Over the past decade, the open-source platforms have been gaining rapid popularity throughout the tech industry: Node-RED is one of them, and so how can banks benefit from this open-source programming platform, and more importantly how secure can it be? Maksym Popov is COO at 42flows.tech and he has extensive experience in both banking and tech.

 

 

An inside look at the work of Ukraine’s biggest bank

I began my professional banking career in PrivatBank, the largest commercial bank in Ukraine, contributing to their e-business by developing and deploying middleware technologies on Corezoid. How did I start deploying middleware? Let me explain.

In 2004 I was working at PrivatBank’s credit card department. By 2008, we had already issued a relatively large number of credit cards. We next considered the necessity of looking at the customer relationship management (CRM) approach.

In 2008 I went to work as a Chief of CRM at PrivatBank. Likewise my technical team had to develop our own CRM system in addressing an issue that I presented.

At that time CRM had already been integrated into all our banking processes and communications with employees and customers. However, we were even then thinking to move on for we knew that we had to take a completely different approach in creating better marketing campaigns based on CRM communications and analytics.

Since the software requirements were rather specific, we had to develop a unique solution. For this we used a technology named Corezoid, it was founded in 2014. After Corezoid was integrated in PrivatBank’s processes, I became a team member and then a CTO at Middleware Inc., the company that owns Corezoid.

12 years of working at PrivatBank gave me a great background that still helps me even now with the management of my two current businesses 42flows.tech.

42flows.tech is a leading digital banking and middleware implementation company that helps businesses leverage technology to drive efficiencies. 42flows.tech became first in this niche by automating processes and building new communication channels in messengers (Viber, WhatsApp, etc.).

 

Maksym Popov

Maksym Popov, COO at 42flows.tech

Key takeaways after a decade in tech

With managing my own fintech business, and after working so many years in the tech industry, I made a number of conclusions. Here, I want to share 5 of my biggest reflections and key takeaways:

  • The technologies used by businesses must solve business problems. Nobody needs a technology that is detached from the business needs.
  • The banking market is evolving rapidly. That is why banks need to quickly launch products, create prototypes and run various marketing experiments. This means that technologies need to support those business strategies.
  • Understanding the automatization needs and requirements it’s crucial that we “check everything ten times manually before requesting any automation”.
  • The more linear is built the engagement process with your employees/customers and the fewer conditions and exceptions it has then the easier it will be for you to interact with your clients; the less costs will be required to support the solution.
  • Every bank and financial institution is digitized. The question is about the quality of such digitalization and how these digital processes are configured. Arguably the most troubling of all is the absence of human resources in the procedure of the organization’s digitalization. 

 

 

How Node-RED solutions reshape banking

When we launched PrivatBank’s CRM system, we had a meeting with one CRM specialist. The first question he asked us was: “How many marketing projects do you launch every month?”.

The first lesson he taught us was to launch at least 100 experiments per month for the banking business as at the time we were only running 2 or 3. And then from those 100 tries we had to choose the strongest campaigns for launching mass communications.

From this we immediately observed how CRM gave many benefits to our business. Furthermore, these experiments have entirely changed our business.

However, the bank then needed to have a tool to massively launch such experiments quickly and with lower costs. Node-RED is one of the most powerful tools available on the market that can launch many internal experiments within the software requirements.

A little technological reference: Node-RED is a low-code platform from IBM whose open-source license is accepted in different industries. It orchestrates APIs in microservices infrastructure that enables complicated business logic and gives non-developers opportunities to change and adjust business rules. Actually, it is a visual programming platform, based on Node.js, so all the solutions are translated into clear JS code that could be deployed and scaled like ordinary Node.js code.

Node-RED is not just the fintech engine! Not at all. Node-RED is the tool that makes the digitalization of the banking system way easier, better and cheaper.

What factors have influenced the digitalization of banking and fintech businesses? I have rounded up three crucial elements:

  • Competition. There is ongoing competition in the banking sector in every country. Banks develop elegant and comfortable solutions for their target audiences to increase the bank’s customer base. Otherwise, the banks wouldn’t be alive.
  • Digitalization is convenient and affordable. Banks are increasingly saying that the number of customer complaints has decreased tenfold, and the level of customer interaction has increased. Also, with more ways to attract customers through innovative solutions, chatbots or banks in messengers are way cheaper than before.
  • Covid-19. It’s no secret that the pandemic has directly accelerated the pace of the fintech sphere digitalization.

In my opinion, the clients are the best indicators of the most productive banking solutions as it is them who are “voting with their money”.

Maksym Popov

Maksym Popov, COO at 42flows.tech

And so it is not fair to judge whether a fintech solution is successful until you see the customers’ interaction with the software development. For example, we can say that a digital bank is successful only after it generates an n-number of new customers.

 

Neobanks are taking over

I believe that neobanks are the future. Traditional banks are steadily dying out being replaced by virtual ones. Obviously, neobanks have significant advantages over the traditional banking sector. That is why the number of neobanks is growing faster all around the world. 

Let’s take the Ukrainian banking market for example, the latest news I’ve heard is we already have 7 digital banks in Ukraine and much more to come.а

Are neobanks more vulnerable to cyber threats when compared to ordinary banks? This leads me to believe that no digital banking solution integration is truly safe without proper security platforms. That’s why pretty much all the open-source software we use, in particular, those in the banking and financial industries will also never be completely safe without such platforms.

Open-source solutions are more secure and reliable due to their openness. On top of that, other security teams have checked them for safety. If an open-source product has a good reputation and there is no open security breach, it then takes down all commercial solutions.

 

 

If you want to know more or have any questions, please get in touch with us at success@42flows.tech.

We also have many other interesting articles to share? You are welcome to explore our blog.

One response to “Node-RED Solutions for the Future of Neobanks”

  1. Great content! Keep up the good work!

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