with Novatti now partnering with the Australian subsidiary of the Philippines’s largest non-bank, Filipino-owned, remittance service provider, iRemit, through RippleNet. This alone is expected to result in several thousand transactions a month being processed by Novatti through RippleNet. Revenue from this partnership is dependent on take-up of the services. Importantly, discussions are already underway to also expand this service to new financial services clients in South East Asia.
Managing Director of Novatti, Peter Cook, said, “We are delighted to see this partnership delivering for both Novatti and Ripple in such a short period of time. The partnership with Ripple not only provides Novatti’s customers with access to new, innovative payment solutions, it also highlights how Novatti’s partnerships translate into revenue.”
“Forming our partnership with Ripple was part of Novatti’s broader strategy to develop a banking and payments ecosystem that enables our existing platforms to scale quickly. In addition to Ripple, Novatti’s ecosystem now includes partnerships with world-leading payment and fintech companies including Visa, Apple Pay, Alipay, UnionPay International, Google Pay, Samsung Pay, Marqeta and Decta.”
“The early success of Novatti’s partnership with Ripple also highlights the benefits of our broader overseas expansion since the start of this year, with new licences obtained for the New Zealand market and Emersion now up and running in the US. As shown through Ripple, this expansion opens Novatti up to new revenue opportunities, and provides us with greater exposure to the global demand for digital payments that we expect to accelerate going forward.”
Cape awarded MVP Grant to kickstart new wave of Open Banking powered business finance tools
Cape, the Corporate Card helping small to medium business (SMBs) take control of their cash-flow, has been awarded a prestigious Minimum Viable Product (MVP) grant by the NSW Government.
The Cape team is improving the operating efficiency and long-term success of growing businesses by automating accounting and helping lower their bills, enabling business owners to get their spend management under control. Cape’s solution utilises Open Banking to help businesses unlock capital to invest in growth, whilst optimising cash flow to save on unnecessary expenditure.
The grant was awarded thanks to Cape’s proposition to build a cash management platform to remove vendor, expense and spend management roadblocks, saving thousands of dollars in the process for business owners.
Cape’s founders said that the grant would go towards securing early-stage growth opportunities for the company, particularly in product development and sales initiatives, as the company seeks to transition out of the pre-revenue stage.
Ryan Edwards-Pritchard, CEO of Cape, commented, “We’re excited to have the support of the NSW government in our mission to help business owners stay on top of their cash and keep their companies healthy. The grant shows how invested the government is in developing the local economy and continuing New South Wales reputation as an active fintech hub.”
Stuart Ayers, Minister for Jobs, Investment, Tourism and Western Sydney Stuart Ayres commented, “It is fantastic to see promising startups such as Cape tap into the NSW Government’s Minimum Viable Product (MVP) grant. The MVP grant is designed to support promising startups like Cape progress from product development to first sales.
Cape is currently gearing up for their launch and will initially go to market with a Rewards platform, before delivering Machine Learning capabilities to streamline receipt and business expense management across supplies, third party services, SAAS subscriptions & payments.
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