Wrestling with ACH Originators with Nanci McKenzie and James Rowe
07/26/23 • 39 min
Episode Summary
In this episode of Wrestling Payments, host Joe Casali welcomes Nanci McKenzie and James Rowe from Affirmative Technology. They dive into the challenges of creating a risk rating for originators in the payments industry.
The conversation highlights the importance of risk management in financial institutions. Nanci and James discuss the need for automated solutions to handle the increasing volume of transactions. They emphasize that manual methods and spreadsheets are no longer sufficient. The discussion also touches on the role of regulators and the pressure they put on institutions to have robust risk management systems in place.
The episode concludes with a look at the broader economic landscape. James, an economist, shares his insights on the potential impact of rising interest rates and the debt ceiling issue on financial institutions. He also offers his perspective on the current state of the economy and its implications for banks. This episode is a must-listen for anyone interested in the intersection of risk management and the payments industry.
Podcast Experts
Name: Nanci McKenzie and James Rowe
What they do: Executive Vice President of Compliance and Product Strategy and Chairman of the Affirmative Technology Board
Company: Affirmative Technologies
Noteworthy: An industry veteran, Nanci McKenzie is known for her expertise in risk management and compliance in the payments industry. / An economist by training, Rowe specializes in leveraging data analytics to solve key business problems in the financial sector.
Where to find them: Nanci: LinkedIn|James: LinkedIn
Key Insights
Automated Risk Rating for Originators
Wrestling Payments delves into the need for automated risk rating for originators in the payments industry. Nanci and James discuss how their tool, Navigator, can provide accurate ratings for originators based on their transaction history. This system allows financial institutions to prioritize their focus on high-risk originators, enabling efficient risk management. The tool also allows for monitoring originators' risk transition, providing valuable insights into their business activities.
Embracing Data Analytics
James, an economist by training, emphasizes the importance of embracing data analytics in financial institutions. He demystifies terms like AI, machine learning, and big data, explaining that these are simply automated statistical techniques that have been around for decades. James encourages financial institutions not to be intimidated by these terms but to leverage them to make effective decisions.
Regulatory Pressure and Risk Management
The podcast also highlights the increasing regulatory pressure on financial institutions to have robust risk management systems. Nanci points out that regulators are asking institutions how they are risk grading their customers and are taking enforcement actions based on their findings. This underscores the importance of efficient risk management systems, such as the one provided by Affirmative Technologies.
Episode Summary
In this episode of Wrestling Payments, host Joe Casali welcomes Nanci McKenzie and James Rowe from Affirmative Technology. They dive into the challenges of creating a risk rating for originators in the payments industry.
The conversation highlights the importance of risk management in financial institutions. Nanci and James discuss the need for automated solutions to handle the increasing volume of transactions. They emphasize that manual methods and spreadsheets are no longer sufficient. The discussion also touches on the role of regulators and the pressure they put on institutions to have robust risk management systems in place.
The episode concludes with a look at the broader economic landscape. James, an economist, shares his insights on the potential impact of rising interest rates and the debt ceiling issue on financial institutions. He also offers his perspective on the current state of the economy and its implications for banks. This episode is a must-listen for anyone interested in the intersection of risk management and the payments industry.
Podcast Experts
Name: Nanci McKenzie and James Rowe
What they do: Executive Vice President of Compliance and Product Strategy and Chairman of the Affirmative Technology Board
Company: Affirmative Technologies
Noteworthy: An industry veteran, Nanci McKenzie is known for her expertise in risk management and compliance in the payments industry. / An economist by training, Rowe specializes in leveraging data analytics to solve key business problems in the financial sector.
Where to find them: Nanci: LinkedIn|James: LinkedIn
Key Insights
Automated Risk Rating for Originators
Wrestling Payments delves into the need for automated risk rating for originators in the payments industry. Nanci and James discuss how their tool, Navigator, can provide accurate ratings for originators based on their transaction history. This system allows financial institutions to prioritize their focus on high-risk originators, enabling efficient risk management. The tool also allows for monitoring originators' risk transition, providing valuable insights into their business activities.
Embracing Data Analytics
James, an economist by training, emphasizes the importance of embracing data analytics in financial institutions. He demystifies terms like AI, machine learning, and big data, explaining that these are simply automated statistical techniques that have been around for decades. James encourages financial institutions not to be intimidated by these terms but to leverage them to make effective decisions.
Regulatory Pressure and Risk Management
The podcast also highlights the increasing regulatory pressure on financial institutions to have robust risk management systems. Nanci points out that regulators are asking institutions how they are risk grading their customers and are taking enforcement actions based on their findings. This underscores the importance of efficient risk management systems, such as the one provided by Affirmative Technologies.
Previous Episode
A New Look at Innovation with Linda Cooper
Episode Summary
It's hard to imagine life without a smartphone, as it has integrated into every aspect of our personal and professional lives. Let's take a look at banking. No one writes checks anymore. Instead, we use mobile banking apps; even our credit and debit cards are tap-and-go or tap-to-pay. We understand it's all technology-driven, often forgetting that there have always been, and probably will always be, people behind all these solutions.
In this episode of Wrestling Payments, Linda Cooper, the VP & senior operations manager at Gorham Savings Bank, joins our host Joe Casali to discuss innovations in banking from the perspectives of FIs and customers. They also touch upon banking in general and the reasons for its bad reputation. Finally, Linda lists what skills are needed to thrive in the field.
Podcast Expert
Guest name: Linda Cooper
What she does: Linda is the VP & senior operations manager at Gorham Savings Bank.
Company: Gorham Savings Bank
Where to find Linda: LinkedIn
Noteworthy: Linda covers various areas, working with the data processing, loan servicing, and content management teams.
Podcast Insights
Banking has earned a bad reputation, and it's on us to carry that burden. That's because banks take responsibility for any money-related issue, regardless of the level of control they have in a given situation. Linda explains. ''If anything happens, we take the rap for it, whether it is interest rates going up or IRS checks not getting there quickly enough or no matter what. We are on the front end, and it's our problem whether we can control it or not. So it requires large shoulders because that's just the way it is.''
Modern banking means faster banking. But, convenient as it may sound, enjoying the shiny objects of today's banking may have some side effects. ''We go on and on about faster payments in all of their forms, and it just means it's faster to be wrong or fraudulent. You can make mistakes faster. You can have problems faster and with less time to react. So there's that side of it.''
Relying on technology requires you to have plan B. Digital tools are the present and future of any industry, including banking. But one thing we must bear in mind: technology can break, and depending on how severe the breakage is, we must have a recovery strategy. ''You need to be able to create and have manual procedures so that in the case of failure — it's like insurance. The idea is that you would never have to use it, but you still need to have it.''
Next Episode
Instant Payment Conspiracy Theories Episode
Episode Summary
In this episode of Wrestling Payments, host Joe Casali, along with guests Sean Carter and Mark Dixon from NEACH, dive into the world of payment systems. They tackle the pressing issues of misinformation and conspiracy theories in the payment industry. Carter, NEACH's president, views these as outside interference, while Dixon, Vice President of Education, sees them as a pulse of public sentiment.
The trio also discusses the concept of banking as a service, the role of financial institutions in supporting FinTech, and the importance of understanding disclosures when dealing with apps like Venmo and Cash App. They debunk the rumor of the government switching all benefits to FedNow and forcing every institution to join the platform.
Lastly, they address the theory of FedNow being the government's new cryptocurrency set to eliminate cash. They clarify that FedNow transactions are in US dollars, not digital dollars and that laws would need to change before a digital dollar could be implemented. Tune in for a deep dive into these topics and more.
Guest-at-a-Glance
Name: Sean Carter and Mark Dixon
What they do: President & CEO / Vice President-Education
Company: NEACH
Noteworthy: Sean Carter, President and CEO of NEACH, is a seasoned leader in the payment industry. He's known for his keen insights on misinformation and its impact on the payment system. Mark Dixon, Vice President of Education at NEACH, is a thought leader in the payment space. He's recognized for his understanding of the evolving landscape of banking and financial services.
Where to find them: Sean: LinkedIn / Mark: LinkedIn
KEY INSIGHTS
Misinformation as a Pulse of Public Sentiment
Misinformation in the payment industry is viewed differently by our guests. Sean sees it as outside interference, a tool used by some to confuse and scare the public for their gain. Mark, on the other hand, perceives it as a pulse of public sentiment, a reflection of what people are thinking and feeling about the payment space. This difference in perspective highlights the complexity of dealing with misinformation and the need for a nuanced approach.
The Role of Financial Institutions in Supporting FinTech
Mark discusses the concept of banking as a service. He highlights how proactive institutions are entering this space, backing FinTech partners and providing support. He emphasizes the importance of understanding disclosures when dealing with apps like Venmo and Cash App. This insight underscores the evolving landscape of banking and financial services and the need for consumers to be informed.
Debunking the Rumor of FedNow
The podcast addresses the rumor of the government switching all benefits to FedNow and forcing every institution to join the platform. The hosts clarify that FedNow transactions are in US dollars, not digital dollars and that laws would need to change before a digital dollar could be implemented. This insight dispels misconceptions about FedNow and emphasizes the importance of accurate information in the payment industry.
Wrestling Payments - Wrestling with ACH Originators with Nanci McKenzie and James Rowe
Transcript
NEACH S1.E7- Wrestling Payments - Nanci McKenzie AND James Rowe
[00:00:00] Joe Casali: Hello, and welcome to Wrestling Payments, the official podcast of NEACH, the New England Automated Clearinghouse. I'm Joe Casali, I'm the host. as many of you know, wrestling payments deals with today's most pressing payment issues in how industry is responding. Today I am delighted to have Nanci McKenzie, executive Vice President of Compliance and, and product Strategy with Affirmativ
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