An Interview with Joshua Bower-Saul, CEO and Co-Founder of Cybertonica

16 May 2018

Joshua Bower Saul accepting MPE award

Cybertonica CEO Joshua Bower-Saul accepting the Best DATA Analytics & Science Award 

In February 2018, Cybertonica won the Best DATA Analytics & Science Award at The Merchant Payments Ecosystem (MPE) Awards in Berlin. Our CEO and Co-Founder Joshua Bower-Saul has recently been featured in MPE conference digital magazine POSitivity with an exclusive interview which you can read below.

What would you point to as key trends significantly impacting merchant payments in next 1-3 years?

The biggest impact for merchant payments is going to be the growth of Neo-Banks, mobile payments and alternative systems and currencies. What is most critical is that merchants are working with future-proofed platforms that can integrate these many different types of transactions without needing difficult and costly adaptation of their risk and fraud management systems. Weak merchants who are unprotected will be quickly targeted by sophisticated fraudsters, and the importance of providing anonymous but secure transactions will be more and more apparent.

How can payments providers overcome the challenge of legacy systems, and embrace the future?

To embrace this future, the merchants and the payment platforms must accept that only a real-time, intelligent and dynamic authentication and risk management tool is adequate to the very complex payment scenarios. This cannot be built in-house or be designed with rules that only work on one channel or type of payment flow. Legacy systems need to be adaptively transformed into test data sources for more contemporary machine learning and AI led decision and risk measurement tools and the neo-banks, mobile payment and other forms all link to a single risk

What are the specific challenges for innovators in merchant payments ecosystem?

Primarily for incumbents the challenges are tied to slow internal processes of large, very risk-averse major companies. The legacy risk management and fraud management systems no longer can outsmart the contemporary big business of fraud, where people have access to full identities through hacked user data and can simulate 80% of an identity relatively cheaply. This is often enough to get account access. For the innovators the challenges are managing to gain credibility when in fact the systems have not been built to deal with the large-scale fraud and risk that they can occasionally call forward. Also, innovators trying to find solutions to such problems face the credibility gap and the testability gap:

1. At first a major organisation will prefer working with a largish player in the innovation market for balance sheet, risk mitigation etc. and will only allow for limited data to be used with the new product, reducing its impact and reputation.

2. Secondly, if the innovator gets over the credibility gap, then they have to make it through the testability gap, where existing data and regulatory make it hard to handle major data sets. There is a need for a generalised sandbox for data focused firms. This is the testability gap.

3. Thirdly, the willingness to pay for innovation. Both investors and strategic partners and investors need to understand that investing time and money in young businesses is the best means for seeing if their efficiencies can add value. We met one Neo-Bank that wished to conquer the world, and had raised the money to do so, but could not imagine paying even 6 pennies per month per user for security and fraud management.

What future developments do you foresee for B2C payments in the fintech era?

Crypto currencies will become the norm for international B2C payments and for a large portion of B2B and institutional transactions. Special use tokens will become a popular way to pay for travel and other segments related to international exchange. Currency exchange markets will be entirely transparent and online.

Watch our CEO Joshua Bower-Saul explain what makes Cybertonica special to win the Best Data Analytics & Science Award at this year’s Merchant Payments Ecosystem Awards:

* This interview was originally published on the MPE website in May 2018, click here to read the interview on the MPE website.

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