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City AM has partnered with City Week, and we've been given the opportunity to speak to analysts, economists and investors about how to power the sustainable energy transition.
Day 2 was centred on how AI is shaping the future of finance, and City AM managing editor Rupert Hargreaves spoke to two experts in the space.
Rupert spoke to Victoria Cleland, executive director, payments at the Bank of England, and Vishal Marria, founder and chief executive of Quantexa.
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Produced by: Rupert Hargreaves, Joe Lee, Scarlett Wild
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0:01
[Music]
0:14
Hello, I'm Rick Harri, the managing
0:16
editor of City AM and today we are at
0:18
City Week when we're talking about AI
0:20
and digital payments and everything in
0:22
between. I'm sitting here with Victoria
0:25
Cleland, uh, chief executive of payments
0:27
and chief cashier. Is that correct? At
0:30
the Bank of England. Yeah, thank you for
0:32
joining us. Um, so I wanted to start
0:34
with just a brief overview of what your
0:36
role actually entails, how does that
0:39
work and help the economy function?
0:41
Yeah, the sort of two elements of my
0:44
role and bringing them together. It's
0:45
essentially fulfilling the Bank of
0:47
England's remitt in relation to
0:50
payments, both electronic payments but
0:52
also cash. So as chief cashier, I'm
0:54
responsible for the distribution of
0:56
design of Bank of England banknotes and
0:59
as executive director for payments. My
1:01
team run the real-time growth settlement
1:03
system which supports chaps and also
1:05
supports all the retail systems. About
1:08
800 billion a day goes through RTGS. So
1:11
it's absolutely at the heart of the
1:13
financial system. That is a lot of money
1:14
and makes a big number. It's integral to
1:17
the functioning of the economy. Right.
1:18
Absolutely. I mean payments are the
1:20
lifeblood of the economy. Sometimes
1:22
people think oh well payment systems
1:23
that's just to do with the payment
1:25
industry. Actually every single person
1:27
is reliant on the payment systems. It is
1:29
the heart of what we do. It is so
1:31
tangible. It's key for retail payments,
1:34
financial markets, crossber payments.
1:36
You recently did an upgrade to this
1:39
system. That's right. We um have
1:41
recently finished a new program to renew
1:44
the RTGS system which was a piece of
1:47
collaboration with industry over a
1:50
number of years. We started by saying to
1:51
the industry, what would you like the
1:52
new system to be able to do? And so we
1:56
sort of set four core objectives. One
1:58
was around enhancing resilience,
2:00
something central banks love, but we
2:02
also wanted to think about competition
2:04
and innovation. So in addition to the
2:05
resilience piece, we were broadening
2:08
access to enable more players and
2:10
different types of players, for example,
2:12
non-bank payment service providers to
2:14
join the system. We wanted to increase
2:16
user functionality. We've introduced
2:18
some APIs, enhance liquidity saving
2:21
mechanisms and also to increase
2:24
interoperability either with systems
2:26
domestically or cross border with that
2:29
much money at stake and that much
2:31
critical infrastructure. How do you even
2:33
start overhauling a system like that?
2:37
You said multiple years where do you
2:38
begin? So the starting point was really
2:41
what do we want to do? um and so
2:45
consulted with industry and then you're
2:47
right you need to think what is a safe
2:49
way to do this because the real-time
2:52
growth settlement system is a sort of
2:54
the core ledger. It's essentially saying
2:56
whose money is where. You can't do it
2:59
incrementally. All the money's got to be
3:02
on one ledger. So we knew it had to be a
3:04
big bang which meant that when we were
3:07
approaching it we were saying are there
3:09
different pieces we can do first? We
3:11
decided actually we'll do the ISO
3:12
migration. So the messaging first to get
3:15
that piece done and there was a lot of
3:17
work there for industry who were
3:19
fantastic in being ready and then the
3:21
next bit was um the core settlement
3:23
engine I always call it the beating
3:25
heart of RTGS which is where we were get
3:28
literally transplanting something new in
3:30
so working really carefully with the
3:33
suppliers working with industry lots of
3:36
testing getting advice from national
3:39
cyber security center in terms of the
3:41
cyber resilience But we're also trying
3:43
to think, well, what next? I'm going to
3:45
start some wholesale experiments and
3:47
things. Well, talking of what next,
3:48
what's your most exciting thing you're
3:50
looking forward to in the world of
3:52
payments?
3:54
I think it's really seeing industry make
3:56
more use of the system that we've just
3:57
built. So, there's a lot of work that
3:59
went into it for industry as well. It's
4:02
been going um two months now and I think
4:04
we're seeing a big uptick in sort of use
4:06
of the APIs on the system. I want
4:09
industry to use ISO more and then I
4:11
think if we get synchronization up and
4:14
running in live that will be really
4:16
transformational. Be really exciting.
4:17
All right. Well, thank you very much for
4:18
your time today. Thank you.
4:21
[Music]
4:24
Could you give us a bit of an overview
4:25
about what the business does and how
4:27
you're using AI to improve processes?
4:30
Yeah, sure. Uh Rubbert. So fundamentally
4:32
what we do for our clients, we enable
4:34
them to make better trusted decisions by
4:37
connecting data at scale. So if you take
4:40
a large bank, we support them in areas
4:43
like anti-moneyaundering around areas of
4:45
detecting and uh fraud but also in areas
4:48
like customer intelligence and KYC and
4:51
fundamentally we have transformed
4:53
organizations when it comes down to that
4:55
decision- making by connecting internal
4:57
data together and connecting it with
5:00
external data to drive insights to
5:03
empower people as well as machines to
5:06
make better decisions. That's what we
5:07
do. Okay. And you recently this year
5:09
celebrated a big milestone with a series
5:11
F fundraising uh $2.6 billion. That's
5:15
correct. That's correct. Yes. Um can you
5:17
just explain as a you're based in
5:19
Waterloo. You're a British tech company
5:21
through and through. How is the
5:23
environment for fundraising for British
5:24
companies? Look, I I've always said and
5:27
I will continue to say every great
5:29
company can raise money. If you have got
5:32
great unit economics when it comes down
5:35
to your business, if that's around
5:37
growth, if that's around retention, if
5:39
that's around scale, if that's around
5:41
sticky clients, um these are all really
5:44
important factors when it comes down to
5:47
having a very good foundational
5:48
business. How have you found it raising
5:51
money from British institutions? We've
5:53
been very fortunate that we have a great
5:55
cap table uh of some really incredible
5:58
investors. Series F was led by Ontario
6:01
teachers pension plan and they would
6:03
have been fantastic um to our cap table
6:06
with some very thoughtful uh
6:08
introductions, thoughtful uh research as
6:11
well as the support and the guidance um
6:13
that they have uh across the
6:15
organization. But we've also taken money
6:17
from the likes of GIC, Wahberg Pinkis,
6:20
Evolution Equity Partners and so on and
6:22
so forth. But one thing I would be very
6:24
proud to say um my series A was led by
6:28
Albian uh ventures or Albian's VCT fund
6:31
uh and they've been a fantastic partner
6:33
for me right from the early days uh when
6:36
we were probably about 40 to 50 people
6:38
uh and they have scaled with me and they
6:40
have grown with me um so I'm delighted
6:43
to have Albian as one of our investors.
6:45
Okay. So AI is a big driver the
6:47
government's agenda at the moment. They
6:48
want to invest in it but they also want
6:50
to achieve cost savings. What advice
6:52
would you give to someone in the
6:53
government today? AI is a once-
6:56
ina-lifetime opportunity when it comes
6:58
down to using data, using analytics,
7:02
using machines
7:04
to make good for society.
7:08
But this is not a golden silver bullet
7:10
in this process. You need to come back
7:12
to some of the foundations. One of those
7:15
foundations is around the data. So for
7:17
any organization that's on a journey
7:19
around AI, have you got trusted data? Is
7:22
that data contextualized? Is it
7:24
accessible? Is it transparent? Can you
7:27
trust it? It's really foundational. But
7:30
then there's so many other factors. AI
7:32
will transform or remove a lot of
7:34
processes for lots of use cases. Are we
7:38
thinking about that strategically? And
7:40
then the third thing I will say is
7:42
around training. AI is going to
7:45
transform the way you recruit people,
7:49
the way you train staff. So, it's about
7:51
retaining, training, and attracting top
7:55
quality. For example, if you're looking
7:57
at a software engineer today, he or she
8:00
can now use AI to pro provide 20 if not
8:04
30% more productivity when it comes down
8:06
to codew writing. And we I've seen this
8:08
firsthand. And I'm I saw it yesterday.
8:10
I'm an engineer by trade, right? you
8:12
know my degrees were in computer
8:14
science, AI, deep learning and so on.
8:16
And if you look at some of the work that
8:18
you know I trained on many decades ago a
8:21
lot of that can be supported with AI. So
8:25
my advice to everyone not just in the
8:28
public sector AI will transform every
8:31
single process in your organization and
8:35
you need to start getting ready because
8:38
this is happening and those
8:40
organizations and I've seen this
8:41
firsthand those organizations which are
8:44
embracing AI deploying it safely in
8:46
their organizations are getting a
8:49
competitive advantage when it comes down
8:51
to deploying and growing their
8:53
organization.
8:54
Well, on that note, Michelle, thank you
8:56
very much for your time today.
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