1011. News: Starling fights fraud with AI, Uber goes global with Checkout and Citi and Coinbase collaborate

29:45We see brands that have positioned payments as a much more strategic part of the product or street part of the consumer experience. And those are the ones that are really drawing on it and leveraging it. And I think that it's obviously making a difference. And look, we would love to start a debate on whether the next C-level role should really be a chief payments officer rather than anything else because it's that critical to revenue and it's that critical to competitive advantage. I love that. That feels like something we should maybe get you back for a bit of a deeper discussion on an insights show.

30:16I think we'd be up for that. So one for maybe producer Izzy to take away. But look, just to sort of reiterate the congratulations. It's a really cool feature. I think it's a really cool step forward in payments and obviously a really cool partnership with... with Uber. So yeah, massive congrats. Thank you. Thank you. We'll pass that on. All right. Well, now on that note, we're just going to take a quick pause here and we'll be back with you very shortly. Hey folks, David Breer here, CEO of 11FS. Here's something you might not know about me. I get a lot of people trying to impersonate me online, fake profiles, scam emails, the lot.

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32:20Now, before we dive back into the news, a quick word about our latest insights episode. This week on Fintech Insider, we're looking at a trend quietly reshaping global finance. That's the slowdown in sanctions activity. Our host Kate Moody is joined by an expert panel in partnership with LexisNexis Risk Solutions to break down what's behind the numbers and what it means for fintechs navigating compliance in 2025. With the latest sanctions pulse report showing a 40 % drop in new designations, the steepest decline in three years, the team explores delistings, enforcement trends, and how automation, AI, and real-time data can help fintechs stay ahead.

33:03Whether you're leading a compliance team or just curious about the forces shaping financial regulation, this episode is packed with insights on turning a quieter sanction cycle into a smarter strategy. Find it in the same podcast feed as this one. And now back to the news. now this story comes from stock titan with a headline swipe earn and fly with southwest airlines new rapid rewards debit card so southwest airlines powered by galileo sofi's tech platform has introduced the rapid rewards debit card allowing debit first customers to earn points on everyday purchases to be redeemed against southwest airlines flights cardholders earn one point per$2 in qualifying purchases and one point per$1 on Southwest specific purchases with a 2 ,500 point welcome bonus and up to 7 ,500 points annually.

33:56No credit checkers required, monthly fees are waived, and ATM withdrawals are free within the Cirrus network, making it accessible for budget conscious travelers. Bill, look, start by extending our huge congratulations. A really, again, another really exciting launch. I mean, we're very privileged that you guys are welcoming onto FinTech Insider to tell us about these very cool launches. Maybe again, Bill, you can just give us a little bit of the background in terms of how this one came about. Yeah, no, thank you. It certainly is a very exciting time in the loyalty, you know, travel space. And I think you're starting to see, you know, these largely these programs went away, you know, 15 years ago and all of that when Durban was passed and they became a little bit less financially viable.

34:47But I think we're starting to see them come back in a big way and we're starting to see brands look at a very keen segment of their consumer base that actually is debit first in a lot of regard. And so when you ask how these kind of come together, it's I think it's a merging of the trends where consumers are or large segment of consumers are headed and the brand's realization that loyalty is super keen for them and they want to reach all segments of their customers, just not those that might be credit first. And so these have started to kind of come back and we've had a number of discussions. You saw that earlier with our launch of Wyndham.

35:28And, you know, this follows up on that success and we're very excited. And it will be many more, I think, as you'll see this in the coming weeks, months and years. And so very excited about the partnership and looking forward to talking about it. That's great. Right. And Bill, it's clear from listening to you speak about it, that inclusion is really sort of at the heart of this. I mean, not just is it debit first, which is sort of unique in its own sense, but the fact that, you know, the monthly fees are waived, free ATM withdrawals, no credit check. You know, was that something that you were sort of, was very much at the forefront of sort of designing out this proposition?

36:11Oh, absolutely. I think, you know, if you look like a brand like Southwest and they have such a great following, such a loyal consumer base, but yet in the rising preference of debit amongst a big portion of customers, whether it be the younger Gen Z type of customers that actually have proved that they actually enjoy debit more. It's not so much that they don't qualify or can't qualify for credit. It's just they make the preference on debit to the people that maybe haven't had the ability to do a credit, you know, backing for a lot of different reasons. This is a way that they can now enjoy those same type of rewards from a brand and really get leverage out of the travel that they are going to do.

36:59I think it's driving that financial inclusion. And I think this is the way the brands are waking up and realizing that, hey, we want that signal. We want to make sure that they are just as loyal as our other consumers. And so this is kind of that way to reach out and kind of bridge that gap. Yeah. I mean, 46 million is, it's no small segment. Rory, so you're sort of nodding along as Bill was making those points. I guess a lot of that sort of resonated. Yeah, I think that's right. I think the best brands are constantly upgrading their loyalty schemes and rewards programs in line of the latest generational trends and views on all sorts of things.

37:43And look, I think that, Bill will know much more than I will, but travel is one of those things you pay for that can actually make you richer, Ross. So you have to think about it very preciously and sort of see how it works. I mean, you know, in our world, we know when it comes to, you know, using AI and agents in the perching process of travel and many things beyond generations feel about it very differently. We've got, you know, a piece of research we released yesterday actually that surveys 2000 consumers in the UK and 2000 consumers in the in the US about, you know, exactly about how they're willing to use agents in the shopping process.

38:18And, you know, 72 % of millennials, like me, I wish, are very comfortable letting an agent spend on their behalf, whereas those over 55, it drops off the cliff, which you'd very much expect. And again, there are very different, big differences by region. 57 % of US consumers are comfortable letting AI make purchases, but it's only about 39 % in the UK. It happened to be in San Francisco after Money 2020, and I can see that literally every billboard and every poster is an AI ad for some company, etc. the exposure I think that the US audience has to AI is probably driving some of those behaviors.

38:57But look, to the point, I think that I always celebrate when brands are updating to include the trends of the future consumers. And I think, as Bill pointed out, I think that the debit preference has been long ignored in loyalty and reward schemes, and it's great to see that it's being addressed greatly. Yeah, Ross, if you look at it, 90 % of US adults in the country have debit cards. And there's, you know, spending on debit has now reached$4.3 trillion annually. Like, it's just a market that if you're a brand and you're looking to drive loyalty, you really just can't ignore. You have to have some offering.

39:36And the economics might make that offering less than, say, a credit, a traditional credit loyalty type of offering. But it shouldn't be zero. And so, you know, I think we've brought some very unique technology to bear that now makes it achievable again, where maybe before it hasn't. And we've worked really hard on working with a partnership and an ecosystem to craft together a solution that these brands can now actually lean in and start to have that connection and that outreach with those very specific customer sets. And I think it's only going to increase, you know, the younger skewing, as Rory just mentioned, the younger skewing of the demographics, they're one, their ability to want to travel and gain those experience.

40:21Like you said, you know, it's one thing that the cost of travel actually can make you richer. And I think the younger generation really buys in to that and they want that experience and they want that brand loyalty and the brands are wanting to capture that. So it's really a symbiotic relationship between the two. And Bill, I guess that point that you made about technology almost sort of making the model work, that's quite interesting because, you know, if I look at, for example, British Airways here in the UK who've long had a highly valued Avios reward scheme and they've recently sort of scaled back a lot of that stuff because the model didn't make sense.

40:59And of course, from a loyalty perspective, there's quite a lot of blowback. But I guess that's what you guys sort of bring to the table in this instance is the technological difference, I guess. Yeah, I mean, I think that's, and that's where like things like AI really can play because AI can make certain aspects of what we had to do before previously manually very automated and you gain some efficiencies. You gain some insights into that. And so by now using API, AI-enabled, you know, technology, a unique set of capabilities, we're able to create a solution that works for our partners and clients and frankly the end consumer, which is really what you get the adoption in and buy.

41:46And I think it's only going to accelerate as we look to design those user experiences to match the consumer value prop with an economics that works for the brand. And I think that all has to be rapid. It can't just be to the benefit of the brand. It can't just be to the benefit of the consumer. It can't just be to the benefit of the providers. It really has to come together and offer a value across the chain. Yeah, and that sort of win-win-win dynamic is really clear in this instance. May, I'm really interested to get your thoughts, and maybe it's an obvious question, but I think loyalty has always been a big thing in the U.S.

42:31how do you think that stacks up against the UK and other markets? Yeah, I think loyalty is true, I think, in all regions. And in the UK, we have seen loyalty debit cards. So there's Hilton Honors as one as well. But it's still a bit niche emerging. It's not as prevalent, as you said, like it is for credit cards. but from a moral hazard perspective, I do welcome this trend to reward consumers to use debit cards because there is clearly a moral hazard around incentivizing consumers to use credit and maybe take on too much credit that they can't afford. And I think Bill's right. AI has been an enabler to make this more economical for debit card providers to provide a loyalty scheme.

43:30And where I see this kind of trending towards is it has very much been geared around travel and that can in some instances be not as inclusive, right? There are a lot of people who can't travel for whatever reason. And so we would love to see that loyalty program to be broader than just travel, but to be around other things that consumers also delight in. And that can be like everyday products, which is, you know, like a Tesco's or, you know, Sainsbury's, things that, you know, consumers value, especially with the cost of living, high cost of living that we're currently going through at the moment.

44:12Yeah. Couldn't agree more. Yeah, I think to piggyback on what May is saying there, I mean, when you look at what these brands now are looking at out of loyalty and certainly travel is a big one, but more and more it's getting into all aspects of our life. And that's because, you know, with the advent of social media and how easy it is to have a negative experience go broad real quickly, your brand wants to have loyalty. So when there is an inevitable misstep, and there always will be, the consumer gives a little more grace if they feel loyal to the brand, right? if they have that experience, if they've had good experiences.

44:52And now the power of one consumer interaction is greater than ever. And so you have to think more broadly with, and globally, honestly, with your feature functionality and choice that you're giving your consumers and how you bring them into that brand and create that so that when you do have that one mistake, it doesn't just go viral because they post it and all of that. There's more of a relationship there between that brand. And that certainly starts with travel and hospitality. But as May said, I think it goes beyond that every day to, you know, the gas station you go to, the grocery store you go to, the, you know, even your child's daycare, whatever it might be.

45:30It all becomes important. And so loyalty, I think, has just become or will become a more broader suite that the brands need to put into their toolkit. Yeah. And do it right so that, you know, they are properly, it's aligned with the interests of their customers. and consumers. I completely agree. And Bill, thank you again for coming on and sort of giving us the firsthand perspective. All right. Our next story comes from Payments with a headline. Citi and Coinbase team up on digital asset payment capabilities for institutional clients. Citi and Coinbase are teaming up to enhance digital asset payment capabilities for Citi's institutional clients, aiming to bridge traditional finance with blockchain.

46:16technology. The collaboration will initially concentrate on improving fiat on-off ramps and payment orchestration, facilitating smoother transitions between fiat currencies and digital assets. Plans include exploring alternative fiat to stablecoin payout methods and expanding 24-7 access to digital asset payment solutions for Citi's clients. Leveraging Citi's extensive global payments network. The partnership aims to provide scalable and efficient digital asset payment solutions across multiple markets. Rory, maybe I'll come to you first on this just because in one of the previous stories you mentioned about AI even outdoing a stablecoin conversation at Money 2020.

47:04What's your initial reaction to this story? Yeah, look, it's super interesting. We're still seeing the fusing of arguably legacy or incumbent financial backbones with those required to bring digital asset classes into the mainstream. And look, I think the very obvious thing to say first is that, you know, I think crypto benefits from endorsements that builds trust, whether that be regulatory or big brands or traditional finance institutions like Citi and Coinbase, having partnerships that sort of views those two worlds. I think that the sort of crypto adoption will benefit from that. Fundamentally, it's kind of the first thing.

47:45And then secondly, it's just, it does always amaze me. I mean, many merchants that we met at Money 2020 this week in Vegas, there's still too many merchants beholden to the legacy infrastructures. And we shouldn't be, right? Moving money around the world shouldn't be dictated on whether banks in Asia are open for the weekend and therefore payments and settlements will actually happen. The moving movement of money needs to be updated to the digital experiences that we're providing for consumers. And that definitely needs to happen. So if this partnership accelerates that, I think that's great. But I think there's those are the two things I'd sort of make is that one is that I think, you know, crypto benefits when, you know, these sort of partnerships are announced, fusing those two worlds.

48:26And then secondly, there's still a long way to go in connecting, you know, global money movement and bringing it into the digital age. Yeah, maybe the corresponding banking model has had its day. Bill, what are your reflections on this one? Yeah, I think this is certainly one announcement of what will be followed by many announcements. And to piggyback what Rory says, I think the importance of bringing the traditional regulated entities, which are the banks and other institutions, merging with the newer players in crypto. I mean, consumers are going to be impacted by crypto in a lot of different ways.

49:07I mean, most people think of buy, sell, hold. But the reality is, in terms of practice, it's going to be money movement, stable coins, and behind the scenes, cross-border and all of that. The digital money movement is really going to have a lot, a lot of benefit. And the banks getting into this, I know that certainly would a consumer rather have their stablecoin or their crypto experience at a regulated bank versus a, you know, digital crypto startup? And the absolute is absolutely the trust that they have with with the institutions and the ability for them to lean in and be part of the solution will only, you know, speed up and aid adoption.

49:48And I think the stablecoin and the genius law that allows now the banks to play in that space is just going to bring a wealth of options to consumers and businesses. Yeah, absolutely. And look, I think done right, and I think you've articulated this so well again, Bill is done right. I think there's clear upside here for Citi, there's clear upside for Coinbase, but there's also then clear upside, I think, for the end users. What do you think, Mae? What was your sort of reaction to reading this one? Yeah, totally echo what Rory and Bill say. The Genius Act has acted like a regulatory catalyst, which is super helpful.

50:34Also comes at the right time where technology is available. for it to happen. And we are fusing, you know, the plumbing, as Rory referred to, between old and new. And that bridging between on and off ramp is going to be pretty crucial to make sure that, you know, new and old is knitted together in the most seamless way. And I think, you know, there is a lot of, you know, argy-barging around making sure that you've, you know, you're sort of getting in front of everyone else, because I think that there will be a wave of adoption that's going to happen here. The last thing I'd add to this is actually, you know, yes, we've talked about real-time settlements.

51:20You know, I think in this day and age where consumers are largely really used to instant delight and visibility over where their payments are going and able to trace it, I think this adoption will really help. And the last thing is actually the combating fraud aspect because of the tokenization aspect of it, because you can actually really trace the digital assets. That's actually the really super important bit, the utilization of the blockchain technology there. Yeah, no, couldn't agree more. And Rory, I suppose one just sort of final thought on this. I think we've seen, and this is picking up on your point about the sort of that partnering at the infrastructure level.

52:08I think we've seen various sort of announcements over the years that have felt like much sort of lighter touch partnerships. Do you think, I mean, it's still quite early with the Genius Act, but do you think actually that's a real enabler now? And we could see those deep partnerships actually sort of catching fire and really good user experiences off the back of that. Yeah, I think if they're providing value for the ecosystem, whether that be consumer or any sort of merchant or any sort of institution that's in that ecosystem, then I think we'll see those accelerate. I think, look, my simplistic view here is that crypto is a highly disruptive technology.

52:47And it's quite common, in fact, for highly disruptive technologies to require regulation to breed consumer trust. If we go way back to the car, it was a fairly disruptive technology and speed limits and seat belts came way after the car was invented. So I think it's a normal pattern if we look back to history. And I think that the use cases of cross-border or money movements globally, settlement use cases make a ton of sense for sure. I think we're a bit away from the kind of payment acceptance side, I think. I think that there's still a leap to go in when we think about consumers paying for things in stores or online with particular crypto pieces.

53:32But again, I think those will come and I think our point of view on that is we will accelerate those when merchants require them, when our customers require them to be honest. But I think you're right. I think it's infrastructure place first. And I think that, again, as we said, the more significant work adds value to the ecosystem, then I think the more they will happen, for sure. Yeah, I think that's absolutely right. And look, it's one that, as ever, we will continue to keep an eye on. All right, on that note, we're just going to take another quick pause and we'll be back with you very shortly.

54:07Okay, now for a quick look at a few more stories, very briefly, that we don't have time to cover, but have excited us coming out of Money 2020 in Las Vegas this week. So this one comes from Reuters with a headline, Dutch online bank Bunk gets U.S. broker-dealer license. Bunk, a Dutch online bank with over 20 million users in Europe, has received a license to operate as a broker-dealer in the United States, enabling it to sell U.S. stocks to American customers. The broker-dealer license is part of Bunk's broader strategy to expand into the U.S. market. had previously applied for a U.S. banking license in 2023, but withdrew that application and intends to refile when ready.

54:49The move signals heightened competitive pressure in digital banking and fintech, as European challengers such as Bunk and Revolut seek U.S. expansion and broaden their service offerings beyond Europe. To give us more information on this news, we have a voice note from Joe Wilson, Chief Evangelist at Bunk. The big news today is that we've been granted a broker-dealer license in the U.S. Now, we've always had global ambitions and had our sights on the U.S. But more importantly, our users demanded of this. People who are on our platform work on both multiple continents, multiple countries, and the U.S.

55:26is a big part of that. This license means that we can offer things that are investment options like stocks, ETFs, mutual funds, when we get a partner there. But we also offer that here in Europe. It's just with a partner here, and it's not the same in the U.S. because there's different regulatory restrictions. This is at a federal level, and we go through all 50 states to register as we set it up. Now, we're excited about this. It's a big milestone for us. I think the industry as well. There's more to come. Both of the U.S. and Bialy, so just stay tuned, and we'll keep you posted. I love jazz excitement.

56:00That comes right through the voice note for sure. All right. Now, finally, it is time for something a little bit different, as ever, from the world of business to finish this week's news show. Now, this one comes from Fidextra with a headline, JP Morgan lets staff use AI to help write performance reviews. So, JP Morgan Chase is allowing employees to use its in-house AI system, LLM Suite, to assist in drafting year-end performance reviews. The bank emphasizes that AI-generated content should serve as a starting point, with employees retaining full responsibility for the final submissions. Since it's launched, LLM Suite has been adopted by over 200 ,000 users within eight months, reflecting the bank's commitment to integrating AI into its operations.

56:49May Lim, maybe I'll come to you first for your reflections. this feels like it could be an amazing time saver and also it could go quite spectacularly wrong. What do you think? I think yes, it will be a time saver for the manager, but with all things AI, it's reliant on good input data. And so I think there is still that required front-end process for individuals to document their performance milestones, create the 360 feedback to log how they are doing against those benchmarks before it can actually go into LLM Suite for the summary and the write-up. So yes, I do think it's going to be a time saver, but still requires with all of these things, really good input data to go into it.

57:48I think the bigger signal is actually just the fact that yes, we are seeing large banks and large institutions like this adopting AI more to reduce operational inefficiencies and to just make or enhance the capabilities of humans wherever possible. and that's a good signal and we'll continue to see more and more things like that, I think. Yeah. Rory, that point about using AI as a starting point, I think, is really important, isn't it? Of course, we saw Deloitte this week getting quite a lot of trouble over in Australia for submitting a deliverable to the Australian government that relied heavily on AI.

58:40that sort of backfired. So obviously making sure that you've got the right controls and are just using it as a starting point. I think we can all learn from that. Yeah, I don't have quite to say on this one. I think that there's a real fine balance. And I think like all these things, there will be, you know, the human race will find the right balance in time, right? But there will be a rotation and there'll be a counter rotation too, actually, in that sort of sense. So, you know, on the specific point of use of AI, I think that today's LLN models are the worst LLN models we're ever going to use.

59:12They're only ever going to get better. And there's been significant sizable investment in every part of the world in this technology. So it's only going to get better in terms of how it's done and how it works.

59:29So predicting what it is not going to do in the future, I think is impossible, actually. We should all certainly try and avoid those. On the specific performance reviews, I mean, look, I don't mind admitting that I've definitely concatenated the time spent on the documentation part of the reviews. And I think that's enormously helpful. I think if, but I wouldn't, you know, try and shorten the discussion parts of the performance reviews. that are just so material. I began my career at GE and it was drilled into us the value of real-time feedback and never dodging a difficult conversation and making sure that people got constructive feedback so they improved and check out with an inspirational founder who's inspired by the athlete mindset and that you can always do better and no matter what you do, there's always a way that you can improve.

1:00:19There's no best, there's only better. And that comes from conversation and that comes from human dialogue. So I'm pretty protective of that bit, for sure. But again, I'm sort of ever optimistic that I think we'll find that out and we will protect the bits that need to be human and we'll let the agents do the stuff we don't want to do. Which actually is quite a nice way to be. If we could remove everything that annoyed us about our jobs, then that would help us as human beings too. Yeah. No, I really appreciate that sort of note of optimism where we are right now is the worst it's ever going to be.

1:00:50And it's only going to get better. Bill, final word to you. What do you think of this story? Yeah, no, I think it's where we're going. And I think a good manager will use AI as a tool to have a good review and provide good feedback in a structured manner and spend less time having to do the gathering and the part underneath and more time actually talking to the employee, which will result in a better outcome. A bad manager will probably use it as a crutch and it will be bad. And, you know, maybe it highlights that quicker of who bad managers are faster and a company can, you know, make a change there, a thing.

1:01:27But I think using AI, as Rory alluded, to do the more manual tasks and free up us as humans to have the more important interactions is really where the benefit and really where the goal of this should be. and if it's done in that then it can be a really good thing because you then spend more time actually building those connections giving the proper feedback encouraging the employee, helping the employee to bring their best self to work each and every day and so I think from that standpoint it's good. Like anything, there's always a flip side. There will be abuse there will be, you know, people that don't do it well that will cause very negative and you have to be very careful as a company because a couple of those can need your company in the news, right?

1:02:13If you have some very bad interactions, that you don't want that type of negative publicity as well. But overall, I think it's where we're headed. I think it's how we manage it. And we've all got to get used to finding what the balance is where AI can improve our lives. And we use it for the better and not the other way around. I love that. Right, that concludes this week's FinTech Insider News. Thank you so much to today's guests. maybe we can just do a quick run around the virtual room and you can tell us where people can find out a little bit more about you guys and about your companies. Rory, how about we start with you?

1:02:51Ours is very simple. It's checkout.com. So yeah, you can find a lot more about checkout and all the work we're up to worldwide on our website. Superb. Bill, how about you? Same thing with me, galileo-ft.com or sofi.com. Either one provide a wealth of knowledge. And then obviously I'm on LinkedIn. You can always look me up, Bill Kennedy, and if you have any questions, you know, buy them off. Perfect. Thank you, Bill. How about you, May? Same thing. Anthemus.com is where you'll find me and in terms of Common AI, it's the new partnership that we have. It's CommonAI.org and yeah, I can be found on LinkedIn.

1:03:29It's May Lim. Superb. Thank you, May. As for me, you can find me likewise on LinkedIn and you can find out more about 11FS on 11FS.com. Thank you so much for listening to today's episode of Fintech Insider. If you like what you heard, please make sure to follow us on your favorite podcast platform of choice. And if you really like what you heard, why not share the podcast with a colleague or friend? As always, if you want to join the conversation, find us on social media, just search for 11FS or Fintech Insider or email podcasts at 11FS.com. Thank you again and goodbye.