RiskScout is a FinTech SaaS platform providing a turnkey solution to financial institutions to enter highly-profitable emerging markets such as private ATMs, Money Services Businesses, Cryptocurrency, and others, which often necessitates maintaining considerable BSA/AML compliance protocols. RiskScout has been designed and developed from the ground up by a deep bench of risk and compliance experts with former BSA officer and examiner experience. RiskScout is providing community financial institutions and hard-working entrepreneurs with the innovative tools they need to grow and remain viable and competitive within their marketplace. CEO Justin Fischer will be discussing RiskScout with us in this Interview with TechBullion.
Please tell us your name and a little more about yourself?
Justin Fischer, CEO and Co-Founder of RiskScout.
I come from a family of farmers in Texas but I took the technology path in Austin and I spent 20 years building FinTech solutions. I love sports, the outdoors and solving problems that matter.
What is RiskScout and what unique services or solutions are you providing?
RiskScout is a RegTech SaaS company that is helping financial institutions bank underbanked businesses in this community. These are new and emerging markets that tend to have a high regulatory and compliance burden.
We help Financial Institutions, Insurance Providers and Merchant Processors.
We also have a product called FirstPass, which is open to any business who would like to run a business background check on MSB businesses. This is popular with real estate companies, venture capital groups, law firms, CPAs, escrow companies, and anyone who is interested in the Trust but Verify model.
Tell us more about the high-risk markets and industries included in this category?
There are over 40 types of higher-risk businesses but we mostly see the following:
- Independent ATMs and Money Services Businesses
- Cannabis THC
- Hemp/CBD – very different than THC in compliance even though they come from the Cannabis plant
- Crypto Businesses
- Cash Intensives
- Professional Services Firms
It’s a lot of work to streamline the regulatory demands that come with high-risk markets, how does RiskScout specifically help investors overcome this major challenge?
We help financial institutions to automate the targeting, onboarding, business verification and ongoing (BSA) compliance that is necessary to ensure businesses are legitimate. We do this by first having our knowledgeable compliance staff, with years of BSA and bank examination experience, evaluate and recommend compliance strategies for target markets. We then configure and deploy automation workflows that ask the key questions, verify business information and licensing and ensure ongoing compliance is comprehensive and timely.
How is RiskScout expanding your reach using virtual branch technology? How does this help the unbanked?
The pandemic was a huge statement for why FIs need to invest in online and mobile technology. There are still many branches that are reduced or closed. RiskScout deploys SaaS Cloud tools so our FIs can not only bank without the branch in their area but nationwide and specific to certain state or regional requirements. We have one FI who went from seeing five businesses come through their branches a month and a 10-week process to open accounts to seeing over 100 and a two-day process, plus they now offer merchant accounts and insurance through the platform.
There are two big problems with underbanked markets. The accessibility of banking, which a virtual branch can solve, and the compliance requirements, which can either be a person, process or technology but generally more efficient as a technology investment.
The crypto industry is known to be very volatile. How does RiskScout ensure your customers are safely interacting with crypto?
Most of the news in the financial industry is about consumer cryptocurrency, but what is completely neglected and underbanked are the crypto businesses themselves. In that way, we help FIs build compliance programs around Fintechs, Miners, Processors, and many other Crypto businesses in order to provide them much-needed traditional banking services.
Tell us about your team of researchers at RiskScout. How do they explore and understand these markets from an insider view?
We live and breathe these markets. I enjoy attending and speaking at Cannabis and Hemp conferences to help businesses and FIs connect. Our “Compliance Dream Team,” they love it when I call them that, are always researching and suggesting new compliance processes or technology tweaks to help our institutions stay on top of an ever-changing space.
How does RiskScout ensure customers’ programmes match their institutional level of risk?
We spend the time upfront to understand our FIs and their risk tolerances, plus educate them on the regulatory requirements and types of businesses in these markets. Then we implement the technology configured to each FI’s requirements via configurable workflows. These workflows will automatically send out information collecting reviews to the businesses and most will respond on their phone. This has saved everyone involved a lot of time and makes compliance a less burdensome and more responsive endeavor.
What are the limitations of the Money Services Businesses (MSB), and how do you want Customers to benefit from it?
Money Services Businesses have a wide definition as it could be a money transfer service, check-cashing retail, or even a FinTech company in some cases. The key with MSBs, like all higher-risk businesses, is to track activity, source cash, and work with the businesses to ensure there is no money laundering activities.
Do you have any opportunities for investors and partners at RiskScout or more information to share with our readers today?
For investors, we are always interested in talking to Seed to Series A investors interested in FinTech and want to be good partners. Inquiries can be sent to firstname.lastname@example.org
For financial institutions, insurance providers, and merchant services companies, we are here to help you with a new plan or to optimize and scale your existing plan for these emerging markets.
For Partners, we are always on the lookout for complementary businesses, where we can build solutions together. We are interested in solving problems for community businesses and financial institutions – let us know if you are too!
For more information, visit the website: Riskscout.com