517 Expectations vs Reality Latest Global Findings for Financial Services Digital Identity

Welcome to Breaking Banks, the number one global fintech radio show and podcast. I’m Brett King. And I’m Jason Henricks.

Every week since 2013, we explore the personalities, startups, innovators, and industry players driving disruption in financial services. From incumbents to unicorns and from cutting edge technology to the people using it to help create a more innovative, inclusive, and healthy financial future. I’m J.P. Nichols, and this is Breaking Banks.

Welcome to Breaking Banks. We’re pleased once again to be partnering with FIS on this episode. They continue to be a great sponsor for us.

And we’re going to get into some really interesting research. I think it is timely because when we look around the world at what is happening in the banking and financial services landscape, there’s some interesting divergence here. First of all, we certainly saw out of the UK market a big change in customer expectations around the launch of the various challenger banks in that market.

And that is now why you have a significant portion, I think the latest data is like one in four Britons gets their salary paid into a challenger bank account, which would have sort of been unthinkable a few years ago. You have NewBank, who’s quite profitable, did a quarter of a billion dollars worth of profit last year, now by far the largest bank in Latin America with 83 million customers. And I’m interested in exploring when we look at investment that happens at a corporate level, why is it that we’re seeing these sort of exceptional experiences come from new players, mobile wallet plays, these non-traditional players versus what we see actually in terms of innovation that’s coming out of the financial services, the more traditional financial services space.

So to help us with this topic, we’re going to invite a couple of people from FIS. We have DeAndre Jones. He’s the Chief Client Officer for FIS Banking Solutions.

DeAndre, welcome to Breaking Banks. Thanks. Thank you, Brett.

Glad to be here. Good to have you with us. And we also have John Starkey, who’s the Senior Director for Product Retail Solutions at FIS.

John, welcome. Thanks, Brett. Good to talk to you.

First of all, maybe I’ll start with you, John, if you can frame this report for us. I know this, you know, the main research unveils this sort of misalignment between end user priorities and where the innovation or investment innovation is happening in the financial services space. But help us frame why you went down the path of doing this research and really what it led to.

Sure. We can talk briefly about what the survey was. So we surveyed and interviewed 4,000 consumers across the U.S. and the U.K., alongside about 800 financial services executives, to really understand, from one perspective, what the consumers were telling us were their highest priorities and what they were looking for from financial services capabilities.

And then matching that up against what the financial service executives were telling us that they were investing in. And all of that within the background of what’s been going on in the financial markets with inflation and recession and trying to understand how all of these things interplay to meet those needs of the consumers. Yeah, that makes sense.

And so, you know, I think, you know, from your point of view, how would you think that executives generally, how aware are they of this misalignment, do you think? I don’t think so. I don’t personally believe that they are very aware of it right now. I think, unfortunately, there probably isn’t enough of this sort of voice of the customer work going on in our industry today.

I think that they’re they’re reviewing a lot of the new technologies that are being talked about broadly and in some of the trade mags and trade podcasts and such. But that’s informing their decisions as opposed to the voice of the customer. When you actually talk to the customer, you start to see where that misalignment is.

Well, DeAndre, you know, let’s get into some specifics. You know, what what really was some of the clear advice from consumers or feedback from consumers, you know, the end users in terms of what their expectations were? You know, those expectations around simplification that’s coming out loud and clear. How do we streamline? How do things get easier for us to use? And you think about most consumers when you pull up those smart devices, whether they’re using Apple or Android or whatever else they may be utilizing, and you see a number of different apps.

I don’t see those apps going away anytime soon. But what they are saying is, wow, it’s still overwhelming. And you click down into that specifically around their financial lives, right? The average consumer is looking at a number of financial apps.

How do I make this easier? How does this get easier for me to navigate this in one specific platform? And that’s sort of what everyone’s sort of battling right now. Hmm. You know, looking at the explosion of wallet tech around the world, you know, not only do we have Alipay and Tencent WeChat Pay, you know, in foreign markets, you’ve got Paytm, you’ve got M-Pesa, MTN Money, you know, you’ve got all these mobile wallet schemes now to the point where, you know, the WorldPay research and others show that by 2025, it’s going to be like 55% of all commerce transactions will be wallets versus a plastic card or cash.

Right. But that’s interesting that you’re saying about the financial wellness and financial awareness piece, because that’s something that I think wallets have created that expectation for. I don’t know.

Do you guys agree with that observation? Yeah, you know, I do, actually. You know, when it comes to the importance of financial wellness today, we’ve seen that both on the consumer banking side, as well as the small business banking side, that’s what they’ve said that they’re craving. They said, help us get access to insights about how we spend our money and what solutions that are out there that can help us spend our money smarter and handle our finances more efficiently.

And they’re asking for those tools and they’re asking for those tools to be delivered to them side by side. You know, give us dashboards where we may have elements of financial insights, but typically would have required three separate applications in moving back and forth from application to application. And they’re saying, please put that together.

Help us make those connections for us so that we can improve our financial wellness. For sure, we’re seeing that. You know, this is an interesting element of consumer psychology when it comes to finance, actually.

And I’ll share with you guys if you don’t mind. When we were building MoveIn, which was the first mobile challenger bank in the US, we had this focus on the smart bank account that helped you save money. And so to do that, the feedback loop was fairly simple.

You know, every time you did a transaction, we categorized it. We told you whether you were above or below your typical spending. And the core banking app, you know, it would turn red or orange when you are spending more than you usually do versus green, you know, when you are spending less.

So very visual traffic light approach this. But, you know, when you look at traditional banking, you hear a lot of talk about financial literacy being the entry point into the financial system, you know, in terms of products and understanding, you know, your options and things like that. But actually, what you’re saying is that customers just want to be able to manage their money a bit better.

And they expect that that’s a basic function a bank should have, that the bank should help them save more money over time. Right. Would that be a fair argument? It is a fair argument, for sure.

And I think that those vendors that are providing those solutions are winning in the marketplace. And those that don’t have it are really falling to the wayside. Because what will happen is if you’re a bank, for example, and you’re delivering those sorts of services as part of your solutions, you’re keeping your clients.

If you’re not, you’re losing them to fintechs and challenger banks. Yeah, I’d agree. I think what was once a point of difference has quickly become table stakes.

And go ahead. No, no, I was just gonna say, you know, this, as you say, this table stakes right now. But, you know, let’s talk about moving forward with this.

Because if we’re going to be really intuitive when it comes to creating these embedded, you know, financial wellness sort of, you know, let’s call it a smart bank account that helps you manage your money, right, for want of a better terminology. If we’re going to create that, we’re going to be using artificial intelligence. And so, you know, a lot of this speaks to where the investment should be going to ensure that you can provide these types of experiences that are differentiated.

Because just providing a dashboard today is not going to necessarily differentiate you. But using AI, well, that could. Where does it come, Deandre, in terms of like the future facing technology, and where you see this going? How do those expectations look a few years down the road? I think AI is going to be the key to improving the experience and taking it to the next level.

And in fact, when you think about the survey results, the way for financial institutions to come back and say, we actually hear, we hear you and we understand, we’re making this investment in this space, because it’s going to ultimately be the tool. And the tools that are going to help sort of solve this problem that you have. So when it comes to simplification in one platform, you can simplify things, but you’re going to need those insights to help you utilize your money right back to the financial wellness piece.

You’re going to need those insights to help you understand risk and pitfalls. Even as a consumer, AI is going to be able to help with those things, especially as we get better, faster, more nimble within these organizations at creating that best customer experience utilizing AI. You guys mentioned this was a global survey or global focus.

Was there anything that came out in the research that differed by geographies? There was. It was US and UK. So those two markets.

What we found, the biggest differences, I think, were primarily in the impact that the financial services executives were seeing based on what’s going on with inflation, recession. Etc. So that was having a greater impact in the US back in May when the survey was conducted.

And therefore, when we surveyed consumers and executives alike, it showed a much higher percentage of them being drastically impacted in how they made their decisions based on those market economic conditions. Right. Similar in the UK, but to a lesser degree.

So less flexibility on where the tech should go because of the geopolitical concerns and so forth. And of course, things like regulation, which has a huge impact on traditional players in terms of IT cost alone. One of the things that I noted when I was thinking about it is the more that the economic conditions impact your ability to invest, the more important it is that you get your investment right.

If we were all living in a much higher end of the cycle for the economic conditions, then investing with more of a broad brush would probably be fine from the standpoint of those financial executives. But when dollars are tight, it’s really important that they focus in on those things that the consumers are really looking for. Yeah, I mean, I think you can’t go wrong investing in AI necessarily.

But one of the challenges in sort of trying to chase that ever accelerating innovation curve is there’s sort of not an end to that process. So it’s not like you can sort of prioritize one part of the puzzle and we’ll worry about other investments we need later on. You’ve got to be sort of continuously adapting throughout the process a bit.

Do you see in terms of the executive’s voice that generally speaking, there’s more of acceptance that innovation is just the status quo now, you know, continuous innovation? Or is it still a bit in fits and starts? Yeah, I certainly do. What I think about right now is back to what John said several minutes ago is that that voice of the customer is going to be really important. And those who can create the opportunities to where they can infuse the innovation from their customers, but also their internal colleagues are going to be those that create that new point of difference.

So those executives who don’t abandon innovation, but really get on board with it and create the internal vessel centers of aspiration, whatever we want to call it to be able to enable it faster, I think they’re going to have a leg up going forward. Yeah, John, do you have any follow up? Well, one thing you’ve mentioned AI a few times, and it’s interesting in our survey, when you looked at the consumers, they had AI listed very low in terms of things that they’re interested in. But let’s dig a little deeper on that.

Right. So within the financial tech space, we executives in product and management are spending time thinking about those use cases where we can leverage AI to really make a difference for consumers. In a survey, when a consumer has just said, is AI important to you? They don’t have any context.

Well, what’s it going to do? Right, exactly. So I think you’re actually right. Survey may show AI is having low interest among consumers.

We all know it’s how you’re going to leverage the layout, the AI in a way that can really drastically change things. And then how you present that to the consumer is going to be important. Yeah, well, you know, I’ll give you a couple of use cases I put in bank 4.0. One is when you are, you know, if you look at mortgage shopping in the future, and you think about the application in smart glasses.

So suddenly now, if I know you’re intending to buy a home, you know, and as an OS provider, I’d probably know that based on search history and so forth. Right. Then I can now anticipate if you’re going into a listed real estate property that you probably want to consider your home, you know, mortgage options or financing options.

So I can present that to you in your head up display as you walk into a listed real estate property. But if you’re a bank waiting for a customer to come and ask for a mortgage, right, then you may miss the entire process in the future because of that sort of, we might call it embedded tech or embedded finance stuff, but contextual behavioral stuff or, you know, we’re so we’re already starting to see people play with that. So I think, as a consumer, if you if I could tell you, I would give you functionality in your bank account in your wallet, so that I could tell you if there’s certain bills that you’ve got coming up that you won’t be able to afford to pay, would you want that advice? Most consumers would go, of course, yes, I’d love that, without thinking that there’s a lot of data science and AI based on, you know, giving you that response or that result.

Right. So I get what you’re saying. Or the flip side, which we’ve seen, which is, you know, I’ve done a lot of work with cash flow forecasting for small businesses.

Right. And so people tend to only think about if your cash flow is forecasted to go negative. You know, I want the bank to offer me a loan.

Right. But you also if you’re a consumer or you’re a small business and you see that cyclically, you end up at times when you’ve got excess cash flow. Right.

Banks should be offering opportunities to roll that into an interest bearing account or an investment account. And all of that should be the AI in the background looking across the history of the transactions and feeding that info in. So I’ll give you two quick ones.

First of all, Yui Bao, which is the most successful savings product we’ve ever seen, was a savings feature in the Alipay mobile wallet. And all it did is prompt people and saying, you’ve got some hidden treasure in your wallet. You should have it in a savings feature.

Right. And that’s the most successful savings product we’ve seen in history. But we used to AB test this stuff, the behavioral stuff around savings.

And at Moven, you know, we use nudges to say, hey, you’ve got more money in your account than usual. You should probably stick it in your savings bucket. But we found one day of the week and one particular time of day that beat any other time of the week for getting people to put money in their savings bucket.

Do you want to guess what it was? What was it? It was Thursday morning between 6 a.m. and like 10 a.m. And the psychology goes is that if you prompt someone to save at that time, they’re sort of thinking about it. Potentially, they’re thinking about what they’re going to do on the weekend, but they haven’t committed to any spend on the weekend yet. So it’s reasonable for them to set something aside.

But by Friday, they probably have committed to doing something on the weekend. And that’s so not intuitive that you need those tools on the back end to help you identify that. Yeah, exactly.

So that’s really that’s what I’m saying is that if you’re looking forward to better ways of managing your money and helping people with that function of their life, that intuitiveness really comes from data models, behavioral models, you know, things like that, particularly if you want to get it highly personalized. So very, very interesting. Anyway, I know we got a little bit off the track.

So what about best practice in respect to companies looking to leverage this tech, you know, like the banking as a service stuff you’ve mentioned? But, you know, where are we looking for now in terms of that best practice? Specific to banking as a service and embedded finance? Oh, well, just just generally in the space in terms of what you surveyed. Yeah. So let’s let’s talk for a second about what was the biggest tech item that was focused on, which was the the all in one financial services piece.

Right. And you’ve heard people talk about super apps before. And I think that pretty quickly almost got a bad reputation in the industry.

People said super apps. I’m not sure if I believe in that or not. But but I’ll tell you what has proven.

I think that’s a I think that might I mean, it might be a little bit of a Western view. Like I know where I spent a lot of time. I spent six months a year in Bangkok.

And so if you’re in Indonesia or Bangkok or in China, I think people have quite a different view of super apps. But yeah, I think in the Western view, we’ve not really got any really super successful super apps in the West. So, yeah.

So so what I’ve seen in the U.S. market is less anyone trying to take on that full view of a super app and instead trying to figure out how to break down some of the barriers between banks and fintechs and challenger banks using some of the financial service providers like an FIS, for example, to help break down some of those walls. And that becomes enabled by things like fully cloud enabled products, APIs, embedded service, open banking. And so what we’ve seen is both sides of it, both from an embedded finance perspective.

How can we enable using APIs to allow banks to push their services outward to fintechs, which is a market that we’re all familiar with? But then the flip side where banks have started to look at that and say, OK, I’m going to play in the banking as a service space. But I also want to keep the eyes of the consumer within my platform. And to do that, I have to adjust.

And the way I adjust is I start becoming more friendly with being able to present third party fintechs directly out to my consumers in a way that’s seamless, that allows for some of that cross pollination of insights and information. And that’s something that I’m heavily focused on trying to support, both both on the consumer side and on the business side. And it’s resonating really well with banks who know that they do need to do something there.

OK, so, John, here’s one for you. Right. If we look at the traditional way banks thought about serving their customers is most banks had a goal for being the dominant bank for their customer relationship.

We used to call this concept the primary financial institution in banking. But what we see today is that a lot more people setting up their second or third bank account on the side. They’ll have that for specific purposes.

Millennials and Gen Z tend to think of their financial services selection like they do apps on their phone. You know, it’s just they’ll pick something that’s purpose built for whatever they need at the time. Is there anything that indicates support for that shift from the data that you see in the survey that customers are not as married to having a single banking relationship anymore? We have definitely seen that.

That’s absolutely true, again, both on the consumer and small business side. And what we’ve seen then in a shift with banks is they’ve started to be comfortable even acknowledging the fact that their consumers do have maybe second and third accounts that held away at third party banks. And so what we’ve done with them is said, OK, let’s acknowledge it and start to provide tools that allows the consumer to see all of those accounts, whether it’s your fee or two additional banks.

Give them that entire view by doing that, by the way, by having that single view, you’ve put yourself back in that primary position because you’re the one place where they can go to see everything. And so getting comfortable in allowing both acknowledging that consumers are going to do this, not being afraid of it, allowing them to view and move money between all of those things, I think improves their position in the long run with those consumers. Hmm.

Interesting. I think that sort of supermarket approach, you know, you do have now like, you know, what Starling has done in the UK was sort of approach that JP Morgan is doing a lot of partnerships with with Fintech. They find it’s faster and cheaper to do it that way.

So there’s a lot more collaboration that’s possible on these platforms. But interestingly, in China, when the wallets started really causing havoc over there, the central bank required the wallets to open up so that they could get the banks could get the transaction data from the fintechs. So sort of reverse open banking, if you like.

Right. Very interesting to see. All right.

So if you have found this conversation interesting and you want to get into more of the detail to look at the key findings, we’re going to tweet out to both of the links. So FIS Global for the US and the UK versions of the report. But if you want to search for this, put in your search engine.

Consumers want an all in one platform to manage their finances with FIS tagged or if you’re in the UK, UK financial service providers appear more resilient to turbulent market conditions. And you’ll be able to track down the report with search there. So that’s that’s an easy way to find it.

So, John, where can people find out more about generally the research you’re providing and more about your part of the FIS practice or how do they get in touch with you? I think if they reach out to us at info at FISglobal.com or out to the FISglobal.com website, they’ll be able to reach in and those those questions and inquiries will be directed to us. Fantastic. And you’re on LinkedIn or you? I am.

I’m on LinkedIn under John Stuckey at FIS. OK, and DeAndre, you’re the same, right? You’ve got I mean, not the same, but you’re on LinkedIn. Yes.

DeAndre Jones, FIS. Well, thank you both for coming on the show today. You know, I think it is interesting.

I think, you know, when we look globally, you know, I would say, you know, all of the fastest growing financial institutions in the world today are digital. You know, that’s a function of cheaper and faster acquisition cycles. And if you look at the new tech that’s coming out and sort of the leading edge thinking, often it’s coming from these new players.

So, you know, we’re going to continue to see these new entrants in the market really set customer expectations. And unless banks are doing a lot of partnering with these organizations, it appears like they might be playing catch up for some time. So I know I read a lot into the report there, but it’s putting my own disruptor spin on it.

But DeAndre and John, thanks for joining us on Breaking Banks today. Thanks for having us. All right, that’s it.

Let’s take a quick break. We’ll be back after these words from our sponsors. This show is brought to you by Alloy Labs.

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Well, welcoming now, Derek Godfrey, chief product officer of Clear, and as the recent Axios article said, there’s kind of a BFD going on with Clear right now, and that is you’re getting out of the airports and into fintech. Talk about what you’re announcing, what’s happening and where you’re going from here. Yeah, well, it’s great to be here.

Thanks, JP. We’re not getting out of airports. We’re expanding outside of airports.

Going beyond. Just to be clear, airports is really where we started to prove out our thesis around secure identity and what it does to unlock experiences. And so anybody that knows us from the airport knows that if you’re a Clear Plus member, that that’s the fastest way to get to the other side.

Great experience. Can’t confirm. Yeah.

Thank you. We appreciate it. And so how do we bring that to our partners in the digital space? And so we’ve done a lot of work.

We really started some of this work when there was a travel slowdown around our health pass and so enabled people to get back to live events with a great health pass product that allowed people to, you know, confirm their vaccination status digitally. And out of those experiences, we had a lot of demand and we saw the market didn’t really have a consumer brand friendly, reusable digital identity. And so we know, knew we always wanted to play in that space.

That’s been kind of the long arc here. And so now is the time to take the next step. And prior to some of the work we’re going to talk about in KYC, you know, we’ve set up partnerships with Avis, obviously in the travel space, super relevant for us, for people to fast lane through that experience with health care, a regulated industry.

And so that maps well to the things we’ve done in the airport. And then we’ve also done digital marketplaces and LinkedIn. And so one of the things that we were always interested in was what what does the financial services marketplace look like? Obviously, lots of regulatory and compliance, risk fraud, but not always the greatest consumer experience in terms of what account opening looks like, how you verify yourself.

I don’t think anybody’s gone through that and said, wow, that was great. And so at Clear, when people go through the Clear lane at the airport, they say, wow, that was great. That was a time saver.

I loved it. And we think there’s an opportunity there. And we’re really excited to make our acquisition, which we made earlier this year in Sora ID, small startup, amazing tech, great team, which you acquired, which we acquired.

And, you know, one of the nice things about them is that they were maybe 10 blocks to the east of us in New York. And so we got to spend a lot of time really understand that they had a shared vision for whatever usable digital identity looks like and lots of experience in the KYC space. So when we’ve we’ve acquired them, we’re merging our product lines.

And it’s really about how do we provide a branded consumer experience? So people want to know that their identity is going to be protected, that it’s trusted. We have a strong bond with our members, people that have used us before, put a lot of faith in us. So that’s very sacred to us.

But how do we let them unlock other experiences? And KYC, highly regulated, not too different from what we do in the airport with different set of constraints. How do we do that digitally? And so they brought a lot to the table in terms of everything around PEP and OFAC and AML and sanctions, lots of configuration opportunities. And we want to marry that with our, you know, what we think is best in class user experience, in addition to the millions of members that we’ve already verified.

And so these are really desirable members in the sense that these are fruit travelers. These are high net worth individuals that I think are pretty attractive, that definitely value time, definitely value the clear brand and allow us to leverage our member base and allow them to leverage new partners for an expedited onboarding experience and even re-onboarding. So if there’s any other checks that need to take place, we provide those as well.

And we’ve seen a big lift in terms of what that looks like versus what we see in the market today. So you mentioned your current customer base being attractive. So part of this being successful is going beyond that customer base, right? Because this really needs to work for everyone if it’s going to work in financial services.

What kind of hurdles are you anticipating? I think this is where we’re a pretty different company in the sense that we have always had, when we think about our members, really a hospitality mentality. And so we view you as members. We create a long term relationship with you.

And so part of that starts with the kind of onboarding experience. And so it’s not a traditional transactional model for the member. And so it’s really that top line experience where we think that it has different conversion metrics.

And ultimately, our partners want to get everybody through it. I mean, at the end of the day, we would love people to say, wow, clear that. What a great experience.

That is an incredibly high bar to set for yourself. I don’t think anyone that’s ever done any kind of account opening or KYC has said, wow, that was awesome. And that’s the goal we set for ourselves.

And so it’s not just our existing member base. It’s making sure that there’s an onboard ramp for everybody to join. Yeah, nobody wants a KYC experience.

I mean, you know, I mean, there’s a lot of great reasons for it to exist and it should exist. But yeah, it creates friction. And our whole point has always been frictionless.

You’ve mentioned members and your branding. Is the clear branding an important part of the value proposition or will this also be white labeled, kind of powered by clear inside of banking apps, that sort of thing? It’s one of the things that we’re exploring. Right.

And so we think the brand is one of the real strong appeals. That brand alignment brings a lot of comfort to the members. Also, we’ve spent a lot of time on that experience.

And so to have a branded experience, to know what you’re getting, to see that clear verify button and click it and know what’s going to happen, know that you’re just seconds away from finishing this process. We think that brings a tremendous value. Right.

And so we’re looking at different opportunities to work inside the embedded space. I know people have lots of existing ways of working. And so we want to be respectful of that.

And we understand there’s a kind of a proven model. But we also think this is a new model because no one else has this existing member base, has a focus on these these type of experiences and bring the brand that we have. And so that’s really where we start to differentiate.

We’re really excited about the reusable nature. So nobody just, you know, you might have a bank, but also a broker. Maybe you have some crypto.

Maybe you’re doing ACH somewhere else. And so the number of times that you would do that. And so we’re looking for what we consider concentric circles of overlap between our airports, what we’ve done with LinkedIn and Avis and what we would do in the financial services area.

You mentioned LinkedIn. Talk about what that partnership has been so far and where does it go from here? I mean, I would say one of the great things, it’s a really strong partnership and that’s really who we look to work with and really co-develop. And so for them, it’s really been about upgrading the quality of their network.

Right. And so less regulatory fraud, risk compliance. But the LinkedIn network is better if we actually have high confidence, if we know who we’re dealing with, whether it’s posting jobs or sending messages, any of those things.

And so we do think that identity is going to be foundational. We like the KYC space in the sense for us, it’s better defined in terms of there’s a regulatory compliant. Everybody sort of has to do it.

Everybody has a little bit different take on it. But that’s why we think there’s a lot of opportunity there for us as well. For something like LinkedIn, I mean, today that’s optional, right? Yep.

You can opt in for that. Is the long term plan for that to become part of the standard? I hope so, right. So I think that’s one of the things we work with LinkedIn.

We want to make it so easy that it becomes a standard part of many platforms. We think any digital marketplace that you go and participate in, whether it’s vacation rentals, any peer to peer, we think that that will come. And we think that while some of the specific stuff around KYC will be kind of standard to that, we think the gap is actually going to close.

And the idea that you know who you’re dealing with. And even outside of financial services, when we talk to people and say, do you know your customer? They don’t know the acronym of KYC, but they want to know their customer. They want to have a better and deeper relationship.

But they can’t have friction. They can’t have drop off. They have to think about, you know, the TLV of that customer.

And so that’s where we think we can differentiate. Yeah, it’s balancing that desire for the level of trust and transparency with the friction that it takes to get there. I mean, for LinkedIn, they could have just charged $8 a month to everybody.

We’ve heard of other folks that have done that. And I think, you know, that’s an interesting play. We would love to help them out if they wanted to work with us.

But I do think like even there, you can see the value. So I think there’s a lot of ways to go out and tackle it. But I do think when you know who you’re dealing with, you’re able to move faster, move with more confidence.

And so like, how do we get everybody over that hurdle? It’s really important. Yeah, and all jokes aside, I get the value proposition of saying, no, this is actually me as someone who has been, you know, spoofed and impostered, you know, many times on many platforms. I like that idea.

But paying $8 a month and something didn’t work for me. I will tell you, I’ll give you one minor quibble. Please, we love feedback.

Yeah. Can we do product support right here? Absolutely. This call is recorded.

Let’s do it. Yeah. I tried to verify on LinkedIn, but because I go by JP professionally, that’s not my birth name on my identification, even though I’m already a Clear Plus member.

Yes, I travel a lot. And so I was bounced from that. Yes.

Well, I first of all, I would say try again. I spent a lot of time on upgrading that experience. This is a classic name matching problem.

Yeah. And so I do think like this is something we’re getting better with. And we work pretty closely with LinkedIn to solve on this one.

But yes, this is this is a a known issue, one that we take very seriously. We want to definitely, JP, I think we probably can like solve for that one today. But we definitely ran into that kind of as we got into launch.

I think it’s one of the things that we look for when we start in a new segment like that is working with the right partners. Yeah, because we were on top of it with them. They were great coming up with suggestions.

And so it has been a real partnership and not just a vendor relationship. And so I suspect that there’s lots of green space for you at that kind of level of verification. Right.

LinkedIn isn’t being verified on a platform is helpful. When we’re talking about financial services, it’s far more than that. Right.

It’s required. Right. Know your customer.

Bank Secrecy Act. Yeah, I think so. And I think that the thing to think about that, though, is is that you think about money is in some ways the original social network.

Right. It’s a way to exchange. And we think about nodes and we do think a lot about identity and the money network payments and everything else.

And we think there’s lots of solutions in the marketplace today. They’re not really consumer focused. They’re kind of bolt on from the side.

They’re not they’re not member focused. They’re not experiential. So there is a big opportunity, we believe, for payments and identity to get much closer in terms of you can see all kinds of challenges.

You know, no one knows anybody’s routing number or Ethereum address or phone number that SIM swapped away. So we do think there’s a lot of opportunity to upgrade those experiences by working with those networks. So the compliance side is super interesting and obvious.

I say the network side and what is a reusable network identity coupled with the movement of money is a huge opportunity going forward that we’re excited to be a part of. Well, particularly as you talk about the intersection of identity and money and as that becomes a part of real time payments and being able to, you know, expedite things quickly. I don’t have time to fill out a stack of forms and wait for approval on that.

Eliminate the clipboard. Right. And the third, you know, circle in that diagram then is fraud.

Right. So fraud prevention through identity, but also, you know, what you have and are growing and developing is quite a treasure trove of identity. How do you protect all of that? I, you know, that has been, you know, job one from the very beginning.

Luckily, when we started and really were focused in the airports, working with TSA, Department of Homeland Security, they’ve provided no shortage of guidance, oversight and regulation. Oh, they asked a few questions. They have.

Yeah, yeah. There’s been a couple. So they’ve been a great partner, but they’ve really kind of set the tone and posture that we have in terms of protecting that.

And then really through our leaders like Karen and Ken, our CEO and our president, they have made sure that we’re member focused. Right. And so it’d be very easy to build some of these things and not be as member focused.

But it comes back to that kind of hospitality experience, the obsessiveness. And so while we do think that there is a lot of data there, we do spend an enormous amount of time and energy to make sure that it’s secure and that we are able to make it actionable by our members. Right.

So that’s really ultimately their data. We are stewards of it and we are ones that are going to help them manage that. And so we take that pretty seriously.

But we have no shortage of security and compliance and complexity and no shortage of government oversight and questions and concerns about that. What do you need over the long run from legislation or rules in terms of governing? Because we don’t really have a lot of set standards around identity today. Right.

I would say, you know, this is where, first of all, we have a great public private partnership with the TSA. And so we think that’s a really good model overall. We do think that identity in a lot of ways is pretty distributed at the state level.

Right. So you think about all the DMVs that are issuing driver’s license. Right.

Really focused on driver safety, but also some federation of like identity. And so we do think we don’t think that there will be a national identity system like anytime soon. Right.

I think there’s probably a lack of what you want. I think that that is where companies like Clear can provide a great solution that I think would be more responsive to the market than a kind of top down, heavy, heavy approach. And so I think while all those standards are great, I think we’re able to be a little more responsive to the market and technology as things evolve.

And so same way we care about experience again, maybe not the greatest. So it wouldn’t hurt, but you’re not going to say you want it. Right.

Right. Fair enough. I would say there are areas where we would love to see more kind of regulatory clarity.

Right. And so I think, you know, for all our friends in the crypto space, we would love to see them have a little more regulatory clarity so they can operate more consistently. We do think there is a regulatory need there.

So we we generally welcome regulation. We just want clarity there. I live in the state of Washington and we’ve been kicking the can on the real ID.

I think it’s now 2025. Right. They’ve been telling us since about 2019 that you which I do.

I have the enhanced driver’s license, which means I can cross the land border into British Columbia, which I do every now and then, you know, without a lot of friction there. But, you know, you’ve got that times 50. Right.

And I think that I think, you know, you know, we’re very interested in some of the newer, newer standards, the mobile driver’s license, the MDL looks awesome. And we’re fully aligned to support it is like another way to help our members. But we also think that that’s going to be a long play.

I think the adoption curve for all 50 states to hit the right level is going to take a bit of time. And I think there’s still still a bit of a fragmented market where we see some states coming out with apps and other people using kind of the native platform wallets. So I think I think it’ll continue to be fragmented.

And ultimately, this is where I think clear can provide something of a unified view of that. And so, you know, I was with one of our partners the other day and they literally said, I’m so glad you’re doing all this work because it seems really hard to go and normalize, bring sanity to to what not even just in the U.S., but internationally, what that looks like. And so, well, that’s exactly what I was going to ask next.

What about outside of the U.S.? Where are you playing today and what are the next frontiers? I mean, so we have no limit on frontiers and we think identity is universal. So eventually you want to play everywhere. Today, obviously, we’re homed in the U.S. So that’s our home turf and where we think we have a lot of room to grow.

We’re live in Canada and Mexico from an identity standpoint for our clear, verified standpoint. So those users of LinkedIn, for instance, in Mexico and Canada can also verify. We have some international footprints beyond that, and we are working on plans to extend outside and usually, you know, the obvious places, Western Europe, Australia, New Zealand.

Those those places are like high on the list and, you know, not ready to commit to a date. But internally, we’ve committed to a date. I can tell you that.

OK, well, let’s drill back down on the FinTech a little bit and talk what you can about timeline there. Where are you today? What kind of milestones can we look forward to? What you know, what’s in progress already and what’s the roadmap look like? Yeah, the biggest milestone that we’re excited about is the complete unification of the SOAR acquisition into the clear, verified stack. What that will give us is access to all our clear members, which is tens of millions.

It will give us a new experience that’s branded with lots of opportunities for putting it in embedded applications that we think will be best in class. It’s going to give us a layer of configuration that we, quite frankly, haven’t had before. And so you can really choose what fidelity you want.

It’s going to bring along all of the OFAC, PEP, AML, sanctioned stuff that really completes out the product. It has a great case management piece on top of it, which we weren’t really focused on before. So anybody needs to go and do adjudication, we have that capability coming.

And so we are out partnering with folks today, working on getting them set up. And so anybody that’s interested, please. Well, how can people find out more? I mean, clearme.com is number one, or anybody can find me online and just hit me up and reach out to me.

I’m happy to field anybody and everyone’s questions. Great. Anything we should talk about? I didn’t think to ask you yet.

I don’t think so. I think you’re very thorough, JP. Yeah.

Well, thanks for being here. Appreciate it. Appreciate it.

Thank you. That’s it for another week of the world’s number one fintech podcast and radio show. Breaking Banks.

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