Interview with Allevo: Aligning Instant Payments and PSD2 with banking customers’ needs
Sorina Bera, CEO at Allevo says that banks are clearly moving towards best serving their customers in order to keep them.
The trend is for regulation to come to the aid of people.
What are your main areas of focus in 2018 and what are your hot projects?
We started 2018 by focusing on projects relevant to the banking industry, which were added to the project pipeline by our customers.
As a result, we are implementing the Instant Payments flow via the FinTP-Instant feature. We are also busy validating our PSD2 compliance solution for banks (FinTP-Connect), and we are already involved in a proof of concept lead by one bank. Another point of interest is obviously making significant progress with our EU-funded project dedicated to SMEs and corporate treasuries: FinOps Suite (TOSS – Treasure Open Source Software).
As far as Instant Payments and PSD2 are concerned, we are already working closely with our banking customers to finalize the concept and business details over the coming months, whereas for FinOps Suite (to be completed mid-2019) this year is mostly dedicated to software development, website redesign, and of course, making the project known everywhere we see it fit. And hopefully a few extra surprises.
Besides processing financial transactions in FinOps Suite, our TOSS project also involves developing an automated testing tool and a benchmarking tool, both extremely useful for all the technical teams involved, as well as further extending our FINkers United community worldwide and promoting collaboration in the open source area. The good news is that these two latter tools are not only useful to corporate users of FinOps Suite, but also to banks and users of FinTP.
How are you helping banks serve their customers with a nearly instant payments service?
Banks are clearly moving towards best serving their customers in order to keep them. The trend is for regulation to come to the aid of people, allowing them to move freely between financial institutions, giving them the best and most cost-efficient service on the market. The challenge is keeping them interested by creating cool new products. This type of thinking, aligned with the need for speeding up the processes and for things to happen in real-time, with less to no lag, leads to services like instant payments to emerge.
The local Romanian CSM, TransFonD, announced in early 2018 the launch of the instant payments service for local banks on the market. In this context, we have extended FinTP with a feature to enable banks to use this service – FinTP-Instant.
FinTP-Instant is a FinTP functionality that connects back-office applications of a bank to the instant payments service offered by TransFonD, retrieving payment messages in any format provided by these applications (tables, queues, etc.), ensuring their conversion to the ISO 20022 standard and routing them to the Instant Payments System (IPS).
Besides the instant payment initiation, confirmation, reject messages, as well as recall and negative/positive answer to recall, this functionality also processes new messages pertaining to this scheme:
- SCT Inst transaction status investigation;
- Overdraft message for configuring the guarantee ceiling;
- Reconciliation messages, automatically sent by IPS after completing each settlement process.
In order to fall within the appropriate processing time for instant payments, the timestamp can be applied in FinTP-Instant and since this is a functionality of the FinTP engine, it can also benefit from transaction filtering.
What can you share of your experience in implementing your PSD2 solution with your banking customers?
We started the design of the PSD2 compliance solution in early 2017 and since then we have validated several layers of our product – architecture, communication, security, user stories and so on. We did this by working closely with our customers, as per our company strategy, collecting their feedback and specific requirements.
For confidentiality reasons, we cannot provide a list of on-going implementations and their progress, but what I can say for sure is that FinTP-Connect raised quite a lot of interest among banks. We will issue a press release as soon as our first customer goes live with this solution.
For now, we are happy that our PSD2 proof of concept benefited from the useful input of one of the major banks in Romania and once light started to be shed on needed functionalities, both teams joined efforts to implement this solution in a record amount of time. This is a defining trait for us at Allevo, as we have a customer centric approach, frequently collecting feedback from customers and designing solutions that solve their specific problems.
To be less mysterious though, we can disclose a couple of components featured in the architecture of FinTP-Connect:
- Centralized management of requests;
- Back-office integration;
- TPP identification & validation;
- API management integration;
- Data analytics;
- Access for PISP & AISP;
- Fraud risk management.
Other perks that come to the benefit of both banks and their business clients are: analytics instruments, cash flow management through predictive analysis and automated cash management.
Last, but not least, we are bragging with the way we position the FinTP-Connect solution, and that is not only as a PSD2 compliance solution for banks, but also as an opportunity for banks to offer far more interesting and attractive services to their customers. This, in our opinion, is the way to think things further and develop meaningful tech, to enable services that people actually need.
FinOps Suite is a project that runs until mid-2019. However, you are already in the search for early adopters – how is the search coming along?
Allevo plans to organize two workshops this year aimed at small and medium businesses: one just before the summer holiday, in a partnership we are looking forward to announcing, and another one early autumn. What we are trying to do is get the word out there, make the project known and, of course, collect direct feedback.
In addition to these workshops, we will also hold our annual User Group meeting probably at the end of 2018, which is another excellent opportunity to receive input from our current partners and customers. Besides spreading the news on our new company-oriented solution, we’re also bringing together all players involved in the corporate-to-bank financial flows, have them brainstorming ideas to improve these flows.
Another thing we did in this matter is that we applied with the FinOps Suite (TOSS) project in the European Business Awards sponsored by RSM and we are proud to announce that we have been named National Winner for Digital Technology. Thus, we will represent Romania at the European Business Awards Summit and Gala 2018 to be held in Warsaw this May – while still competing for both the European stage of this award, as well as for the European Public Winner position – based on the votes we receive for our company presentation video. If you like us, please vote by May 4th.