Large financial institutions are more inclined to work together in less competitive areas. Reuters reports that Goldman Sachs Group Inc, JP Morgan Chase & Co, Citigroup Inc and Credit Suisse Group AG have invested $17.5 million in Israel-based AccessFintech, a fintech startup that aggregates and helps resolve business errors while cutting down associated error risk.
“In capital markets, these errors may include data discrepancies between counterparties on the financial terms of a trade or wrong information used to identify a client. Once spotted the errors are normally handled manually, via numerous phone calls and emails between various firms,” says Reuters.
“We see a dramatic level of difference as to what banks are willing to collaborate on, or outsource to shared vendors instead of building internally. We see the banks in a search for efficiency in the places where things are not competitive.”
“We see a dramatic level of difference as to what banks are willing to collaborate on, or outsource to shared vendors instead of building internally,” Roy Saadon, founder and chief executive of AccessFintech, said in an interview with Reuters. “We see the banks in a search for efficiency in the places where things are not competitive.”
In addition to these four banks, AccessFintech's customers also include asset managers, custodians and fund administrators.
“Once we understood the impact on the operational model of the financial participants it was a quick decision to provide the financial backing,” Ana Capella, head of strategic investments at JPMorgan, said in a statement.
Saadon tells Reuters that the $17.5 million will fuel business growth, particularly for sales and client coverage.
