Jun 21 | 2017

What’s Happening in FinTech?

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Top FinTech LearningsThe spring season brings a lot of activity to the financial services space in Canada. It’s one of the busiest times of the year for typical “money out” campaigns from our banks and coincides with strong activity in listings, transactions, and ultimately closings.

More recently the spring season has also come to signal the start of FinTech conference season across Canada. The size and scale of these events continue to grow while our own homegrown talent is taking center stage. With over 250+ FinTech companies across Canada and $1BN in cumulative venture capital investments, Canada is well on its way to solidifying itself as a global center for financial innovation.

As Head of Product at FCT, one of my primary responsibilities is understanding how the needs of our lenders are going to be changing over the next 3-5 years. Internally, we’ve been aggressively transforming our own product portfolio and expanding our focus on hybrid solutions that leverage the best of our financial technology, business process outsourcing (BPO) capabilities, and insurance expertise. As I have been working through the process of how we align our own product roadmaps to these opportunities, I wanted to share more broadly what I’ve learned on the conference circuit throughout the year.

Developments in FinTech

Opening up financial services data:

  • The European Union is already well ahead of North America when it comes to FinTech penetration. In an unusual role reversal, we actually see governments across the globe leading the charge to create an environment that is conducive to FinTech growth and innovation.
  • Initiatives like the European Union PSD2 open banking API, where by 2018 all lenders will be required to open up transactional data (with user permission) to enable third parties to build new types of financial services is one important example. While Canada is definitely lagging in this area, there are several opportunities to target key data as a starting point and use that information to re-engineer how financial services are delivered to customers across all segments.

While cash flow will always be king, managing identity in the digital age is close behind:

  • Online identity is the next cycle of the internet and as we see more and more digital lending platforms that don’t require in-person interaction, there is more of a need for identity management applications that simplify and perfect authentication/verification, early detection of fraud, and are adaptable.
  • Contextual commerce is the next major area of growth in the financial service space. This area deals with making payments through internet connected devices that are not a smartphone or laptop but rather devices like Amazon Echo, Google Home, Oculus Rift, and even your connected car. Thinking through the connected car example, how would you know the driver of the car is the right driver to offer a service?

Homegrown products will find greater product-market fit than global imports:

  • Canadian built and managed FinTech solutions will have the advantage over more global or regional efforts that try to ‘Canadianize.’ Rethinking financial solutions from the ground up will provide another advantage. The underlying point here is a true need to take a product-driven approach to building new financial services as opposed to a clone strategy from other markets.
  • For example, at FCT we believe understanding your customer segmentation in FinTech is critical. Existing companies overly rely on safety, security, legacy as the bread and butter of their solutions. Those features are table stakes but do not do enough in isolation to capture the wallets of the millennial, and eventually Gen Z segments. Great user interface and user experience, smart use of data, and transparency are at the top of the decision matrix for these segments and are causing radical reinvestments in technology talent across existing companies of all sizes.

This is the year of blockchain….or maybe its Ethereum… but it’s time to see RESULTS

  • By now everyone has heard of blockchain and the power of the underlying technology in financial services, but the conversation is FINALLY shifting to the business opportunities and that will be the catalyst for blockchain-infused products to gain traction. Experiments like Project ‘Jasper’ which is a Bank of Canada + Big 5 proof of concept with blockchain to reduce reconciliation efforts in payments systems are examples of the results and value of using distributed public networks.

We strongly believe that we are less than 12 months way from seeing the first mainstream pilot for tools like smart contracts and we are even bigger believers in the truly disruptive nature of these technologies.

I’m incredibly interested in your opinions and welcome comments. If you are passionate about thinking differently in the financial services space, I’d love to chat and can be reached at rlambert (at) fct dot com or through LinkedIn.

Jun 8 | 2016

Why hasn’t smart home technology taken off?

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smart homeIt’s a science fiction film cliché, the responsive house that all but turns down your bed and butters your toast. For the past decade, sensor-based technologies have been marketed, in aggregate, as “the smart home,” with big companies and technology giants queueing up to integrate the possibilities of cloud-based processing and ever more refined sensors.

But the headline isn’t that any of these name brands are blowing the doors off. To the contrary — the smart home market is kind of a replay of the early days of the videocassette: no industry standard, lots of innovation off the beaten track…and siloed technologies blocking real progress.

Silos are definitely not what the house doctor ordered; the vision is all the other way—appliances, control systems/devices and home entertainment platforms all interoperably linked and smoothly interfaced.


It’s more like a hobbyist’s approach: one widget at a time. (One suspects people are still sufficiently peeved at their remote to have much faith in a house full of remotes.) That’s on the consumer side; on the company side, insurance companies and grocery super brands are already experimenting with individual technologies as outreach programs to build engagement with customers in a whole new way. So the game looks far more like a slow aggregation and integration of niche markets (wins with integrated safety, thermostats and security systems (“background apps”) migrating customers to softer, more personalized interactivities around entertainment, cooking, health management and monitoring special needs family members (“foreground apps”).

And what about fun? These devices can’t be simply widgets: the winners, like the now-legendary HitchBot—a “social robot” which traversed Canada, parts of Germany and several US cities before being destroyed in Philadelphia in July 2015, winning some 500,000 Facebook followers—will become part of our complex, all too human lives.

At home, we are most ourselves. Technology has a long way to go to reflect that fact, inhibited as progress is by high product prices, limited consumer interest and overlong device replacement cycles—but the highest barrier is interoperability: too many networks, too many platforms, far too many niggling problems (“I have to program this remote? What?!” Remember that one?). What’s wanted is an innovator to crash the barriers and build an ecosystem that actually works as if people mattered.

Oct 5 | 2015

Today’s real estate forecast: cloud-y

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smart-house_smallYou say you barely remember, way back in (say) 2008, when that “cloud thing” first hit?

Let EXPERT/ease refresh your memory: In 2008, boxes of software began to disappear. CDs became obsolete as software began to move to the Web. We now download what we need and upgrade automatically – all from some planet far, far away.  Desktop software became more and more “app-like”—and you, dear user, communicated with your software (at least while installing and updating) in a whole new way.

Now, all that cloud infrastructure (where the magic lives) is about to go nova in the form of IoT – The Internet of Things. IoT gives machines the ability to communicate with each other, independent of human presence. This is going to change our relationships with our homes as much as connected sensors have made vehicles smarter.

GE, telecommunications companies, Adobe, and Cisco, among other tech giants, are doubling down on this massive opportunity. As EXPERT/ease has noted before, by 2020, an estimated 40 billion devices (many of them simple sensors) will be “connected” over the cloud. The IoT is turning the connected machines around us into one huge brain. And hundreds of millions of those sensors are going to be within meters of you, whenever you’re at home. And they’re going to make the buying, selling and marketing of homes—especially on mobile phones—so much more compelling and convenient.

Real estate is a billion dollar business full of early adopters. The industry’s first mobile customers were home inspectors, mortgage brokers and real estate agents on the go. In the United States, there is a research lab called the Reach Accelerator, run by the National Association of Realtors. The lab is dedicated entirely to connecting tech companies with real estate entrepreneurs and financial specialists in order to incubating new technology.

One example:  IoT ‘soft locks’ are eliminating the time-wasting and profit-shrinking issues, such as missing the cable guy or coordinating with a home inspector.  ‘Soft locks’ are mobile apps that are triggered in proximity to a home for sale, generating secure, time-limited ‘keys’ to open a house.  No more missed key handoff appointments…imagine that. Right now, you can use the August Smart Lock App to manage who gets in and out of homes. The IoT even works via Bluetooth when power or WIFI are out. Pretty cool.

IoT devices that measure energy consumption will add value to homes by sharing data details about other applications that affect saleability—like a sensor that cues you to increase ambient natural light quality in a kitchen or great room…and thus increase viewability, desirability and asking price.

And it’s smart business. Realtors in savvy markets are already recommending triple pane glass, because they have an IoT app that calculates energy savings on the fly, right there, chatting with the prospective buyer.

Nice touch, sharing ROI data with a client, in the room. Impressive.

Fostering relationships between real estate and mortgage professionals and their customers past, present and future—the heartbeat of our business—is truly about to go nova.

Can mobile real estate transactions be too far off? Let’s see.

Stay tuned as EXPERT/ease follows developments. Live and be well.

May 23 | 2014

E-signatures and two sides of the debate

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E-signatures May 2nd marked the one-year anniversary of the Ontario 2013 budget proposal to permit electronic signatures on an agreement of purchase and sale (APS) for real property. Currently when you make an offer to buy a home with an APS it is usually subject to negotiations between parties. The back and forth changes to the offer between the buyers and sellers normally represented by their realtors, either happens through email or fax. The final agreement must be signed in person as the only contract in Ontario that cannot be signed electronically under the Electronic Commerce Act is the APS for real property.

In the past year, the Ministry of Attorney General has conducted a number of consultations with interested parties: realtors, lawyers, insurers and their professional regulators about the transition to e-signatures. The government will enable the use of e-signatures once it determines if any additional regulations are required to govern the use of e-signatures. Behind the scenes two distinct camps have emerged: the industry and the regulators.

The industry side is of the view that there is no need for detailed regulatory requirements to prescribe acceptable technologies, nor standards as they would stifle competition and technical advancements in the security field. Industry wants to be industrious.

The regulators well they want to regulate with enforceable standards. Their main concern is fraud, which is also the concern of industry who bear the cost and reputational risk of fraud.

Let’s look at the current regime against fraud and understand if it translated to the digital world. As part of the industry camp we submit that consumer protection against real estate fraud already extends from a traditional ink and paper signature to an electronic signature. FINTRAC’s “Know your Client” requirements for lawyers, lenders and other real estate professionals, as well as their existing professional standards provide comparable safeguards in a digital environment.

As well, over 90% of all residential real estate transactions are currently title insured in Ontario. Title insurers are at the forefront of real estate fraud. A lenders’ title insurance policy will compensate the lender in the event of mortgage fraud and likewise, a homeowner’s policy will provide compensation from title theft. The Law Society also collects an annual real estate fraud levy from its members practicing real estate law in event of a fraudulent transfer of title committed by another licensed member. Finally, the Land Title Office operates the Land Title Assurance Fund in the event of a registration of a fraudulent mortgage or transfer of title where the lender /homeowner has no recourse to title insurance.

As a member of the industry-side we see a fulsome regime providing compensation for homeowners and lenders should they be victims of mortgage or title theft. There is no evidence that the advent of an e-signature will diminish the coverage from any of these insurers or funds which are operating in a digital environment under the Teranet regime.

And let’s also think about the future, my seven year old is not learning cursive writing at school. What will a signature look like in the future? I submit that it will not be a made in Canada solution. It will likely be dictated by industry standards as a result of trade agreements with a much larger trading partner like the EU, NAFTA or Asia-Pacific region. So investing in local regimes will be of limited utility in the long run.

An outstanding concern is the issue of compatibility between different sets of users. The APS may be shared with lenders, insurers, mortgage brokers and lawyers as it journeys from offer to closure. Each of these user groups may be subject to their own professional or industry standards. Generally technology compatibility is a significant driver for companies in the digital age so I have no doubt of its top of mind.

So while we are in the midst of a campaign for the hearts and minds of Ontarians, I hope that the next administration will not lose sight of this important change.

Apr 8 | 2014

Is technology disrupting or enhancing the customer experience?

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customer experienceI recently read a blog post by David Marcus, the President of PayPal, on how the payments industry is being disrupted and will be transformed. Technology is certainly driving the disruption but what’s driving the transformation? David’s argument is that today’s current system of payments is antiquated, full of friction and just not easy. With all the new technology we have, we still have to hail the server to pay for our dinner bill, or stand in line to pay for our merchandise at a retail store. It’s still painful. The point is not to paint a picture of what the transformed payments industry could look like. It is that transformation will be driven by considering the whole customer experience and looking for ways to make it easier for customer.

Technology has been a double edged sword. For many things, it has helped companies make things easier and it has offered us new, convenient experiences (where would we be without our smart phones?). But it has also increased business complexity by introducing new options and therefore more and different ways for customers to interact with companies. With this complexity comes an increased likelihood that the customer is going to get inconsistent service from the same company and that new sources of frustration will be introduced. This rapid evolution in the way we do business demands that we take a broader view of the customer experience.

Consider how you pay your bills and get your bank, credit card and service provider statements now. “In the old days” we had one or two options. Most people got their bills and statements in the mail and then either mailed in their cheque or went down to the bank to pay. There were a few things you could pay through pre-authorized payments. Now we have e-statements, (some of which are viewed through the bank site and some which require us to go the service providers site), paper statements, many different ways of paying my bills (pre-authorized through bank account, pre-authorized through credit card, online through web banking, some even still by cheque). Is it a good experience? Sure, there are more options and we can feel good about our contribution to the environment by signing up for paperless billing. But there is no one place to go to manage all of this. I find it painful. For all the technology and options, no one has looked at the complete customer experience and solved for what would make it really simple for customers.

In our business, too, there are many ways we interact with our customers; there is new technology in our business and there is new technology in our customer’s businesses. Only by taking a complete view of the customer’s experience can we increase our value to our customers and at the end of the day that is what it’s all about. This is a journey we are on and one we’re very excited about.

What examples do you have where technology has helped in some ways but complicated your life in others?