Overseas FinTech Companies Eye U.S. Market

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Like a lot of executives at tech firms based outside the U.S., Shin Kusunoki is seeking a path that leads to IT back offices in the States, and the big client wins that can result. But that path isn't easy.

"In order to get into the U.S. market, we feel we need a partnership with a local company," says Shin Kusunoki, a senior vice president and division manager for financial and asset management solutions in NRI's financial technology solutions division.

The Tokyo-based NRI does most of its financial services business in Japan, but is expanding into other parts of Asia and India, and, as Kusunoki mentioned, is seeking possible partners for U.S. expansion.

NRI is not nearly alone, as almost all of the major technology firms outside the U.S. look to expand or move inside the U.S. in a larger way. From the big outsourcers like Tata Consulting, which has inked a North American partnership to deliver broader cloud capabilities, to core banking providers like Temenos, which has long sought to bring its T24 solution to American banks, most of these firms have established a firm beachhead in the U.S. And they're now looking for more as American banks scramble to follow new rules, adopt new mobile channels and migrate to new digital payment models.

Examples abound. Ingenico's purchase of the U.S. portion of Hypercom suggests the Paris-based payments firm has its eyes squarely on VeriFone's lunch. When the Paderborn, Germany-based Wincor Nixdorf looks at the U.S., it sees a chance to make big waves in branch automation as American banks look to streamline branches through strategies that remove paper and bring about other efficiencies. And like all American bank IT shops, the London-based Misys - which already provides a suite of treasury and capital markets systems in the U.S. and other markets - hopes to cash in on the Dodd-Frank frenzy, introducing a new risk and regulatory product line designed to tackle the tough, still developing, U.S. regulatory overhaul. Misys's acquisition by Vista Equity Partners, which includes a merger with risk management provider Turaz, should provide more ammo for risk and compliance efforts in the U.S.

Of course, the U.S. isn't the only market targeted by international IT firms. Opportunities in the EMEA region abound, and large U.S. bank tech firms such as Fiserv and FIS also have vigorous international expansion plans of their own.

In the following profiles, we take a closer look at Wincor Nixdorf, Misys, Evry ASA, Ingenico and Temenos, and the stories of their plans for local and global expansion. -By John Adams

 

TEMENOS

In a June report, Forrester Research ranked Temenos Group AG (TEMN) as one of the top global banking platform vendors with an excess of 35 deals done in more than six global regions in 2011. Only five of these were in North America, the majority closing in Europe and Asia/Pacific.

The Geneva-based firm competes with the likes of Oracle, Infosys, and SAP to sell banks a platform that includes core banking, mobile banking, branch solutions, and risk management. The heart of this platform is T24, a service-oriented architecture (SOA). "T24 comes with a huge set of parameters," says Jost Hoppermann, vice president, banking applications and architecture at Forrester Research in Cambridge, Ma. "By changing the parameters, customers can change the user interface, workflow, protocol for dealing with currencies, and organizational structures, all without changing the source code."

There are currently about 560 installations of T-24. "These are mainly universal and retail banks," says John Schlesinger, chief architect at Temenos.

Temenos is rolling out Enterprise Frameworks Architecture (TEFA), which Schlesinger says will be complete in about three years. "Right now a typical T24 installation has about 50 user interfaces," Schlesinger says, "but at JP Morgan Chase it is more like 4,800 interfaces. The TEFA data framework will make T24 much more scalable in environments like this."

TEFA is also designed to facilitate integration with third-party products such as the PWM (private wealth management software) Temenos acquired in 2010 with the acquisition of Odyssey Group SA, a Luxembourg firm. "Odyssey is still not fully in line with T24," Hoppermann says, "and, while TEFA looks like a nice architecture, I haven't seen enough of the details yet to evaluate whether or not it can do this kind of integration."

Aimed more at smaller customers is the Temenos Model Bank, an accelerator designed to speed up implementations. "It (Model Bank) is essentially a 'bank out of the box,'" says Hoppermann. "New and existing customers could implement quickly and then modify. Most banking platform vendors are trying to build accelerators like this." -By Mark Leon

 

INGENICO

Already one of the largest makers of point-of-sale terminal hardware in Europe, Ingenico is moving aggressively into services, mobile payment systems, and the U.S. market.

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