The co-founder of a Nasdaq-listed payments processor and a former legal advisor for American Express - Tom DeLuca is now focused on his latest venture, AMP Credit Technologies, a platform for banks and lenders to provide short-term unsecured small business loans.
Tom will be speaking at the upcoming Finextra Future Money event, April 21-22, East Winter Gardens, Canary Wharf on 'The Funding Journey' panel.
What inspired you to get into this industry?
In the last 20 years I've seen companies that attempted to disintermediate banks and have failed. We were inspired build a platform that offers SME loan products, which a bank could build itself, should build itself - but would not.
I was interested in using the information and payment streams available to provide credit scoring mechanisms for small business loans. It was in 2007, the year of micro-finance - the time just after Muhammad Yunus won the Nobel Peace Prize for pioneering the concepts of microcredit and finance - this was when I became intrigued on how to apply those principles. A short while later in early 2009, I built a platform that could offer unsecured small business loans, with key emphasis upon the information in the payments channel.
Do you work in harmony with banks or are you disintermediating them?
Our principle from the beginning has been that we are enabling what banks should be doing - they have significant competitive advantages in serving their small business customers: superior cost of capital, brand recognition and protection for their customers. They have better cost of acquisition and the share of customers already.
We empower banks to utilise all these core competencies to provide lending for their SME customers. Both in emerging markets and also developed economies, we believe that banks are the ultimate distribution channel.
Where most players in this space are focused on disintermediating banks, we are focused on trying to serve institutions' customers better.
How do you envision disruptive companies such as Uber and AirBnB shaping the market?
More of these opportunities will arise - those companies have created a market where there was an inefficiency before. I believe there are ecosystems ripe for disruption - the question is - do they exist in the financial sector? I think so but things move a lot slower - the financial services sector is complicated and the solution to the problems in it lies not only in the technology but the financial side too. People forget about the counter-party risk and the regulation, for example.
I've seen some very revolutionary technology in the payments space - e-commerce payments, introduced just as I began my career in the payments business 20 years ago, was one of those remarkable developments - but for me it will be an evolutionary progression, not a revolutionary one.
Watch Tom speak at Finextra Future Money, 21-22 April, East Winter Garden, Canary Wharf, London. Register here.
With support from the UK Government's Trade and Investment body, leading innovators from across the European banking and venture capital industry will gather at Finextra Future Money to lead the debate and discussion around the evolution of fintech.