This interview discusses opportunities surrounding the emerging trends in RegTech.
Sramana Mitra: Let’s start by introducing our audience to yourself as well as to Currencycloud.
Mike Laven: I’m the CEO of Currencycloud, which is based in London. For quite some time, I’ve lived and worked back and forth between the Valley and London in the field of financial technology. Currencycloud was started five years ago in 2012. The initial vision was that businesses paid much too much for international payments. There are very good companies in the consumer space on international payments.
In some ways, we handle a similar issue of moving money across borders, but we do it for businesses. Businesses have a whole set of other kinds of problems. They can have many different kinds of use cases. It can be paying employees or trade finance. It can be receivables. Often the payments themselves are linked to complex data and have all kinds of timing issues. You send money to your mom in China or India. They send you back a WhatsApp saying, “I’ve got it.” That completes the transaction.
In a business, they could send thousands of payments at one time and have other kinds of issues. Our perception was that businesses weren’t served well. At the same time, the growth of the digital economy where everybody expects everything to be free and to be frictionless didn’t correspond to the way payments were being handled on a global basis. We’ve effectively built a technology to solve that kind of issue. We don’t sell directly to end users. We have over 200 customers right now.
Since inception, we’ve processed over $25 billion worth of payments. We’ve reached a stage where we’re getting to be reasonably substantial.
Sramana Mitra: If you could double-click down on what you said and give us a flavor of how the technology works and where do you plug in? Are you an enterprise software that is being installed in a cloud-based architecture on behalf of the enterprise customers? How do you interface with the banks? What’s the architecture?
Mike Laven: Our customers access us through an API. We have a suite of APIs. Often in our industry, API means just streaming currency prices but we have APIs for managing beneficiaries, managing senders, and managing compliance. The system that the customer is sending us the transactions from, it could be payroll, it could be some kind of a unique system that’s unique to their business, or it could be trade finance.
What’s moving in the world of business is not just a significant amount of data but also the money. We’re connected to a series of banks on a global basis. Those banks are connected to other banks. If you think of it, for every transaction that we do, it’s generating from a system inside a business. The funds have to be received. They have to be converted, and they have to be paid out. All that’s going to go through multiple steps. At various levels, that’s going to be integrated or combined. All that has to be reconciled.