The world of FinTech and TechFin is turning upside down the established banking market, new players are entering the market, players from other markets such as Social Media platforms are disrupting key areas such as payments, all told the traditional banking market is under attack.
A perfect recent example is South African new entrant Bank Zero, which is being led by Michael Jordaan and a merry band of entrepreneurs. Banker-turned-venture capitalist Michael Jordaan has vowed that his newest creation, Bank Zero, will compete fiercely in the business banking space. “Building a bank is hard work; building an innovative bank is exponentially harder,” said Bank Zero co-founder and chairman Michael Jordaan.
“We have made it clear we want to attack banking fees,” he told Business Dayin an interview. “But not everyone has latched onto the fact that we are going to be attacking high business bank fees, especially the exceptionally high card transaction and electronic banking fees companies incur.”
Bank Zero has now been integrated into the country’s national payments system, allowing it to compete on “an equal footing with the big guys”, he says.
Bank Zero, says it has initiated alpha testing of its systems, as it prepares itself for a launch in mid-2019. The group officially registered as a mutual bank in August 2018, and in the months that followed it started integrating with the national payments systems of the SARB – a move that it says will bring major benefits to customers.Bank Zero announced it has been integrated with the national payments system of the South African Reserve Bank (SARB) and is set to begin trial runs in preparation for the launch of its banking platform. The bank’s CFO, Liné Wiid, said that settling directly with the SARB rather than through a sponsoring bank allows Bank Zero to control its own payments value chain and nurture a “savings culture”.
Alpha testing involves a small team validating the end-to-end live systems and processes, which includes:
- Using the banking app with its integration to the revolutionary new core banking platform;
- Full end-to-end testing of the customer experience from ‘on-boarding’ through to actual transacting;
- Perfecting the integrated business, security and regulatory processes;
- Recently completing a disaster recovery test of the infrastructure and full software stack; and
- Confirming the fully automated regulatory reporting as required by the SARB.
The bank said it has also entered into strategic collaborations with Mastercard and IBM.
Mastercard and Bank Zero are currently developing a ‘new generation of card’ to deliver cutting-edge security and other unique features, supporting Bank Zero’s value proposition and addressing modern-day payment realities.
The initiative while provide the latest EMV technology and deliver multi-layered security protocols to protect users against fraud and identity theft, it said.
IBM, meanwhile, will deliver high-volume secure computing, providing the bank with enterprise-grade security on its open-source-based LinuxONE enterprise server through its pervasive encryption technology. IBM is hosting Bank Zero on its open-source-based LinuxONE enterprise server, which it says provides “breakthrough enterprise-grade security … through its pervasive encryption technology”.
For certain functions, Bank Zero uses the cloud – which will provide a hybrid model that delivers the best of both worlds.
Bank Zero’s confidence in the LinuxONE technology is heartening for sure, especially for me… I look forward to watching Michael and his team grow from success to success over the coming months…