Fintech Partnerships Focus on AI & Payments Opportunities

A pair of Japan-U.S. fintech alliance announcements focus on targeting artificial intelligence solutions and opportunities in financial services; and another zeroing in on PIN-on-glass payment solutions, acceptance applications and devices.

Tokyo, Japan-based Hitachi, which combines social innovation business products with its operational technology, and Southborough, Mass.-based Virtusa, a provider of digital business transformation, digital engineering, and information technology outsourcing services, are joining forces.

Targeting what they claim is the $25 billion market opportunity for AI solutions in financial services the companies will combine Hitachi’s advanced digital technology and leading R&D capabilities with Virtusa’s deep financial services industry knowledge and digital engineering expertise.

According to the companies, increasingly, financial services organizations need to implement emerging technologies like AI to stay competitive, identify new clients, and serve new markets. They maintain by combining deep domain expertise with digital solutions that use advanced technologies including AI can help financial services organizations accelerate customer acquisition rates, increase revenue by anticipating customer needs, and deliver personalized offerings at the right time and at the right location.

As part of the agreement, a dedicated joint team with experts from both companies will be based in Santa Clara, Calif. Hitachi and Virtusa plan to launch the first jointly developed AI solutions to financial services organizations in the United States by early 2020. The two companies will jointly market these new AI solutions to both existing and new customers. Hitachi and Virtusa will also collaborate on sales, delivery, and maintenance activities.

“The establishment of a new joint team in Silicon Valley will accelerate the global expansion of digital solutions, taking advantage of both companies’ strengths,” Tsugio Yamamoto, vice president, and executive officer Hitachi, said. “Hitachi will accelerate the expansion of our solution menu working together with Virtusa, as well as the enhancement of global delivery capabilities.”

“AI is an imperative for our clients to gain a competitive advantage,” Kris Canekeratne, chair/CEO, Virtusa, said “Financial services organizations have a significant opportunity to leverage and deploy AI to gain significant competitive advantages. With this partnership and through our deep digital capabilities we can help more clients benefit from AI faster.”

In 2016, Hitachi and Virtusa agreed on a strategic partnership in the global IT solution field. This newly signed partnership starts with the joint development of AI solutions for financial services. Plans call for Hitachi and Virtusa to expand AI solution development into additional industries.

In a separate announcement, another Tokyo, Japan-based company, IT services provider NTT DATA and Santa Clara-based Magicube, with what they call “the world’s only Software Trusted Execution Environment platform,” announced a partnership that will offer PIN-on-glass payment solutions to Japanese retailers.

They expect the combination of MagicCube’s EMVCo-certified security platform and its PCI-ready PIN-on-Glass solution, with NTT DATA, will create a new, easy to certify and deploy solution that allows secure input of sensitive data on a touch screen.

According to the announcement, previously this task needed dedicated hardware with physical keypads, such as ATMs and other cash register payment devices. In markets with widely-deployed contactless cards, any consumer device, such as a smartphone or tablet, can utilize tap-to-phone to fully handle payment acceptance using just an app and subscription service.

In addition, according to the announcement, PCI certification for a new standard like PCI Software-Based PIN Entry typically comes with a hefty cost in time and resources. MagicCube’s EMVCo-certified virtual Trusted Execution Environment and the service and support of NTT DATA, known for its excellence in security and payment services., mitigates this process.

“When software replaces hardware, everything becomes downloadable and upgradable, which allows the market to grow exponentially. With MagicCube’s Software Defined Trust approach, we are bringing payment acceptance to the 21st century,” MagicCube CEO Sam Shawki said. “Our PIN-on-Glass technology coupled with NTT DATA’s global presence and integration and hosting capabilities will benefit progressive large retailers as well as micro merchants and allow them easy access to this breakthrough technology.”

MagicCube and NTT DATA’s partnership begins by offering PIN-on-Glass payment solutions for Japanese retailers. The two companies will also leverage the platform to offer all payment-related functions from the cloud — without requiring any additional, independent hardware — to enable full mobility for payment terminal functions.

“By partnering with MagicCube, we’re accelerating the delivery of secure, cutting-edge payment solutions for retail merchants,” Masanori Kurihara, head of cards and payments services division at NTT DATA said. “Given the ongoing digitization of retail payments and associated security concerns, our PIN-on-Glass solutions will satisfy crucial demand by providing scalable, software-based POS capabilities with the same security found in hardware-based technologies.”

In May, MagicCube achieved certification as a software based Trusted Execution Environment by EMVCo, the consortium owned by American Express, Discover, JCB, Mastercard, UnionPay and Visa.