Fintech Nexus

There is no technology that has generated more buzz this year than generative AI. We have all played around with ChatGPT and marveled at its capabilities. But what is really happening with this technology in financial services? Or more importantly, what is going to happen?

My next guest on the Fintech One-on-One podcast is Anu Sachdeva, Global Business and Service Line Leader at Genpact. She has deep knowledge of banking and fintech and has become an expert on generative AI and how it will impact financial services. This is our first deep dive into generative AI on the podcast, but it will certainly not be the last.

In this podcast you will learn:

• How Genpact works with banks and fintechs.
• How Anu first became interested in generative AI.
• What Genpact is doing with generative AI internally.
• How financial services can help unlock the potential of generative AI.
• The use case of using generative AI in anti-money laundering.
• The fundamental principles that Genpact employs when engaging with banking partners.
• How we should be thinking about generative AI.
• The impact of generative AI on the employee makeup of banks and fintechs.
• Will fintechs or banks take the lead with incorporating generative AI.
• How we should think about compliance risk when it comes to generative AI.
• The opportunity for better personalization.
• A look to the future of where generative AI is going.

Connect with Anu on LinkedIn
Connect with Genpact on LinkedIn

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There are tens of millions of Americans who have limited access to credit. Those with thin files or FICO scores below 650 often have difficulty accessing credit. Many have to resort to payday loans or pawn shops when they incur an unexpected expense. But there are fintech companies whose sole focus is serving this population with affordable credit access.

My next guest on the Fintech One-on-One podcast is Todd Schwartz, the CEO and Founder of OppFi. OppFi has been around since 2011 (they have a fascinating founding story) and are now a public company that has helped more than 1.3 million people with affordable loans. I did have the previous CEO, Jared Kaplan, on the show in 2020, but this is the first time I have had the founder on.

In this podcast you will learn:

• The founding story of OppFi.
• Why he started the company with a physical store front.
• How the pandemic really turbo charged the business.
• Why they decided to go public.
• How being public has changed their business.
• For underwriting, why understanding the primary bank account is critical.
• Details of their Turn Up program.
• The impact of the entry of banks into the small dollar loan space.
• What the consumer advocate don't understand about small-dollar lending.
• What happens when states, such as Illinois, ban higher APR small-dollar lending.
• Why they are focused on the states when it comes to engaging with regulators.
• How they make sure that OppFi customers end up better off financially.

Connect with Todd on LinkedIn
Connect with OppFi on LinkedIn

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Medical debt is the number one reason people go bankrupt in the United States. So, you would think there would be a plethora of fintech companies attacking this problem from many angles. And while there are certainly lenders willing to finance medical procedures there are few companies taking a holistic approach to patient financial health.

My next guest on the Fintech One-on-One podcast is Itzik Cohen, the CEO and Co-Founder of PayZen. He saw the problems medical debt has created firsthand when working in the debt settlement space and he decided to do something about it. PayZen is the first company that looks at all the options available for patients as they try to afford their healthcare.

In this podcast you will learn:

• The idea that led to the founding of PayZen.
• The state of medical debt in the United States today.
• What the "operating system for healthcare affordability" means.
• Their north star at PayZen.
• The different types of products they offer.
• How they are finding and analyzing all this medical and financial data.
• What kinds of providers they are working with.
• How they are able to integrate their technology so quickly.
• Itzik's thoughts on removing medical bills from their credit report.
• His vision for PayZen.

Connect with Itzik on LinkedIn
Connect with PayZen on LinkedIn

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The people who lead the national banking regulatory agencies typically come from long careers in banking and law with a traditional view of the banking world. But there has been one exception to this rule.

My next guest on the Fintech One-on-One Podcast is Brian Brooks, the former acting head of the OCC and a current partner at O'Melveny & Myers. Now, don't get me wrong, Brian has had a long career in banking and law but he has also spent time outside of traditional finance, thinking deeply about financial innovation.

He came to the OCC from Coinbase and he has been an advisor or board member to several other companies in crypto and fintech. So, his perspective on the banking industry, as you will hear in this interview, is very different from your typical banking regulator.

In this podcast you will learn:

• How the financial crisis shaped his career.
• The three dimensions of finance he is trying to knit together.
• How he came to join the OCC from Coinbase.
• How Brian was able to gain the trust of the big bank CEOs.
• The most important idea that he had while leading the OCC.
• How he looks back at his 10 months as OCC head.
• How we could have easily avoided the FTX blowup.
• Why the regulators were reluctant to make these simple changes.
• The core ideological debate that Republicans and Democrats have over crypto.
• Why the failures of Silvergate and Signature were more about concentration risk than specifically crypto.
• What he says to people who want to ban crypto.
• How decentralized finance can get scale and not run afoul of US regulators.
• How US-dollar stablecoins could help mitigate the risk of de-dollarization.
• What regulatory changes need to happen to take advantage of new financial technology.

Connect with Brian on LinkedIn
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As recently as six or seven years ago modern payments infrastructure in Latin America didn't really exist. Most countries had a monopoly when it came to payments processing and these monopolies sit on old technology that is difficult and expensive to maintain.

A lot has changed today. Digital payments infrastructure has been built and while those old monopoly companies still exist there is now digital payments infrastructure throughout the region.

My next guest on the Fintech One-on-One podcast is Aron Schwarzkopf, the CEO and Co-Founder of Kushki. The mission of the company is "connecting Latin America through payments" and they are doing this by building new technology that others can build on to provide a comprehensive digital payments experience. 

In this podcast you will learn:

• Why Aron decided to head back to Latin America after some time in the US.
• The three big problems he encountered there.
• How the payments landscape has evolved in Latin America.
• What Kushki does exactly.
• The two types of clients they serve.
• How easy it is to accept international payments online.
• The countries they operate in today.
• Why the prevalence of cash means a green field opportunity for Kushki.
• Why the growth of real-time payments is helping grow the market.
• What it meant when the government of Ecuador named Kushki as the first payment aggregator.
• Why they acquired BillPocket in Mexico.
• The key takeaways from the recent report they published with Statista.
• Why Kushki experiences less fraud than others in Latin America.
• Aron's vision for the future of digital payments in Latin America.

Connect with Aron on LinkedIn
Connect with Kushki on LinkedIn
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In the consumer lending space, fintech lenders have been using AI in their underwriting models for many years. But there are still many consumers who slip through the cracks and get declined for credit when they should have been approved.

My next guest on the Fintech One-on-One podcast is Gal Krubiner, the CEO and Co-Founder of Pagaya. They work with a large number of both traditional and fintech lenders and apply their sophisticated modeling to find consumers who have been mispriced. Their two-sided marketplace then works with investors to fund these consumer loans.

In this podcast you will learn:

• The founding story of Pagaya.
• Why they decided to focus on consumer credit.
• How they are partnering with both fintech and traditional lenders today.
• Who they are working with on the investor side of the marketplace.
• The types of data they are using in their underwriting.
• How their underwriting models have evolved over time.
• How investor demand for their ABS deals is trending.
• How the US consumer is holding up when it comes to loan repayments.
• Trends in credit availability for consumers.
• Why the lack of credit availability is a good thing for Pagaya.
• The impact of rising interest rates on consumer credit.
• Why all the attention that AI is getting is helping Pagaya.
• What happened when they invited ChatGPT to their earnings call.
• How being a public company has changed Pagaya.
• How he is thinking about the macro environment in 2024.

Connect with Gal on LinkedIn
Connect with Pagaya on LinkedIn
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When you stop and think about it, it is kind of crazy that we don't have a global network for moving money instantly and cheaply. The internet is more than 30 years old now and it seems to me that this should be a solved problem by now. But it isn't, at least not yet.

My next guest on the Fintech One-on-One podcast is David Marcus, the CEO and Co-Founder of Lightspark. If David's name sounds familiar that is because he was the leader of the now-defunct Libra/Diem project at Facebook a few years ago. He is passionate about creating a real-time global network for money movement which is why he founded Lightspark.

In this podcast you will learn:

• His fascinating background in tech.
• The thought process that went into the Libra/Diem project at Facebook.
• Why he decided to start Lightspark.
• An explanation of the Lightning Network that sits on top of Bitcoin.
• Why they chose to build their technology for the Lightning Network.
• What Lightspark actually does and who they are working with.
• Who is using their technology today.
• The potential throughput for number of transactions per second.
• How he thinks about solving micro-payments.
• The regulatory challenges that might come with reaching scale.
• Why we should think of what Lightspark is doing as an alternative payments rail.
• Why this is a technology play and nothing really to do with crypto.
• The potential use cases that can be developed.
• How he thinks about programmable money.
• Why it is important that payments systems behave just like the internet (open, real-time and interoperable).
• The different goegraphies where they have clients today.
• How their business model works.
• Why the combination of real-time payments and Lightning is so powerful for the last mile.
• What a future with real-time global payments could mean for commerce.

Connect with David on LinkedIn
Connect with Lightspark on LinkedIn
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One of the richest areas of fintech innovation right now is in instant payments. The launch over the summer of FedNow has brought heightened awareness to instant payments but there have been other offerings available in this country for some time.

My next guest on the Fintech One-on-One podcast is David Watson, the President and CEO of The Clearing House. They are the creator of the first instant payments network in the USA called Real Time Payments, a network that has been operating for over five years now. We talk about the mechanics behind instant payments and the benefits for both consumers and businesses.

In this podcast you will learn:

• What David saw at The Clearing House that was really attractive to him.
• A short history of the 170-year-old company.
• The total volume of payments flowing through the US payments system.
• Who The Clearing House serves.
• How the ACH payments system works.
• The enhancements The Clearing House provides for wires.
• How they work with physical checks today.
• The technology behind their Real Time Payments system.
• Who is using RTP today.
• The different use cases that are flowing through RTP.
• What happens when you send a real time payment to a bank that is not in the network.
• The difference between RTP and FedNow.
• How David feels about competing with FedNow.
• His thoughts on the card network's instant payment offerings.
• How fraud in instant payment networks can be mitigated.
• His vision for the future of instant payments.

Connect with David on LinkedIn
Connect with The Clearing House on LinkedIn

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Much has been written about the student loan challenges for domestic students in this country. But what about international students, those people coming to the U.S. to study for a Master's or Bachelor's program? There are few good loan alternatives for international students as they are ineligible for federal student loan programs.

My next guest on the Fintech One-on-One podcast is Manu Smadja, the CEO and Co-Founder of MPOWER Financing. They are working to address this problem, providing affordable financing for international students looking to study at American and Canadian universities.

In this podcast you will learn:

• The hardship story that was the trigger for starting MPOWER.
• The biggest challenges for international students coming to this country.
• Why demand from international students is stronger than ever.
• Their mix of graduate and undergraduate students.
• How they are underwriting these people.
• Why the type of major is a critical data point in the underwriting process.
• How they approach loan pricing.
• The typical terms of an MPOWER student loan.
• What kind of documentation is needed to obtain a loan.
• What MPOWER does to help students beyond providing the loan.
• The percentage of these students that stay in the U.S. after graduation.
• Their experience with loan performance.
• How they are funding their loans.
• The scale they are at today.
• Why they decided to become a B-Corporation.
• Manu's vision for the future of MPOWER.

Connect with Manu on LinkedIn
Connect with MPOWER Financing on LinkedIn

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Why is it that, in 2023, we are still getting paid on a fixed schedule? It seems crazy to me that payroll systems that were built for batch processing on mainframe computers still maintain this batch mindset in a world where everything can be instant. We should be able to choose the exact cadence of when and how we want to be paid.

My next guest on the Fintech One-on-One Podcast is Kevin Coop, the CEO of DailyPay. The team at DailyPay has created the largest Earned Wage Access (EWA) business on the planet where employees of DailyPay customers can get early access to their earned wages whenever they want. This is a huge deal for those people living paycheck to paycheck.

In this podcast you will learn:

• What attracted Kevin to the CEO role at DailyPay.
• Why we are all still getting paid on these fixed time periods.
• How DailyPay actually works.
• What their app shows employees.
• How often employees access their earned wage before payday.
• The different features that they provide employees.
• How they integrate with the employer payroll systems.
• How these advances are funded.
• The benefits for employers of adding DailyPay.
• How DailyPay earns money.
• How this is improving the financial health of employees.
• How DailyPay is engaging with regulators at the state and federal level.
• How they are partnering with the large payroll providers.
• The different segments that are popular with DailyPay.
• How Kevin thinks about the competitive moat that DailyPay has built.
• The impressive scale they are at today.
• His vision for the future of DailyPay.

Connect with Kevin on LinkedIn
Connect with DailyPay on LinkedIn
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