Innovation in FinTech is a hot topic right now; there is a
torrent of articles, blogs and white papers being published
every day, each professing a deep understanding of how to
innovate in this space.
Apparently, everyone is either an expert or possesses
a crystal ball!
Those in immediate need of services are struggling to
sort through the analyses of opinion makers and separate the
hype from true leadership and innovation.
They should beware: many established vendors are
dressing up their tired old products and services in hipster
garb in order to claim that they are
They claim to be building utilities too, however these
are simply off-shoring projects, using the same old-fashioned
software and expensive staff.
The world has changed significantly since we launched
the Duco Cube service in April 2013: "best of breed" hosted
services have gained traction and are helping firms across the
finance industry to cut costs, cope with regulation and
simplify business processes.
True innovation is about bringing fundamental research
from the university lab directly to operations in industry.
When we decided to build a data reconciliation
platform, the decision was shaped by the painful experience of
trying to apply existing solutions to a wide range of data.
The existing tools were built to solve very specific
problems, for example reconcile bank balances, match FX trades,
perform depot reconciliations, etc.
While they can be good for dealing with one kind of
data, they tend to be poor at solving the wider problem of
establishing data controls across an entire organisation.
These tools also require substantial effort and resources to
deploy and maintain, and are completely intimidating to
Today, it is clear that the rise of consumer
technology is heightening expectations that all members of
staff should have access to powerful and usable
When you deliver this technology via a self-service
model, you also empower your employees to help themselves,
which is highly cost-effective and increases efficiency.
Using these tools, you can put the power to establish
these data controls in the hands of business users who need
them most, and enable the business to cope with a wide array of
different types of data, all on one platform.
It turns out, however, that bringing consumer-like
levels of simplicity and sophistication to the enterprise is
The slick consumer apps we use every day focus on
simple business models. By contrast, the existing
infrastructure, complexity of products and regulatory pressures
in the finance industry conspire against this kind of
The data you wish to reconcile is rarely in the same
format. The traditional response to this is to employ complex
IT tools to transform it, but these are both expensive and
unusable by most business users.
We created the Natural Rule Language, which traces its
roots back to Computer Science Ph.D. research.
This language enables business users to write
straightforward rules that manipulate data, using English
This makes it easy to overcome differences in data
format, removing the need to use IT tools entirely. Since they
are effectively English, the rules are clear to everyone, and
they are easy to maintain.
It often takes many months to see the first results
when you use traditional reconciliation tools. To control
implementation risk, companies resort to processes demanding
lengthy business requirements gathering, multiple iterations
and long testing periods.
Business users are often involved only right at the
beginning and the end of such projects, while much can go wrong
in the middle.
This problem can be overcome by using a
self-optimising algorithm capable of matching very large sets
of random data quickly and accurately, in memory.
This empowers users to take a much more iterative
approach to reconciliation projects, as they get initial
results immediately and can quickly fine-tune the matching
rules in small increments.
Such an algorithm can learn the form of the data and
optimise itself as it works, allowing users to tackle very
large data sets (e.g. millions of trades) and deliver
meaningful insights in hours or days, rather than months.
Many systems dealing with complex data are themselves
complex. There are too many buttons on every screen, making the
user experience unpleasant, cumbersome and confusing.
The challenge therefore is to make applications modern
and simple, take advantage of the latest web technologies, be
responsive and scale to mobile devices. After all, nobody
expects to read a manual anymore!
To make things clear, we rely on strong visual
metaphors, such as our "time machine" for seeing how results
change over time or "change tracking" in process configuration,
making it easy to spot differences.
This leads to an intuitive experience for all users.
To bring a true consumer-like experience to FinTech, you must
produce a product that aligns itself with the way we use the
internet, our smartphones and our laptops.
The world is not a static place. Customers need the
ability to react to the market, so they need their partners to
be able to deliver value quickly. Hosted services have
the ability to deliver this value on an on-going basis, without
disrupting a client’s operations.
We were fortunate to start with a clean slate, which
means we don’t have to dress up old 'cash
cow’ products in order to be perceived as being