Month: February 2017

There is no denying that financial technology is continuing to grow at a fast pace. This innovative sector of technology has rapidly moved across the world, creating new startups and applications that has disrupted how society runs. With great inventions comes large investments. With the U.S. being a pioneer of FinTech projects, there have been some speculation of whether the government has created a barrier to its growth.

According to Rebecca Campbell, sourced by Reuters, “investments declined by around 30 percent in the U.S. even if the nation did still manage to bring in over $4 billion.” With political uneasiness of a new president, the regulations of this new sector within technology have been ambiguous. While many investors seek to invest within this growing platform, without clear regulations, it can create confusion towards the future of companies.

Understandably, with a switch in government during the last election, the political system and regulations of technology and business have been unpredictable. The effect of new laws can create large shift in investment and growth for these companies. Without solid foundation of regulations, companies may find other countries to be more appealing and much easier to run business.

https://www.cryptocoinsnews.com/us-regulatory-environment-hinders-fintech-growth/

In 2015, the volume of fintech deals done peaked at $14.6 billion with 848 different deals, but has now reached a declining state in the amount of deals and investments made from VC firms. In 2016, those numbers have declined to $12.7 billion and 836 different deals, which is a YOY% of -13% for the value of all deals. This drop was due to smaller deal sizes done by investors whose hesitance is caused by political instability and the future of the economy with a new regime. This has caused more startups to struggle since most upcoming fintech businesses rely heavily on VC funding to operate with a profit. It is predicted that this trend will continue for most of 2017 and suggested that fintech startups evaluate and adapt their business models to the current economic condition. Those fintech firms who do not rely on VC backed funding are rapidly growing to above $19 billion. While there is room for caution to invest in the future economy, one must evaluate how fintech currently compares to its competition in traditional banks. Fintech companies offer the same services as normal banks but with lower rates and fee with greater efficiency. They also introduce Peer-to-Peer transactions that many institutions are trying to adapt for their clients. If you consider that the startups not funded by VCs are lucrative, then any VC or investor shouldn’t worry about any outside factors and focus on the high returns they will have.

URL: http://www.businessinsider.com/fintech-deal-sizes-are-shrinking-2017-2

With over $1.4 billion invested in blockchain applications, the technology is seeking to ready its self for wide spread application. While the technology is seeking to significantly disrupt the financial services industry, it is experiencing an issue in its application due to one of the fundamental principles of blockchain. The principle that all transactions are permanent establishes trust for users, but does not provide a method for the correction of human error or hacker theft.

In the financial services industry today, human error is a reality that is taken into consideration and has safeguards to correct the issues. In order for blockchain to truly be ready for widespread adoption, the technology needs to provide solutions to the challenges that are inherent to human interaction with the system. To accomplish this task blockchain companies will need to work with regulators to establish safeguards that provide users the ability to alter blockchain transactions that does not diminish trust in the system. Overcoming this challenge is blockchain’s biggest hurdle because it is the permanence of the system that provides users with the trust that traditionally has been provided through third parties.

Reference:

As the awareness and interest of people are increasing every day in  cryptocurrency, there are more new cryptocurrency that are growing in the market. Most of these currencies are overcoming the challenges that are faced by Bitcoins. The major challenge experienced by bitcoin is the average time of 10 min before a transaction receives a network confirmation. There are projects focusing directly on time reduction of transactions. But the question comes how will this impact the use of bitcoin. The availability of bitcoins is already fixed, as it is generated by the mathematical algorithm, it was predicted that these currency are likely to take the rise at the time the bitcoin circulation slows down. But the way these currencies are coming with a fastest transaction time they have already captured a huge market.Ripple one of the Cryptocurrency has the transaction time of 3.5 seconds and also trying to collaborate with the financial institution.In my Opinion, with this type of rapid growth ,circulation of bitcoin is expected to decline and people who have stuck their money in the bitcoin might experience exponential loss in their investment.

Reference:

4 Cryptocurrencies With Much Faster Block Times Than Bitcoin

Mobile commerce is the wave of the future and is no doubt redefining the retail industry. With a rapid growing trend towards mobile, PayPal has a secret weapon in its arsenal that no payment industry competitor has been able to match: One Touch, which facilitates fast checkouts, enabling users to breeze from site to site without logging into his/her PayPal account or filling out billing information.

One Touch has redefined online checkout with the best conversion rate in the payments industry by making it faster and simpler for customers to pay with a single tap. In addition, PayPal’s One Touch helps combat the common problem many retailers are faced with — conversion and cart abandonment. Once a PayPal account holder logs into their account on any given device, opting into One Touch allows them to stay logged onto PayPal for all future purchases on that same device. This saves the consumer the inconvenience of having to retrieve their login information for each and every purchase.

As a frequent online shopper, One Touch is definitely a feature that would make me more inclined to follow through with a purchase on my mobile device. Typically, I browse for products on my phone, but revert to my desktop if I want to make a purchase because its easier to type in all my information and I will be less likely to make an accident when typing in my info on my desktop vs my phone.

Source: https://www.fool.com/investing/2017/02/06/paypals-one-touch-is-driving-mobile-growth.aspx

Abstract: In this blog post we will discuss how data mining and machine learning can improve fraud detection in any industry. We also categorize solutions in two main parts which have their own specific patterns for fraud detection.

Fraud detection is a topic applicable to many industries including banking and financial sectors. Fraud attempts have seen a drastic increase in recent years, making fraud detection more important than ever.

Generally, data mining (sometimes called data or knowledge discovery) is the process of analyzing data from different perspectives and summarizing it into useful information. Data mining and statistics help to anticipate and quickly detect fraud and take immediate action to minimize costs. Through the use of sophisticated data mining tools, millions of transactions can be searched to spot patterns and detect fraudulent transactions.

The machine learning and artificial intelligence solutions may be classified into two categories: ‘supervised’ and ‘unsupervised’ learning.

In supervised learning, a random sub-sample of all records is taken and manually classified as either ‘fraudulent’ or ‘non-fraudulent’. Relatively rare events such as fraud may need to be over sampled to get a big enough sample size.These manually classified records are then used to train a supervised machine learning algorithm. After building a model using this training data, the algorithm should be able to classify new records as either fraudulent or non-fraudulent.

What the Article Says:

As the growth of FinTech has been exponential across the world, the first edition of the Middle East and North Africa FinTech conference will be held in Bahrain on March 26th. Sponsored by the Bahrain Economic Development Board and Arab Banking Corporation, the event will bring up a series of initiatives that have been in the works to move toward a digital, cashless economy. The article also mentioned that they will be discussing the impact of FinTech in the neighboring regions of Qatar and Dubai, where digital currencies and blockchain technology are prominent.

My Thoughts:

I think the location of the conference plays a huge part in its success. I have not heard of Bahrain having a lot of publicity in the media, especially in regards to FinTech so this may be a great starting place for their growth. There is also a huge potential for boosting the economy when FinTech leaders arrive in Bahrain.

Source: https://www.cryptocoinsnews.com/bahrain-host-inaugural-middle-east-africa-fintech-forum/

This time, the legal community is weighing-in on the future of blockchain and bitcoin technology growth under US President Trump. David Brill, a business lawyer, wrote an interesting piece titled “Bitcoin, Blockchain and Trump: Where do we go from here?” (Brill, 2017), detailing his recent discussions at an American Bar Association (ABA) conference between private sector lawyers, senior government counsel, and various other high level attendees connected to Securities and Exchange Commission (SEC) and Futures trading disciplines.

Brill appears to hinge his predictions by on the one hand, expecting a decrease in resources for the bitcoin FinTech in the US market, but on the other hand, foreseeing potential growth for blockchain in both the US and UK space, with the latter attributed to the Brexit related split from the EU.

I’m going to go out on a limb and disagree with Brill on his bitcoin predictions, and instead assume that the US political environment, i.e. uncertainty with President Trump’s agenda, will actually ignite resurgence in bitcoin and digital currency investments, both at home and abroad. This, in tune, will also keep the separate blockchain innovations coming on strong as they have done in the past few years.

 Brill, D. (2017, February 10). Bitcoin, Blockchain and Trump: Where Do We Go From Here? Retrieved from www.coindesk.com: http://www.coindesk.com/bitcoin-blockchain-trump-go/

For hospitals that focus on the quality of care they would like to offer their patients, often finance related activities may take a back seat. Hence a financial information system to track, manage and automate the accounts would increase efficiency and transparency. It streamlines the workflow among different departments in the hospital. Implementing a seamless system would allow the users to retrieve and access dynamic date. Also the information from the system would act as a platform to data analytics which is very crucial nowadays.

Major transactions include payroll and patient related accounting. Among the payroll accounts, they include all the recurring payments which are automatically generated within the system at the start of each payment period. We can trigger approval conditions for non recurring payments, rates, endowments, deductions etc. From the patients side, all the transactions beginning from the visit to the hospital to discharge like doctor fees, medications, cost of operations etc could be managed by implementing a common system with different stakeholders. Also the patient and payroll histories could be maintained which can be used later for qualitative analysis. A general ledger could be maintained for colleting, processing and reporting of the financial data and views can be used for presenting this data. We could also inculcate contract and claim management features.

Source:

http://www.hcsinteractant.com/solutions/healthcare-financial-systems/