Integration to US FIs (Part 1) - S2E6

Category: Data Connectivity , Podcast
Author: Amy Rice
In part one of a two-part series on OmniTalk FI, Randy Goggans, Partner at NXTsoft, will be sharing his extensive knowledge of the financial industry and how NXTsoft's integration solution can help banks and credit unions connect to any Fintech solution to create true digital banking experience for their customers. Randy also talks about how NXTsoft is the go-to partner for international fintechs looking to break into the US banking industry. With pre-built connections and over 25 years of experience, NXTsoft offers their partners a complete integration solution to connect their next big fintech solution to their target market. 

S2E6 - Graphic2

Randy Goggans, Partner -Randy Goggans was involved in the founding of NXTsoft. He is passionate about making digital banking a reality and works diligently with Fintech companies and financial institutions of all sizes to make that happen. Randy has previous experience in the Fintech industry heading up U.S. sales for Temenos and serving as national sales manager for TriNovus. Randy is an alumnus of Auburn University.

 

 

NXTsoft is the leading provider of API connectivity between fintech companies and financial institutions.

With NXTsoft’s connectivity library, we can have you up and running with a new bank or credit union customer within 90 days, no matter which core they utilize.

Fintechs are choosing the NXTsoft partnership for their connectivity solution because:

  • They get their product to market faster, and at a lower cost.
  • They are closing more deals, faster.
  • They can offload the cost and compliance burden of managing and maintaining that connectivity onto the experts, freeing up their resources to focus on their expertise, their products, and their clients.

Tune in on Monday, April 5th to listen to Part 2! 

Connectivity For Your FinTech Solution

For more information about how to become a NXTsoft strategic partner, visit https://www.nxtsoft.com/contact or call 1-800-915-3381


Transcript:

Amy Rice: Today is part one of a two-part series with Randy Goggans, partner of sales for NXTsoft. Randy was involved in the founding of NXTsoft and is passionate about making digital banking reality. He works diligently with Fintech companies and financial institutions to make that happen. Randy has previous experience in the Fintech industry heading up US sales for Temenos and serving as national sales manager for TriNovus. Randy is here today to talk about the Fintech landscape for financial institutions and how NXTsoft can help international Fintechs break into the US banking marketplace.

AR: Today I have Randy Goggans. He's the partner sales at NXTsoft. How's it going, Randy?

Randy Goggans: Great. How you doing, Amy?

AR: I'm good. Thank you. So you have kind of an extensive background in Fintech and connectivity. So, can you describe the connectivity landscape in the Fintech industry?

RG: Sure, I'd be happy to. Thanks for your time today and thanks for letting me come on and to talk about connectivity and happy to do so, so appreciate that.

Where we are today with the connectivity market is let's back up a little bit, when banks traditionally in the past or looking to connect to Fintechs it was usually done either by the bank or by the Fintech and where we are in today's world is the correct way to move data today is through what's called an API. So, what we're doing is we're working directly with the core banking systems, the Jack Henry FIS, Fiserv, Finastra, CSI. We're working directly with those companies and we have direct integration to all those core systems. So, today we've got direct integration to 38 core systems, and I believe Amy, there's 40 total.

We're directly integrated with those core systems, which in today's time, that is what the banks need. And that is what the Fintechs need in order to deliver their product. So in the past, what would happen before NXTsoft came along and we've been around for 20 plus years, building integrations and working with the core system. So, we've been around a long time and we have today over 1500 banks and credit unions that we serve through API APIs. And that's usually multiple APIs at each institution. And, I'll get in just a little while about where we're going with growth and how we're growing the number of institutions that we have APIs with.

RG: But, I thought it might be good to hit a little bit on how do we get this information and why is it valuable for both the bank and the Fintech? So, like I said before, we get the data directly from the core system. We work and contract directly with the bank or the credit union to work on their behalf. And then what we do is we are the facilitator between the bank and whatever Fintech institution or product that they have purchased. And then we hook it all together and we make it work. And, what used to take six to 12 months where we are connecting and making that connection to that product work within 60 days. So, which is really, really quick.

So, filling a very big pain point in the market right now, because in today's time, the banks today are focused on really turning their bank into a digital bank. And in order to do that, they've got to be flexible, nimble, they got to have an API partner as well continue to run the bank, make loans and bring in deposits so they can have a business. So, we see a lot of our institutions today moving towards, "Okay, we've been a traditional brick and mortar. We've got 20 locations or 30 locations, how can NXTsoft help us today become a digital bank?"

And if you think about what we're doing, that's what we're doing with all our connectivity we're doing on the bank side and this is very important that we describe when we're talking to banks, credit unions, and Fintechs is if you think about it, NXTsoft provides a win-win for all parties on the banks traditionally in the past, because the connectivity piece was so hard. If a banker went out to a conference and purchased my product, for instance, and that was not from their core system. They would come back to the bank with a signed contract, with a product, and then they would have to then figure out how do I get the data they need? How do I get it to the Fintech? And it's a really big manual process.

RG: So, what we're doing now is sitting right in the middle of that. We're the experts. We have the relationships with all the core systems. We have relationships directly with the core and the bank. And we are just plugging in, we're really plug and play because we've already got those integrations established and have had those for 25 years. So, my point to that was for the banker or credit union today, what we've allowed them to do now is go to the market, the Fintech market, because in order to be a digital bank, which they are all trying to do because with COVID, and that's what the customers are demanding now, is "I want to interact with my bank through the internet, as opposed to coming into the branch."

We've given that bank through NXTsoft, the ability to become digital and buy from anybody. As opposed to just a subset of vendors that might, for some crazy reason, have access directly to their core system, which is very rare that they would have an interface. So, we allow the bank to be able to buy any product and service they want to meet the needs of their customers and their market. And, on the Fintech side for the Fintechs out there, the thousands and thousands of Fintechs in the US and international Fintechs that are wanting to be in the US we are giving them the ability to sell to any banker credit union in the US. Which today, if they're here and maybe they've got one interface to an NFIS core or one interface to a Fiserve core, you really got a limited market of who you can sell your product to.

Whereas, if they're partnered with an NXTsoft, we give them the ability and their sales team to sell to any bank or credit union in this country and have the necessary integration that they need to make their product work. So, it gives the bank the ability to buy from anybody and it gives the Fintech the ability to sell to any bank or credit union in the US which is, I believe now we're about over 11,000 institutions, which is a really big market and all the Fintechs really want a bigger market when they're going to sell product to, as opposed to just a subset.

AR: You talked about what's going to happen in 2021 and kind of beyond that, could you expand on that?

RG: Sure, absolutely. We follow the market. We've been in this market building and developing products for 25 plus years. So we've seen the trends move through banking and financial technology. I would say in 2000, during the recession of 2007 ish, the biggest pain point with the banks was compliance. And that was when the Dodd-Frank Act was coming out. And so that was a huge pain point for banks and credit unions for years. And then what we saw, I would say, let's just say, five years ago, the biggest pain point became cybersecurity. And still is a pain point today.

But, what we're seeing in the market again, is even another paradigm shift to where with COVID and all these bank employees not being in the bank, they're not only are the employees are remote, but their customers are obviously remote. We are seeing the paradigm shift now the pain point is really one thing and that's connectivity. Connectivity to the market and to their customers. So, that's what we see in 2021.

What we're doing right now as a company is we are doing really two things to get the word out on what NXTsoft is doing is number one, we have banks and credit unions that come directly to us that have a specific project that needs to be integrated to their core system. We'll help there. On the other side of the equation and where I spend a lot of time is I work directly with Fintech partners, and those could be any anywhere from it's any financial technology company that needs data from the core system and or the bank to run their application correctly. A lot of times, before NXTsoft, these companies would find work arounds and run things in a batch environment, which is really to run a really high end product for the consumer in a batch environment, doesn't make a lot of sense.

RG: So, our APIs are real-time and they're talking to their bi-directional talking one way or another. So it's a real-time instance, but we are going to the market now and as opposed to just going out to banks and credit unions directly, we're signing up partners that can bake in the integration layer NXTsoft. And, they can go to their sales team and they can sell to, again, their product, to any bank or credit union. And then we come in as their partner where we work with them, the bank and the core system to integrate their product. So again, what we hit on, on the last segment there, really two goals. That we have at NXTsoft is allow the bank to buy any product they want, that meets their customer demand. And allows the Fintech to sell to any financial institution in the US and that's what we're accomplishing.

As far as 2021, what I see and to switch gears just a little bit is, I see more and more financial institutions, banks, and credit unions calling us looking for an API partner. And really what they're saying is "We're looking for a partner that we can establish to help us become a digital bank." And that's what all banks are having to do right now. It's not that they necessarily want to do it because a lot of the community banks we deal with have been used to people walking in the lobby. Community folks they see every single day, well, that's not happening anymore. So, I see banks really moving all of their technology over the next year to two years as fast as they can do it to APIs.

There's another model in the market of getting data that is very heavily scrutinized today and that's the concept of screen scraping. So a lot of of companies out there, if you've ever used Venmo, I'm sure, 50 million Americans use Venmo. Well, what's going on there is the consumer really don't understand that every night that you're giving credentials to your online banking account, to the company when you sign up for that service. And every night they're taking every bit, they're logging into your online banking account, just like you do to check your bank balance and everything. And, they're scraping all that data over to their database and then they're getting that every single night.

RG: So, the regulators and there's companies out there that are really making a very good effort, we're working with companies like the Clearing House, and other companies out there that are really trying to minimize the way that old screen scraping model and move all those institutions that are using those products or the consumer use those products to API.

So, NXTsoft as a whole, what I see banks and credit unions doing in 2021 is identifying an API partner that is an expert in the market, like NXTsoft, because we are the leader in the API market for financial institutions today. We've been here a long time. We've been doing it a long time. We not only work externally with vendors that have a certain core system, but we also work directly with every core system. And, we help them internally with integration projects as well. So, our relationships with the core systems today are very, very strong. And we continue to see that moving forward. We continue to see banks... They will need to partner with someone to even if to connect all their third parties through an API. Because, the reason for doing that is when they partner with us and we provided API, we're not only building the API for them. We're supporting that API. We're maintaining the API and we're securing the API.

We're doing all those things as your API partner and all those things need to be done because the core systems today come out with releases every quarter. We, because of our relationship with the course, we get the releases early. So, we're able to implement those releases for our consumers that use our APIs. So the security aspect, I think, is a big component of what we're doing at NXTsoft, is not only are we building, maintaining and supporting ongoing and adding the updates, but the security piece is we're laying at a 24/7 monitoring service on top of all of our APIs. So in the event, there's any anomaly with any of the API connectivity we have with any of our banks to Fintechs, we're on top of it and fixing it quickly.

AR: Thanks for listening to this week's episode of OmniTalk. Don't miss part two, that will be released on April 5th. Randy will continue talking about how NXTsoft is giving financial institutions the opportunity to work with new and advancing lending technology because of our vendor agnostic integration solutions.

March 15, 2021
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