Fin Tech

B2B FINTECH SAAS AND

PLATFORMS

Bhumishq @The Mauritius IFC the leading
change champion for B2B Fintech SAAS
and Platforms for Africa, Latin America,
ASEAN and other IFCs.

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Bhumishq

 

The Opportunity

A fast and efficient digital on boarding of non-face-to-face clients is imperative for international financial institutions, which are providing their service online. Current AML requirements adopted in Mauritius for non-face-to-face clients based on certified copies of ID documents will lead to a high abandonment rate (up to 95%) at on boarding of potential clients.

The 4th AML Directive (AMLD4), which was introduced in European Union in 2017 and considered a best practice in AML legislation globally, among other changes, proposes recognise “secure electronic copies of original documents as well as electronic assertions, attestations or credentials as valid means of identity (Article 17).”

For financial institutions operating globally or with global clients, the need to comply with regulations in different jurisdictions, which are inconsistent and often unclear, means that they end up requesting information that may not actually be required for a specific on boarding process.

We will provide innovative services of digital on-boarding assisting local and international financial institutions in fraud reduction and achieving a cross-border compliance in Anti-Money Laundering (‘AML’) and Know Your Customer (‘KYC’) supporting a diverse range of international Customer Due Diligence (‘CDD’) process, including Know Your Business (‘KYB’). We will be specifically targeting emerging markets such as Africa, Asia, South America and Middle East.

Evolving regulatory landscape of AML

1980s/1990s

  • When: 1980s/1990s
  • Crime: Money Laundering (ML)
  • What: Drugs
  • Who: Financial Institutions (FI)

Tick-box Approach

Rule-Based Approach

2000s

  • When: 2000s
  • Crime: ML/terrorism financing (TF)
  • What: Drugs, weapons, human trafficking, high value goods
  • Who: Financial Institutions, agents, traders in high value goods

Rick Assessment Approach

Risk-Based Approach

2010s

  • When: 2010s
  • Crime: ML/TF and Financial Crime, corruption, fraud, tax evasion
  • What: All objects of economic and financial crime
  • Who: Financial Institutions, agents, traders in high value goods

Multidimensional Risk Assessment Approach

Enhanced Risk-Based

PRODUCTS B2C

Digital KYC Services

  • Video KYC and Biometrical Identification of client is a product, which is designed to meet AML requirements and minimises the risk of identity fraud. It requires to use a mobile device like a smartphone, PC or tablet. Clients will have to access a video conference for a face recognition based on biometric measures of their face or/and submit a high quality selfie. Such methods of verification are used for advanced fraud prevention through biometric authentification based on face comparison of submitted “selfie” and an image in ID document.
  • ID documents verification is a product, which validates different types of ID documentation via partner platforms checks to determine their legitimacy as well to ensure a document is not forged or alerted that includes:
    1. Template matching
    2. Document copy quality or blurriness
    3. Document number algorithm
    4. MRZ checksums
    5. Data extraction and comparison
  • Comprehensive Global AML Watchlist is a product that determents the coverage of various sanction lists (such as OFAC, UN, HMT, EU, DFAT, and many more), law enforcement lists (Interpol, country specific government and state agencies, and police forces), and governing regulatory bodies’ (financial and securities omissions) from around the world. It is a powerful and robust tool that utilises cognitive machine learning technologies to reduce false positives when conducting background compliance checks

PRODUCTS B2B

Digital KYC Services

Business Verification is a service which provides data intelligence for business entities, enables clients (1) to retrieve company data from commercial registers worldwide helping to streamline workflows for your Know Your Business (KYB) and (2) identifying the ultimate beneficial owner(s) (UBOs).

  1. Verifying business details, to obtain and verify company vitals of the applicant such as:
    • Registration Number – business registration number
    • Business Name – the name of the company
    • Business Status – operation status of the company
    • Address – the physical address where the company is operating
    • Managing Directors – this may include key management personnel of the company
    • Date of Incorporation – the day, month, year of the company’s incorporation
  2. Verifying ultimate beneficial ownership (UBO)
    • According to the FATF, “beneficial owner refers to the natural person(s) who ultimately owns or controls a customer and/or the natural person on whose behalf a transaction is being conducted. It also includes those persons who exercise ultimate effective control over a legal person or arrangement”

ADDITIONAL PRODUCTS

Additional Services

Client E-Signature and E-Authorisation Services is a product that allows clients to sign contracts online. It has the same validity from a legal perspective. All the client needs is an internet access, a computer with webcam or smartphone or tablet and their valid ID document. The client will be identified first before taken directly to the contract signing.

CRS Reporting
Common Reporting Standards (CRS) have to be implemented in Mauritius in 2018. CRS will have a significant effect on client on-boarding and KYC, AML processes. The existing KYC, AML processes need to be upgraded to ensure the capture of the relevant fields, such as foreign tax residency and respective tax payer identification number. Moreover, CRS compliance will require dealing with huge volume of customer data, handling complex rules, and maintaining audit trails, and therefore a well designed digital on-boarding solution can achieve compliance, besides delivering added value to the business.

Integration, Customization and Maintenance

PAYTECH :
Closed loop B2B
payment infrastructure

Our value propositions


Our PayTech company will be niche solution providing
brokerage firms ans assets managers (‘e-merchants’)
with international payments services conducted via
EFTs, E-wallets and payment cards.

i. Limited AML Risks

We will not offer third party payments targeting exclusively closed-loop transfers from a client bank account to a broker accounts and back to a client bank account, avoiding related AML risks of placement and integration.

ii. Fast and efficient digital client onboarding

It is essential to engage strong onboarding programs to enable smooth and efficient client acceptance with an adequate mitigation of related AML risks. The Start-up Company will conduct its own client on-boarding jointly or independently from the brokerage firms using a full set of digital onboarding tools including video biometrics for clients authentications, ID document verification, comprehensive background checks and IA technologies for transaction monitoring - filtering, profiling and risk modelling.

iii. Account-drive payment enabled through APIs

To commercialise digital payment propositions we will generate revenue by exposing its core payment system to brokers through customised application programming interfaces (‘APIs’), we will enable e-merchants to drive the growth of the customer base by embedding its APIs for payment in their own offerings whenever they need them. Offering APIs externally opens the way to interactions, in which restyles client register their bank account or a payment card on e-merchant’s applications and then seamlessly access the payment functions as required.

iv. Immediate access to funds via issued co-branded cards

Providing retail clients with a direct and immediate access to their funds at e-merchants accounts by issuing co-branded payment cards without going into a lengthy redemption process will boost up a volume of digital payments on convenience of the product. The co-branded cards will have an option of covering clients tokens, loyalty points and cryptocurrencies into flat currencies.

v. Targeting emerging markets

Although we will be onboarding clients all over the Globe, it will be specifically targeting emerging markets such as Africa, Asia, South America and Middle East.

PayTech Solutions

Closed-loop International Transferts conducted via EFT, e-Wallets and cards brokerage firms and assets managers (‘e-merchants’) will embed PayTech customised application programming interfaces (‘APIs’) in their own offerings allowing their customers seamlessly access the payment functions as required.

BANKTECH :
Credit risk score

The opportunity

The Mauritius Credit Information Bureau (MCIB) of the Bank of Mauritius only provides credit information such as outstanding loan balances, suit filed accounts, bankruptcy and insolvency cases and compromise settlements. They do not provide the information in a summarized way and, more importantly, they do not provide any indication to what extent the information can affect the creditworthiness of individuals. The proposed credit scoring platform will use all the credit and financial information to provide a meaningful score summarizing the credit worthiness of every individual. This will enable various institutions to profile prospective clients in a more effective way and to manage lending risks.

Non-Performing Assets (NPA) across banks are quite high in Mauritius averaging from 3% to 10%, and this is partly due to the lack of an effective tools for banks and to distinguish between good and bad borrowers, and to monitor the credit worthiness of existing customers over time. The credit scoring agency intends to fill in that gap.

Business objective

The main objective is to create an independent credit rating agency that provides a meaningful credit score and credit report for every Mauritian resident. Both the score and report will provide a more unified, detailed, and timely assessment on the debt status, loan payment behavior, and overall credit quality of every individual across the entire financial ecosystem. This is the first service of its kind in Mauritius and will have significant impact on the Mauritian economy.

Proprietary credit scores

The creditworthiness of a consumer is computed from a proprietary scoring model called a “credit score”, which we will develop using homegrown algorithms tailored specifically for the Mauritian market. It will more give more importance to factors that have led to poor financial behaviours of borrowers in the past.

A credit score is a number that reflects the likelihood of a customer paying credit back. We will leverage Artificial Intelligence and Machine Learning to continuously analyze data and patterns and keep an up-to-data predictive scoring model for each consumer with higher accuracy.

Industry-specific credit scores

Our Industry-specific credit scores incorporate the predictive power of the base credit score while also providing banks and other financial institutions a further-refined credit risk assessment tailored to the type of credit the consumer is seeking.

Because different lending uses (mortgage, automobile, credit card, shopping loans) have different parameters, our algorithms will be adjusted according to the predictability of that use. For this reason, financial institutions will have access to both an overall credit score for a consumer, as well as a number of specific credit scores based on the type of lending. For example, a person might have a different credit score for a credit card application when compared to a mortgage application.

Credit report

Our service will not only provide the credit score but will also provide a concise and easily understandable report summarizing various financial and non-financial information relating to the credit score. Below are some examples of information the report will contain.

Credit History

This will be a summary of a person's credit accounts and how he/she managed them. A credit history includes the times a person has borrowed money from a bank or another financial institution, for example; credit cards, loans, utilities, mobile phones, store cards and mortgages.

Payment Status

This will include details like whether a person has made repayments on time and in full. Missed or late payments stay on our credit report for at least six years, as do bankruptcies, individual voluntary arrangements and court judgments for non-payment of debts.

Financial Connections

This is a list of people who have a financial connection with that person, such as a joint mortgage or bank account. These people are known as the person’s financial associates. Their credit history doesn't appear in the person’s report, but banks and other financial institutions can view it when a person applies for credit. This is because a person’s financial associates' circumstances may affect his/her ability to repay money.

Our customers

Banks and other financial institutions will be able to query our platform in real time to retrieve a detailed credit report and up-to-date credit score of any Mauritian consumer, based on that person’s NIC number and personal information. They can then use the credit score and credit report, alongside other information provided by the client to get a better insight into that person’s financial behavior and be in a position to better evaluate the potential risk posed by lending money to that consumer and to reduce the amount of non-performing assets. Our credit scores will help bank and other financial institutions determine who qualifies for a loan, at what interest rate, and what credit limits.

 

The above represent the first 3 projects coming out of the Bhumishq Hive.

The projects are subject to regulatory approval by the Financial Services Commission of Mauritius and relevant regulatory bodies.

If you are interested in expanding your fintech markets, please connect with us.

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