Interview with Allevo CEO: Does PSD2 change everything for banks? It might, but all is not lost
Banks face a new compliance burden in January 2018, with the coming into effect of the PSD2 Directive. Allevo has set its course to help banks face this challenge and revolutionize the open banking sector as we know it.
What are some of Allevo’s most important projects and success stories to date?
Given the traditional, heavily regulated environment that Allevo addresses through its products, one of our most challenging (and rewarding) projects so far was the transition to the open-source model, started back in 2011.
At first, customers did not really understand the benefits of deploying an open source environment. However, this type of mentality has changed and now banks are looking into open banking solutions, which means that embracing this innovation-driven approach was the best thing to do at that time.
When it comes to individual projects tailored to our customers` needs, it is difficult to pick favorites. This is the reason why we decided to put together a puzzle from the pieces of our most prized implementations. We deeply cherish our collaborations and we look forward to adding new layers to it as our business and software engineering expertise grows.
With the PSD2 coming into effect in January 2018, how is Allevo helping banks achieve compliance with the Directive? What are the greatest specific challenges banks are facing?
PSD2 paves the way for significant changes across the banking industry. Of these changes, competition and the integration with TPPs, which banks will have to open their interfaces to, will have the biggest impact.
In the light of the upcoming enforcement of this directive, we decided to give banks a helping hand. For this specific reason, we started working on FinTP-Connect, an API-based application which enables banks to respond to information requests from TPPs, while also getting to know and serve their customers better.
This is basically an extension of our well-established core product, FinTP, which already provides technical integration between various business applications, while automating flows and enabling operational risk containment and compliance with regulatory and industry standards.
As recently announced, Allevo is developing its software solution, FinOps Suite. Can you elaborate a bit more on this project and its benefits for SMEs and corporate treasurers?
As Beneficiary of the Competitiveness Operational Programme 2014-2020, we have launched the TOSS (Treasure Open Source Software) project on August 16th, 2017. The software solution developed within this project – FinOps Suite – is focused on processing financial transactions for SMEs and corporate treasuries. The open source principle applied here is meant as an alternative to traditional software infrastructures these institutions are used to.
Marketed under the “Making financial operations easy” one-liner, the features of FinOps Suite include payment integration, validation, reporting and reconciliation, with the ability to accommodate further customer requirements. The target audience of this project consists mainly of SMEs, service providers, big manufacturers, financial transactions processors, and financial infrastructures.
Other potential extensions aim at the relationship between the corporation and its individual/institutional clients, as well as sharing certain information with them or even allowing some financial operations to accompany the exchange of goods or services.
What does Allevo bring different compared to other software vendors counterparts?
Our biggest plus is the open-source business model. Since we distribute our applications under the GPL v3 open source license, our technology drives cost reduction and conveys full control over the source code of the application, thus eliminating the common vendor lock-in dependence, while gaining access to both transparent product development process and product audit.
Furthermore, we have a customer intimate approach, with proven track record in designing and developing customized software tools, in order to serve clients of all sizes, in various industries.
As part of our strategy, we want to expand the customer base and sustain new product development. We are looking into new customer segments to diversify our solution portfolio, slowly moving to a flat organizational structure, comprised only of delivery, sales and support.
This strategy, correlated with the open source business model make Allevo stand out in the pool of software vendors out there.
What are the projects that you are most looking forward to in 2018 and beyond?
2018 is set to be a game-changing year for the financial industry. PSD2 already acts as a massive disruptor to budgets, resources, and processes. We aim to make all transitions as smooth as possible and ease the customer`s project implementation journey.
This will connect bank back-office systems to services offered by CSMs like TransFonD, retrieving payment instructions (in any format provided by these applications), converting them to the ISO 20022 standard and routing them as dictated by the scheme. We will start this implementation by accommodating the service offered by TransFonD on the local market, for RON payments.